20 Fair Empl.Prac.Cas. 239,
Herman J. JOHNSON, Individually and on behalf of all persons
similarly situated, Plaintiff-Appellant,
v.
GENERAL MOTORS CORPORATION, Defendant-Appellee.
No. 77-2429.
United States Court of Appeals,
Fifth Circuit.
July 9, 1979.
Joseph Jones, Jr., Atlanta, Ga., Fletcher Farrington, Savannah, Ga., for plaintiff-appellant.
William A. Clineburg, Jr., R. Byron Attridge, L. Joseph Loveland, Jr., Atlanta, Ga., for defendant-appellee.
Appeal from the United States District Court for the Northern District of Georgia.
Before THORNBERRY, CLARK and FAY, Circuit Judges.
CHARLES CLARK, Circuit Judge:
The primary issue on this appeal is whether the doctrine of res judicata bars the maintenance of an employment discrimination suit brought by a plaintiff who was an absent member of a plaintiff class in a previous class action involving the same discrimination practices, when the prior action was conducted pursuant to subsection (b)(2) of Rule 23 of the Federal Rules of Civil Procedure and no notice was provided to absent class members. The district court held the appellant's cause of action totally barred by the prior suit on the basis that no notice was necessary to bind absent class members in a 23(b)(2) class action. We reverse. Although notice is not necessary to bind absent class members in a 23(b)(2) class action seeking only injunctive and declaratory relief, due process does require notice before the individual monetary claims of absent class members may be barred. The portion of the present action which seeks monetary relief for the plaintiff and others similarly situated cannot be barred by a prior suit in which no notice to absent class members was provided.
I.
The appellant Herman Johnson is a black employee at the General Motors Assembly Plant in the Lakewood area of Atlanta, Georgia. In 1971, Johnson was promoted from his position as an hourly-paid employee at the plant to a position as a salaried employee. As a result of a supervisor's criticism, he was demoted back to hourly-wage status in 1972. Johnson filed an EEOC complaint in 1973. Subsequent to that filing, he was again promoted to a salaried position as a foreman. After receiving an EEOC right-to-sue letter he brought this action against the appellee General Motors under Title VII and 42 U.S.C. § 1981. Johnson brought his suit as a class action, defining the class to encompass all past, present and future black employees at the plant. The complaint alleged wide-ranging discrimination practices, including discrimination in promotion, job assignment, job education and the dissemination of job openings. The complaint sought both injunctive and monetary relief.
The district court held that Johnson's action was barred by the res judicata effect of a prior suit involving racial discrimination at the Lakewood General Motors Plant, Rowe v. General Motors Corp., 4 E.P.D. P 7715 (N.D.Ga.1969), Rev'd and remanded,
Johnson was an employee at the Lakewood plant before and during the Rowe litigation. The discrimination allegedly suffered by Johnson racial preference in the promotion of employees was the very type of discrimination at issue in Rowe. The district court found that Johnson was a member of the plaintiff class in Rowe, and that his present suit was therefore barred by the adjudication in Rowe.
Johnson asserts several deficiencies in the conduct of the Rowe litigation in an attempt to avoid its res judicata effect. He first argues that Rowe was never formally certified as a class action as required by Rule 23(c)(1) of the Federal Rules of Civil Procedure, and, in a related argument, that the class was never formally delineated and described in the court's final order, as required by Rule 23(c)(3). Johnson next asserts that because class members in Rowe received no notice of the Rowe litigation, they are not bound by the Rowe judgment. Finally, relying on the named plaintiffs' willingness to settle their individual claims for $1,000 each and their failure to pursue monetary relief for the class, Johnson attacks the adequacy of the representation in Rowe.
II.
Rowe's violation of Rule 23 requirements in the lack of class certification and failure to describe the class in the judgment are insufficient deficiencies to annul the binding effect of the Rowe judgment. The lack of notice to the absent class members in Rowe, however, presents a more substantial problem. Because the appellant's present suit seeks monetary as well as injunctive relief, we hold that the lack of notice prevents the imposition of Rowe as a bar to his present suit. Our holding on the notice issue eliminates the need to reach the adequacy of representation question.
A.
Rule 23(c)(1) provides that "As soon as practicable after the commencement of an action brought as a class action, the court shall determine by order whether it is to be so maintained." In Rowe the district court failed to comply with this important requirement of the rule and neglected to formally certify the case as a class action. It is clear, however, that throughout its pendency the district court regarded Rowe as a class suit. The court in its opinion stated:
Plaintiff Rowe instituted the case against the defendant as an individual action on his own behalf and as a class action under Rule 23(a)(1). The alleged class included all Negroes similarly situated to Rowe and all present and future Negroes employed in hourly rated jobs.
4 E.P.D. P 7715. On appeal, this court described the case as a class action in language nearly identical to that of the district court's,
Id. at 359 n.24. In short, it is beyond dispute that despite the lack of a proper order certifying Rowe as a class suit, the case was in fact a class action and was specifically described and treated as such both at trial and on appeal.
In Bing v. Roadway Express, Inc.,
To say that this is not a class action would be to ignore the substance of the proceedings below in favor of an excessively formalistic adherence to the Federal Rules of Civil Procedure. We believe the trial court's implicit determination of the class action question satisfies Rule 23(c)(1).
Id. at 447. In Gore v. Turner,
B.
Rule 23 also provides in subsection (c)(3) that a judgment in a class action "shall include and describe those whom the court finds to be members of the class." The final decree entered by the district court in Rowe did not specifically describe the members of the class. Once again Bing is controlling. In Bing the district court, aside from failing to certify the class, also failed to explicitly delineate the contours of the class in its final judgment order. We held that the judgment described the class by implication and that such a description was sufficient.
Viewed in the context of the entire Rowe litigation, the failure to describe the class in the final order is an error without significance to the present appeal. The final decree was derived, virtually verbatim, from a "proposed final decree" appended to this court's opinion in the case.
No notice was provided to the absent class members in Rowe. Although Rowe was not formally certified as a class action under any particular division of Rule 23, this court's opinion specifically referred to the suit as an action appropriately maintained under subsection (b)(2) of the Rule.
The text of Rule 23 makes notice mandatory for (b)(3) class actions suits predicated on common questions of law and fact which predominate over questions affecting individual class members requiring "the best notice practicable under the circumstances." F.R.C.P. Rule 23(c)(2). The Rule provides for only discretionary notice, however, in (b)(2) class actions. F.R.C.P. Rule 23(d) (2). The Supreme Court in Eisen v. Carlisle & Jacquelin,
Although the complaint did not so specify, the absence of a claim for monetary relief and the nature of the claim asserted disclose that a Rule 23(b)(2) class action was contemplated. Therefore, the problems associated with a Rule 23(b) (3) class action, which were considered last Term in Eisen . . . , are not present in this case.
Id. at 397 n.4,
It does not follow that because notice in (b)(2) actions is not made mandatory by Rule 23, every (b)(2) action in which notice is absent will automatically bar all subsequent efforts by members of the class to litigate claims that might have been brought in the original class action. Before the bar of res judicata may be applied to the claim of an absent class member, it must be demonstrated that invocation of the bar is consonant with due process. E. g., Hansberry v. Lee,
We recently applied these principles in Bogard v. Cook,
Bogard largely controls the instant case. Unlike Bogard, Johnson received no notice whatsoever of the class action that would later be invoked to bar his claim. Notice and an opportunity to be heard are "fundamental requisites of the constitutional guarantee of procedural due process." Eisen,supra,
Our holding does no violence to the general rule making notice only discretionary in Rule 23(b)(2) cases. The decisions from which that rule derives presuppose that Rule 23(b)(2) class actions will be limited to class suits seeking only equitable relief. Both Eisen and Sosna explicitly equate actions for equitable relief with subsection (b)(2) of the Rule and actions for monetary relief with subsection (b)(3). Eisen, supra,
In light of these developments, we have previously suggested that when both monetary and injunctive relief are sought in an action certified under Rule 23(b)(2), notice may be mandatory if absent class members are to be bound. We expressly took note in Pettway of "the problem of binding unidentified class members," suggesting that it "may be overcome by particularizing the class members at some point in the litigation or utilizing the notice provision of subdivision (d)(2)."
D.
Johnson does not assert that the representation in Rowe was inadequate insofar as the named Rowe plaintiffs sought injunctive or declaratory relief. Indeed, the plaintiffs in Rowe were ultimately successful in obtaining such relief. Rather, Johnson relies on the failure of the named Rowe plaintiffs to pursue class-wide monetary awards. Since we have already held that, for lack of notice, Rowe does not affect absent class members' claims for monetary damages, it is unnecessary to further consider the adequacy of the representation in Rowe.
III.
Our holding that Johnson's cause of action for monetary damages is not barred as res judicata raises several additional issues that will now become critical in determining the future course of this litigation. Those issues are not properly before us on this appeal; they will be for the district court to resolve on remand.
Since the district court regarded Johnson's action as utterly foreclosed by Rowe, it concluded, on that basis alone, that Johnson was also an inadequate class representative. Our decision does not imply that Johnson's suit may properly be maintained as a class action. If there are others similarly situated to Johnson, there is nothing to prevent them from litigating their claims in a class suit, but the questions of whether Johnson's particular suit meets the requirements of Rule 23, or whether Johnson is an adequate class representative, are not before us. On remand it will be for the district court to manage the suit pursuant to its usual responsibilities under Rule 23.
A more intricate issue concerns Johnson's attempt to obtain further injunctive relief from allegedly discriminatory practices at the Lakewood plant. Johnson's complaint alleges racially discriminatory practices at the Lakewood plant which range far beyond the practices at issue in Rowe. Unlike the representative plaintiffs in Rowe, Johnson purports to represent all black employees at the plant, not merely hourly-wage earners, and he complains of practices which go beyond the procedures for promotion to salaried positions that were at issue in Rowe. Under our analysis in part II(C) of this opinion, an absent class member is bound by the res judicata effect of a (b)(2) class action to the extent that the judgment concerns injunctive or declaratory relief, even when no notice was provided. In part II(D) we noted that Johnson does not complain of the representation in Rowe with regard to the injunctive and declaratory relief obtained in that suit. Under this analysis, res judicata would bar Johnson's entitlement to relief duplicative of that already granted in Rowe or to relief which could have been sought in that action. On the record before us, however, it is impossible to know whether Johnson may be entitled to equitable relief for alleged wrongs outside the scope of Rowe. More importantly, it is impossible at this juncture to know whether Johnson may adequately represent class members who may be entitled to equitable relief because of practices which did not affect Johnson or class members from Rowe. Finally, since the outstanding Rowe injunction emanates from the same district court in which Johnson's present suit has been filed, the possibility exists that Johnson, either individually or on behalf of the Rowe class, may be entitled to relief under the district court's continuing jurisdiction to enforce its Rowe decree.
All of these issues are within the scope of the district court's duties to control and supervise an action under Rule 23. The cause is reversed and remanded for further proceedings not inconsistent with this opinion.
REVERSED AND REMANDED.
FAY, Circuit Judge, specially concurring:
While concurring in Judge Clark's scholarly opinion, I feel compelled to add a short personal observation.
Class actions are unique creatures with enormous potential for good and evil. This valuable tool will only serve the ends of justice if Rule 23 of the Federal Rules of Civil Procedure is followed strictly. If writing on a clean slate, I would hold that Rowe was never a class action because it was never certified as such. Prior decisions of this Court bind us to a contrary conclusion. The case before us today highlights one of the consequences inherent in ignoring the requirements of Rule 23.
Certainly Herman Johnson should not be barred. Rowe was not certified as a class action and no notice was issued in accord with Rule 23(c) whether as a (b)(2) or (b)(3) class. As a matter of fact, Rowe was only a class action because we said it was! Section III of this opinion points out some of the problems created by our failure to adhere to those procedures outlined in Rule 23. This should serve as a "cautionary signal" to all of us.