Grant v. Local 638

373 F.3d 104

Roysworth GRANT, Plaintiff-Appellee Equal Employment Opportunity Commission, Willie Ellis, the City of New York, Plaintiffs-Appellees The Hispanic Society and Individual Nonwhite Local 28 Members, Plaintiffs-Intervenors-Appellees-Movants, v. LOCAL 638, Defendant-Intervenor Local 28, Sheet Metal Workers' International Association, Defendant-Intervenor-Appellant-Respondent.¹

No. 03-6189.

United States Court of Appeals, Second Circuit.

Argued: February 3, 2004.

Decided: June 18, 2004.

Jyotin Hamid, Debevoise & Plimpton, New York, NY, (Edwin G. Schallert, Patricia G. Corley and Wendy B. Reilly, Debevoise & Plimpton; Michael L. Foreman and Audrey J. Wiggins, Lawyers' Committee for Civil Rights Under Law, Washington, DC; Alan Levine, Puerto Rican Legal Defense and Education Fund, New York NY, on the brief) for Plaintiffs-Intervenors-Appellees-Movants.

David J. Cynamon, Shaw Pittman, LLP, Washington DC, (Christine N. Kearns and Karen-Faye Newman, Shaw Pittman, LLP; Edmund P. D'Elia, New York, NY; John O'B. Clarke, Highsaw, Mahoney & Clarke, P.C., Washington, DC, on the brief) for Defendant-Intervenor-Appellant-Respondent.

Eric S. Dreiband, General Counsel, Vincent J. Blackwood, Acting Associate General Counsel, Paul D. Ramshaw, Attorney, U.S. Equal Employment Opportunity Commission, Washington, DC, for Plaintiff-Appellee Equal Employment Opportunity Commission.

Before: POOLER, SOTOMAYOR, and WESLEY, Circuit Judges.

POOLER, Circuit Judge.

In this long-standing race discrimination lawsuit, Local 28 of the Sheet Metal Workers' International Association ("Local 28" or "the union") has been proven guilty of discrimination against nonwhite² workers, subjected to affirmative relief, and found guilty of contempt. Outstanding issues include individual entitlement to back pay and revision of affirmative action goals in light of prior contempt findings. In early 2003, Local 28 settled these issues with the governmental plaintiffs, the Equal Employment Opportunity Commission ("EEOC"), the New York State Division of Human Rights ("DHR"), and the City of New York ("city") (collectively, "the government"). After receiving objections from plaintiffs/intervenors, the Hispanic Society and individual nonwhite Local 28 members (collectively, "intervenors"), the district court refused to approve the proposed settlement. Local 28 contends that the district court's order is appealable either (a) because it effectively denied a request to modify an injunction and thus is appealable pursuant to 28 U.S.C § 1292(a)(1), or (b) because under applicable Supreme Court precedent, an order refusing to approve a Title VII settlement is always appealable on an interlocutory basis. We agree with intervenors that this appeal is not exempt from the general rule that interlocutory orders are not appealable and thus dismiss Local 28's appeal.

BACKGROUND

In 1971, the Department of Justice, which has since been succeeded by EEOC, sued Local 28, three other unions, and the unions' joint apprenticeship committee, alleging that they had discriminated against nonwhites. Shortly thereafter, the city of New York intervened as a plaintiff. EEOC v. Local 638, 401 F.Supp. at 470.

In a 1975 bench trial, the government proved that Local 28 had discriminated against nonwhites. See EEOC v. Local 638, 401 F.Supp. 467, 487 (S.D.N.Y.1975), aff'd in part, modified in part, 532 F.2d 821 (2d Cir.1976). After trial, the district court ordered back pay, enjoined Local 28 from further discrimination, and directed the institution of an affirmative action plan and other affirmative relief. EEOC v. Local 638, 401 F.Supp. at 488-92. Since the trial, issues concerning the scope of the relief ordered and the defendants' lack of compliance have been presented to the district court, this court, and the Supreme Court.³

In 1999, we affirmed, in pertinent part, a district court decision requiring back pay hearings to determine the amounts to be awarded as a result of Local 28's prior contempts. City of New York v. Local 28, 170 F.3d 279, 286 (2d Cir.1999). Also unresolved at that time was the recalculation of the affirmative action goal, stated as a percentage of membership, which too was necessitated by past contempt findings. In May 2001, EEOC and Local 28 began settlement talks that ultimately produced a proposed consent order. The proposed order, among other things, capped the potential back pay award, set a higher affirmative action goal, lowered the union's contribution to a fund for training minorities, provided for still lower contribution rates if the union met its affirmative action goals, and permitted the union once it satisfied certain conditions to petition the district court for a modification of existing court orders.

On December 19, 2002, the district court conditionally approved the settlement. EEOC v. Local 638, 2002 WL 31856826, at *1-2 (S.D.N.Y. Dec. 19, 2002). On April 9, 2003, the Hispanic Society and individual nonwhite members of Local 28 moved to intervene, claiming that the government had not adequately protected their interests. See EEOC v. Local 638, 2003 WL 21767772, at *1 (S.D.N.Y. July 30, 2003).

The district court granted intervention, and on August 6, 2003, it disapproved the proposed consent order. EEOC v. Local 638, 2003 WL 21804837, at * 3 (S.D.N.Y. Aug. 6, 2003). Although the district court acknowledged that voluntary compliance is the preferred method for settling Title VII actions, the agreement did not survive the district court's mandated review of "the proposal to make sure that it is fair, adequate, and reasonable." Id. at * 1. The factors that persuaded the court not to approve the agreement included the opposition to it by nonwhite union members and the court's conclusion that the government and individual plaintiffs risked little by litigation. Id. at *1-2. In particular, the court noted that its own expert had determined the damages to be nearly $150 million, some $145 million more than the capped amount, and that both the district court and this court agreed that Local 28 had the ability to pay more than the capped amount. Id. at *2 (citing EEOC v. Local 638, 117 F.Supp.2d 386, 392 (S.D.N.Y.2000), aff'd, 247 F.3d 333 (2d Cir.2001)). The court also acknowledged that withholding approval would lengthen the course of litigation but said:

Much of the litigation to date has resulted from Local 28's non-compliance with this court['s] orders after liability was established in 1975. The Union should not be rewarded for dragging its feet until government plaintiffs reached a point of exhaustion.

Id. at * 3.

Local 28 timely appealed the district court's order, and on November 12, 2003, the plaintiffs/intervenors moved to dismiss on the basis of mootness and lack of jurisdiction.

DISCUSSION

"Ordinarily, appeals are permitted only from `final decisions of the district courts.'" Karaha Bodas Co., v. Perusahaan Pertambangan Minyak Dan Gas Bumi Negara, 313 F.3d 70, 81 (2d Cir.2002) (quoting 28 U.S.C. § 1291). Local 28 does not claim — and it could not — that the district court's order was a final judgment. Instead, the union relies on 28 U.S.C. § 1292(a)(1), an exception to the general prohibition against appealing non-final orders. Section 1292(a)(1) gives us jurisdiction over appeals from "[i]nterlocutory orders of the district courts of the United States ... granting, continuing, modifying, refusing or dissolving injunctions, or refusing to dissolve or modify injunctions." Based on the terms of the proposed consent order, Local 28 claims that the district court's order has the practical effect of refusing to modify an injunction and therefore is appealable.

Relying primarily on Local Number 93 v. City of Cleveland, 478 U.S. 501, 106 S.Ct. 3063, 92 L.Ed.2d 405 (1986), and Carson v. American Brands, Inc., 450 U.S. 79, 83-84, 101 S.Ct. 993, 67 L.Ed.2d 59 (1981), the union also insists that an order refusing to accept a consent order in a discrimination case is always appealable on an interlocutory basis.

Section 1292(a)(1), by its terms, applies only when a district court actually grants, dissolves, or modifies an injunction or refuses to take one of these actions. The Supreme Court has recognized, however, that interlocutory jurisdiction may exist where the district court's order has the "practical effect" of denying an injunction. Carson, 450 U.S. at 83-84, 101 S.Ct. 993. "Because § 1292(a)(1) was intended to carve out only a limited exception to the final-judgment rule, ... appeal as of right under § 1292(a)(1) will be available only ... where an appeal will further the statutory purpose of `permit[ting] litigants to effectually challenge interlocutory orders of serious, perhaps irreparable, consequence.'" Id. at 84, 101 S.Ct. 993 (quoting Baltimore Contractors, Inc. v. Bodinger, 348 U.S. 176, 181, 75 S.Ct. 249, 99 L.Ed. 233 (1955)). If serious or irreparable harm is not present, "the general congressional policy against piecemeal review will preclude interlocutory appeal." Id.

The Carson court found irreparable harm based on several circumstances. First, in refusing to enter the proposed consent decree,

the District Court made clear that it would not enter any decree containing remedial relief provisions that did not rest solidly on evidence of discrimination and that were not expressly limited to actual victims of discrimination. In ruling so broadly, the court did more than postpone consideration of the merits of petitioners' injunctive claim. It effectively foreclosed such consideration. Having stated that it could perceive no vestiges of racial discrimination on the facts presented, and that even if it could, no relief could be granted to future employees and others who were not actual victims of discrimination, the court made clear that nothing short of an admission of discrimination by respondents plus a complete restructuring of the class relief would induce it to approve remedial injunctive...