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MISTER v. ILLINOIS CENT. GULF R. CO.

August 7, 1986

ROBERT EARL MISTER, ON BEHALF OF HIMSELF AND ALL OTHERS SIMILARLY SITUATED, PLAINTIFFS,
v.
ILLINOIS CENTRAL GULF RAILROAD COMPANY, A CORPORATION, DEFENDANT.



The opinion of the court was delivered by: Foreman, Chief Judge:

MEMORANDUM AND ORDER

                        TABLE OF CONTENTS
                                                             Page
I. INTRODUCTION                                           1562
II. LEGAL FRAMEWORK                                        1562
      A. Jurisdiction                                        1562
      B. Title VII                                           1562
         1. An Individual Disparate Treatment Claim          1562
         2. A Disparate Impact Claim                         1563
         3. A Class Action Pattern & Practice Disparate
              Treatment Claim                                1564
      C. A 42 U.S.C. § 1981 Claim                        1564
      D. Statistical Evidence                                1564
III. THE CLASS CLAIMS                                       1566
      A. The Claims and Theories of the Parties              1566
      B. An Overview of the Evidence Presented               1567
      C. The Plaintiffs' Evidence                            1568
         1. Statistical Analysis                             1568
         2. The Plaintiffs' Static Work Force Statistics     1569
         3. Anecdotal Evidence                               1570
D. The Defendant's Evidence                            1570
         1. Statistical Analysis                             1570
         2. The Defendant's Anecdotal Evidence               1573
E. The Court's Analysis of the Plaintiffs' Case        1573
         1. The Accuracy of the Data Upon Which the
              Plaintiffs Relied                              1573
         2. The Plaintiffs' Applicant Flow Analysis          1575
         3. The Plaintiffs' Static Work Force Statistics
              and Anecdotal Evidence                         1576
         4. The Plaintiffs' Prima Facie Case                 1576
F. The Court's Analysis of the Defendant's Rebuttal    1576
         1. The Distance Factor                              1576
         2. The Defendant's Demographic Analysis             1577
      G. The Court's Conclusion Concerning the Class Claims  1579
      H. Mister's Representation of the Class                1581
IV. ROBERT MISTER'S INDIVIDUAL CLAIM                       1581
V. ORDER                                                  1582

I. INTRODUCTION

The plaintiff, Robert Earl Mister, a black male, filed this action on January 9, 1981, against the Illinois Central Gulf Railroad Company, pursuant to Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq. (Title VII), 42 U.S.C. § 1981, and 42 U.S.C. § 1985, alleging that the defendant refused to hire him because of his race. In addition to the individual claim, and upon the plaintiff's request, the Court allowed the plaintiff to represent a class of all black persons who had applied for jobs and been wrongfully rejected due to the defendant's allegedly racially discriminatory practices with regard to hiring within the defendant's St. Louis, Missouri, Operating Division. On October 11, 1985, the Court granted the defendant's motion for summary judgment with respect to the plaintiffs' 42 U.S.C. § 1985 claims.

After numerous discovery battles that caused many continuances, the Court, without a jury, heard the liability phase of the case on November 12, 13, 14, 15, 18, 19, 20, 21, 1985, December 5, 6, 1985 and January 21, 22, 23, 24, 30, 31, 1986. The following memorandum represents this Court's findings of fact and conclusions of law as contemplated by Fed.R.Civ.P. 52(a). In order to place the discussion of the evidence in the proper perspective, the Court feels that a general overview of the legal standards is appropriate.

II. LEGAL FRAMEWORK

A. Jurisdiction.

This Court finds that it has subject matter jurisdiction of the Title VII claims pursuant to 42 U.S.C. § 2000e-5(f)(3) and that it has subject matter jurisdiction of the 42 U.S.C. § 1981 claims pursuant to 28 U.S.C. § 1343. Venue is proper both under 42 U.S.C. § 2000e-5(f)(3) and 28 U.S.C. § 1391.

B. Title VII.

Title VII prohibits an employer from failing or refusing to hire an individual because of the individual's race. 42 U.S.C. § 2000e-2(a)(1). The Supreme Court has identified two theories in Title VII cases — disparate treatment and disparate impact. International Brotherhood of Teamsters v. United States, 431 U.S. 324, 97 S.Ct. 1843, 52 L.Ed.2d 396 (1977). In general, either theory may be applicable to a particular set of facts. Id. at 335 n. 15, 97 S.Ct. at 1854. Regner v. City of Chicago, 789 F.2d 534 (7th Cir. 1986).

Under the disparate treatment theory, the employer treats some people less favorably than others because of their race, religion, sex, or national origin. Teamsters 431 U.S. at 335 n. 15, 97 S.Ct. at 1854 n. 15. Proof of discriminatory intent is critical. Id. Under the disparate impact theory, employment practices that are facially neutral in their treatment of different groups "fall more harshly on one group than another and cannot be justified by business necessity. . . ." Id. Unlike a disparate treatment case, a plaintiff in a disparate impact case need not show an intent to discriminate. Id.

1. An Individual Disparate Treatment Claim.

McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973), is the seminal case concerning the burdens of pleading and proof in an individual disparate treatment case. The Supreme Court therein outlined a three-step formula for such cases. First, the plaintiff must establish a prima facie case. He may do so by showing that a) he belongs to a protected class; b) that he applied for an existing job for which he was qualified; c) that despite his qualifications, he was rejected; and d) after the rejection, the employer continued to seek applicants with the plaintiff's qualifications. Id. at 802, 93 S.Ct. at 1824. Once the plaintiff establishes a prima facie case, the burden shifts to the defendant to provide a legitimate nondiscriminatory reason for its actions. Id. The purpose of this evidence is to show that the employment decision was not "motivated by discriminatory animus." Texas Department of Community Affairs v. Burdine, 450 U.S. 248, 257, 101 S.Ct. 1089, 1095, 67 L.Ed.2d 207 (1981). The defendant need not demonstrate nondiscriminatory intent, but must simply produce evidence to rebut the presumption of discrimination raised by the plaintiff's prima facie case. Id. at 254-55, 101 S.Ct. at 1094. This is not a burden of persuasion, but merely a burden of production. The plaintiff may still persuade the Court that the defendant's explanation is "unworthy of credence" that "a discriminatory reason more likely motivated" the defendant. Id. at 256, 101 S.Ct. at 1095. The plaintiff at all times retains the ultimate burden of persuasion.

The McDonnell Douglas formulation was not "intended to be rigid, mechanized, or ritualistic" in application. Furnco Construction Corp. v. Waters, 438 U.S. 567, 577, 98 S.Ct. 2943, 2949, 57 L.Ed.2d 957 (1978). Nor does it suggest a specific order of proof at trial. Coates v. Johnson & Johnson, 756 F.2d 524, 531 n. 5 (7th Cir. 1985). The ultimate question in a disparate treatment case is whether the defendant's actions were founded in a discriminatory intent. Teamsters, 431 U.S. at 335 n. 15, 97 S.Ct. at 1854 n. 15.

2. A Disparate Impact Claim.

In a disparate impact case, the plaintiff can establish a prima facie case of discrimination by showing that "facially neutral standards in question select applicants for hire in a significantly discriminatory pattern." Dothard v. Rawlinson, 433 U.S. 321, 329, 97 S.Ct. 2720, 2726, 53 L.Ed.2d 786 (1977).

Once the plaintiff establishes a prima facie case of discriminatory impact, the burden of proof shifts to the defendant to demonstrate a business necessity for the practice or that the practice has a "manifest relation to the employment in question" in order to avoid a finding of discrimination. See Griggs v. Duke Power Co., 401 U.S. 424, 431, 91 S.Ct. 849, 853, 28 L.Ed.2d 158 (1971), and Connecticut v. Teal, 457 U.S. 440, 446, 102 S.Ct. 2525, 2530, 73 L.Ed.2d 130 (1982). The Supreme Court has not indicated whether this shift in burden is one of persuasion or simply one of coming forward with the evidence as in a disparate treatment case. See Schlei and Grossman, Employment Discrimination Law, p. 1328 (2d ed. 1983). This Court is inclined to follow those cases holding that the shift is one of persuasion. See Johnson v. Uncle Ben's Inc., 657 F.2d 750, 752-53 (5th Cir. 1981), cert. denied, 459 U.S. 967, 103 S.Ct. 293, 74 L.Ed.2d 277 (1982). Even if the defendant meets his burden of persuasion, the plaintiff may still prevail by showing that the defendant was using the practice as a mere pretext for discrimination or that other selection devices without a significant discriminatory effect would also "serve the employer's legitimate interest. . . ." Albemarle Paper Co. v. Moody, 422 U.S. 405, 425, 95 S.Ct. 2362, 2375, 45 L.Ed.2d 280 (1975).

Similar to a disparate treatment case, the allocation of proof set forth above represents a method for analyzing evidence and not a procedure by which evidence is presented. Teamsters, 431 U.S. at 335 n. 15, 97 S.Ct. at 1854 n. 15.

A disparate impact theory is most frequently employed in class actions because the employment practice in question, by the very nature of the theory, must affect a large group of persons. Statistics are almost totally determinative in cases under the disparate impact theory.

Generally, a disparate impact claim concerns the impact of a facially neutral standards or criteria such as a maximum height requirement, or minimum scores on an objective test. See e.g., Griggs v. Duke Power Co., 401 U.S. 424, 91 S.Ct. 849, 28 L.Ed.2d 158 (1972). Courts are not in agreement as to whether the disparate impact analysis can be applied to subjective employment decisions. See Schlei and Grossman, Employment Discrimination Law, p. 24 (1983-1984 cumulative supplement); Major Issues in the Federal Law of Employment Discrimination, Supplement 1 p. 13. This Court need not get too caught up in this interesting debate because in the recent case of Regner v. City of Chicago, 789 F.2d 534, (7th Cir. 1986), the Seventh Circuit has seemingly approved the application of the disparate impact model to a subjective procedure. See also Griffin v. Board of Regents of Regency Universities, 795 F.2d 1281, 1287-1289, nn. 13, 14 (7th Cir. 1986). For an excellent discussion of this issue, see Lamber, Discretionary Decisionmaking: The Application of Title VII's Disparate Impact Theory, 1985 U.Ill.L.R. 869.

3. A Class Action Pattern and Practice Disparate Treatment Claim.

Although the disparate treatment theory arises most often in an individual case, class actions may also proceed under this theory. In such a case, the plaintiff generally combines a claim of individual disparate treatment with a claim that the defendant's treatment of the plaintiff is part of a pattern or practice of discriminatory treatment toward the members of the plaintiff's class.

Plaintiffs who raise a pattern or practice claim must demonstrate that the discrimination has been the regular policy of the defendant, i.e., that "discrimination was the company's standard operating procedure — the regular rather than unusual practice." International Brotherhood of Teamsters v. United States, 431 U.S. 324, 336, 360, 97 S.Ct. 1843, 1867, 52 L.Ed.2d 396 (1977). The plaintiff usually establishes a prima facie case by employing statistical evidence to create an inference of classwide discrimination similar to a disparate impact case. Id. at $339, 97 S.Ct. at 1856. Although the plaintiffs almost always offer evidence of individual instances of discriminatory treatment to buttress their case, the plaintiffs are not required to show that each member of the class is a victim of the defendant's discriminatory policy. Id. at 360, 97 S.Ct. at 1867. Evidence of isolated incidents alone will not establish a prima facie case. However, in some cases, statistical evidence alone may constitute a prima facie case. See Coates v. Johnson & Johnson, 756 F.2d 524, 532 n. 6 (7th Cir. 1985).

Once the plaintiffs establish a prima facie case, the burden then shifts to the defendant to rebut the inference of discrimination created by the plaintiff's statistics. The defendant may do so by "demonstrating that the plaintiffs' proof is either inaccurate or insignificant." Teamsters, 431 U.S. at 360, 97 S.Ct. at 1867, or by providing a "nondiscriminatory explanation for the apparently discriminatory result." Id. at 360 n. 46, 97 S.Ct. at 1867 n. 46. At all times, the plaintiffs maintain the burden of persuasion with respect to discrimination. Coates, 756 F.2d at 532.

C. A 42 U.S.C. § 1981 Claim.

42 U.S.C. § 1981 provides a redress for racial discrimination in private employment. McDonald v. Santa Fe Trail Transportation Co., 427 U.S. 273, 96 S.Ct. 2574, 49 L.Ed.2d 493 (1976). Traditionally, the courts regarded Title VII and § 1981 cases as involving analogous principles, standards, and theories of discrimination; however, the Supreme Court has eliminated the disparate impact theory in § 1981 cases. General Building Contractors Association v. Pennsylvania, 458 U.S. 375, 102 S.Ct. 3141, 73 L.Ed.2d 835 (1982). In General Building, the Supreme Court held that § 1981 could only be violated by purposeful discrimination. Therefore, the legal standards outlined above for the individual and class disparate treatment claims would apply equally as well to the 42 U.S.C. § 1981 individual and class claims.

D. Statistical Evidence.

The differences resulting from the above comparisons may be measured in a number of ways. The chief barometer employed is a standard deviation.

    The "standard deviation" is a number that
  quantifies the degree to which disparities spread out
  above and below the mean of distribution, thus
  describing the probability that chance is responsible
  for any difference between an expected outcome and
  the observed outcome in a sample consisting of two
  groups (a binomial distribution). The greater the
  number of standard deviations, the less likely it is
  that chance is the cause of any difference between
  the expected and observed results. The Supreme Court
  noted in Castaneda v. Partida, 430 U.S. 482, 97 S.Ct.
  1272, 51 L.Ed.2d 498 (1977), that under a "two-tail"
  test of statistical significance, "[a]s a general
  rule for . . . large samples, if the difference
  between the expected value and the observed number is
  greater than two or three standard deviations, then
  the hypothesis that the [disparity] was a random
  would be suspect to a social scientist." Id. at 497
  n. 17, 97 S.Ct. at 1281 n. 17. The general rule
  should be applied with ...

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