Appeal from a judgment of the United States District Court for the Southern District of New York, Gagliardi, J., dismissing individual and class Title VII sex discrimination complaints after a bench trial.
Before MANSFIELD, MESKILL and PIERCE, Circuit Judges.
Carlotta Rossini and Jane Zukofsky appeal from a judgment of the United States District Court for the Southern District of New York, Gagliardi, J., that dismissed their individual and class complaints of sex discrimination in employment, after a six week bench trial. The complaints were brought under Title VII of the Civil Rights Act of 1964, as amended and presently codified at 42 U.S.C. §§ 2000e to 2000e-5 (1982). Rossini and Zukofsky raise numerous claims of error ranging from early discovery and class certification rulings to the final disposition of the case by the district court. Because several of these claims have merit, we reverse and remand for further proceedings.
The facts and procedural history of this case are generally set forth in two published opinions of the district court, Rossini v. Ogilvy & Mather, Inc., 597 F. Supp. 1120 (S.D.N.Y. 1984) (first opinion), and Rossini v. Ogilvy & Mather, Inc., 615 F. Supp. 1520 (S.D.N.Y. 1985) (second opinion). We presume the reader's familiarity with both opinions and set out here only a brief sketch of the case's background. Additional details will be added as necessary during our discussion of the issues raised on appeal.
The two individual plaintiffs-appellants are professional employees of the defendant-appellee, Ogilvy & Mather, Incorporated (O&M),*fn1 a large advertising agency with an office in New York City. They first filed suit in 1978 alleging sex discrimination. After an initial denial of class certification, a class was eventually certified in 1979 with only Zukofsky as class representative. Judge Brieant, to whom the case had originally been assigned, recused himself in 1981. Trial before Judge Gagliardi began in early October 1983 and ended in mid-November of that year.
Judge Gagliardi's first opinion, issued in November 1984, decertified the class as to several issues and then disposed of one of the two remaining class claims and disposed of all of Rossini's and most of Zukofsky's individual claims on the merits. Judge Gagliardi reserved decision on the class and Zukofsky salary discrimination claims pending the receipt of additional evidence pursuant to his reversal of a magistrate's discovery order. That order had earlier been affirmed by Judge Brieant. 597 F. Supp. at 1164-68, 1174.
Judge Gagliardi received the additional evidence together with a stipulation of the parties waiving any additional hearing. On August 27, 1985, Judge Gagliardi issued his second opinion, in which he rejected the class and Zukofsky salary discrimination claims on the merits. The plaintiffs appeal from the final judgment filed August 30, 1985.
Rossini and Zukofsky argue that the district court erred in (1) denying class representative status to Rossini and excluding all officers from the class; (2) partially decertifying the class represented by Zukofsky; (3) issuing three discovery orders; (4) refusing to admit certain statistical evidence and evaluating the statistical evidence that was admitted; (5) disposing of the individual retaliation claims; and (6) disposing of Zukofsky's salary discrimination claim. These and several other subsidiary arguments will be addressed below.
1. Denial of Class Representative Status to Rossini
The adequacy of a class representative, like other class certification questions, is a matter committed to the sound discretion of the district court. Malchman v. Davis, 761 F.2d 893, 899 (2d Cir. 1985), cert. denied, 475 U.S. 1143, 106 S. Ct. 1798, 90 L. Ed. 2d 343 (U.S. Apr. 28, 1986); see also Society for Good Will to Retarded Children, Inc. v. Cuomo, 737 F.2d 1239, 1243 (2d Cir. 1984). Accordingly, we will reverse a class representative decision only where the court has abused its discretion. Such an abuse occurred here.
Judge Brieant first denied class representative status to Rossini, who is a vice president of O&M, in a memorandum and order issued on October 18, 1978. Rossini v. Ogilvy & Mather, Inc., 80 F.R.D. 131 (S.D.N.Y. 1978). Judge Brieant found that the combination of Rossini's "desire to gain . . . credentials" as a political activist and her agency status as an O&M officer created conflicts of interest which prevented her from serving as a representative of a class that included non-officers. Id. at 135-36.
In an affidavit in support of a motion to reconsider this decision, Rossini's attorney stated that "Vice Presidents of Ms. Rossini's level have virtually no managerial authority, and . . . no actual or apparent authority . . . to bind the Corporation" J. App. at 573. The attorney asked for a hearing or an opportunity to file evidence in order to demonstrate that the conflict of interest finding was erroneous. Id. at 573-74. Judge Brieant neither granted nor denied the request for a hearing but described his decision on Rossini's status as "conditional," subject to revision based on facts to be disclosed during discovery. Id. at 620-23.
In a subsequent memorandum and order, Judge Brieant reaffirmed his denial of class representative status to Rossini. Rossini v. Ogilvy & Mather, Inc., 19 Fair Empl. Prac. Cas. (BNA) 1328, 20 Empl. Prac. Dec. (CCH) P30,045 (S.D.N.Y. Apr. 18, 1979). He limited his earlier decision, however, stating that it had not been based on Rossini's political activism but rather on
the fact that Rossini as a Vice President of Ogilvy encounters an unavoidable conflict between her role as agent for the corporation and her role as fiduciary for a class maintaining litigation against that corporation. Rossini as a present officer of Ogilvy has an inherent and continuing conflict with regard to managing class litigation against that corporation on behalf of non-officers or non-director employees.
In accordance with his decision on Rossini's status, Judge Brieant also excluded all officers from the class. He certified a class consisting of "all females (excluding corporate officers) who are, have been, or will be, or were since May 30, 1975, employed by defendant Ogilvy & Mather, New York, as managers or professionals and who have been, are, continue to be, or would be affected by the discriminatory practices of defendant." J. App. at 729. The class was certified with only Zukofsky as its representative.
During trial before Judge Gagliardi, motions to reverse these decisions by allowing Rossini to serve as representative of the class and including most officers in the class were explicitly forecast in opening argument, Tr. 13.*fn2 The motions as to Rossini was finally denied near the end of the trial. Tr. 3559.
The denial of class representative status to Rossini based solely on her purported status as a corporate agent of O&M is irreconcilable with the facts found by the trial court. Frances Devereux, personnel director at O&M, testified that the title of vice president was "basically a [sic] honorarium" which carried with it no real change in job function. Tr. 25. O&M president Kenneth Roman testified that election as an "officer" of O&M brought with it no change in function, no policy making authority and no authority to bind the company in any way. Tr. 825-27. After hearing such testimony, Judge Gagliardi found that 150 O&M employees--or about one-quarter of the official, professional and managerial staff--had officer titles, the lowest of which was vice president, and that receipt of such titles brought no change in duties, salary or authority. 597 F. Supp. at 1126-28, 1167.
Rossini's vice-presidential title was, therefore, an insufficient basis for concluding that she was not an adequate representative of a class of female professionals and managers at O&M. The decision to recognize or deny class representative status should be based on substance, not mere form. See Sheehan v. Purolator, Inc., 103 F.R.D. 641, 651 n.10 (E.D.N.Y. 1984) (actual agency, not mere corporate title, determined class representative status).
O&M argues on appeal that Rossini was denied representative status because of her minor role in personnel decisionmaking. This argument is not persuasive. O&M uses an "account group" structure in which a group of employees services a client under the leadership of an "account group director." Thus, like Rossini, many members of the class certified by Judge Brieant were supervisors of other employees and were involved in making recommendations for promotion of their underlings. As we have noted, one segment of the class was "managers," a title necessarily implying such supervisory responsibilities. Furthermore, the argument that Rossini's actual personnel role was the basis for the denial of representative status is refuted by Judge Brieant's plainly worded memoranda on the subject.
In his first memorandum, Judge Brieant presumed that Rossini's officer title made her a corporate agent and that this agency entailed a responsibility for "compliance by the corporation with proper personnel policies." 80 F.R.D. at 135. The second memorandum made clear that it was this presumed agency which created the supposed conflict of interest. 20 Empl. Prac. Dec. at 11,251.
Thus, the finding that Rossini was a corporate agent was clearly erroneous. Judge Gagliardi's refusal to grant representative status to Rossini after the error in Judge Brieant's "conditional" decision had become clear was an abuse of discretion.
The court's exclusion of officers from the class, apparently based on its clearly erroneous finding as to the agency status of O&M officers, was another abuse of discretion. While it would have been reasonable, as suggested at trial by the plaintiffs, see Tr. 13, to exclude only that narrow segment of the O&M officers who actually had the sort of agency powers that concerned the court, it was not reasonable to exclude an entire group of professional employees simply because they possessed what all of the evidence indicated were essentially honorary titles.
The erroneous decision to deny class representative status to Rossini and to exclude her and other non-controlling officers from the class is a basis for reversal if it was prejudicial. We conclude that it did cause prejudice to the class, as more fully discussed in parts 2(b) and 3(a), infra.
2. Decertification of the Class Represented by Zukofsky
O&M moved the court in August 1982 to decertify the class represented by Zukofsky, relying on the recent decision of the Supreme Court in General Telephone Company of the Southwest v. Falcon, 457 U.S. 147, 72 L. Ed. 2d 740, 102 S. Ct. 2364 (1982). Judge Gagliardi did not act on the motion until after trial. Then, in his first opinion, he analyzed the class claims under the standards set forth in Falcon and granted the decertification motion as to the claims of discrimination in transfer, promotion and training at O&M. 597 F. Supp. at 1129-39, 1172.
Zukofsky, as an individual, asserted that she was a victim of a discriminatory denial of transfers from one O&M department to another. Judge Gagliardi's decertification of the class transfer discrimination claim was based on his conclusion that the plaintiffs had failed to prove the existence of any class of employees suffering from such discrimination. 597 F. Supp. at 1134. See 7 C. Wright and A. Miller, Federal Practice and Procedure § 1760 ...