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EQUAL EMPLOYMENT OPPORTUNITY COMMISSION v. CUSTOM COS.

April 7, 2004.

EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff, and CATHERINE COPELLO and ALLISON KENNEDY, Plaintiffs-Intervenors,
v.
CUSTOM COMPANIES, INC., and CUSTOM DISTRIBUTOR NETWORK, INC., Defendants



The opinion of the court was delivered by: HARRY LEINENWEBER, District Judge

MEMORANDUM OPINION AND ORDER

Before the Court are Defendants' Motions to Limit the Class in Case Nos. 02-0-3768 and 03-C-2293. (these cases were consolidated on July 7, 2003.) For the following reasons, the Motions are granted in part and denied in part.

I. BACKGROUND

 
A. The Sexual Harassment Class Action (Case No. 02-C-3768)
  Custom Companies, Inc. ("Custom") employed Catherine Copello ("Copello") ay a sale representative from 1994 until her discharge in November 1999. On January 14, 1999, Copello filed a timely charge of discrimination with the United States Equal Employment Opportunity Commission (the "EEOC"), alleging that throughout her employment she and other female employees at Custom were subjected to sexual discrimination, sexual harassment, and retaliation. In November 1999, Copello filed an amended charge of discrimination with the EEOC, alleging that Custom retaliated against her for filing the initial EEOC charge. In April 2000, Copello filed a second amended charge with the EEOC alleging retaliation and sexual discrimination.

  The EEOC investigated Copello's charge of discrimination and issued a determination letter on September 6, 2001, finding that the evidence gathered in the investigation established reasonable cause to believe that Custom had discriminated against a class of female employees "by subjecting them to a sexually hostile, offensive work environment, in violation of Title VII." The EEOC's conciliation efforts failed, and it thereafter filed a civil action against Custom under Title VII of the Civil Rights Act of 1964 ("Title VII"), 47. U.S.C. § 2000e et seq., and Title I of the Civil Rights Act. of 1991, 42 U.S.C. § 1981a. The amended complaint contains class-wide allegations of both discriminatory treatment under 42. U.S.C. § 2000e-b ("Section 706") and pattern and practice allegations under 42 U.S.C. § 2000e-G ("Section 707"). The EEOC alleges that "[s]ince at least 1994," Custom "engaged in a pattern or practice of unlawful employment practices." Am.Compl. ¶ 7. These purported practices include pressures to "entertain" customers at "strip clubs," company outings attended by strippers, groping and sexual touching, pornographic materials on display on work computers, and lewd sexual language. See id. B. The Retaliation Class Action (Case No. 03-C-2293)

  Corrine Miller ("Milder") began her employment at Custom in 199b. In early 1999, and again in mid-1999, she testified in support, of a complainant in an internal sexual harassment Investigation at Custom. On December 27, 1999, Custom discharged Miller. On June 26, 2000, Miller filed a charge of discrimination with the EEOC alleging that Custom had discriminated against her and terminated her in retaliation for her participation in the Internal sexual harassment investigation. Following an investigation of Miller's charge, and failed conciliation efforts, the EEOC filed the present action against Custom on April 2., 2003. The EEOC alleges "retaliatory practices" on behalf of a class of female employees, claiming that since at least 1998, Custom has altered-job duties, reduced compensation, disciplined, and discharged class members in retaliation for employees "opposing sex harassment." See Compl. ¶ 8.

  C. The Court's October 27, 2003 Ruling

  On October 27, 2003, this Court denied Plaintiff-Intervenor Allison Kennedy's ("Kennedy") motion to intervene under Federal Rule of Civil Procedure 24(a)(1). See Custom Companies, Inc. v, EEOC., 2003 WL 72455510 (N.D. Ill. 2003). Custom employed Kennedy as a sales representative between August 17 and October 20, 1998. She claimed that she faced a sexually hostile environment during these two months of employment. Custom terminated Kennedy in October or November 1998. This Court held that Kennedy could not intervene in the retaliation class action because her claims were time-bar red. Specifically, the Court found that the retaliation class action was bound by the 300-day time frame preceding Miller's June 26, 2000 EEOC charge. Therefore, any claims preceding August 31, 1999, including Kennedy's claims, were time-barred. The Court also held that Kennedy could not avail herself to the "single-filing" doctrine to piggyback onto Miller's claim because this doctrine is available only to those parties who could have filed a claim with the EFOC based on the same unlawful conduct within the required statutory period, See id.

  II. DISCUSSION

 
A. Limits on the Class in the Sexual Harassment Action
1. Rearward time limits on the class
  In Illinois, a plaintiff alleging Title VII violations must file charges with the EEOC within three hundred days of the alleged discriminatory employment, practice (the "filing period"). See 42 U.S.C. § 2000e-5 (e)(1); Koelsch v. Beltone Elect. Corp., 46 F.3d 70b, 707 (7th Cir. 1995). One of the issues raised in these Motions is whether a hostile work environment claim that includes continuing violation allegations can include claims of employees who did not. work at, Custom during the filing period (i.e., more than 300 days before Copello filed her EEOC charge or March 20, 1998). In other words, can the class of plaintiffs here include employees who were not exposed to any discriminatory acts during the filing period because Custom no longer employed them. (The Court recognizes that. EEOC enforcement actions brought on behalf of a class of individuals are not "true" Federal Rule 23 class actions, See General Telephone Co. v. EEOC, 446 U.K. 318 (1980), bur, for purpose of clarity, it will use such terms as "class action" and "class membership,")

  Custom argues that a continuing violation claim cannot revive otherwise stale claims, and, accordingly, class membership must be limited Lo those individuals who were employed at some point during the filing period. Under Custom's view, employees who left Custom before March 20, 1998 "could not have been subjected to any allegedly hostile work environment during the 300-day limitations period, and therefore could not. have timely filed an EEOC charge on January 14, 1999 the date that Copello filed her charg[e]." Defs. Br. at 6. The EEOC, in turn, contends that under a continuing violation theory, Custom can be liable for acts that predate the 300-day filing period, and therefore class membership cannot be so limited. See Pls. Resp. Br. at 4-8,

  As a preliminary matter, Custom relies heavily on this Court's October 27, 2003 ruling ("prior ruling") to support its argument. At issue in the prior ruling was whether a plaintiff-intervenor could rely on the "single filing" doctrine to revive her stale claim. The Court held that it could not, based, in part, on the problems ct notice to employers and "long-standing notions of finality and prompt resolution of claims." Custom Companies, inc., 2003 WL 22455510 at M. At that point, however, the Court did not have the opportunity to consider the crucial issue here: whether the continuing violation doctrine could allow claims of class members that occurred entirely outside of the filing period. Accordingly, the prior ruling informs the present opinion, but does not control the outcome here.

  a. The case law supports Custom's position

  Turning now to the case law, the Court mast begin with a discussion of the fairly-recent United States Supreme Court decision in National Railroad Passenger Corp. v. Morgan, 536 U.S. 101 (2002), which the EEOC contends is controlling authority here. The EEOC relies heavily on Morgan to support its proposition that a hostile work environment claim that contains continuing violation allegations allows a court to "look beyond the 300-day charge filing period and impose liability based on the claims of class members employed outside 300 days." Pls, Resp. Br. at 4. Custom argues vigorously that Morgan simply "clarified the continuing violation doctrine solely as it applies to an individual's hostile ...


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