Lowery v. Circuit City Stores Brief Amicus Curiae in Support of the Defendant-Appellant/Cross-Appellee

    IN THE UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

Nos. 97-1372, 97-1470

RENEE LOWERY, ET AL.

Plaintiffs-Appellees/Cross-Appellants,

CIRCUIT CITY STORES, INC.,

D efendant-Appellant/C ross-Appellee.

ON APPEAL FROM THE UNITED STATES DISTRICT COURT 
FOR THE EASTERN DISTRICT OF VIRGINIA

BRIEF FOR THE CHAMBER OF COMMERCE OF THE 
UNITED STATES OF AMERICA AS AM CU S CURIAE 

IN SUPPORT OF THE DEFENDANT-APPELLANT/CROSS-APPELLEE

Stephen A. Bokat 
Robin S. Conrad 
Sussan L. Mahallati
NATIONAL CHAMBER LITIGATION 

CENTER, INC.
1615 H Street, N.W.
Washington, D.C. 20062 
(202) 463-5337

Robert J. Smith*
Harry A. Rissetto 
Mona C. Zeiberg
MORGAN, LEWIS & BOCKIUS LLP 
1800 M Street, N.W.
Washington, D.C. 20036 
(202) 467-7000

* Counsel o f Record

Counsel fo r the Chamber o f Commerce 
o f the United States o f  America



TABLE OF CONTENTS

INTEREST OF THE AMICUS C U R IA E .......................................................................................1

STATEMENT OF THE CASE 3

SUMMARY OF THE A R G U M E N T .............................................................................................4

ARGUM ENT...................................................................................................................................... 5

I. The Fourth Circuit Should Support a Strict Adherence to the
"Rigorous Analysis" Standard.................................................................................... 5

A. The Supreme Court has Rejected "Across-the-Board"
Class Actions In Race Discrimination Cases ............................................... 5

B. Adherence to the "Rigorous Analysis" Standard is Crucial
in Putative Employment Discrimination Class Actions ..............................9

C. Improper Class Certifications Have Significant
Consequences for Both Litigants and the Judicial System ......................10

II. Decertification of the Class Was Proper Because the District Court Failed to
Conduct a "Rigorous Analysis" When the Class Was First Certified ................. 12

A. The Initial Certification Decision Failed to Consider
Evidence Weighing in Favor of Circuit C ity............................................. 12

B. The Subsequent Class Decertification Decision By the 
District Court Properly Recognized That The Class Failed
to Satisfy Rule 23's Requirements and Lacked Commonality................... 14

C O N CLU SIO N ................................................................................................................................16

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TABLE OF AUTHORITIES

FEDERAL CASES

Adams v. Bethlehem Steel Corp.. 736 F.2d 992 (4th Cir. 1984), affd sub norm Davis v.
Bethlehem Steel. 769 F.2d 210 64th Cir.). cert, denied. 474 U.S. 1021 09851 ...................  8

Amchem Prod.. Inc, v. Windsor. 117 S. Ct. 2231 (1997) ....................................................  2 ,6 ,8

In re American Med. System, Inc.. 75 F.3d 1069 (6th Cir. 1996) .........................................  8, 10

Bergmann v. University of Maryland. 1987 U.S. Dist. LEXIS 13951 (D. Md., Nov. 13, 1987) 10

Blackie v. Barrack. 524 F.2d 891 f9th Cir. 1975). cert, denied. 429 U.S. 816 C19761 .............  13

Bolton v. Murray Envelope Corp.. 493 F.2d 191 (5th Cir. 1974) ................................................ 7

Bowe v. Colgate-Palmolive Co.. 416 F.2d 711 (7th Cir. 1969) ..................................................  7

Bovs Market. Inc, v. Retail Clerks Union. Local 770. 398 U.S. 235 (1970) ............................  12

Califano v. Yamasaki. 442 U.S. 682 0979) ..................................................................................  6

Castano v. American Tobacco Co.. 84 F.3d 734 (5th Cir. 1996) .........................................  2, 10

East Texas Motor Freight System, Inc, v. Rodriguez. 431 U.S. 395 (1977) ......................passim

Eisen v. Carlisle & lacquelin. 417 U.S. 156 0  974) .....................................................................  9

General Tel. Co. of the Southwest v. Falcon. 457 U.S. 147(1982) ...................................passim

Hansberrv v. Lee. 311 U.S. 32 (1940) ......................................................................................... 11

Harriss v. Pan America World Airways, Inc.. 74 F.R.D. 24 (N.D. Cal. 1977) .................... 11

McKnight v. Circuit City Stores. Inc.. 168 F.R.D. 550 (E D. Va. 1996) ................................... 15

Michigan State University Faculty Association v. Michigan State Univ.. 93 F.R.D. 54
(W.D. Mich. 1981) ................................................................................................................  10

Oatis v. Crown Zellerbach Corp.. 398 F.2d 496 (5th Cir. 1968) .................................................. 7

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Reed v. Arlington Hotel Co.. 476 F.2d 721 (8th Cir.). cert, denied. 414 U.S. 854 (1 9 7 3 ) .........  7

Rosenberg v. University of Cincinnati. 654 F. Supp. 774 (S.D. Ohio 1986) .............................. 10

Stastnv v. Southern Bell Telegraph & Telegraph Co.. 628 F.2d 267 (4th Cir. 1 9 8 0 ) ...........  9, 14

Stott v. Haworth. 916 F.2d 134 (4th Cir. 1990) ...............................................................................  8

Wheeler v. Columbus. 703 F.2d 853 15th Cir. 1983) ....................................................................  11

RULES

Fed. R. Civ. P. 23 ........................................................................................................................... passim

LAW REVIEWS

Howard Downs, "Federal Class Actions: Due Process by Adequacy o f Representation 
(Identity of Claims) and the Impact of General Tel. Co. o f the Southwest v. Falcon."
54 Ohio St. L.J. 607, 612-636 (1993) ................................................................................................ 6 ‘

Jack B. Weinstein, "Ethical Dilemmas in Mass Tort Litigation," 88 Nw. U. L. Rev. 469
(1994)   11

TREATISES AND BOOKS

Herbert Newberg & Alba Conte, 1 NEWBERG ON CLASS ACTIONS (3d ed. 1 9 9 2 )..................  6, 15

Barbara Lindemann Schlei & Paul Grossman, EMPLOYMENT DISCRIMINATION LAW
(2d ed. 1983) .................................................................................................................................. 7

i i i



IN THE UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

Nos. 97-1372, 97-1470

Appellants,

RENEE LOWERY, ET AL.

Plaintiffs-Appellees/Cross-

CIRCUIT CITY STORES, INC.,

Defendant-Appellant/Cross-Appellee.

ON APPEAL FROM THE UNITED STATES DISTRICT COURT 
FOR THE EASTERN DISTRICT OF VIRGINIA

BRIEF FOR THE CHAMBER OF COMMERCE OF THE 
UNITED STATES OF AMERICA AS AMICUS CURIAE 

IN SUPPORT OF THE DEFEND ANT-APPELLANT/CROSS-APPELLEE

INTEREST OF THE AMICUS CURIAE 

The Chamber of Commerce of the United States of America ("the Chamber") is the 

largest federation of business companies and associations in the world.1 With substantial membership 

in each of the fifty States, the Chamber represents an underlying membership of more than three 

million businesses and professional organizations of every size, in every sector of business, and in

1 On July 7, 1997, this court granted the Chamber’s motion to file a brief amicus 
curiae in the instant case limited to the class certification issue.



every region of the country. The Chamber thus serves as the principal voice of the American 

business community.

One of the Chamber’s functions is to represent the interests of its members in 

important matters before the courts of the United States, the United States Congress, the Executive 

Branch, and the independent regulatory agencies of the federal government. The Chamber has sought 

to advance those interests by filing amicus curiae briefs in civil cases raising issues of national 

importance to the business community. Among those pleadings was an amicus curiae brief filed in 

support of Circuit City’s petition for Writ of Mandamus on the issue of class action certification 

before this Court. In re Circuit City Stores. Inc.. No. 96-1825 (June 21, 1996). The Chamber also 

submitted amicus curiae briefs on the issue of class certification in Amchem Prod.. Inc, v. Windsor. 

117 S.Ct. 2231 (1997) and Castano v. American Tobacco Co.. 84 F.3d 734 (5th Cir. 1996).

In the instant case, the Chamber is vitally concerned with the increased use of class 

action litigation in the employment discrimination context. Specifically, the Chamber maintains that 

without careful and rigorous judicial adherence to the rules and procedures regarding class actions 

businesses will face unwarranted managerial disruption, legal costs, and employee distraction. The 

Chamber's membership is particularly vulnerable to class action litigation, as its constituency 

represents the American economic base, and as its members have been involved in some of the most 

publicized class action suits. The Chamber believes that to prevent unfounded class actions from 

adversely affecting the competitive vitality of American business and inappropriately draining limited 

judicial resources, courts must not permit an unwarranted erosion of the rigorous analysis and 

application of the rules and standards appropriate to class actions. To do otherwise, will result in a

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federal judiciary facing litigation implicating thousands of individual employment decisions, and 

resembling administrative agencies rather than courts of law.

STATEMENT OF THE CASE

On October 31, 1995, ten named plaintiffs filed a class action suit against Circuit City 

Stores, Inc., alleging race discrimination in violation of 42 U.S.C. § 1981 and Title VII of the Civil 

Rights Act of 1964 in the hiring, promotion, and transfer process at the company’s headquarters 

office. A separate action by plaintiff Peterson was consolidated with the class action. In April 

1996, the U S. District Court for the Eastern District of Virginia certified a Rule 23 (b)(2) class action 

in this case. The class was composed of all African-Americans employed at Circuit City’s 

headquarters after April 19, 1992. (CR 111).2 The Court reserved its authority under Rule 23 (c) (1) 

to restructure or decertify the class. (CR 110:1).

On August 23, 1996, as discovery neared completion, the district court on its own 

motion decertified the class. The court determined that a “Rule 23 (b) class certification is not the 

most fair and efficient way to litigate plaintiffs’ claims.” (CR 200:6). The court further noted that 

“the benefits of class certification, be,, accelerated and efficient disposition, will not necessarily 

follow in this case, but unfairness to the defendant is a likely result.” (CR 200:6).

Most of the plaintiffs’ claims were dismissed before trial. At the time of trial, only 

six plaintiffs and nineteen claims remained. During trial, the district court dismissed the claims of 

three plaintiffs for insufficient evidence. By the close of trial, only three plaintiffs and fifteen claims

2 References to the Clerk’s Record will be noted as CR, followed by the relevant 
page number.

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remained. Those claims were submitted to the jury. The jury rejected twelve of the fifteen claims 

of discrimination, but nevertheless found that Circuit City had engaged in a “pattern or practice” of 

discrimination.

Following the trial, the district court determined that plaintiffs had failed to identify 

any “specific elements” of Circuit City’s “promotion practices [that] ha[d] a significant disparate 

impact on African-American employees.” (CR 382:3). Despite this finding, however, the court 

adopted plaintiffs proposal for sweeping injunctive relief that dramatically restructures personnel 

procedures at Circuit City’s headquarters, and prohibits the company from taking adverse 

employment actions against African-American employees. (CR 416, ^3 , 10, 11, 13). In addition, 

the court awarded plaintiffs’ counsel nearly $4 million in legal fees. (CR 451).

The case is now before this Court on Circuit City’s appeal of the district court’s 

“pattern or practice” and remedy rulings. Appellees/Cross Appellants (plaintiffs) have cross- 

appealed primarily on the district court’s decision to decertify the class. This brief addresses the 

latter issue.

SUMMARY OF THE ARGUMENT

Class action procedures, if misapplied, can subvert the interests of justice and inflict 

substantial harm on litigants whose divergent interests may not be properly represented by the class. 

This risk of injury is as important as a class action’s potential to provide significant efficiencies for 

litigants, as well as for the judicial system as a whole. Accordingly, Rule 23 of the Federal Rules of 

Civil Procedure sets forth explicit criteria for class actions. Before a class can be certified, the 

moving party bears the burden of proving that the requirements under Rule 23 of the Federal Rules 

of Civil Procedure have been fulfilled. As an additional safeguard, the Supreme Court has held that,

4



before a class may be certified in an employment discrimination case, the district court must 

undertake a "rigorous analysis" to ensure that the plaintiff has satisfied its burden of proof regarding 

the Rule 23 factors. General Tel. Co. of the Southwest v. Falcon. 457 U.S. 147, 161 (1982).

In the instant case, the district court initially certified the putative class without first 

undertaking the “rigorous analysis” required by Falcon and its progeny. The subsequent 

decertification by the district court recognized the flaw in the initial decision, and acknowledged that 

the individual nature of the plaintiffs’ claims made this case inherently inappropriate for class action 

status under Rule 23.

ARGUMENT

I, The Fourth Circuit Should Support a Strict Adherence to the "Rigorous Analysis" 
Standard

A. The Supreme Court has Rejected "Across-the-Board" Class Actions In Race
Discrimination Cases

The district court’s decertification decision was a correct application of the Supreme 

Court’s skepticism about assuming that employment discrimination claims are, by their nature, 

inherently appropriate for class actions. General Tel. Co. of the Southwest v. Falcon, 457 U.S. 147, 

157 (1982) (“If one allegation of specific discriminatory treatment were sufficient to support an 

across-the-board attack, every Title VII case would be a potential company wide class action.”). Any 

review of the district court’s decision in the instant case should take into account the special 

jurisprudential context of Rule 23 class actions in employment discrimination litigation.

Historically, class actions evolved from the English courts of equity. To avoid a 

multiplicity of proceedings, these courts imposed a compulsory joinder rule that all parties materially 

interested — either legally or beneficially — in the subject of the suit had to be made parties so there

5



might be a single, binding decree. 1 Newberg on Class Actions § 1.09 (3d ed. 1992). See also 

Howard Downs, "Federal Class Actions: Due Process by Adequacy of Representation (Identity of 

Claims) and the Impact of General Tel. Co. of the Southwest v. Falcon." 54 Ohio St. L. J. 607, 612- 

636 (1993) (describing the historical evolution of class actions).

In modem times, the class action has been described as "an exception to the usual rule 

that litigation is conducted by and on behalf of the individual named parties only." Califano v, 

Yamasaki. 442 U.S. 682, 700-701 (1979). Accordingly, class actions have been found to be 

"peculiarly appropriate" when the "issues involved are common to the class as a whole" and when 

they "turn on questions of law applicable in the same manner to each member of the class." Califano. 

442 U.S. at 701; see also 1 Newberg on Class Actions § 1.01 (describing historical theory behind 

class actions). When class actions are appropriate, they can accomplish significant judicial 

economies and efficiencies. See 1 Newberg on Class Actions § 1.01; see also General Tel. Co. of 

the Southwest v. Falcon. 457 U.S. 147, 155 (1982) (citing Califano. 442 U.S. at 701).

The fundamental characteristics of all class actions have been codified in Rule 23 of 

the Federal Rules of Civil Procedure. Subdivision (a) of the Rule sets forth four prerequisites for a 

class action: (1) the numerosity of the class renders joinder of members impracticable; (2) there are 

questions of law or fact common to the class; (3) the claims or defenses of the class representative 

are typical of the claims or defenses of the class; and (4) the representative(s) will fairly and 

adequately protect the interests of the class. See Amchem Prod.. Inc, v. Windsor. 117 S. Ct. 2231, 

2245 (1997) (“Rule 23(a) states four threshold requirements applicable to all class actions.”). 

Although Rule 23 mandates that all four requirements of 23(a) must be fulfilled in order for a class 

to be certified, prior to the Supreme Court's decision in East Texas Motor Freight System, Inc, v.

6



Rodriguez. 431 U.S. 395 (1977), many courts had followed a more presumptive standard in Title VII

cases than in other types of cases. See Schlei & Grossman, Employment Discrimination Law 1216-

1218 (2d ed. 1983). Thus, these decisions permitted the named plaintiff to raise "across-the-board"

charges of employment discrimination on behalf of a class of a protected group without regard to a

specific inquiry whether the prerequisites under Rule 23(a) had been met. Id. One rationale

presented for this lenient treatment was the view that Title VII actions were "by their nature" class

actions. See Bowe v. Colgate-Palmolive Co.. 416 F.2d 711 (7th Cir. 1969); Oatis v. Crown

Zellerbach Corp.. 398 F.2d 496 (5th Cir. 1968). Other courts found that "across-the-board" claims

of employment discrimination were presumptively appropriate for class treatment. See Bolton v,

Murray Envelope Corp,. 493 F.2d 191 (5th Cir. 1974); Reed v. Arlington Hotel Co.. 476 F.2d 721

(8th Cir.), cert, denied. 414 U.S. 854 (1973).

In East Texas Motor Freight System. Inc, v. Rodriguez, the Supreme Court rejected

a presumptively lenient application of the Rule 23 standards to Title VII class actions. The Court

explained that, although suits alleging racial or ethnic discrimination often involve classwide wrongs,

careful attention to the requirements o f Fed. Rule Civ. Proc. 23 remains 
nonetheless indispensable. The mere fact that a complaint alleges racial or 
ethnic discrimination does not in itself ensure that the party who has brought 
the lawsuit will be an adequate representative of those who may have been the 
real victims of that discrimination.

431 U.S. at 405-06. (emphasis added).

Five years later, in General Tel. Co. of the Southwest v. Falcon. 457 U.S. 147 (1982), 

the Supreme Court reiterated the Rodriguez rule that classes in Title VII cases — particularly "across- 

the-board" classes -  cannot be certified on the basis of mere allegations and presumptions. In so 

holding, the Court noted that:

7



Conceptually, there is a wide gap between (a) an individual's claim that he has 
been denied a promotion on discriminatory grounds, and his otherwise 
unsupported allegation that the company has a policy of discrimination, and 
(b) the existence of a class of persons who have suffered the same injury as 
that individual, such that the individual's claim and the class claims will share 
common questions of law or fact and that the individuals' claim will be typical 
of the class claims.

Id. at 157. Accordingly, Falcon repeated the Rodriguez injunction that plaintiffs are required to 

establish actual compliance with the requirements of Rule 23(a). Further, the Court directed that, in 

order to determine whether plaintiffs have met this burden, courts are required to undertake a 

"rigorous analysis" of the Rule 23(a) factors prior to the certification of any class. Id. at 161.3 

Following Falcon, courts have continued to recognize that class treatment is not automatically 

appropriate for employment discrimination actions under either Title VII or the Civil Rights Act of 

1966, 42 U.S.C. § 1981. Rather, these courts have followed the mandate set forth in Falcon and 

conducted a "rigorous analysis" to determine whether the Rule 23(a) criteria have been satisfied. See, 

e g.. In re American Med. Svs.. Inc.. 75 F.3d 1069 (6th Cir. 1996); Stott v. Haworth. 916 F.2d 134 

(4th Cir. 1990); Adams v. Bethlehem Steel Corp.. 736 F.2d 992 (4th Cir. 1984), affd sub nom, Davis 

v. Bethlehem Steel. 769 F.2d 210 (4th Cir.), cert, denied. 474 U.S. 1021 (1985).

3 The plaintiffs, and the EEOC and NAACP as amicus curiae, cite Amchem Prod.. 
Inc, v. Windsor. 117 S.Ct. 2231 (1997) for the proposition that civil rights actions are prime 
examples of class actions. In Amchem. the Supreme Court addressed the issue of the specialized 
“settlement” class action. The Court held that while the existence of a settlement may be 
relevant to class certification, a putative class created solely for settlement nevertheless must 
satisfy Rule 23's standards just as a class brought for litigation purposes must meet those 
standards. As part of its general discussion of the requirements of a Rule 23 (b)(2) action, the 
Supreme Court simply noted that civil rights cases are “prime examples” of Rule 23 (b)(2) 
actions. 117 S.Ct. 2245. The Court did not, as plaintiff and its amici imply, advocate a return to 
the “pre-Falcon” across-the-board standard even for the narrow category of settlement claims.

8



B. Adherence to the "Rigorous Analysis" Standard is Crucial in Putative Employment 
Discrimination Class Actions

Employment discrimination claims brought as class actions require rigorous analysis

to avoid requiring the judicial system to adjudicate multiple, fact specific, individual claims in a

potentially confusing and prejudicial single proceeding. The aggregation of essentially separate and

unrelated claims confuses the record, burdens the parties, and unnecessarily challenges the fact

finder. The "rigorous analysis" standard promulgated by the Supreme Court requires that the district

court not simply accept plaintiffs' allegations at face value and disregard contradictory evidence

bearing on the class determination. Such a rule would undermine the "protections that [the] class

action criteria are designed to provide for putative and actual class members on the one hand and the

party opposing the class on the other . . . ." Stastnv v. Southern Bell Tel. & Tel. Co.. 628 F.2d 267,

273 (4th Cir. 1980). Rather it requires a significant inquiry into the factual basis underlying the

contention that the prerequisites for Rule 23 class certification have been satisfied. Id,.

In Stastnv. the Fourth Circuit recognized the necessity for such an inquiry and

rigorous analysis. In doing so, the Stastnv court recognized that, under Eisen v, Carlisle & Jacquelin.

417 U.S. 156 (1974), while courts should not conduct a "mini-trial" on the merits in order to

determine whether class certification is proper, searching factual inquiries were appropriate:

Eisen cannot of course be read to forbid any pre-trial inquiry designed to 
establish the class action criteria that happens to touch on matters that may 
also relate to the merits of the class or individual claims as alleged.

628 F.2d at 276 n.12. Accordingly, the Stastnv Court prescribed that courts strike a balance in

conducting their Rule 23 determinations:

Ideally, by careful structuring of the inquiry, with pre-trial procedures focused 
precisely upon the commonality factors as they relate to the existence, the 
nature, and the common reach of the employment pattern or practice that must

9



eventually be shown, it may well be possible to make the final class action 
determination before proceeding to trial on the merits.

Id. at 275.

A class action inquiry requires the weighing of evidence presented by both parties. 

For example, in Bergmann v. University of Maryland. 1987 U.S. Dist. LEXIS 13951 (D. Md., Nov. 

13, 1987), the court explicitly cited as persuasive the University's evidence that the decisions at issue 

were made primarily at the department level. Id- at 16. Furthermore, in finding that plaintiffs failed 

to satisfy their burden of proof under Rule 23, the district court rejected several of plaintiffs' factual 

assertions and allegations used to support their claim for class certification.1

The cases cited above, as well as numerous cases from other Circuits, demonstrate the 

proper level of Rule 23 inquiry mandated by Rodriguez. Falcon, and their progeny. See, e.g.. Castano 

v. American Tobacco Co.. 84 F.3d 734 (5th Cir. 1996); In re American Med. Svs., Inc.. 75 F.3d 1069 

(6th Cir. 1996). Such rigorous inquiry, which critically examines the allegations and factual proffers 

of plaintiffs, as well as the evidence presented by defendants, ensures that class action certification 

occurs only in those instances which serve the underlying objectives of Rule 23.

C. Improper Class Certifications Have Significant Consequences for Both Litigants and 
the Judicial System

In appropriate circumstances, class actions serve the goals of sound judicial 

administration and justice. Federal courts must be diligent, however, in ensuring that improper 

classes are not certified, because improvident certifications not only undermine these very goals, but 

cause injury to the litigants. 4

4 See also Rosenberg v. University of Cincinnati. 654 F. Supp. 774 (S.D. Ohio 
1986); Michigan State Univ. Faculty Ass'n v. Michigan State Univ,. 93 F.R.D. 54 (W.D. Mich. 
1981).

10



To begin with, the improper certification of a class could easily lead to unmanageable, 

unwieldy litigation. There are negative potential ramifications to such an approach, not the least 

of which are a drain on judicial resources, financial injury to the defendants, and the diminishment 

of potential claimants' recovery due to exorbitant attorneys’ fees. See, e g.. Falcon. 457 U.S. at 163 

(Burger, I ,  concurring) ("Rather than promoting judicial economy, the across-the-board class action 

has promoted multiplication of claims and endless litigation.").

Improper class certifications can also adversely affect the class claimants involved. 

There is the obvious "unfairness to class members bound by the judgment if the framing of the class 

is overbroad." Falcon. 457 U.S. at 161 (citation omitted); see also Wheeler v, Columbus. 703 F.2d 

853, 855 (5th Cir. 1983) (stating that if a class encompasses divergent interests, "adverse 

consequences could result to persons who have never had their day in court"); Harriss v. Pan Am. 

World Airways. Inc. 74 F.R.D. 24, 38 (N.D. Cal. 1977) (discussing the dangers of allowing a plaintiff 

to represent class members whose interests are not "coextensive" with his own). Not only are the 

interests of fairness implicated by the inclusion of claimants with disparate interests in a class, but 

so too are important constitutional due process rights, £§e Hansberry v. Lee, 311 U.S. 32, 42 (1940) 

(stating that due process requires that judicial procedure fairly protect "the interest of absent parties 

who are to be bound by it"). Furthermore, recent attempts to resolve mass tort litigation through 

federal class actions have led to frustrated claimants who are unable to obtain meaningful information 

about the resolution of their claims and are shut out from the process once their claims are swept into 

aggregate litigation and brokered settlements. See generally Jack B. Weinstein, "Ethical Dilemmas 

in Mass Tort Litigation," 88 Nw. U. L. Rev. 469 (1994).

11



Lastly, and significantly, irreversible damage is also imposed on those required to 

defend against improperly certified classes. These ramifications include the likelihood that the 

announcement of the class will bring forth numerous meritless claims, the possibility of reduced 

employee morale, and a potentially damaging effect on the public's view of the defendant. For all 

these reasons, it is incumbent upon courts to maintain a rigorous scrutiny over the mandates of Rule 

23(a). To this end, the Court should not create or continue plaintiff classes when, as in this case, 

there is a failure to satisfy the criteria of Rule 23(a).

II. Decertification of the Class Was Proper Because the District Court Failed to Conduct 
a "Rigorous Analysis" When the Class Was First Certified

“'Wisdom too often never comes, and so one ought not to reject it merely because it 

comes late.’” Bovs Market. Inc, v. Retail Clerks Union. Local 770. 398 U.S. 235, 255 (1970) 

(Stewart, I ,  concurring). Here, the district court should not have granted class certification in the 

first instance. The court in its later decision to decertify the class, recognized that the initial 

certification of the class in this case was irreconcilable with Rule 23's design and the rigorous 

analysis required by Falcon and its progeny.

A. The Initial Certification Decision Failed to Consider Evidence Weighing in Favor of
Circuit City

In its initial certification decision, the district court failed to undertake the “rigorous 

analysis” required to determine whether plaintiffs’ claims satisfied the requirements of Rule 23. 

Instead, the court skewed its analysis in favor of the plaintiffs’ evidence by ignoring evidence offered 

by the company to counter plaintiffs’ allegations.

The court’s original order granting plaintiff s motion for class certification held that:

In sum, plaintiffs argue that Dr. Mann’s observations and statistical analyses
strongly suggests that black employees at Headquarters have confronted

12



barriers to their advancement. Moreover, plaintiffs maintain that the 
managers’ and supervisors’ subjective decision making procedures comprise 
a common discriminatory link among the putative class members. These 
practices, coupled with the racial animus of white executives, permeate the 
corporate culture and have resulted in disparate impact and disparate treatment 
to black employees. These allegations are sufficient to satisfy the 
commonality requirement o f Rule 23(a).

(CR 9) (emphasis added).

Thus, the court’s initial certification ruling explicitly acknowledges what is so 

troubling about this case — the failure to consider the employer's evidence in reaching a decision 

regarding class certification. The court simply ignored the voluminous record consisting of 

depositions, affidavits, and documentary evidence that supported Circuit City’s position on the class 

action issue. In particular, it failed to consider evidence presented by Circuit City that objective 

criteria were used in promotion decisions at the company’s headquarters, and that hundreds of 

different managers in different departments, applying different criteria for different positions, were 

responsible for the promotion decisions at Circuit City and exercised this responsibility independently 

from senior management. Instead, the court based its certification decision solely on the allegations 

presented by the plaintiff.5

It is significant that in a twelve page certification decision, the court only mentioned 

one item of evidence submitted by the company. This evidence — Dr. Haworth’s statistical study 

indicating the complete absence of a pattern of adverse treatment against African-Americans at 

Circuit City — was not considered by the court. Rather, the district court dismissed it out of hand,

The court erroneously relied on Blackie v. Barrack. 524 F.2d 891 (9th Cir. 1975), 
cert, denied. 429 U.S. 816 (1976) as requiring it to take plaintiffs’ substantive allegations in the 
complaint as true. Blackie was a securities fraud case decided before Rodriguez and Falcon. 
Unlike in the employment discrimination context, courts have been decidedly more “liberal” in 
certifying class actions in the securities fraud area.

13



stating that “at this juncture, the court cannot consider the merits of any parties’ statistical results, but 

instead must accept Dr. Mann’s analysis for purposes of class certification.” (CR 8). Clearly, the 

district court’s outright refusal to consider defendant’s statistical evidence indicating an absence of 

any pattern of discrimination contradicted the mandate of Falcon and its progeny. See also Stastnv. 

628 F.2d at 279-80 (rejecting plaintiffs' statistical evidence due to faulty methodology).

The evidence offered to support the existence of objective criteria, as well as proffered 

statistical evidence reflecting an absence of discrimination, were central to the determination of 

whether plaintiffs in this case satisfied Rule 23(a)'s requirements of commonality, typicality, and 

adequacy of representation. Because the district court ignored critical evidence offered by Circuit 

City, it undoubtedly failed to undertake a sufficiently rigorous analysis of these issues. Thus, the 

initial certification of the class was clearly erroneous.

B. The Subsequent Class Decertification Decision By the District Court Properly 
Recognized That The Class Failed to Satisfy Rule 23's Requirements and Lacked 
Commonality

Since the inception of this litigation, plaintiffs have attempted to package what is 

essentially a series of individual allegations of discrimination into a “class action.” The crux of 

plaintiffs’ argument is that Circuit City maintains subjective employment practices that have a 

“common” discriminatory effect on African-American employees. This “common thread” of 

subjective decision making, combined with “racial animus” on the part of Circuit City’s senior 

management, in the plaintiffs’ eyes, supports certification of the class in question.

In its August 23, 1996 decertification decision, the court correctly stated, “the focus 

of each individual plaintiffs proof, defendant’s response to each plaintiff, and the jury’s inquiry is 

whether each individual employment decision was motivated by intentional racial discrimination.”

14



McKniaht v. Circuit City Stores. Inc.. 168 F.R.D. 550, 554 (E.D. Va. 1996). (emphasis added). As 

the court’s decision suggests, the focus on individual decision making — and the lack of typical and 

common questions of law and fact — makes this case inappropriate for class certification under Rule 

23's strictures.

Here, the plaintiffs never proffered facts that any specific promotion practice at Circuit 

City was discriminatory in purpose or effect. Instead, the plaintiffs recited a rhetorical conclusion 

that “excessive subjectivity in promotion decisions” existed at the Company’s headquarters. An 

alleged “subjectivity” is, without more, not enough to create class commonality. See Newberg on 

Class Actions § 24.21 (“[A]n absence of supported allegations by the plaintiffs of centralized 

employment decision making or a showing of decentralization by the defendant may result in a denial 

of class certification.”) Plaintiffs never established that the alleged practices were “typical” of 

Circuit City’s practices, “motivated by a policy of discrimination,” or “reflected in” other 

employment practices at the company. See Falcon at 158.

Moreover, plaintiffs’ allegations that Circuit City’s decentralized management style 

served as a ploy for evading the requirements of the federal anti-discrimination laws is not enough 

to support class certification. As more fully discussed in Circuit City’s brief, the company adopted 

its decentralized approach as part of a larger “anti-bureaucratic” management philosophy that gave 

employees wide freedom of action. This philosophy was designed to cultivate a creative, 

innovative and flexible workforce. By dealing with employees on an “individual” basis, without the 

constraints of certain bureaucratic formalities such as job descriptions, Circuit City created an 

environment that fostered employee growth.

15



The nature of the allegations in the instant case focused on “individually” unique facts 

and circumstances, as well as defenses, implemented in each promotion decision. In such a context, 

the district court correctly concluded that class certification was inappropriate. To rule otherwise, 

would have been to ignore the criteria set forth in Rule 23 and return to the “across-the-board” 

presumptive standard for certification expressly rejected by the Supreme Court in Falcon.

CONCLUSION

For the reasons stated .above, the Court should affirm the ruling of the district court 

decertifying the class in the instant case.

Stephen A. Bokat 
Robin S. Conrad 
Sussan L. Mahallati
NATIONAL CHAMBER LITIGATION 

CENTER, INC 
1615 H Street, N.W.
Washington, D C. 20062 
(202)463-5337

Respectfully submitted,

4 /

Robert f. Smit l*
Harry ASRis«fetto 
Mona C. Zeiberg
MORGAN, LEWIS & BOCKIUS LLP 
1800 M Street, N.W.
Washington, D C. 20036 
(202) 467-7000

* Counsel o f Record

Counsel fo r the Chamber o f Commerce 
o f the United States o f America

16



CERTIFICATE OF SERVICE

I hereby certify that two copies of the Brief of the Chamber of Commerce of the

United States of America as Amicus Curiae In Support of the Defendant-Appellant/Cross-Appellee
I  j  re­

served this _i_L day of October 1997, by first-class mail, postage prepaid, upon the followingwere

persons:

Kenneth S. Geller, Esq.
Andrew L. Frey, Esq.
Donald M. Falk, Esq.
Mark S. Davies, Esq.
MAYER, BROWN & PLATT 
2000 Pennsylvania Avenue, N.W.
Washington, DC 20006

W. Stephen Cannon, Esq.
Senior Vice President & General Counsel 
CIRCUIT CITY STORES, INC.
9950 Maryland Drive 
Richmond, VA 23233

Phillip D. Bostwick, Esq.
David J. Cynamon, Esq.
SHAW, PITTMAN, POTTS & TROWBRIDGE 
2300 N Street, N.W.
Washington, DC 20037

Joseph M. Sellers, Esq.
WASHINGTON LAWYERS' COMMITTEE FOR 

CIVIL RIGHTS AND URBAN AFFAIRS 
1300 19th Street, N.W.
Suite 500
Washington, DC 20036



John A. Gibney, Jr., Esq.
SHUFORD, RUBIN & GIBNEY 
700 East Main Street 
Suite 1250 
P.O. Box 675 
Richmond, VA 23218

John J. Gallagher, Esq.
Barbara Berish Brown, Esq.
Neal D. Mollen, Esq.
Kelly J. Koelker, Esq.
PAUL, HASTINGS, JANOFSKY & WALKER 
1299 Pennsylvania Avenue, N.W.
Washington, DC 20004

Daniel J. Popeo, Esq.
Paul D. Kamenar, Esq.
WASHINGTON LEGAL FOUNDATION 
2009 Massachusetts Avenue, N.W.
Washington, DC 20036

Robert E. Williams, Esq.
Ann Elizabeth Reesman, Esq.
McGUINESS & WILLIAMS 
1015 15th Street, N.W.
Suite 1200
Washington, DC 20005

Robert P. Joy, Esq.
MORGAN, BROWN & JOY 
One Boston Place 
Boston, MA 02108

Elaine R. Jones, Esq.
Theodore M. Shaw, Esq.
Norman J. Chachkin, Esq.
Charles S. Ralston, Esq.
NAACP LEGAL DEFENSE & EDUCATIONAL FUND 
99 Hudson Street 
16th Floor
New York, NY 10013



Paul D. Ramshaw, Esq.
U S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION
Appellate Services Division
Room 7010
1801 L Street, N.W.
Washington, DC 20507

And on the same date eight copies were sent to the Clerk of this Court by first-class mail, 

postage prepaid.

1800 M Street, N.W.
Washington, D C. 20036 
(202) 467-7000

Counsel fo r  the Chamber o f Commerce 
o f the United States o f America