Sally A. RANDALL and Rona C. Pepmeier, individually and on behalf of all others similarly situated, Plaintiffs-Appellants, and Karen Governor and Barbara Jones, Proposed Intervening Plaintiffs/Appellants, v. ROLLS-ROYCE CORPORATION, et al., Defendants-Appellees.
No. 10-3446.
United States Court of Appeals, Seventh Circuit.
Decided March 30, 2011.
637 F.3d 818
Argued Feb. 16, 2011.
III.
There was sufficient evidence from which a jury could conclude beyond a reasonable doubt that Taylor knew that he was aiding Blake in distributing crack on October 20, 2005. Therefore, we AFFIRM the judgment of the district court. The jury‘s contradictory findings on the special verdict form regarding the amount of drugs involved are irrelevant because the ultimate sentence was below the mandatory minimum for a conviction for distributing any amount of crack. Further, the district court made sufficient factual findings to support a two-level enhancement for obstruction of justice. Therefore, we AFFIRM the sentence of the district court.
R. Anthony Prather, Attorney, Barnes & Thornburg LLP, Indianapolis, IN, George A. Stohner (argued), Attorney, Morgan, Lewis & Bockius, Los Angeles, CA, for Defendants-Appellees.
Before POSNER, FLAUM, and SYKES, Circuit Judges.
POSNER, Circuit Judge.
The plaintiffs in this class action suit on behalf of more than 500 female employees of a Rolls-Royce plant in Indiana that manufactures aircraft, industrial, and marine engines appeal from the denial of class certification and the subsequent grant of Rolls-Royce‘s motion for summary judgment. (We refer to the defendants, all of which are affiliated corporations, collectively as “Rolls-Royce.“) The plaintiffs charge Rolls-Royce with sex discrimination, in violation of
To appeal a district court‘s denial of class certification, as the plaintiffs are doing in this case, is a risky strategy, especially when, as in this case, the class is proposed to be certified under
Conversely, a defendant confident of prevailing on the merits will often be well advised not to oppose certification, though there is some risk in doing so (so perhaps we should say a defendant utterly confident of winning on the merits would be well advised not to oppose certification). Rolls-Royce is confident of prevailing on the merits, and rightly so as we‘ll see, but follows the lawyer‘s reflexive strategy of denying whatever the opponent asserts.
Certification and merits cannot always be separated. For example, certification may be denied because the named plaintiff‘s claim is atypical of the claims of the other members of the class, and it may be a plaintiff typical because of a possibly complete defense to his claim that may not apply to claims of the other class members, as in CE Design Limited v. King Architectural Metals, Inc., 637 F.3d 721, 725-28 (7th Cir.2011). And then the only effect if the denial of certification is upheld may be the substitution, in a new class action suit, of another class member for the named plaintiff in the old suit, and in that event the defendant‘s victory will be Pyrrhic; substitution is an issue in this case, as we‘ll see.
But a plaintiff‘s victory in overturning the denial of certification may be equally Pyrrhic if he prevails only by occluding significant differences between his claim and that of other class members by insisting on its typicality, thus making it more difficult for unnamed class members to convince a court that their own claims are stronger than his (implying that his is atypical) and so should not be barred by a judgment against him.
We‘ll discuss the merits and then certification.
Rolls-Royce determines the compensation of its employees (all its employees, but this case concerns just those exempt from the minimum-wage and maximum-hours provisions of the
Thus, while in theory the jobs within each compensation category are of equal value to the company (we imagine that Rolls-Royce‘s motive for saying this—thereby unwittingly arming its adversaries in this case—is to improve employee morale by reassuring each employee that he or she is as good as others in the same compensation category even if paid less than they), the jobs are not equally valued by the market. Recognizing that it therefore must pay some employees in each category more than others, Rolls-Royce specifies different levels of base pay for different jobs within a category and (further complicating comparison across jobs) authorizes supervisors to make ad hoc pay adjustments; notably, each employee is eligible to obtain a percentage of his base pay as additional compensation, the per-
In 2003, the year before the beginning of the complaint period, the average base pay (that is, the base pay before the performance add-on just noted) of male employees in the twenty compensation grades was about 5 percent higher than that of the women in those grades. That differential persisted throughout the complaint period. And because the performance adjustments were calculated as percentages of base pay, base pay influenced total pay throughout the period, though other adjustments may have diluted that influence or for that matter eliminated it. Of course if the women outperformed the men, they might catch up and even exceed them in pay, just by virtue of the performance adjustment. Yet they would exceed them by less than if their base pay had been equal to the men‘s at the outset. Suppose that in year one W‘s pay (after performance adjustment) is $90,000, and so this becomes her base pay in year two. M‘s pay is $100,000 in year one. In year two W receives a 20-percent performance bonus and M only a 5-percent bonus. As a result W‘s pay now exceeds M‘s—it is $108,000 to his $105,000. But if W‘s base pay in year two had been equal to M‘s, her second-year pay would have been $120,000, and so she was hurt by having started from a lower base—the difference in year-one base pay being attributable, according to the plaintiffs, to sex discrimination.
If the difference was attributable to sex discrimination, Rolls-Royce‘s failure to eliminate the difference would, by perpetuating discrimination, violate
Rolls-Royce‘s expert, Bernard R. Siskin, shot down the plaintiff‘s theory of discrimination in base pay under
In concluding that the base-pay difference was attributable to discrimination, the plaintiffs’ expert, Richard Drogin, made errors besides failing to adjust for differences in the jobs occupied by male and female employees. We‘ll mention only one of these errors: he included in the comparison employees hired after the beginning of the complaint period. That made no sense without an inquiry, which he did not attempt, into the reasons for the different starting salaries of male and female hires. Remember that the claim is that Rolls-Royce discriminated against women by failing to erase a disparity in base pay that existed at the outset of the complaint period; for all we know it did erase it, and the reason for the apparent persistence of the disparity is that new female hires were, for reasons unknown but not contended to be discriminatory, paid less than new male hires.
Having failed to rebut Siskin‘s key finding, either with Drogin‘s defective report or anything else, the plaintiffs’ complaint about base-pay discrimination fails. We add (it bears on the issue of class certification, discussed below) that in several of the years in question the named plaintiffs’ base pay exceeded, with only a few exceptions, that of the male employees in the plaintiffs’ compensation grades who the plaintiffs claimed were comparable to them.
The named plaintiffs are more concerned with promotions they failed to get than they are with the largely nonexistent (for them at least) base-pay differentials. Yet Siskin‘s study found that women in the class members’ five compensation categories are promoted on average more rapidly than men. Furthermore, while many promotions in a firm or other institution are more or less routine and even automatic, this is not true at the level of our plaintiffs, both of whom are in the highest of the five compensation categories, earning well over $100,000. Rolls-Royce has relatively few employees in this rarefied stratum and their work is not fungible. They do different jobs involving different skills and experience. The fact that some of the male employees who the plaintiffs contend were promoted ahead of them are, like them, called “Director of Operations” has no significance; the title covers a multitude of positions differing in authority (such as number of employees supervised) and responsibility.
In beginning to speak of facts peculiar to the two named plaintiffs, we are veering from merits issues to the certification issue. Because the district judge denied class certification, thus extruding the unnamed class members from the case, her grant of summary judgment spelled dis-
Fortunately for the class, the plaintiffs’ challenge to the denial of class certification fails. Their claims are, as we just noted, significantly weaker than those of some (perhaps many) other class members; and as explained in CE Design Limited v. King Architectural Metals, Inc., supra, 637 F.3d at 725-28, named plaintiffs who are subject to a defense that would not defeat unnamed class members are not adequate class representatives, and adequacy of representation is one of the requirements for class certification.
The adequacy of the plaintiffs’ representation is further undermined by the existence of a conflict of interest, beyond that implicit in their having weaker claims than some of the unnamed class members, between them and unnamed class members. Amchem Products, Inc. v. Windsor, supra, 521 U.S. at 625; Gilpin v. American Federation of State, County & Municipal Employees, 875 F.2d 1310, 1313 (7th Cir.1989); Hines v. Widnall, 334 F.3d 1253, 1258 (11th Cir.2003) (per curiam). The plaintiffs have authority within the company with regard to the compensation of some, and maybe many, of the unnamed class members and, as worrisome, over male employees in the same job categories as the class members. Although we doubt that the plaintiffs would deliberately depress the salary of female employees whom they supervise, or increase the salary of male employees whom they supervise, in order to create evidence of discrimination, the possibility of such strategic conduct (which might be unconscious) creates a conflict of interest between the plaintiffs and unnamed members of the class, (as well as with Rolls-Royce, if the plaintiffs raised the salaries of male employees in the class members’ compensation categories in order to create evidence of sex discrimination). A class representative‘s conflict of interest is an independent ground for denial of class certification. Wagner v. Taylor, 836 F.2d 578, 595-96 (D.C.Cir.1987); Wells v. Ramsay, Scarlett & Co., 506 F.2d 436, 437-38 (5th Cir.1975). There is even evidence that the plaintiffs participated in decisions concerning female employees’ compensation that, on their theory of the case, were discriminatory.
The plaintiffs made two attempts in the district court to avoid a finding that they are inadequate class representatives. The first was to cast this as an injunction class action suit, which is to say a class action suit governed by
But that‘s not what they‘re seeking, exclusively or even mainly; and indeed this isn‘t a proper
True, the only monetary relief sought is back pay; true, too—contrary to the common but erroneous notion that courts of equity can‘t award monetary relief—they can do so if the award is merely incidental to the grant of an injunction or declaratory relief: “incidental” in the sense of requiring only a mechanical computation. That is the “clean-up” doctrine of equity. Reich v. Continental Casualty Co., 33 F.3d 754, 756 (7th Cir.1994); Medtronic, Inc. v. Intermedics, Inc., 725 F.2d 440, 442-43 (7th Cir.1984); Mowbray v. Moseley, Hallgarten, Estabrook & Weeden, Inc., 795 F.2d 1111, 1113-14 (1st Cir.1986). In such a case, to make the class representative bring a second suit, for damages, on top of his injunctive action would create pointless redundancy. In re Allstate Ins. Co., 400 F.3d 505, 507 (7th Cir.2005); see also Lemon v. International Union of Operating Engineers, 216 F.3d 577, 580-81 (7th Cir.2000), and cases cited there.
The plaintiffs argue that if only equitable relief is sought, a class action suit may be maintained under
It would not be enough, for example, to award all members of the class 5 percent of their earnings during the complaint period, to erase the allegedly discriminatory differential in pay between male and women employees; for if the women‘s salaries had been 5 percent higher from the outset, they might have received lower performance or other pay raises above their base pay. Remember that compensation is influenced by the labor market: women underpaid because of the base-pay differential would be more likely to receive a compensatory pay adjustment than if their base pay had been higher.
The claim of discrimination in promotions presents a further complication. Because Rolls-Royce does not have a fixed compensation schedule for employees in the compensation categories at issue, individualized hearings would be required to determine how much higher an employee‘s pay would have been had she received a promotion denied her on the ground of her sex.
The proper approach in this case would thus have been for the plaintiffs to seek class certification under
The plaintiffs’ other attempted end run around the district judge‘s denial of certification is to ask us to reverse her denial of their motion to substitute two other class members for the original named plaintiffs—substitutes who might have a more typical (and, not incidentally, a stronger) claim than the original plaintiffs. Such substitution (via permissive intervention by an unnamed plaintiff, who if intervention is allowed becomes the named plaintiff and thus the class representative) is possible. See
The motion was not filed until after the judge had denied class certification—and that was almost four years after the suit had begun and long after it was plain that there were substantial doubts about the typicality of the named plaintiffs’ claims and the adequacy of their representation of the class. As the district judge explained, “until [the plaintiffs] secured the assistance of additional, more experienced counsel, this case progressed at an almost imperceptible pace, with Plaintiffs seeking and receiving numerous extensions of the deadlines for filing their class certification motion, to the point that the Court finally had to admonish counsel regarding their duty of diligence and to voice our concerns over the apparent limited resources being devoted to the case.” 2010 WL 987484, at *13. Things sped up for a time when the plaintiffs retained a firm “with apparently much needed class action expertise and additional resources“—but the firm soon withdrew, citing irreconcilable differences with the plaintiffs’ original lawyers. Id. The judge remarked that “local counsel has been in the ‘driver‘s seat’ throughout the case, and has set, at best, a plodding pace.” 2010 WL 1948222, at *3.
It would go too far to suggest that unless substitution for the original named plaintiffs is sought as soon as a substantial challenge to certification is made, the district judge is justified in denying it. Such a rule might involve constant interruptions of the proceeding—procedural hiccups—as nervous class action counsel tried to add new class representatives every time the defendants raised an objection to certification. But it was obvious from the outset that these named plaintiffs faced a serious challenge to their status as class representatives. And with the entire class in one location (a single plant in Indiana), class counsel had ample opportunity to sift through potential named plaintiffs before deciding on Randall and Pepmeier. Intervention shouldn‘t be allowed just to give class action lawyers multiple bites at the certification apple, when they have chosen, as should have been obvious from the start, patently inappropriate candidates to be the class representatives. Griffin v. Singletary, 17 F.3d 356, 359-60 (11th Cir.1994); see also Sanford v. MemberWorks, Inc., 625 F.3d 550, 560-61 (9th Cir.2010). The judge was justified in denying the motion to intervene.
AFFIRMED.