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Grant v. Bethlehem Steel Corp.

decided: June 30, 1987.

ROYSWORTH D. GRANT, WILLIE ELLIS, ON BEHALF OF THEMSELVES AND ALL SIMILARLY SITUATED, PLAINTIFFS-APPELLANTS, LOUIS MARTINEZ, PLAINTIFF INTERVENOR-APPELLANT,
v.
BETHLEHEM STEEL CORPORATION, E. RICHARD DRIGGERS, JAMES DEAVERS & THOMAS CONNELLY, INDIVIDUALLY AND AS AGENTS OF BETHLEHEM STEEL CORP., THE INTERNATIONAL ASSOCIATION OF BRIDGE STRUCTURAL & ORNAMENTAL IRON WORKERS, AFL-CIO; LOCAL 40, BRIDGE STRUCTURAL & ORNAMENTAL IRON WORKERS, AFL-CIO; RAY CORBETT, RAY MULLETT, JERRY PLACE, INDIVIDUALLY AND AS OFFICERS OF LOCAL 40, BRIDGE STRUCTURAL & ORNAMENTAL IRON WORKERS, AFL-CIO, DEFENDANTS-APPELLEES, THE CLASS OF IRON WORKERS, PLAINTIFF-APPELLEE



Appeal from an order of the United States District Court for the Southern District of New York (Knapp, J.) approving $60,000.00 in settlement of class action suit despite unanimous opposition by responding class members. Affirmed.

Author: Miner

Before: KEARSE, MINER and MAHONEY, Circuit Judges.

MINER, Circuit Judge:

Plaintiffs-appellants Roysworth D. Grant and Willie Ellis and plaintiff intervenor-appellant Louis Martinez appeal from an order of the United States District Court for the Southern District of New York (Knapp, J.) approving a $60,000.00 settlement of a class action suit instituted under the provisions of Title VII, 42 U.S.C. §§ 2000e et seq. (1982) and 42 U.S.C. § 1981 (1982) against defendant-appellee Bethlehem Steel Corporation and three of its supervisors.

On appeal, appellant contend primarily that the settlement should be set aside because all class members responding to the notice of proposed settlement opposed the settlement. We affirm.

BACKGROUND

The general background of the instant appeal is set forth in Grant v. Bethlehem Steel Corp., 635 F.2d 1007 (2d Cir. 1980), cert. denied, 452 U.S. 940, 101 S. Ct. 3083, 69 L. Ed. 2d 954 (1981) ("Grant I"), familiarity with which is assumed. Only those facts necessary for a discussion of the issues presented on this appeal will be set forth below.

On February 20, 1976, appellants commenced this class action in the district court against Bethlehem Steel and three of its supervisors. Appellants alleged that Bethlehem Steel had discriminated against blacks and Hispanics in its selection of ironwork foremen, in violation of 42 U.S.C. §§ 2000e et seq. and 42 U.S.C. § 1981.

After an eight-day bench trial, the district court found that appellants had failed to substantiate their claims of racial discrimination. On January 2, 1979, the district court dismissed their complaint. In Grant I, we reversed the district court's order of dismissal, holding that appellants had "made out a prima facie case of not only discriminatory treatment but discriminatory impact as well." Grant I, 635 F.2d at 1020. We remanded the case to the district court to permit Bethlehem Steel and its supervisors to introduce evidence that "their discriminatory conduct may have been justified by business necessity, and for any rebuttal testimony by the plaintiffs." Id.

On remand, Judge Knapp directed Magistrate Bernikow to explore with the parties the possibility of settlement or, in the alternative, to ensure that the parties were prepared fully for trial. Class counsel and Bethlehem Steel subsequently agreed to a settlement in the amount of $60,000.00. Under the terms of the settlement, Grant, Ellis and Martinez each would receive $2,000.00 apart from their shares of the settlement fund.

After notice of the proposed settlement was served on the class members, Magistrate Bernikow, on June 17, 1985, conducted a fairness hearing, at which the objections of appellants and others were heard. According to appellants, of the 126 members of the plaintiffs class, 45 class members opposed the settlement and no responses were received from the remainder of the class. Appellants also claim that 33 letters notifying class members of the settlement were returned.

On July 24, 1986, Judge Knapp adopted Magistrate Bernikow's recommendation that the settlement be approved. This appeal followed the denial of appellant's request for reconsideration.

Discussion

Appellants contend primarily that the district court abused its discretion in approving the settlement despite the objections of all ...


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