[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS FILED FOR THE ELEVENTH CIRCUIT U.S. COURT OF APPEALS ELEVENTH CIRCUIT SEPTEMBER 07, 2000 THOMAS K. KAHN CLERK No. 99-11959
D. C. Docket No. 97-02537-CIV-T-99A
PATRICIA WINN CARTER, for her herself and on behalf of all others similarly situated, MAXINE H. JONES, for herself and on behalf of all others similarly situated, et al.,
Plaintiffs-Appellees,
versus
WEST PUBLISHING COMPANY, WEST PUBLISHING CORPORATION, et al.,
Defendants-Appellants.
Appeal from the United States District Court for the Middle District of Florida
(September 7, 2000)
Before EDMONDSON, DUBINA and WILSON, Circuit Judges.
DUBINA, Circuit Judge: Plaintiffs, eight former and current female employees of West Publishing
Company (“West”), filed a sex discrimination lawsuit against West on behalf of
themselves, and all others similarly situated. Plaintiffs allege that West denied
female employees the opportunity to purchase stock and that the few female
employees offered stock received fewer shares than similarly-situated males, in
violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000 et seq., and
the Equal Pay Act of 1963, 29 U.S.C. § 206(d). The district court certified a class
under Federal Rule of Civil Procedure 23(b)(3). Pursuant to Federal Rule of Civil
Procedure 23(f) (“Rule 23(f)”), we permitted West to appeal the district court’s
class certification decision. After a thorough review of the record, we reverse the
district court’s order.
I. Background
West provides legal information services throughout the United States. It
operated for nearly 100 years as a privately held corporation until The Thomson
Corporation (“Thomson”) acquired West on June 20, 1996. Prior to this
acquisition, West had an employee stock program which offered some employees
an opportunity to purchase West stock. Each year, West would first determine
how many shares it could issue based on the company’s current performance and
capital needs and how many of those issued shares it could sell to employees.
2 Next, West would offer the opportunity to purchase stock to a few select
employees.
Most of the employees selected already owned stock. Nonetheless, each
year, approximately ten to twenty employees received the opportunity to become
first-time stock purchasers. Generally, a potential new shareholder had to be a
member of one of the following three groups: (1) the Management and Executive
Group; (2) after 1983, the Key Employees’ Incentive Plan (“KEIP”); or (3) the
sales force. In addition, one of West’s department heads and/or other managers
had to recommend the potential new shareholder to West’s Chief Executive Officer
(“CEO”) as an employee who merited an opportunity to purchase stock. Relying
on these written recommendations, West’s CEO would select first-time stock
purchasers based on both objective and subjective factors, such as performance,
impact on West’s profitability, length of service, loyalty to and support of West’s
management and its private corporate structure, trustworthiness, and ability to
maintain confidentiality. West, however, never adopted or distributed to its
employees a written description of the employee stock program and allegedly kept
the selection criteria a secret. West also did not publicly disclose which employees
it selected and admonished selected employees not to discuss their stock ownership
with other employees.
3 Although the identity of those who owned stock was supposed to remain a
secret, most employees knew who did and did not own stock. During the late
1980’s, certain men in the sales force boasted that they owned stock, while female
employees, with one exception – Margaret Daly – acknowledged that they did not
own stock. At a sales meeting in 1996, Margaret Daly asserted that other women
on the sales force were jealous of her because she was the only woman who owned
stock.
West stopped selling stock to its employees on August 30, 1994, but did not
publicly announce that it had discontinued the employee stock program. West
continued to pay stock dividends until June 4, 1996. On June 20, 1996, Thomson
purchased West for $3.42 billion or $10,455 per share of West stock, a price
significantly higher than the price paid by employees to purchase stock from West.
At the time of the sale, West had fewer than 200 employee shareholders and
twenty-five non-employee shareholders. Of the employee shareholders, 157 were
men and 29 were women.
On November 6, 1996, Maxine Jones (“Jones”), a sales representative at
West, filed an Equal Employment Opportunity Commission (“EEOC”) charge
alleging gender discrimination in West’s employee stock program. After the
EEOC issued a right to sue letter, Jones and another female employee of West,
4 Patricia Carter (“Carter”), filed this lawsuit on October 16, 1997, seeking backpay,
compensatory damages, and punitive damages.
After deposing Jones, West filed a motion for summary judgment arguing
that Jones’s EEOC complaint was untimely, thereby rendering the class action
lawsuit time-barred. On April 19, 1999, the district court rejected West’s argument
and held that Jones’s EEOC complaint was untimely for two reasons. First, the
district court held that even though the discriminatory practice of selling stock
ended in August 1994, the payment of stock dividends to employees constituted a
continuing violation of Title VII and thus, the statute of limitations did not begin to
run until June 1996. Second, the district court found that the doctrine of equitable
tolling applied to toll the running of the statue of limitations.
Plaintiffs, in turn, filed a motion for class certification. The district court
granted the plaintiffs’ motion and certified a class of all females employed by West
between January 20, 1996, and June 20, 1996, who, during their employment,
either (a) did not receive any shares of West stock and (i) were in the Management
and Executive Group; (ii) were KEIP unit awardees; or (iii) were sales
representatives; or (b) received some shares of West stock, but fewer shares than
were received by similarly-situated males. In so ruling, the district court, relying on
its April 19th order, held that the named plaintiffs had standing to bring this class
5 action lawsuit because, inter alia, Jones filed a timely complaint. The district court
also found that common issues predominated over individual issues and
proceeding as a class was superior to individual actions and thus, certified the class
under Rule 23(b)(3). In addition to the class certification issues, the district court
found that considering the procedural posture of the case, West’s employee stock
program could violate Title VII because the payment of cash dividends to
shareholders may constitute a wage premium. West filed this interlocutory appeal
pursuant to Rule 23(f).
II. Discussion
On appeal, West argues that the district court erred in certifying the class for
three reasons: (1) that the named plaintiffs lack standing to bring this class action
lawsuit; (2) that West’s employee stock program does not fall within the purview
of Title VII; and (3) that individual issues predominate over common issues. In
addition to contesting these arguments, plaintiffs argue that Rule 23(f) limits this
court’s review to class certification issues only. As a result, plaintiffs contend that
this court cannot review the first and second issues raised by West. Assuming that
we lack jurisdiction to review the second issue, we can review the first issue. As to
the merits, we hold that plaintiffs lack standing to bring this class action lawsuit.
A. Rule 23(f)
6 The threshold issue raised in this appeal is the scope of this court’s appellate
jurisdiction under Rule 23(f). Rule 23(f) provides, in pertinent part, that “[a] court
of appeals may in its discretion permit appeal from an order of a district court
granting or denying class action certification under this rule.” Plaintiffs contend
that Rule 23(f) limits review to the issue of class certification and does not permit
review of the underlying merits of the action. Otherwise, plaintiffs argue that
parties dissatisfied with a district court’s pretrial rulings could use Rule 23(f) as a
vehicle for airing grievances not specifically tied to class certification.
We agree with plaintiffs that Rule 23(f) limits our review to the district
court’s order granting class certification. See Pickett v. Iowa Beef Processors, 209
F.3d 1276, 1279 (11th Cir. 2000) (“Rule 23(f) provides for our jurisdiction over
interlocutory appeals from a district court’s order granting class certification, and
we limit our discussion to that issue. We do not address the merits of Plaintiffs’
claims.”); cf. Miller v. Mackey Int’l, Inc., 452 F.2d 424, 428 (5th Cir. 1971)
(Wisdom, J.) (“Nothing in [Rule 23] indicates the necessity or the propriety of an
inquiry into the merits.”).1 This court, however, still must determine the scope of
issues included in the class certification decision. In particular, plaintiffs contend
1 In Bonner v. City of Prichard, 661 F.2d 1206 (11th Cir.1981) (en banc), this court adopted as binding precedent all decisions rendered by the former Fifth Circuit prior to October 1, 1981.
7 that West’s arguments that the named plaintiffs lack standing to bring this class
action lawsuit and that West’s employee stock program does not fall within the
purview of Title VII pertain to the merits of plaintiffs’ underlying claim and are
entirely distinct from plaintiffs’ class certification claim.
To determine the proper scope, we must examine the requirements of class
certification in a Title VII lawsuit. A plaintiff who brings a Title VII action on
behalf of a class must satisfy two prerequisites: (1) the named plaintiff must have
standing to bring the claim, and (2) the requirements of Rule 23 must be fulfilled.
See Griffin v. Dugger, 823 F.2d 1476, 1482 (11th Cir. 1987). As we have noted:
any analysis of class certification must begin with the issue of standing and the procedural requirements of Title VII. Thus, the threshold question is whether the named plaintiffs have individual standing, in the constitutional sense, to raise certain issues. Only after the court determines the issues for which the named plaintiffs have standing should it address the question whether the named plaintiffs have representative capacity, as defined by Rule 23(a), to assert the rights of others.
Jones v. Firestone Tire & Rubber Co., Inc., 977 F.2d 527, 531 (11th Cir. 1992)
(quoting Griffin, 823 F.2d at 1482); see also Brown v. Sibley, 650 F.2d 760, 771
(5th Cir. Unit A July 1981) (“This constitutional threshold must be met before any
consideration of the typicality of claims or commonality of issues required for
procedural reasons by Fed.R.Civ.P. 23.”); cf. Holmes v. Pension Plan of Bethlehem
Steel Corp., 213 F.3d 124, 135 (3d Cir. 2000) (“In addition to the requirements
8 expressly enumerated in Rule 23, class actions are also subject to more generally
applicable rules such as those governing standing and mootness. For instance, a
plaintiff who lacks the personalized, redressable injury required for standing to
assert claims on his own behalf would also lack standing to assert similar claims on
behalf of a class.”).
In Andrews v. American Telephone & Telegraph Co., 95 F.3d 1014 (11th
Cir. 1996), as part of a 28 U.S.C. § 1292(b) interlocutory appeal from a class
certification order, this court reviewed the district court’s threshold determination
that the named plaintiffs had standing. See id. at 1022. In fact, this court referred
to the standing question as part of its Rule 23(a) analysis by stating that “appellants
challenge the court’s approval of the class representatives because of problems
with standing, adequacy of representation, and typicality of the named plaintiffs’
claims (Rule 23(a) issues).” Id. at 1021; see also Great Rivers Co-op. of S.E. Iowa
v. Farmland Indus., Inc., 120 F.3d 893, 899 (8th Cir.1997) (“Inherent in Rule 23 is
the requirement that the class representatives be members of the class . . . . Here,
[the class representative] is not and cannot be a class member because his claim is
time barred; consequently, he cannot represent the class.”). Therefore, our binding
precedent holds that a determination on standing is a part of the class certification
analysis, and thus, subject to review under Rule 23(f). Because we reverse the
9 district court on the standing issue, we need not address whether we have
jurisdiction as to West’s second argument.
B. Standing
A plaintiff who seeks to represent a class in a private Title VII suit must
have standing to raise the class’ claims and must satisfy the procedural
requirements of Title VII. See Griffin, 823 F.2d at 1482. Title VII requires a
plaintiff to file a charge with the EEOC within 180 days of the unlawful
discriminatory act. See 42 U.S.C. § 2000e-5(e). The time to file an EEOC charge
may be extended to no more than 300 days if the aggrieved person first institutes
“proceedings with a State or local agency with authority to grant or seek relief
from such practice or institute criminal proceedings with respect thereto.” Id.
Pursuant to the “single-filing rule,” “[a]s long as at least one named plaintiff timely
filed an EEOC charge, the precondition to a Title VII action is met for all other
named plaintiffs and class members.” Griffin, 823 F.2d at 1492. This rule
encompasses two essential requirements: “First, at least one plaintiff must have
timely filed an EEOC complaint that is not otherwise defective. . . . Second, the
individual claims of the filing and non-filing plaintiffs must have arisen out of
similar discriminatory treatment in the same time frame.” Jones, 977 F.2d at 532
(quoting Jackson v. Seaboard Coast Line R.R., 678 F.2d 992, 1011-12 (11th
10 Cir.1982)).
West contends that the named plaintiffs lack standing to assert claims
against West, either individually or as class representatives, because they rely on
an untimely EEOC charge. Pursuant to the single-filing rule, the named plaintiffs
and the class rely on Jones’s EEOC complaint. Jones filed the complaint on
November 6, 1996, more than 180 days from August 30, 1994, the date on which
West stopped offering employees the opportunity to purchase West stock. Even
though Jones apparently filed an untimely EEOC charge, the district court ruled
that the payment of stock dividends to employees constituted a continuing
violation of Title VII, and thus, the statute of limitations did not begin to run until
June 1996. Alternatively, the district court held that the doctrine of equitable
tolling applied to toll the running of the statute of limitations. On appeal, West
argues that the district court clearly erred in holding that both the continuing
violation and equitable tolling doctrines applied. We agree.
1. Continuing Violation
“In determining whether a discriminatory employment practice constitutes a
continuing violation, this Circuit distinguishes between the present consequence of
a one time violation, which does not extend the limitations period, and the
continuation of that violation into the present, which does.” Thigpen v. Bibb
11 County, Georgia, Sheriff’s Dep’t, 216 F.3d 1314, 1326 (11th Cir. 2000) (quoting
Calloway v. Partners Nat’l Health Plans, 986 F.2d 446, 448 (11th Cir. 1993)). As
the Supreme Court explained:
[t]he proper focus is upon the time of the discriminatory acts, not upon the time at which the consequences of the acts became most painful. . . . The emphasis is not upon the effects of earlier employment decisions; rather, it is upon whether any present violation exists.
Delaware State College v. Ricks, 449 U.S. 250, 258, 101 S.Ct. 498, 504 (1980)
(internal citations and quotations omitted). Furthermore, “[t]he continuing
violation doctrine does not exist to give a second chance to an employee who
allowed a legitimate Title VII claim to lapse.” Roberts v. Gadsden Mem’l Hosp.,
835 F.2d 793, 800 (11th Cir. 1988).
Plaintiffs argue that West’s employee stock program constituted a present
violation because the payment of dividends was a wage premium that enhanced
employee compensation. Plaintiffs contend that this wage premium presents a
situation more akin to the disparate salary and insurance coverage claims found in
Bazemore v. Friday, 478 U.S. 385, 106 S.Ct. 3000 (1986), and Beavers v.
American Cast Iron Pipe Co., 975 F.2d 792 (11th Cir. 1992), to constitute a
present violation, than the claims of a single discriminatory act followed by
neutral, nondiscriminatory consequences as found in Delaware State College v.
Ricks, 449 U.S. 250, 101 S.Ct. 498 (1980); United Air Lines, Inc. v. Evans, 431
12 U.S. 553, 97 S.Ct. 1885 (1976); and Ross v. Buckeye Cellulose Corp., 980 F.2d
648 (11th Cir. 1993).
In Bazemore, the North Carolina Agricultural Extension Service had
maintained two separate, racially segregated branches and paid black employees
less than white employees. See 478 U.S. at 394, 106 S.Ct. at 3006. The Extension
Service merged the two branches, but some pre-existing salary disparities
remained. See id. Because these disparities resulted solely from discrimination
that occurred prior to Title VII’s effective date, the Extension Service maintained
that it should not be required to affirmatively eliminate them. See id. at 394-95,
106 S.Ct. at 3006. The Supreme Court rejected this argument, holding that the
Extension Service’s perpetuation of the salary disparities constituted a continuing
violation of Title VII. See id. at 395, 106 S.Ct. at 3006. “Each week’s paycheck
that delivers less to a black than to a similarly situated white is a wrong actionable
under Title VII, regardless of the fact that this pattern was begun prior to the
effective date of Title VII.” Id. at 395-96, 106 S.Ct. at 3006; see also Calloway,
986 F.2d at 448 (“Partners discriminated against Calloway not only on the day that
it offered her less than her white predecessor, but also on every day of her
employment.”). Moreover, this court, in Beavers, held that a company’s policy
that denied insurance coverage to children who did not reside with their employee-
13 parent constituted a continuing violation because each week the company denied
insurance coverage to divorced men’s nonresident children comprised a wrong
actionable under Title VII. See 975 F.2d at 797-98.
As in Bazemore and Beavers, plaintiffs assert West continued to violate Title
VII by providing different levels of compensation to its employees. In particular,
plaintiffs contend that West’s payment of dividends pursuant to its allegedly
discriminatory stock purchase policy resulted in an on-going practice of providing
male employees a wage premium over similarly-situated female employees.
West’s payment of dividends, however, differs from the continuing
violations in Bazemore and Beavers. Instead, as in Ricks, this case involves the
present effects of a one-time violation. In Ricks, Ricks, a college professor, alleged
that discrimination motivated Delaware State College to deny him tenure. See 449
U.S. at 254, 101 S.Ct. at 502. After denying him tenure, Ricks accepted from the
college a one-year “terminal” contract with the explicit notice that his employment
would end upon its expiration. See id. at 253-54, 101 S.Ct. at 501. He claimed
that this terminal contract constituted a continuing violation of his civil rights
which extended the statute of limitations period until the contract expired. See id.
at 257, 101 S.Ct. at 503-04. The Supreme Court rejected this argument, stating
that the loss of the teaching position was an inevitable effect of the allegedly
14 discriminatory tenure decision and thus did not constitute a continuing violation.
See id. at 258, 101 S.Ct. at 504; see also Allen v. United States Steel Corp., 665
F.2d 689, 693 (5th Cir. 1982) (rejecting plaintiff’s argument that their
discriminatory layoffs and recalls are continuing violations of Title VII, because
the effects of that discrimination continued through reduced pension and vacation
benefits).
Similarly, plaintiffs assert a single discriminatory act – West’s
discriminatory employee stock program – followed by neutral, nondiscriminatory
consequences – payment of dividends. The act of paying male employees a
dividend flows from the inevitable consequence of West’s allegedly discriminatory
practice of offering only men the opportunity to purchase stock. An employee
receives dividends only after he receives stock. If an employee does not own
stock, then she will not receive dividends. Even though the most painful
consequence of the discrimination – the loss of dividends and capital gains from
the sale of West – occurred later, the statute of limitations commenced when the
last discriminatory act occurred – West’s last sale of stock to employees.
The decisions in Evans and Ross further support this conclusion. In Evans,
the Supreme Court held that United Air Lines’ seniority system which gave present
effect to plaintiffs past, illegal forced retirements did not constitute a continuing
15 violation. See 431 U.S. at 558, 97 S.Ct. at 1889. The Court reasoned that the
seniority system did not discriminate against former female employees or treat
former employees discharged for a discriminatory reason any differently from
former employees who resigned or were discharged for a non-discriminatory
purpose. See id. Instead, the Court noted that the system operated in a neutral
manner. See id. Similarly, in Ross, this court rejected the argument that a wage
freeze qualified as a continuing violation. See 980 F.2d at 660. Even though the
wage freeze locked into place the allegedly discriminatory effect yielded by prior
applications of a pay and promotion system, the court held that the freeze did not
constitute a continuing violation, but was a neutral act, because it locked every
employee at the plant, regardless of race, into the then-existing compensation
system. See id.
As in Evans and Ross, even though West’s distribution of dividends gave
present effect to its alleged past discrimination, the payment of dividends did not
constitute a continuing violation because it operated in a neutral manner. West
distributed dividends to each shareholder, regardless of their gender, based on the
amount of stock owned. This payment of dividends represents just the type of
neutral act that Evans and Ross indicate is not a continuing violation, but a mere
continuing effect. Accordingly, we hold that the district court clearly erred in
16 finding that West’s payment of dividends constituted a continuing violation of
Title VII. See Calloway, 986 F.2d at 448 (reviewing a district court’s finding of a
continuing violation under the clearly erroneous standard).
2. Equitable Tolling
Under equitable tolling, Title VII’s statute of limitations period does not
start to run until a plaintiff knew or reasonably should have known that she was
discriminated against. See Ross, 980 F.2d at 661 n. 19. A plaintiff who asserts the
applicability of equitable tolling bears the burden of proving that it is appropriate.
See id. at 661. Because the named plaintiffs and the class rely on Jones’s EEOC
charge, the district court properly examined whether Jones knew or should have
known of West’s discrimination prior to May 1996. The district court held that
plaintiffs met their burden by showing that Jones had a mere suspicion of
discrimination, which is not enough to start the running of the statute of
limitations. See Sturniolo v. Sheaffer Eaton, Inc., 15 F.3d 1023, 1026 (11th Cir.
1994) (“Although the district court noted that Sturniolo ‘suspected’ age
discrimination at the time of his discharge, a discharged employee’s mere
suspicion of age discrimination, unsupported by personal knowledge of
discrimination, will not constitute pretext.”).
After a careful review of the record, we hold that the district court clearly
17 erred in applying the doctrine of equitable tolling. See Ross, 980 F.2d at 660
(reviewing a district court’s finding of equitable tolling under the clearly erroneous
standard). The facts demonstrate that Jones knew or should have known that
West’s employee stock program operated in a discriminatory manner prior to May
1996.2 Although West attempted to keep secret the identity of those who owned
stock, Jones testified that “[t]his may have been a secret, but it wasn’t a secret” and
that “[e]verybody knew.” (R4-55-Exh.2 at 123). She further stated that there
existed an obvious disparity in treatment within the sales force between the
“haves” (shareholders) and the “have nots” (non-shareholders). (Id. at 170-71).
As to the gender of the shareholders, Jones testified that she knew that only
men owned stock and that qualified women did not own stock. During West’s
sales meetings in the late 1980’s, Jones overheard men on several occasions boast
to other employees that they owned stock. (Id. at 123-24). She stated that it was
obvious that only men on the sales force owned stock, except for one female –
Margaret Daly. (Id.). In contrast, Jones testified that female employees often
asked each other whether any of them owned stock, including those Jones thought
2 The parties agree that Jones knew of her procedural rights to file an EEOC charge, as demonstrated by her 1986 visit to the EEOC. See McClinton v. Alabama By-Products Corp., 743 F.2d 1483, 1486-87 (11th Cir.1984) (rejecting equitable tolling where a plaintiff was generally aware of his legal right to obtain redress for employment discrimination). In 1986, Jones visited the EEOC for the purpose of filing a charge of sex discrimination in the assignment of sales territories against West, but decided not to file the charge.
18 deserved to own stock, and all of them said no. (Id. at 125). Jones also testified
that Margaret Daly claimed “that all the women on the sales force were jealous of
her because she was the only one who had stock.” (Id. at 124). Based on this
evidence, we conclude that Jones had more than a mere suspicion of
discrimination. She had sufficient evidence to have understood that West operated
its employee stock program in a discriminatory manner.
Moreover, the reasons espoused by plaintiffs for waiting to bring an EEOC
charge until after Thomson acquired West do not support a finding of equitable
tolling. Plaintiffs do not point to any evidence of discrimination discovered after
the sale that they needed to recognize that West was discriminating. Instead, they
focus on the change of management as removing their fear of retaliation for filing
an EEOC charge. Plaintiffs’ purported fear of retaliation, however, is not a ground
for equitable tolling. See e.g., Arizmendi v. Lawson, 914 F. Supp. 1157, 1162
(E.D. Pa. 1996); Caldwell v. National Ass’n of Home Builders, 598 F. Supp. 371,
377 (N.D. Ind. 1984); Platt v. Burroughs Corp., 424 F. Supp. 1329, 1333 (E.D. Pa.
1976). Otherwise, the doctrine of equitable tolling would effectively vitiate the
statutory time requirement because an employee could defer filing indefinitely so
long as she had an apprehension about possible retaliation. This court cannot
permit such circumvention of Title VII’s express filing limitations. Furthermore,
19 Title VII specifically protects employees against retaliation for filing a
discrimination complaint. See 42 U.S.C. § 2000e-3. Therefore, the district court
clearly erred in finding the doctrine of equitable tolling applicable to this case.3
III. Conclusion
In sum, we hold that Rule 23(f) provides us with jurisdiction to review the
district court’s holding that plaintiffs have standing, individually and on behalf of
the class, to assert a Title VII claim. As to the merits of the standing issue, we hold
that the district court clearly erred in finding the doctrines of continuing violation
and equitable tolling applicable to this case. The named plaintiffs lack standing to
assert claims against West, both individually and as class representatives, because
the sole EEOC charge upon which the entire class relies was untimely. Therefore,
we reverse the district court’s order certifying the class and remand this case for
further proceedings consistent with this opinion.4
REVERSED AND REMANDED.
3 Because we hold that the named plaintiffs lack standing to bring this class action lawsuit, we need not address whether the district court properly certified the class under Rule 23(b)(3). 4 Plaintiffs also filed a motion to relinquish or clarify jurisdiction for a particular purpose – to withdraw the class’ claims for compensatory and punitive damages. Because we hold that the named plaintiffs lack standing to bring this class action lawsuit, we deny the motion as moot.
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