Shipp v TN Department of Employment Security Petition for Writ of Certiorari

    Ik  the

(Emtrt of tlje IttttBii States
October Term, 1978 

No. 78-..............

E roneous S h ip p , et al.,
Petitioners,

v.

M em ph is  A rea Oeeice, T ekkessee  D epartm ent  
oe E m plo ym en t  S ecu rity , et al.

PETITION FOR A WRIT OF CERTIORARI TO THE 
UNITED STATES COURT OF APPEALS 

FOR THE SIXTH CIRCUIT

J ack  G reenberg 
0 . P eter  S herwood 
E ric S ch napper  

Suite 2030 
10 Columbus Circle 
New York, New York 10019

W illiam  E . Caldw ell  
Ratner, Sugarmon, Lucas & Salky 

525 Commerce Title Building 
Memphis, Tennessee 38103

Counsel for Petitioners



TABLE OF CONTENTS

PAGE

Opinions Below .............................  2

Jurisdiction ..............................  2

Questions Presented .................    2

Statutory Provisions and Rules
Involved .........................   3

Statement of the Case .............   4

REASONS FOR GRANTING THE WRIT .............  9

I. Certiorari Should Be Granted To
Resolve A Conflict Among The Circuits 
As To Whether An Erroneous Failure 
To Certify A Class May Be Corrected 
On Appeal Despite An Intervening 
Dismissal of the Claims of the Named 
Plaintiff ............................  9

II. The Decision of the Court of 
Appeals, Insofar As It Holds That 
An Individual Claim of Discrimina­
tion Can Be Rejected Without 
Deciding Whether There Is A 
Pattern or Practice of Discrimina­
tion, Is Inconsistent With The 
Decision of This Court and of
Three Circuits .......................  17

III. Certiorari Should Be Granted To 
Clarify What Form Of Order Is 
Required To Constitute A 
"Class Certification" Under
Rule 23(c)(1) ......................  22

- l



TABLE OF CONTENTS

CONCLUSION .............................. . . 27

APPENDIX

PAGE

Order of the District Court,
December 20, 1974 .............  la

Opinion of the District Court,
September 25, 1975 ............... 9a

Opinion of the Court of Appeals,
August 7, 1978 ..................  39a

Order of the Court of Appeals,
October 26, 1978 .......   55a

li -



TABLE OF AUTHORITIES

Cases:

Allen v. Likins, 517 F.2d 532 (8th Cir.
1975) ..................... .......... 10,16

Basel v. Knebel, 551 F.2d 395 (D.C.
Cir. 1977) ......... ................ 11,14

Bradley v. Housing Authority, 512 F .2d
628 (8th Cir. 1975) .................  10

Burns v. Thiokol Chemical Corp., 483
F. 2d 300 (5th Cir. 1973) ........... . 20

Carter v. Kilbane, 529 F.2d 1370 (6th
Cir. 1975) ..........................  10

Cicchetti v. Lucey, 514 F .2d 362 (1st
Cir. 1975) ...................   12

Cobbledick v. United States, 309 U.S.
323 (1940) ..........    17

Cohen v. Beneficial Loan Corp., 337
U.S. 541 (1949) .....................  14

Coopers & Lybrand v. Livesay, 57 L.Ed.2d
351 (1978) .........................  2,3,14

Cox v. Babcock & Wilcox Company, 471
F. 2d 13 (4th Cir. 1972) ............  12

Donaldson v. Pillsbury Co., 554 F.2d
825 (8th Cir. 1977) .................  10,20

PAGE

- iii -



TABLE OF AUTHORITIES
cont'd

PAGE

East Texas Motor Freight Systems, Inc. 
v. Rodriguez, 431 U.S. 395
(1977) ........................ . 3,8, 13

Franks v. Bowman Transportation Co.,
424 U.S. 747 (1976) ...............14,20,21,

22,25,26

Frost v. Weinberger, 515 F.2d 57 (2d
Cir. 1975) ............... ......... 11

Gardner v. Westinghouse Broadcasting Co.
57 L.Ed.2d 364 (1978) ...... ...... 4,15,16

Gardner v. Westinghouse Broadcasting Co.,
559 F.2d 209 (3rd Cir. 1977) ---.... 11,15

Garrett v. City of Hamtrack, 503
F. 2d 1201 (6th Cir. 1974) ........  10

Geraghty v. United States Parole
Commission, 579 F.2d 238 (3rd
Cir. 1978)  ......................  11,13

Goodman v.Schlesinger, ____ F,2d ,
18 EPD 18659 (4th Cir. 1978) ....... 12,13

Indianapolis School Commissioners v.
Jacobs, 420 U.S. 128 (1975) .......  3,13,25

Kremens v. Bartley, 431 U.S. 119 (1977).. 26

Lamphere v. Brown University, 553
F. 2d 714 (1st Cir. 1977) ..........  20

- iv -



TABLE OF AUTHORITIES
cont 'd

PAGE

Lasky v. Quinlan, 558 F.2d 1133
(2d Cir. 1977) ....................  11

McDonell Douglas Corp v. Green, 411
U.S. 792 (1973) ..................  19,20,21,22

McLish v. Roff, 141 U.S 665 (1891) .....  17

Napier v. Gertrude, 542 F .2d 825 (10th
Cir. 1976) ........................  12

Pasadena City Board of Education v.
Spangler, 427 U.S. 424 (1976) .....  25

Satterwhite v. City of Greenville,
578 F .2d 987 (5th Cir. 1978) ...... 12,13

Sosna v. Iowa, 419 U.S. 393 (1975) ...... 26

Teamsters v. United States, 431 U.S. 342
(1977) ............................  20,21,22

Valentino v. Howelett, 538 F.2d 975
(7th Cir. 1977) ...................  10

Vun Cannon v. Breed, 565 F .2d 1096
(9th Cir. 1977) ...................  12

Walker v. World Tire Corp., 563 F.2d
918 (8th Cir. 1977) ..............  10,16

Weathers v. Peters Realty Corp.,
499 F.2d 1197 (6th Cir. 1974) ..... 10

v



Winokur v. Bell Federal Savings and

TABLE OF AUTHORITIES
cont 'd

PAGE

Loan Ass'n, 560 F.2d 271 (7th 
Cir. 1977) ......... ........... 10,13,14,16

Zurak v. Regan, 550 F.2d 86 (2d Cir. 
1977) ...... . . ...... ....... . . . .

Statutes

11

28 U.S.C. §1254(1) ................. 2

28 U.S.C. §1291 ............. ....... 3,17

Civil Rights Act of 1964, Title VI .. 4

Civil Rights Act of 1964, Title VII . 

Rules

Rule 21, Federal Rules of Civil
Procedure ......................

3,4

Rule 23(a), Federal Rules of
Civil Procedure ................ 25,26

Rule 23(b), Federal Rules of
Civil Procedure ................ 4,24,26

Rule 23(c), Federal Rules of Civil
Procedure ........... ..........

Other Authorities

3,22,25,26

3B Moore's Federal Practice
123.01 [11.-1] .............. 22

vx



IN THE
SUPREME COURT OF THE UNITED STATES 

October Term, 1978 
No. 78-

ERONEOUS SHIPP, et al.,

Petitioners,

v.

MEMPHIS AREA OFFICE, TENNESSEE 
DEPARTMENT OF EMPLOYMENT SECURITY, 
et al.

PETITION FOR A WRIT OF CERTIORARI 
TO THE UNITED STATES COURT OF APPEALS 

FOR THE SIXTH CIRCUIT

Petitioners Eroneous Shipp, et_ £l_. , respect­
fully pray that a Writ of Certiorari issue to 
review the judgments and opinions of the United 
States Court of Appeals for the Sixth Circuit 
entered in this proceeding on August 7, 1978 and 
October 26, 1978.



2

OPINIONS BELOW
The December 20, 1974, order of the district 

court, which is not officially reported, is set 
out in the Appendix hereto, pp. la-8a. The 
September 25, 1975 opinion of the district court, 
which is not officially reported, is set out in 
the Appendix, pp. 9a-36a. The opinion of the 
court of appeals dated August 7, 1978, which is
not yet officially reported, is reprinted in 17 
FEP Cases 1430, and is set out in the Appendix, 
pp. 37a-54a. The order of the court of appeals 
denying rehearing, dated October 26, 1978, is set 
out at pp. 55a-56a of the Appendix.

JURISDICTION
The judgment of the court of appeals was 

entered on August 7, 1978. Petitioners filed a
timely Petition for Rehearing, which was denied on 
October 26, 1978. This Court has jurisdiction
under 28 U.S.C. §1254(1).

QUESTIONS PRESENTED
1. Where a district court erroneously 

fails to certify a class action and subsequently 
dismisses the individual claim of the named 
plaintiff, can that failure be corrected on 
appeal, pursuant to Coopers & Lybrand v. Live say,



- 3 -

57 L.Ed.2d 351 (1978), or does East Texas Motor
Freight System, Inc, v. Rodriguez, 431 U,S. 395 
(1977) preclude an appeal from such an error?

2. In a Title VII action alleging a class­
wide policy of discrimination, may the individual 
claim of the named plaintiff be decided without 
considering whether there is in fact such a 
policy?

3. In order to "properly certify" a class 
action under Indianapolis School Commissioners 
v. Jacobs, 420 U.S. 128 (1975), need a district 
court do more than comply with the literal lan­
guage of Rule 23(c)(1) by "determin[ing] by order 
whether it is to be so maintained"?

STATUTORY PROVISIONS AND RULES INVOLVED 
Section 1291, 28 U.S.C., provides in perti­

nent part:
The courts of appeals shall have jurisdiction 
of appeals from all final decisions of the 
district courts of the United States....

Rule 23(c)(1), Federal Rules of Civil Proce­
dure, provides:

As soon as practicable after the commencement 
of an action brought as a class action, 
the court shall determine by order whether it 
is to be so maintained. An order under this 
subdivision may be conditional, and may be 
altered or amended before the decision on the 
merits.



- 4 -

STATEMENT OF THE CASE
This action was commenced on September 16, 

1971, against the Memphis Area Office of the 
Tennessee Department of Employment Security 
(hereinafter "TDES"), a state operated employment 
service largely supported by federal funds. The 
complaint alleged that TDES had a policy of 
referring white applicants to better paying jobs 
than those offered to equally qualified black 
applicants. Plaintiff alleged that this discrimi­
nation was the result in part of discrimination in 
the selection of the TDES counsellors involved in 
making the referrals. These practices were 
alleged to violate Title VI and Title VII of the 
1964 Civil Rights Act. Plaintiff, a black appli­
cant whom TDES had refused to refer to a particu­
lar job, sought relief for himself and for a class 
of blacks alleged to be the victims of these 
practices.

The complaint specifically alleged that each 
of the requirements for a Rule 23(b)(2) and a Rule 
23(b)(3) class action were met. TDES claimed it 
had no policy of discrimination, but did not deny 
any of plaintiff's detailed allegations of numer- 
osity, typicality, etc. Extensive discovery was



- 5 -

conducted from 1971 to 1974, most of it with 
regard to what were specifically denoted as the 
merits of the "class issues". At a pre-trial 
conference on March 8, 1974 plaintiff expressly
sought a more formal ruling on the propriety of 
the class action, but the district court never 
entered any such ruling. The parties are in 
disagreement as to the reason for the district 
court's inaction; plaintiff maintains that the 
court took no formal action because counsel for 
TDES stipulated at the March 8,1974 conference 
that the case was a proper class action.

The trial of this action was held in two 
phases. From March 20-22, 1974, plaintiff pre­
sented his case in support of both his individual 
claim and the class claim, and TDES offered 
its defense to the individual claim. TDES was 
granted time to prepare its defense to the class 
claim; that evidence was finally presented at a 
second hearing on April 23, 1975.

With regard to the individual claim, the 
testimony at trial revealed that TDES had refused 
to refer plaintiff for a vacancy in the shipping 
department of the local RCA plant, although



- 6 -

plaintiff was a former military officer who had 
extensive experience managing shipments at an Air 
Force base in Europe. TDES officials asserted at 
the time of the refusal that plaintiff was un­
qualified because he was unfamiliar with shipping 
rates in the area, but the white applicant hired 
for the RCA job testified that the position did 
not in fact require any knowledge of those rates.

Plaintiff also established that in the years 
prior to trial the average hourly wage of posi­
tions to which TDES applicants were referred were 
as follows:

The average wage difference between whites and 
blacks was $.38 an hour. TDES classifies appli­
cants into occupational categories according to 
their experience and level of skill. In the 16 
largest categories, within which experience and
skill levels were comparable according to TDES, 
white males got better paying jobs than black

Type of Applicant Average Wage

White males 
Black males 
White females 
Black females

$2.56 
$2.25 
$2.25 
$1. 77



- 7

males in every category. There were 13 major 
categories, all poorly paid, in which over 90% 
of the referrals were black, including domestic 
worker (100%), laundress and laundryman (99%) 
and janitor (95%). The TDES operations in 
Memphis, which until the early 1960's operated on 
an officially segregated basis, continued to use 
racially identifiable offices.

The district court, however, found for 
defendant TDES on both the individual and class 
claims. With regard to the claim of the named 
plaintiff, it is unclear from the opinion of the 
district court whether it concluded that plaintiff 
had been denied referral for reasons other than 
race, or that such discrimination had caused no 
injury because the job at issue had already been 
filled. 7a-8a. The district court decision 
regarding the named plaintiff was initially 
issued on December 20, 1974, prior to completion 
of the trial of the class claims. Plaintiff 
promptly moved for reconsideration of the indivi­
dual claim after a decision on the class claim, 
and the district court in fact reconsidered and 
reaffirmed its rejection of the individual claim



- 8 -

after deciding the class claim. 36a. With 
regard to the class claims, the district court 
found that the wide disparity in the wage levels 
was primarily the result of past racial discrimi­
nation by private employers and "the community" 
rather than by TDES itself. 31a-35a.

On appeal the Sixth Circuit refused to 
consider the merits of the class claim. It upheld 
the dismissal of the claim of the named plaintiff, 
but it is again unclear whether the appellate 
court believed the district court had found no 
discrimination or no injury, and which finding it 
was affirming. 49a-50a. The court of appeals did 
not reach the merits of the class claims; it held, 
rather, that none of the district court orders 
regarding the class constituted an adequate 
certification of the class. 51a-54a. Plaintiff 
urged that, if the district court orders were 
inadequate, that error could and should be 
corrected on appeal. The Sixth Circuit, however, 
concluded that since the district court subsequent 
to that error had rejected the claim of the named 
plaintiff, dismissal of the class claim was re­
quired by East Texas Motor Freight Systems,
Inc, v. Rodriguez, 431 U.S. 395 (1977). 53a-54a.



- 9 -

Plaintiffs filed a timely Petition for 
Rehearing, and moved, under Rule 21, Federal 
Rules of Civil Procedure, to add additional 
plaintiffs. On October 26, 1978, the court 
of appeals denied the Petition for Rehearing, and 
held that it lacked jurisdiction to add parties to 
the action.

REASONS FOR GRANTING THE WRIT

I. Certiorari Should Be Granted To Resolve 
A Conflict Among The Circuits As to 
Whether An Erroneous Failure To Certify 
A Class May Be Corrected On Appeal 
Despite An Intervening Dismissal of the 
Claims of the Named Plaintiff

This case presents an important and recurring 
procedural problem. As viewed by the Sixth Cir­
cuit the district judge, despite two requests 
by plaintiff's counsel, erroneously failed to 
decide whether the case should be formally certi­
fied as a class action. By the time the case

1_/ As we note infra, we maintain that the 
district court did adequately certify the class, 
PP- 21-26, and that the court of appeals erred in 
deciding the individual claim without first 
deciding the class claim. Pp. 17-21.



- 10 -

reached the court of appeals, however, the dis­
trict court had decided against the named plain­
tiff on the merits of his individual claim, a 
decision the appellate court upheld. Petitioner 
urged that the court of appeals should correct the 
erroneous lack of certification. The Sixth 
Circuit, however, concluded that it was powerless 
to correct that error since plaintiff, although 
presumably a proper class representative when 
certification was first sought, had subsequently 
been held to have no personal claim and thus not 
to be a member of the alleged class. 51a-54a.

The circuits are widely divided on this
• 2/issue. In addition to the Sixth Circuit,—  the

3/ 4/Seventh—  and Eighth Circuits—  hold that an

2/ The Sixth Circuit's position prior to the 
instant case had been unclear. See Carter v. 
Kilbane, 529 F.2d 1.370, 1371 (6th Cir. 1975); 
Garrett v. City of Hamtrack, 503 F.2d 1201 (6th 
Cir. 1974); Weathers v. Peters Realty Corp., 499
F.2d 1197 (6th Cir. 1974).

3/ Winokur v. Bell Federal Savings and Loan 
Ass1 n , 560 F.2d 271 (7th Cir. 1977); Valentino v. 
Howlett, 528 F.2d 975, 979-81 (7 th TIT! 1977).

4/ Walker v. World Tire Corp., 563 F. 2d 918,
921-23 (8th Cir. 1977); Allen v. Likins, 517 
F . 2d 532, 534-35 (8th Cir. 1975); Bradley v .



- 11

erroneous denial of certification cannot be 
corrected on appeal if in the interim the named 
plaintiff ceased to be a proper representative.

c /  r j
The S e c o n d T h i r d a n d  District of Colum­
bia—^Circuits take the opposite position, hold­
ing that an erroneous failure to certify can 
be reviewed and corrected by an appellate court, 
and that the appellate decision regarding certi­
fication "relates back" to the date on which 
the district court failed to certify the class.

4J Cont 'd

Housing Authority, 512 F.2d 626, 628-29 (8th Cir. 
1975); but see Donaldson v. Pillsbury Co., 554 
F .2d 825, 831-2 n.5 (8th Cir. 1977).

5/ Lasky v, Quinlan, 558 F .2d 1133, 1136-37 
(2d Cir. 1977); Zurak v. Regan, 550 F . 2d 86, 
91-91 (2d Cir. 1977); Frost v. Weinberger, 515
F.2d 57, 64 (2d Cir. 1975).

6/ Geraghty v. United States Parole Commission, 
579 F.2d 238, 245-254 (3rd Cir. 1978); Gardner v . 
Westinghouse, 559 F . 2d 209, 214-17 (3rd Cir.
1977) (Seitz, J. concurring), aff'd 57 L.Ed. 2d 
364 (1978). Geraghty relied on the decisions of 
the Second and District of Columbia Circuits. 579 
F.2d at 250 n.48.

V Basel v. Knebel, 551 F.2d 395 , 397 , n.l 
(D.C.Cir. 1977).



- 12 -

Other circuits have adopted a variety of
intermediate standards. In the Fifth Circuit an
erroneous denial of certification can be corrected
on appeal if the plaintiff sought an evidentiary
hearing on the propriety of certification, but

8 /apparently not otherwise.—  The practice of the 
Fourth Circuit is to decide whether the denial of 
certification was erroneous, but not to permit the 
original plaintiff to represent the class; in­
stead the case is remanded to the district court 
with instruction that the case is to "be retained 
on the docket for a reasonable time to permit
a proper plaintiff ... to present himself to

9 /prosecute the action."—  In the Tenth Circuit the 
denial of certification can and must be corrected 
on appeal if failure to do so would mean that the 
claim would "evade review."A5/

8/ Satterwhite v.City of Greenville, 578 F.2d 
9 8 7 , 995-96 n.10 (5th Cir. 1978) (en banc), cert 
pending No. 78-1008.

9/ Goodman v. Schlesinger, F . 2d ,
18 EPD 18659, p. 4607 (4th Cir. 1978); Cox v . 
Badcock & Wilcox Company, 471 F.2d 13, 16 (4th
Cir. 1972).

10/ Napier v. Gertrude, 542 F.2d 825, 828 (10th
Cir. 1976). The issue is apparently unresolved



- 13

The existence of this conflict is widely 
recognized. The Third Circuit, noting that the 
Fifth and Seventh Circuits had adopted rules 
different than its own, stated:

We acknowledge that the courts of 
appeals are divided on the question of 
whether under the recent Supreme Court 
decisions, the denial of class action status 
is appealable by a named plaintiff whose 
claim has become moot. Geraghty v. United 
States Parole Commission, 579 F.2d 238, 251
n.19 (3rd Cir. 1978);

The Fourth Circuit recently conceded that its 
rule "is apparently contrary to the [Fifth Cir­
cuit] Satterwhite majority." Goodman v. Schlesin-
ger, ____ F. 2d ____, 18 EPD 18659, p. 4607 (4th
Cir. 1978). Satterwhite in turn referred to the 
more restrictive Seventh Circuit decision with an 
understated "but see". Satterwhite v. City of 
Greenville, 578 F. 2d 9 8 7 , 996 ( 5th Cir. 1978).

This conflict reflects a disagreement among 
the lower courts as to the meaning of recent 
decisions of this Court. In holding that an

10/ Cont'd

in the First and Ninth Circuits. See Cicchetti 
v. Lucey, 514 F . 2d 362, 368 (1st Cir. 1975). 
Vun Cannon v ■ Breed, 565 F.2d 1096, 1101 n.7 (9th
Cir. 1977).



14

erroneous denial of certification cannot be 
appealed if the claim of the named plaintiff has 
been rejected, the Sixth and Seventh Circuits 
analogized such a case to Rodriguez v. East Texas 
Motor Freight, 431 U.S. 395 (1977), where certifi­
cation had never been sought, and Indianapolis 
School Commissioners v. Jacobs, 420 U.S. 128 
(1975), where an inadequate certification had 
never been appealed. 53a-54a; Winokur v. Bell 
Federal Sav. & Loan Ass 'n, 560 F.2d 271 , 276
(1977) . In permitting an appeal the District of 
Columbia Circuit suggested such a case is closer 
to Franks v. Bowman Transportation Co., 424 U.S. 
747 (1976), where the case was certified before 
the claim of the named plaintiff became mo.ot. 
Basel v. Knebel, 551 F.2d 395, 397 n.l (D.C. Cir. 
1977).

We contend that the issue presented by this 
Petition is controlled by the recent decisions of 
this Court holding that a denial of certification 
may not be the subject of an interlocutory appeal. 
Coopers & Lybrand v, Livesey, 57 L.Ed. 2d 351
(1978) ; Gardner v. Westinghouse Broadcasting Co., 
57 L.Ed. 2d 364 (1978). In Coopers & Lybrand,
this Court rejected a claim that such a denial was



- 15 -

"effectively unreviewable on appeal from a final 
judgment" and thus an appealable collateral order 
under Cohen v. Beneficial Loan Corp., 337 U.S. 541
(1949); this Court insisted that "an order denying 
class certification is subject to effective review 
after final judgment at the behest of the named 
plaintiff...." 57 L.Ed. 2d at 358 (emphasis 
added). In Gardner the Court held that denial of 
certification was not an "irreparable" denial of 
class injunctive relief, emphasizing that "if, 
after judgment on the merits, the relief granted 
is unsatisfactory, the question of class status is 
fully reviewable." 57 L.Ed.2d at 368 n.6 (emphasis 
added). This passage is a quotation from the 
Third Circuit opinion in Gardner, and there the 
evident concern of the court of appeals was to 
insist that a denial of certification could be 
appealed after final judgment regardless of 
whether that judgment rejected or mooted the 
claims of the named plaintiff. Gardner v . 
Westinghouse Broadcasting Co., 559 F.2d 209, 
214-15 (3rd Cir. 1977) (Seitz, J., concurring).

The decision below, and many of the conflict­
ing decisions in other circuits, address the 
situation where a named plaintiff no longer has an



- 16

active claim against the defendant because 
his claim was rejected on the merits. But the 
same problem arises if the named plaintiff pre­
vails, for should full relief be awarded to him 
and the defendant not appeal, the dispute between 
the defendant and the named plaintiff would 
be moot. Thus the Eighth Circuit has held that 
a named plaintiff is barred from appealing a 
denial of certification not only when his claim 
has been re jected,— ^but also when he has obtained
all the relief he personally sought in the ac-

1 2 /tion.—  The Seventh Circuit has held that
a defendant can deliberately prevent an appeal 
from a denial of certification simply by tendering 
the plaintiff all the relief he personally re-

1 3  /.quested, thus mooting his claim.— 'if these 
decisions are correct, appellate review after 
final judgment of a denial of certification would

11/ Walker v. World Tire Corp., 563 F.2d 918 (8th 
Cir. 1977).

12/ Allen v. Likins, 517 F,2d 532 (8th Cir. 1975).

13/ Winokur v. Bell Federal Sav. & Loan Ass'n, 560 
F.2d 271, 274 (7th Cir. 1977).



- 17

be impossible, not merely in some cases, but in 
most. If that is so Gardner and Coopers & Lybrand 
were incorrectly decided.

The decision in this case, like the similar 
rule in the Seventh and Eighth Circuits, creates 
an unprecedented anomaly in federal law: an 
erroneous district court decision denying certifi­
cation, or an erroneous failure to act on a 
request for certification, is absolutely insulated 
from appellate review. In authorizing appeals 
from "final orders" under 28 U.S.C. §1291, it was 
the intent of Congress that that appeal bring up 
with it all previous orders entered and actions 
taken by the district court, "to have ‘the whole 
case and every matter in controversy in it decided 
in a single appeal." McLish v. Roff, 141 U.S. 
661, 665 (1891). Postponement of appellate review 
of a denial of certification is intended only to 
determine when that review is to occur, not to 
"defeat the right to any review at all." Cobble- 
dick v. United States, 309 U.S. 323, 324-25
(1940).



- 18 -

II* The Decision Of The Court of Appeals, 
Insofar As It Holds That An Individual 
Claim of Discrimination Can Be Rejected 
Without Deciding Whether There Is A Pattern 
or Practice of Discrimination, Is Incon­
sistent With The Decisions of This Court 
and of Three Circuits

In deciding the individual claim of the named 
plaintiff, the district court repeatedly recog­
nized that the resolution of that claim depended 
to a substantial degree on whether, as plaintiff 
claimed, the defendant had engaged in a general 
practice of discrimination against black appli­
cants. After hearing all the evidence on the 
individual claim, the trial judge agreed to defer 
any decision on it until he could decide the class 
claim as well.—  The judge subsequently issued a 
tentative opinion on the individual claim, holding 
that the plaintiff had failed to meet his burden

14/ Transcript of Hearing of March 22, 1975, 
pp. 129-130.



- 19 -

of proving discrimination. 7a-8a. But the trial 
court agreed to reconsider its view of the 
individual claim after deciding the class claims, 
and only finally rejected the individual claim 
on the basis of its determination that there was 
no general practice of discrimination. 36a. On 
appeal the .Sixth Circuit proceeded in an entirely 
different manner. It disposed of Shipp's personal 
claim in a single unexplained sentence asserting 
that the finding of no discrimination was "not 
clearly erroneous", 49a-50a; but it expressly did 
not decide whether the district court had erred in 
finding no class-wide discrimination, even though 
that finding was a foundation of the district 
court's rejection of the individual claim. 
54a. .

This Court has repeatedly held that the 
existence of a pattern of discrimination is of 
critical importance to resolving a claim of 
discrimination against a particular individual. 
McDonnell Douglas Corp. v. Green, 411 U.S. 
792, 804-805 (1973), held that a defendant's 
"general policy and practice with respect to 
minority employment" would be relevant to a claim



- 20

that the plaintiff there had been rejected for 
employment because of his race. Both Teamsters 
v. United States, 431 U.S. 324, 357-62 (1977), and 
Franks v. Bowman Transportation Co, 424 U.S. 747, 
772-73 (1976), hold that proof of a general 
practice of discrimination shifts to the defendant 
the burden of proof, requiring it to establish 
that an unsuccessful minority applicant was not 
rejected because of his or her race.

Under Teamsters, Franks and Me Donne 11 
Douglas an individual claim of discrimination 
cannot ordinarily be decided without first decid­
ing whether there is a class-wide pattern of 
discrimination. Three circuits expressly require 
that the plaintiff be permitted to establish the 
latter issue prior to a determination of the 
former

The court of appeals in the instant case 
refused to decide the merits of the class claim of

15/ Lamphere v. Brown University, 553 F.2d 714, 
719 (1st Cir. 1977); Burns v. Thiokol Chemical 
Corp., 483 F .2d 300, 306 (5th Cir. 1973); Donald- 
son v. Pillsbury Co. , 554 F.2d 825, 832-33 (8th 
Cir. 1977), cert, denied 434 U.S. 856 (1977).



- 21

a pattern and practice of discrimination, even 
though that was the foundation of the district 
court's opinion. It upheld the district court's 
conclusion of no discrimination against Shipp 
without considering the correctness of the dis­
trict court's premise that there was no general 
practice of discrimination. This resolution of 
the merits was inconsistent with Franks, Team­
sters , McDonnell Douglas and the practice in 
other circuits.

This issue is inextricably intertwined with 
the first Question Presented. Even in a case 
where a trial judge erroneously denies certifica­
tion, the individual plaintiff would be entitled 
under Franks, Teamsters, and McDonnell Douglas to 
discover and introduce evidence of a general 
practice of discrimination in support of his own 
claim. Ordinarily a district court finding of no 
discrimination against the named plaintiff could 
not be upheld if the court of appeals found there 
was a class-wide pattern or practice of dis­
crimination. Thus the only way an appellate court 
could reject an individual claim and then dismiss 
a possibly meritorious class claim for want of a 
proper representative would usually be to dis­



- 22 -

regard Franks, Teamsters and McDonnell Douglas and 
refuse in passing on the individual claim to 
consider whether there was a general practice of 
discrimination. Consequently in this case, as in 
most others, the court of appeals only had an 
opportunity to erroneously dismiss the class claim 
because it had first erroneously rejected the 
individual claim.

III. Certiorari Should Be Granted To Clarify 
What Form Of Order Is Required To 
Constitute A "Class Certification" Under 
Rule 23(c)(1)

Rule 23(c)(1), Federal Rules of Civil Proce­
dure, provides in pertinent part:

As soon as practicable after the commencement 
of an action brought as a class action, 
the court shall determine by order whether it 
is to be so maintained.

The Committee Note indicates that the Rule means 
simply what it says, that the order must determine 
"whether an action brought as a class action is to 
be so maintained." 3B Moore's Federal Practice 
f23.01[11.—1] (emphasis added). Until the deci­
sion in this case, no opinion of this or any lower 
court read Rule 23(c)(1) other than in that 
literal manner.



- 23

The Sixth Circuit did not question that the 
district judge had in fact determined "whether" 
the case was to be maintained as a class action; 
on the contrary, it noted that there had actually 
been a "trial on the merits of the class action 
claims" and a decision "on the merits" of those 
claims. 40a-42a, 46a n.15. Nor is there any 
suggestion that the district judge, having deter­
mined that the case could proceed as a class 
action, failed to enter an order memorializing 
that determination. Actually there are ten such 
orders. The trial judge issued four orders au­
thorizing and regulating discovery expressly bear-

16/ing on "the class action issue of the case",—  
and five orders, including the pretrial order, 
providing for how and when the "class action 
aspect of the case" was to be tried.— ^In its

16/ Court of Appeals Appendix, pp. 21a (July 16,
1973), 30a (December 11, 1973), 48a (December 17,
1973). A fourth order was issued on March 15,
1973.

17/ These orders were issued on March 11, 1974, 
March 22, 1974, June 13, 1974 (id_. p. 738a),
December 20, 1974 (id. p. 744a) and January 5,
1975.



- 24

decision on the merits the district court included 
a finding that it had "jurisdiction of ... the 
class action allegations made by plaintiff Shipp". 
31a,

The Sixth Circuit, however, found all of 
these orders insufficient to meet the requirement 
of Rule 23(c)(1). Its opinion suggests the dis­
trict court orders were inadequate for three 
reasons. First, the court of appeals objected 
that the trial judge had failed to make detailed 
findings that each of the requirements of Rule 
23 were met.— 'Second, the court of appeals 
complained that the trial judge had failed to 
specify the subsection of Rule 23(b) under which 
the class action was to proceed. 47a-48a. 
Third, the court of appeals repeatedly stressed 
that the trial judge had failed to "certify" the 
class, indicating that the use of this term was 
necessary or of special importance. 47a.

18/ "[T]he district court never ... made any 
determination that the prerequisites for a class 
action were met, specifically that plaintiff's 
claims were typical of the claims of the class 
or that plaintiff would fairly and adequately 
protect the interests of the class pursuant to 
Rule 23(a)." 46a.



- 25

The court of appeals apparently based these 
requirements, and its conclusion that the class 
was not "properly certified", on its reading 
of Indianapolis School Commissioners v. Jacobs, 
420 U.S. 128 (1975). 53a. But Jacobs does not 
require that a Rule 23(c)(1) order do more than 
actually determine whether a case may be main­
tained as a class action. In Jacobs the order 
rejected as insufficient by the majority stated 
only that plaintiffs were "qualified as proper 
representatives of the class whose interest they 
seek to protect." 420 U.S. at 130. This clearly 
did not decide whether the action was to be heard 
as a class action, but merely held that the 
requirement of Rule 23(a)(4) had been satisfied. 
Similarly in Pasadena City Board of Education v . 
Spangler, 427 U.S. 424 (1976), counsel for the 
parties had "treated [the case] as a class 
action", 427 U.S. at 430, but there was no proof 
the trial court had done so.

On three occasions this Court has held the 
order of a district court sufficient to satisfy 
the requirements of Rule 23(c)(1) and thus of



- 26 -

Article III. Kremens v . Bartley, ̂ ^431 U.S. 
119 (1977); Franks v. Bowman Transportation 
Co. ,— ^424 U.S. 747 (1976); Sosna v. Iowa,—  ̂
419 U.S. 393 (1975). None of the orders approved 
by this Court could meet the three-part standard 
set out by the Sixth Circuit below. None of the 
orders in Kremens, Franks and Sosna made express 
findings that each of the particular requirements 
of Rule 23(a) and (b) were met, and none of them 
used the term "certify". The order in Sosna 
neither specified the subheading of Rule 23(b) 
being utilized nor defined the class. The deci­
sion below is clearly inconsistent with this 
Court's approval of the orders in Kremens, Franks 
and Sosna.

The Sixth Circuit's requirements for a Rule 
23(c)(1) order, if applied only prospectively, 
would nonetheless be erroneous. But the court of

19/ The order is set out at p. 270a of the 
Appendix, No. 75-1064, October Term, 1976.

2QJ The order is set out at p. A53 of the Appen­
dix, No. 74-728, October Term, 1975.

21/ The order is set out at pp. 45-46 of the 
Appendix, No. 73-762, October Term, 1974. The 
document in Sosna was a stipulation of fact 
approved by the district court. 419 U.S. at 
397-98.



- 27

appeals applied those newly announced standards to 
orders issued three to four years earlier. The 
retroactive application of such a construction of 
the Federal Rules is certain to wreak havoc in 
other cases as it did here, for few Rule 23(c)(1) 
orders would meet those standards. Otherwise well 
tried cases will have to be dismissed because of a 
failure to meet procedural standards of which 
neither counsel nor the trial court could have 
been aware. To do so would be to elevate form 
over substance in a manner entirely inconsistent 
with the purposes of the Federal Rules of Civil 
Procedure.

CONCLUSION
For the above reasons a Writ of Certiorari 

should issue to review the judgment and opinion of 
the court of appeals.



- 28

Respectfully submitted.

JACK GREENBERG 
0. PETER SHERWOOD 
ERIC SCHNAPPER 

Suite 2030 
10 Columbus Circle 
New York, New York 10019

WILLIAM E. CALDWELL 
Ratner, Sugarmon,

Lucas & Salky
525 Commerce Title Building 
Memphis, Tennessee 38103

Counsel for Petitioners



APPENDIX



IN THE
UNITED STATES DISTRICT COURT 

FOR THE WESTERN DISTRICT OF TENNESSEE 
WESTERN DIVISION

No. C-71-373

ERONEUS SHIPP, Individually and on 
behalf of all others similarly 
situated,

Plaintiff,

v.

MEMPHIS AREA OFFICE OF THE TENNESSEE 
DEPARTMENT OF EMPLOYMENT SECURITY, 
et al. ,

Defendants.

ORDER

Plaintiff, a black male, has sued the Memphis 
Area Office of the Tennessee Department of Employ­
ment Security, the Tennessee Department of Person­
nel, and Jane L. Hardaway, its (former) Commis­
sioner, for alleged racial discrimination with

la -



respect to its failure to refer him to a job 
through the Tennessee Department of Employment 
Security at Memphis, Tennessee. Jurisdiction is 
asserted under the post-Civil War civil rights 
acts and the 1964 Civil Rights Act as amended 
(Title VII). By order of the Court, after ex­
tended discovery, trial was had on Shipp's 
claim with opportunity for defendants to respond 
at a later hearing on the merits of the class 
action claim.

Plaintiff, a native Memphian and a college 
graduate, has considerable service as an officer 
in the Army Air Force in handling military corgo 
and passengers. After termination of his military 
service as a first lieutenant, he attended gradu­
ate school for a time in 1963, but was unable to 
obtain suitable employment in New York City where 
he was then living. After unsuccessfully applying 
for employment in Memphis in 1964, he taught for 
several years in Arkansas public schools and then 
taught language and English in the Memphis City 
School System after obtaining a required certifi­
cate in Tennessee. On Friday, March 7, 1969,
after hearing a radio broadcast the day before

©

- 2a -



initiated by the Memphis Office of the Tennessee 
Department of Employment Security, Shipp called to 
inquire about a job opening for an assistant or 
analyst in a traffic department. He talked to 
Mrs. Ewing in the Tennessee Department of Employ­
ment Security office about his interest and 
background and was advised to come in for an 
interview for possible employment on March 11, 
although she was not encouraging that his qualifi­
cations were suitable for this particular spot. 
He reported in person, however, on March 10, with 
an application, and talked to Mrs. Askew at 
the Tennessee Department of Employment Security 
office. She also discouraged him about the 
particular job which offered higher pay than the 
approximately $6,700.00 Shipp had been earning, 
since the job required heavy experience in rates, 
and suggested that he consider other possible 
openings.

Shipp, suspicious that he was being shunted 
aside, demanded an opportunity to interview the 
employer. Mrs. Askew responded that it was 
against policy to reveal the "client's” or pros­
pective employer's name unless the Tennessee

- 3a -



Department of Employment Security itself con­
sidered the applicant qualified and recommended 
the interview. With notebook and pencil in hand, 
Shipp began to take notes of his interview with 
Askew, who at his insistence, then dialed on the 
telephone the employer, RCA at Memphis.

Shipp did not believe Mrs. Askew-^actually 
made the call, but heard one side of the purported 
telephone conversation while she spoke to Robert 
Phillips in the RCA personnel office and heard her 
ask if the job were filled. She then informed 
Shipp that the job was not open, that the employer 
did not consider his background sufficient for the 
job and was not interested in an interview. Still 
not having RCA's name divulged as the prospective 
employer, Shipp even more dissatisfied, then 
demanded to speak to Mrs. Ewing who had returned 
to her desk in the commercial and sales division 
of the Tennessee Department of Employment Security 
office during the course of his discussion with 
Mrs. Askew. He stated he did not believe Mrs. 
Askew had actually made the call but had only

JV Mrs. Askew was a supervisor, Mrs. Ewing an 
interviewer, at the time in the same department. 
Both are white.

- 4a -



pretended to do so, and was still apparently 
taking notes of what was taking place. At 
this time, Shipp intimated that he felt he was 
being mistreated and misled by reason of his 
negro race in connection with this job. He 
wondered why the job was already filled under 
the circumstances known to him, and indicated no 
interest in other possible openings. Despite 
Shipp's insistence, Ewing refused to call RCA 
again, stating she could not try to bypass 
her supervisor. Shipp was taken to the Tennessee 
Department of Employment Security manager's office 
after asserting these complaints, which created 
something of a commotion in this division of the 
Tennessee Department of Employment Security.

Unknown to Shipp, however, RCA's personnel 
office had also solicited job applicants from 
private employment services during February of 
1969, as well as the Tennessee Department of 
Employment Security for the traffic department 
job, dealing particularly with transportation and 
shipping rates. The Tennessee Department of 
Employment Security submitted several potential 
names of white persons for the job to RCA prior to 
the Shipp episode, and Phillips had several

5a -



conversations with Ewing indicating a desire for 
recent rate experience. Phillips also interviewed 
one B. E. Fletcher during February, then employed 
at Central Soya, and on or about March 4, 1969, 
Fletcher gave his employer notice that he intended 
to resign and accept the RCA position in contro­
versy. Phillips, however, did not then notify the 
Tennessee Department of Employment Security that 
the job was considered filled, even though 
Fletcher had prospectively been offered the job to 
report about mid-March. RCA at the time had 
an affirmative action program after some contact 
with E.E.O.C. representatives. Phillips did not 
know Shipp's race and was not told his race on 
March 10th when Askew of the Tennessee Department 
of Employment Security discovered the job was no 
longer open.

Evidence was presented on Shipp's behalf of a 
background indicating segregation by race prior 
to 1964 in Tennessee Department of Employment 
Security employment offices. Evidence was also 
presented showing a preponderance of whites in 
managerial, supervisory and interviewer positions 
in the Tennessee Department of Employment Security 
office in Memphis in 1969. Statistical evidence

- 6a -



was also offered with analyses, which plaintiff's 
counsel asserts is indicative of a plan, practice, 
or effective result of racial discrimination 
by this office (and defendants) at the time suit 
was instituted and when Shipp's interview took 
place.

The Court concludes, however, that Shipp 
himself has failed to demonstate racial prejudice 
or discrimination against him in connection with 
his job application and his transactions with 
the Memphis Tennessee Department of Employment 
Security Office in March of 1969, Shipp has 
failed to prove the charges made by him against 
any of the defendants. As an aside, it is 
pertinent to note that Shipp also failed to prove 
any damage whatsoever by reason of his not receiv­
ing the RCA job. That Memphis operation closed 
about six months later and most employees lost 
their jobs. Both Phillips and Fletcher in the 
fall of 1969, had to seek other employment. Shipp 
himself averaged some $7,500 in earnings during 
1969-1970, and 1970-71 school years.

The cause of action brought by Eroneous Shipp 
is dismissed and he will bear his own costs which 
are assessed against him. This dismissal, how-

7a



ever, is without prejudice to the consideration of 
the class action claims, equitable in nature, 
seeking affirmative relief against defendants for 
alleged unlawful discriminatory employment prac­
tices. Nothing indicated in this order is in­
tended to be a determinative finding or conclusion 
with respect to the asserted class action claim.

A hearing on the merits of the latter claim 
is set for January 6, 1975, at 9:30 A.M.

This _____ day of December, 1974.

Harry W. Wellford /s/_____________
UNITED STATES DISTRICT COURT JUDGE

Filed: December 20, 1974



IN THE
UNITED STATES DISTRICT COURT 

FOR THE WESTERN DISTRICT OF TENNESSEE 
WESTERN DIVISION

No. C-71-373

ERONEUS SHIPP, Individually and on 
behalf of others similarly 
situated,

Plaintiff,

v.

MEMPHIS AREA OFFICE OF THE TENNESSEE 
DEPARTMENT OF EMPLOYMENT SECURITY, 
et al.,

Defendants.

MEMORANDUM OPINION

Plainiff, Eroneus Shipp, commenced this 
action by complaint filed on September 16, 1971, 
against defendant Memphis Area Office of the 
Tennessee Department of Employment Security (here-

9a



after called, as indicated, "Memphis Area Office," 
"Memphis Office," or "TDES"). This was filed as a 
class action on behalf of similarly situated black 
persons charging defendant with individual and 
class-wide race-based discrimination in its job 
referral and related services, as well as in its 
own employment practices. Such alleged racially 
discriminatory actions were asserted to violate 
Title VII of the Civil Rights Act of 1964, 42 
U.S.C. §200 et_ seq., [sic.] the Civil Rights Act 
of 1866, 42 U.S.C. §1981, and 42 U.S.C. §1983, as 
well as the Fourteenth Amendment to the Constitu­
tion of the United States. Plaintiff sought 
individual as well as class-wide equitable relief 
against defendant.

The court entered an order on December 20, 
1974, after hearing with respect to Shipp's 
individual claim, denying him relief but without 
adverse effect upon the class action aspects of 
the case. Further hearings were held as to the 
latter asserted class action claims, and expert 
testimony was adduced by both sides.

The basic issues involved were (1) whether 
blacks, because of race, were referred to em­
ployers by TDES to jobs poorer in quality and in

10a -



pay than those to which whites were referred; (2) 
whether TDES failed to use appropriate and/or 
necessary procedures to eliminate relationships 
with allegedly racially discriminatory employers; 
(3) whether TDES discriminated against blacks in 
internal hiring and promotion practices; and (4) 
whether TDES established or continued the racial 
identifiability of certain job categories because 
of past racial practices.

TDES was created in response to the problems 
spawned by unemployment. It consists of two 
coordinate divisions, the unemployment compensa­
tion division and the state employment service. 
T.G.A. §50-1332. The employment service division 
is financed by the United States Department of 
Labor to maintain free public employment offices 
throughout the state pursuant to 29 U.S.C. §§49 to 
49(k), and subsequent federal legislation. 
(T.C.A. §50-1346). The employment service divi­
sion in Memphis is the subject of this litigation. 
Historically the Memphis Area Office operated on a 
racially segregated basis until the late 1950's. 
A separate office serving primarily blacks was 
maintained in Memphis by TDES until approximately

11a



1 9 6 0 Subsequently the office was moved to a 
new location serving both whites and blacks, 
although the domestic and casual labor office 
continued to deal primarily with black employees. 
When all the activities were combined in a single 
office at 1295 Poplar in 1969 , this Memphis 
office of IDES handled a full range of both white 
and black clientele. After the Civil Rights Act 
of 1964 was adopted, however, explicit racial 
specifications for jobs or applicants were elim­
inated, although by 1962 blacks were being serv­
iced by the office which had formerly handled 
white job applications. The TDES staff in the 
primary office at 1295 Poplar began to be filled 
with a significant number of blacks by 1968, 
whereas before it was predominantly but not 
exclusively white in racial make-up.

In 1970, significantly altering the operation 
of TDES in Memphis, a Job Bank computer-assisted 
information system, was implemented, and Memphis 
was selected by the Department of Labor as one of 
a handful of cities to participate in an experi­
mental "Conceptual Model" (hereafter, "COMO")

_!_/ This was separate from a farm office which 
serviced primarily black farm laborers.

12a -



approach to the delivery of manpower services. 
Prior to that time TDES interviewers specialized 
in occupational categories, and they dealt with 
both employers and applicants in their assigned 
occupational "specialities." These interviewers 
viewed and referred applicants seeking jobs, and 
would conduct "file searches" in an effort to 
match pending job orders in the specified occupa­
tions with pending applications for those par­
ticular jobs. Applicants could find out what 
jobs were available from interviewers.

The Job Bank program came into being under 
Manpower Development and Training Act to improve 
the problem of communication about jobs. The Job 
Bank is designed to afford more immediate avail­
ability of orders through a central control and to 
allow city-wide exposure of applicants to listed 
jobs. A part of the philosophy behind the Job 
Bank program was the improvement of opportunities 
for disadvantaged persons and minorities. One of 
the intended benefits of the design of the Job 
Bank was to separate job order-taking from the 
interviewing and referral process. It was hoped 
that this program would help disadvantaged appli­
cants in the availability of openings to all

13a -



interviewers so as to reduce the danger of "play­
ing favorites." It was also expected that the new 
computerized information-gathering system would 
better enable local employment service offices to 
identify the characteristics of job-seekers 
who are not recieving maximum benefits of such 
service. This program, according to one of 
plaintiff's own experts did not produce in Memphis 
or elsewhere all the desired effects and ad­
vantages .

On April 15, 1970, the Memphis Office began 
the COMO operational program in conjunction 
with the Job Bank system, again with a primary 
goal of serving the disadvantaged more adequately, 
and the "hard core" unemployed. The purpose of 
the COMO design was to improve the manpower 
delivery system by "self-service use by job ready 
applicants of a computerized Job Bank listing of 
job openings and other information about job 
opportunities;" "job-finding assistance and 
instruction, job development, and job market 
information for applicants who are unsure of 
their degree of job-readiness;" "a controlled 
caseload, team approach to provide a hard-core 
and disadvantaged with the full range of intensi­

14a -



fied manpower services." The Memphis TDES 
office was organized in a manner deemed effective 
to deliver all of these levels of service to those 
with greatest need for manpower services.

A detailed application card is filled out
when an applicant at TDES applies. It reflects
the applicant's work history and other information

2 /necessary for occupational or DOT coding—  and 
other information necessary for referral action. 
The back of this application card contains in­
formation pertaining to test results, if any, 
and other special information, as well as a 
record of job referral action for the particular 
applicant and follow-up contact information. For 
those who have not previously filed applications, 
there is an intake and briefing session which 
explains the operation of the office. Applica­
tions are filled out at the receptionist desk and

2/ The Dictionary of Occupational Titles (DOT) 
is a system of coding types of jobs designed by 
the Department of Labor. The system utilizes a 
six-digit code in which the first three digits 
indicate the job or the occupation, and the second 
three digits indicate to what extent particular 
job requires the employee to relate to data, to 
relate to people, and to relate to things.

15a -



filed by occupational code with a cross index. 
The applications are maintained on file until the 
applicant is placed, or until 60 days from the 
last contact. Applicants who are not "job ready" 
or who need more special attention for some reason 
are referred to counselors. A more detailed 
counseling control card is maintained for this 
group of job seekers. Applicants who do not need 
special attention or help go to the Job Bank 
viewers where they may look for job openings in 
areas of their interest or look generally at all 
job openings available that day. When an appli­
cant selects a job in which he is interested he 
then goes to a interviewer who determines his 
eligibility for the job in question, checks with 
the Order Taking Unit to see if the job is still 
open and whether the number of referrals requested 
by the employer have already been made. An 
applicant who is referred to a job is given a Job 
Bank referral slip to deliver to the employer. 
The employer indicates the action taken on the 
referral and returns this slip to TDES.

When an employer telephones TDES in Memphis 
seeking applicants for a job opening, a person in 
the Order Taking Unit (who, although classified as

16a



an interviewer, does not necessarily have contact 
with applicants) takes down all relevant informa­
tion pertaining to the opening on a job order 
form. That job order is transmitted daily by wire 
to the TDES computer center in Nashville where the 
information is transferred to microfilm cards and 
returned to Memphis the next morning for use in 
the Job Bank. The information available to 
applicants contains all relevant data about the 
job but the microfilm viewers do not reveal the 
employer's name. (The employer's name and other 
data are available, however, on the viewers 
used by interviewers and counselors of TDES.)

Although the Memphis Office operates branch 
offices and conducts activities related to the 
primary function of job referral and placement, 
most of the operation is now conducted at one 
main location. In May of 1973, however, the 
Commercial, Professional & Technical Division 
moved from the main office to another location. 
Applicants seeking clerical, professional or 
technical jobs are now referred to that other 
location nearby, which handles a higher percentage 
of while [sic] applicants than the main office. 
This CP&T office handles higher-paying and

17a



better quality positions such as clericals, 
engineers, bookkeepers, etc. This separate 
unit maintains its own applicant files and does 
its own file searches, and all applicants seeking 
employment in these occupational classifications 
are referred to the separate CP&T office. The 
vast majority of employees at the latter office 
are white. The Memphis Office still operates a 
separate "Domestic and Casual Labor" unit. 
Casual, day, domestic, and farm applicants 
are now handled in an annex at the main office 
location. Most of the applicants handled in this 
unit are for jobs of three days duration or less, 
such as warehouse loading, yard work, and mis­
cellaneous jobs of this type. The unit also 
handles such full-time jobs as domestic help. 
This unit is not, however, a part of the Job 
Bank operation and job orders are taken directly 
by the unit without coming from central control.

The procedures described as employed begin­
ning in 1970 and up to the present are more 
efficient and helpful to job applicants, including 
blacks. There has been continued improvement 
in service to black and minority group job appli­
cants in the Memphis office of TDES since 1970. 
The Job Bank system has increased the participa­

18a -



tion of black applicants in job opportunities and 
areas previously available, for the most part, 
to white applicants.

State employment agencies, including TDES, 
that receive federal assistance in the implemen­
tation and operation of job opportunity programs 
are not to refer appplicants to employers known to 
be engaged in racially discriminatory employment 
practices. Employer relations unit representa­
tives of TDES have responsibility to deal with 
employers and to counsel those who may be believed 
or found to engage in racially discriminatory acts 
or procedures, and they may initiate recommenda­
tions to cease "doing business" with such em­
ployers. Normally, however, an interviewer or 
order taker within the TDES would initiate infor­
mation or request for action relative to an 
alleged discriminatory employer. Such an em­
ployer's card may be marked for "control"-purposes 
and excluded from use as being a racially discrimi­
nating "suspect" employer. Normally, however, the 
use of tests, even though not validated, would 
not place an employer in such a category. There 
is an area equal employment opportunity represen­
tative (formerly called a minority group represen­

19a -



tative) whose responsibility essentially is to 
gain compliance with the 1964 Civil Rights Act as 
amended, and to coordinate activities of TDES with 
local race sensitive agencies.

In 1971, the percentage of minority race 
persons of TDES was approximately the same as 
that of the percentage of minority to the whole 
number of State of Tennessee employees. The 
Personnel Department of the State of Tennessee, 
however, at this time had a lesser percentage 
of black and minority employees. Under a new 
State administration, however, after 1971 these 
percentages improved as to incidence of black 
employees, including those in supervisory posi­
tions. The defendant department heads initiated 
actions to improve utilization of black employees 
prior to the filing of this suit. In 1971, the 
percentage of black employees in the Memphis 
Office of TDES was approximately twice that of the 
State as a whole (approximately one-fourth), 
although there were relatively few interviewers in 
the main office. The majority of the traffic in 
the Memphis Office then and now, however, is 
black. There is still some opportunity for 
discrimination by interviewers and others in

- 20a -



the Memphis office since 1970, but plaintiff has 
failed to demonstrate by proof specific instances 
of such discrimination. There still must be 
judgments made of applicants' abilities, file 
search suitabilities, and code ratings, but 
no system can avoid the possibility of discrimina­
tion.

In dealing under guidelines suggested by the 
Department of Labor with suspected discriminatory 
employers, TDES procedures causes them to be 
placed "on control" or to be eliminated as 
sources of employment pending investigation and 
attendant circumstances. It was not the practice 
of TDES to notify the local office of the Equal 
Employment Opportunity Commission if discrimina­
tory practices were suspected of a given employer, 
nor did TDES refuse to serve employers who ad­
ministered tests which might prove to have dis­
parate effects on blacks. An area Equal Employ­
ment Opportunity representative, a black, was 
appointed after passage of Titles VI, VII of the 
Civil Rights Act of 1964 to serve as liason 
with community agencies and to improve minority 
group opportunities and representation.

21a -



According to plaintiff's data, by trial of 
this cause, 34% of Memphis Area Office employees 
were black, roughly equivalent to the percentage 
of black adult population in the City. Some were 
classified as managers, others as counselors, 
interviewers, clerks, typists, ERR's, and "agents.1 
The higher salaried positions generally, however, 
reflected relatively fewer blacks, because 38% of 
the whites had been hired before 1964 and only 13% 
of the blacks had been hired before that date, 
giving the blacks relatively less seniority and 
experience. This was borne out by the data 
indicating that the higher salaried blacks, for 
the most part were hired before 1964, and the same 
situation prevailed for whites. Significant
advancement was made by blacks as counselors and

3/managers m  recent years.—  Black employees do 
fill most of the lower paying positions. Most of 
the white interviewers had been hired prior to 
1964, while most black interviewers were hired 
after 1964.

3J For instance, 35% of counselor II positions 
were filled by blacks; 50% of counselor III 
positions, and 25% of counselor I positions.

- 22a -



The State of Tennessee follows a civil 
service system in which classified civil service 
job openings are filled (whether by new hires or 
by promotions) in accordance with a classification 
system established by the Department of Personnel. 
See TCA §8-3001 et seq. Generally, an employment 
certification list is maintained and State agen­
cies hire from the top five eligibles, and in the 
case of promotions, vacancies are filled from the 
top three eligibles for promotion. Tests are 
usually involved, or have been involved in many 
classifications. In the case of the position of 
interviewer at the Memphis Office of TDES, 
for example, tests are involved and performance is 
an important factor in selection. Validation 
studies in connection with these tests were being 
made at time of trial. The Department of Person­
nel furnishes TDES the names of eligible as to the 
interviewer (and other) classifications. TDES is 
considered to be a total "civil service" agency 
except as to non-skill, lower paying positions. 
Prior experience is, of course, a factor in TDES 
promotions, and Memphis Area Office appplicants 
are given priority over those from other areas.

23a



The Department of Personnel has not identified the 
race of persons on eligibility lists in accordance 
with D.S. Civil Service Commission requirements. 
Generally, according to plaintiff's counsel's 
contentions, minority applicants, based on test
scoring, do not attain the top three or top five

• • 4 /positions
Blacks, according to 1970 census figures, in 

Shelby County, Tennessee, comprised a substantial 
majority of "poverty level" or less economic 
family units, although they comprised only about a 
third of the population, and they experienced more 
than twice as much unemployment proportionately. 
Some studies attribute the disproportion to 
"institutionalized behavior" as contrasted to 
specific discriminatory conduct in the Memphis 
area in considering the heavy concentration of 
blacks in relatively low-paying jobs. This is 
part of a national problem with respect to urban 
minority employment.

In 1966, the relative occupational position 
of black males in the Memphis area in comparison

4/ See proposed finding #34, (plaintiff's).

- 24a -



to whites was approximately the same as in the 
South as a whole, although there was a substantial 
gap between the average income of black and white 
males, and this gap continued into 1970. In 1969 
there were 22,422 white referrals, 35,480 non­
white job referrals by the Memphis Office of TDES 
in response to 31,198 job "orders." There were 
23,186 placements, of which 7,309 were white, 
15,877 non-white. In 1972, there were 19,668 
white referrals, 36,829 non-white, in response to 
41,911 job orders, resulting in 20,084 placements, 
of which 14,054 were non-white. Unquestionably 
the TDES Office was an important source of jobs 
for blacks in Memphis as well as in the United 
States as a whole. In 1973,-^68% of referrals 
were to blacks, and 58% of placements were to 
blacks. There was, however, a difference in that 
same period of about thirty cents an hour in the 
average hourly rate of black and white males 
in the jobs to which they were referred. There 
was even a greater differential, over-all, between

5/ Over a ten month period analyzed by plain­
tiff's expert, Dr. Joseph C. Ullman, a consultant 
with the Department of Labor's Manpower Adminis­
tration.

- 25a -



black and white females. The disparity, however, 
between the races as to job referral differentials 
decreased as educational levels increased. 
References to Dr. Ullman's analysis of data on 
behalf of plaintiff is made to a ten month 1972— 
1973 period in which defendant TDES computerized 
figures were made available to plaintiff. The 
differences were determined by plaintiff's expert 
to be statistically significant.

From the over-all 68% average of referrals to 
black males during the period analyzed, there was 
only a slight difference in the ratio referred to 
so-called "higher paying industries" and to "low 
wage, industries," but there was about a ten 
percent variance from the norm in the case of 
referrals of black females in respect to "high 
pay" and "low pay" categor ies . This was due, 
primarily, to the large number of black females, 
largely uneducated, unskilled, and unexperienced, 
who were referred in domestic and service posi­
tions. There was not a signficant gap, however, 
in average referral wage rates of black and white 
females to "high-wage industries" during this 
period studied. This was a contrast to the

26a -



significant differences in the other categories 
mentioned as to both male and female referrals. 
More blacks were referred, on a percentage basis, 
to low-skill jobs than to high-skill jobs, based 
on DOT codes used by the Department of Labor in 
compiling its statistics. When skill and ex­
perience were demonstrated to be job requisites or 
desirable, the proportionate differences between 
black and white referrals proved to be less 
significant. Other than possible discrimination 
involved, by the employer, or by some TDES em­
ployee, Dr. Ullman thought a likely explanation 
for the disparity to be based on more job ex­
perience on the part of white applicants, and that 
TDES "interviewers are referring whites with 
experience in preference to blacks without ex­
perience." His opinion was that a presently 
racially neutral policy on the part of TDES, 
particularly the Memphis office, in referring more 
job experience whites than less experienced 
blacks, has an effect of perpetuating past dis­
crimination. He conceded, however, that substan­
tially disportionate effects would be required on 
the part of TDES to place the higher percentage

27a -



of uneducated or comparatively uneducated blacks, 
unskilled as well as inexperienced, in comparison 
to better educated (attaining a higher grade 
level), more skilled and more job experienced 
whites, particularly as to hard core unemployed. 
For instance, defendant's expert, Dr. Bernard R. 
Siskin, in studying the same ten month statistics, 
concluded that "it is almost three times more 
likely that a white applicant is high-skilled than 
a black is high-skilled." He also concluded that 
the data studied was misleading and inaccurate 
because it did not relate to individual applicant
data or experience rather than referral data.

6 /Dr. Siskin' s—  conclusions were m  many 
areas contrary to those of Dr. Ullman. For 
example, he found that black females were being 
disproportionately referred to permanent jobs, 
in comparison to temporary jobs, than were white 
females, whereas black males were being dispropor­
tionately referred to temporary jobs, but this he 
explained was due to black males being referred to 
laborer jobs which they were seeking more than 
were white males. He found that it took more than

6/ Dr. Siskin of Temple University has testified 
also for plaintiffs in discrimination cases.

- 28a -



50% more referrals to place a black than a white 
and concluded that this situation reflected upon 
the statistical data relied upon by Oilman. After 
adjustment, taking this factor into account, the 
racial disparity in regard to referrals to high- 
skill or low-skill jobs was reduced significantly, 
particularly as to males. His conclusion was that 
the TDES data showed that agency to be acting in a 
"complete racially neutal manner," in Memphis, and 
was, moreover, not inconsistent with some affirma­
tive action indications.

In substance, Dr. Siskin found disparities 
between the races due primarily to differences 
in skills, education and other factors after 
analyzing (the data. He found no evidence that 
racial discrimination played any significant role 
in practice or procedure during the 1972-1973 
period studied in the Memphis office. Particu­
larly as to those with high school education 
or better, he found differences, if any, with 
regard to referrals to be relatively unsubstantial 
and of no practical significance with respect to 
race. He found an over-all wage differential, 
as adjusted, of approximately 18 cents but con­
sidered this difference to be accounted for

29a -



by considerations of disparities in skills, 
experience, and special education. Over-all, 
public employment service, such as that of TDES, 
handles only about five percent of total job 
placement in the economy, but it is an important 
employment factor to blacks.

Whites who apply at the Memphis Office of 
TDES are almost twice as likely to have high skill 
experience than blacks; 25% more, in proportion, 
of white males have at least a high school educa­
tion than black males; 30% more white females 
have at least a high school education than black 
females .—^Approximately 40% of blacks so apply­
ing have less than a high school equivalent, 
whereas only 10% of white females are in this 
category, and only 15% of white males. In the 
Memphis community at large approximately 37% of 
black employees are categorized as laborers, 
compared to less than 6% of white males. Approxi-

7] It is more than five times as likely that 
black female applicants to the Memphis Office 
will have a ninth grade education or less in 
comparison to white females; three times as 
likely black males will be so educationally 
handicapped in contrast to white males. (16% 
to 3% in case of females, 16.5% to 5% in case of 
males).

- 30a



mately 75% of black employees were categorized as 
laborers or "operatives" (56% of black females), 
as compared to 27% white males (21% white females) 
so categorized in 1969.

From these findings the court concludes that 
the court does have jurisdiction of this cause, 
including the class action allegations made by 
plaintiff Shipp as to all defendants. The Memphis 
Area Office of TDES is an "employment agency" 
within the meaning of Title VII 42 U.S.C. §2000e 
(b) and (c), and the other parties were appro­
priately named in Rule 19 to effectuate complete 
relief to the extent indicated. Charges under the 
post Civil War Civil Rights Acts, 42 U.S.C. §1981 
and 1983 and under the 14th Amendment may be 
afforded separate relief. Johnson v. R.E.A., 43
U.S.L.W. 4623, ____ U.S. ____  (5-19-75). See
Long v. Ford Motor Co., 496 F.2d 500 (6th Cir. 
1974).

There was no bad faith indicated by TDES with 
regard to black employment opportunities following 
a seasonable opportunity to comply with the 
provisions of Title VII enacted in 1964. The 
employment practices of TDES, and particularly the 
Memphis Office, were facially neutral and non-dis- 
criminatory until approximately 1970. In respect

31a -



to the COMO program and efforts to solve chronic 
minority unemployment after that time, the Memphis 
Office, and TDES made some affirmative efforts, 
although not entirely effective to alleviate 
effects of past discrimination within the internal 
structure of the office and in its impact on the 
Memphis employment community. There was no 
freezing or limitation placed upon transfer or 
promotion insofar as blacks were concerned, 
despite the fact that seniority as well as testing 
capability and other pertinent considerations, 
were taken into account as to hiring and promo­
tions. This is not a Griggs v. Duke Power Co., 
401 U.S. 424 (1971) nor an EEOC v. Detroit Edison, 
9 EPD 19997 _____ F.2d ____ (C.A. 1975) situation.

There was significant increase in number of 
black employees and in their advancement to 
higher paying positions during the years in 
dispute in the Memphis Office. Need for improve­
ment , however, is specifically noted in the

g j
positions of manager, i n t e r v i e w e r a n d  ERR.

8J  It is recognized that blacks are well repre­
sented as counsellors, clerks, typists and "agents" 
in that office.

- 32a -



There was a significant dispute between 
sincere experts who testified in this cause as to 
the effect of statistical studies and analysis and 
not only whether they indicated a prima facie case 
of employment discrimination, but also whether 
they indicated racial discrimination at all as to 
the effect of TDES services when factors of 
skill, education and experience were taken into 
account. This court does not find any basis 
to attribute to the Memphis Office of TDES a 
realistic causative force in the evident signifi­
cant differences between white and black appli­
cants as to skills, education and experience. 
Rather it seems apparent that the community 
itself, and the private sources of employment in 
the Memphis area, apart from the TDES, were the 
basic reason for differences in skill and ex­
perience. Many causes may be the reason or be 
suggested for differences found between the 
educational level of whites (or lack thereof) and 
that of black applicants to the Memphis TDES 
Office. Here again, this court does not attribute 
the blame for this condition upon any of the 
defendants in this cause.

- 33a -



Defendants' explanation of its practices did 
not indicate a system "loaded" or weighed against 
black applicants, nor did it demonstrate perfect 
procedures that would eliminate virtually all 
avenues for possible subtle discrimination. The 
use of job banks and the increasing proportion of 
blacks who receive consideration by referral to 
higher pay and higher skill jobs does tend to show 
not only good faith efforts to eradicate past 
effects of segregation and discrimination but also 
some effective affirmative steps to assist in 
upgrading opportunities for blacks at TDES.

It is a fact that most of the managers and 
top-level decision makers in the Memphis Office 
are white. Improvement, however, is reflected in 
the ratios in recent years so that blacks now 
have a real voice at most higher policy levels. 
The court does not find this fact alone a real­
istic basis for concluding that in its internal 
structure, the Memphis Office has been shown to be 
discriminatory in the availability of service to 
blacks, nor in affording opportunities for ad­
vancement. The court would hope and expect that 
state civil service procedures might be liberal-

- 34a -



ized so as to afford still greater opportunities 
to qualified black state employees of TDES to 
advance (and to be hired in the first instance). 
In view of current notoriety in this area, however, 
in other state Departments it is evident that 
lawmakers and the public are conscious of desir­
able reasons for and apparent purposes behind 
civil service procedures to remove state employees 
in agencies such as TDES from politics. Changes 
in these procedures so that the names of more 
blacks might appear on eligibility lists would 
have to emanate from the Department of Personnel 
and its commissioner. It has not, in any event, 
been demonstrated that blacks have been, for 
racial reasons, deliberately or by design omitted 
or eliminated from qualified eligibility lists by 
any of the defendants. Plaintiff has failed to 
show that present referral policies and practices 
of the defendants have an unlawful discriminatory 
impact upon black job applicants now, or that they 
perpetuate past effects of racial discrimination 
for which defendants may be deemed responsible.

The court has previously considered fully 
the individual case of Eroneous Shipp and rendered 
its opinion as to that cause of action. Upon

- 35a -



reconsideration in light of plaintiff's motion, 
the court reiterates its prior determination that 
judgment must also in that phase of the case be 
rendered for defendants.

Let judgment be entered for defendants 
accordingly and costs be assessed against plain­
tiff.

This _____ day of September, 1975.

Harry W. Wellford /s/___________
UNITED STATES DISTRICT COURT JUDGE

Filed: September 25, 1975



U.S, COURT OF APPEALS 
SIXTH CIRCUIT

No. 76-1515, August 7, 1978

ERONEOUS SHIPP, et al.

Plaintiffs,

- vs -

MEMPHIS AREA OFFICE, TENNESSEE 
DEPARTMENT OF EMPLOYMENT SECURITY, 
et al. ,

Defendants.

On Appeal from the United States District Court 
for the Western District of Tennessee. Affirmed 
in part and reversed in part.

Elijah Noel, Jr. (Ratner, Sugarmon,
Lucas & Salky), Memphis, Tenn., Jack 
Greenberg, Morris J. Bailer, and Eric 
Schnapper, New York, N.Y., and William 
E. Caldwell, Washington, D.C., on brief 
for appellant.

Henry Haile of Haile & Martin, P.A., 
Nashville, Tenn. (Brooks McLemore,
Attorney General of Tennessee, and Sam J. 
McAllister, Chief Counsel, Tennessee 
Department of Employment Security, with him 
on brief) for appellees.

- 37a -



Before WEICK, CELEBREZZE and KEITH,
Circuit Judges.

KEITH, Circuit Judge: —  Eroneous Shipp, a
Black man, appeals from a judgment of the district 
court denying both individual and class claims 
against the Memphis Area Office of the Tennessee 
Department of Employment Security (TDES), the 
Tennessee Department of Personnel, and Jane Harda­
way, its former Commissioner. Plaintiff commenced 
this action on September 16, 1971, on behalf of
himself and all other similarly situated Black 
persons, alleging that TDES engaged in racial 
discrimination in its job referral services and 
that the Department of Personnel engaged in racial 
discrimination in its internal employment prac­
tices, in violation of Title VII of the Civil 
Rights Act of 1964, 42 U.S.C. §§2000e et seq. , 42 
U.S.C §§1981-1985, and the Thirteenth and Four­
teenth Amendments to the United States Constitu­
tion.— ^We affirm in part and reverse in part.

On Friday, March 7, 1969, after hearing a 
TDES initiated radio advertisement soliciting 
applicants for a job as a traffic analyst, plain-

_1/ Title VII jurisdiction over TDES was properly 
invoked pursuant to the Civil Rights Act of 1964, 
42 U.S.C. §20Q0e(c). TDES is a federally funded 
employment service.

- 38a -



tiff telephoned the TDES office concerning the 
job. He was informed by a TDES interviewer that 
he was probably unqualified. Nevertheless, 
plaintiff obtained an application and went to the 
TDES office on Monday, March 10, 1969, seeking to 
be referred to the advertised job. He spoke this 
time with a TDES supervisor who refused to refer 
him because she believed the job required recent 
traffic rate experience and that plaintiff was 
unqualified. TDES had previously referred two 
white applicants to the job. The supervisor, 
however, called the employer, RCA, and was in­
formed that the job already had been filled. 
Plaintiff believed he had been subjected to 
racial discrimination because he had informed the 
TDES interviewer that he had heard the job adver­
tisement in a predominantly Black radio station 
and had attended a well-known predominantly Black 
college. Plaintiff filed charges against TDES 
with the EEOC and subsequently received a right- 
to-sue letter. The district court dismissed 
plaintiff's individual claim on the ground that 
plaintiff failed to prove that TDES had discrimi­
nated against him. The court found that TDES 
believed plaintiff was unqualified for the

- 39a -



job and that the job was filled at the time of 
plaintiff's application. The district court 
also dismissed the class claims. On appeal 
plaintiff alleges that the district court erred in 
dismissing plaintiff's individual claim and class 
claims against TDES and the Department of Person­
nel.-^

This case came to trial following many years 
of discovery,during which a tremendous amount of 
statistical and other evidence was elicited. Over 
a three-day period, March 20-22, 1974, the dis­
trict court heard all of the proofs on plaintiff's 
individual claim and plaintiff's proofs with 
respect to the class action aspect of the case. 
At the conclusion of this hearing, defendants 
moved for a directed verdict on the class claims. 
On June 13, 1974, the court entered an order 
stating that it would consider entering judgment 
on the individual claim without prejudice to the 
rights of the class involved, and that it would 
take under advisement defendants' directed verdict 
motion without prejudice to defendants' rights

2J Counsel for plaintiff did not appear for 
oral argument.

- 40a -



under the motion to go forward with their proofs 
on the class action aspect of the case.

On December 20, 1974, the district court
entered a five page order dismissing plaintiff's 
individual claim. Although the court noted that 
evidence was presented indicating segregation 
by race in TDES' referral services prior to 1964 
and a preponderance of whites in managerial and 
interviewer positions, the court concluded that 
"Shipp himself has failed to demonstrate racial 
prejudice or discrimination against him in connec­
tion with his job application and his transac­
tions" with IDES in 1969 and that Shipp "has
failed to prove the charges made by him against

3/any of the defendants."—
Trial on the merits of the class claims was 

continued with presentation of defendants' proofs 
on April 23, 1975. Plaintiff subsequently moved 
the court to reconsider its December 20, 1974,
order dismissing the individual claim. On Septem­
ber 25, 1975, the district court entered a memo-

3J  The district court further noted as pertinent 
the fact that plaintiff failed to prove any damage 
from TDES' failure to refer him to the RCA job. 
RCA's Memphis Operation closed approximately six 
months after the TDES incident and most employees 
lost their jobs, including the person hired by RCA 
from a private employment service prior to Shipp's 
application for the job.

- 41a -



randum opinion dismissing the class claims on the
merits and reiterating its prior judgment on the
individual claim. At no time did the district
court define or certify the action as a class

4 /action.—  Rule 23, Fed.R.Civ. Pro. Plaintiff

4j  Rule 23 of the Federal Rules of Civil Proce­
dure provides:

(a) Prerequisites to a Class Action. One or 
more members of a class may sue or be sued as 
representative parties on behalf of all only if
(1) the class is so numerous that joinder of all 
members is impracticable, (2) there are questions 
of law or fact common to the class, (3) the 
claims or defenses of the representative parties 
are typical of the claims or defenses of the 
class, and (4) the representative parties will 
fairly and adequately protect the interests of the 
class ;

(b) Class Actions Maintainable. An action 
may be maintained as a class action if the prere­
quisites of subdivision (a) are satisfied, and in 
addition:

(1) the prosecution of separate actions by 
or against individual members of the class 
would create a risk of

(A) inconsistent or varying adjudications 
with respect to individual members of the class 
which would establish incompatible standards of 
conduct for the party opposing the class; or

(B) adjudications with respect to individual 
members of the class which would as a practical 
matter be dispositive of the interests of the 
other members not parties to the adjudications or 
substantially impair or impede their ability to 
protect their interests ; or

- 42a -



never motioned the court for class certification, 
nor did the district court certify the class sua 
sponte, Baxter v. Palmigiano, 425 U.S. 308, 310 
n.l (1976); Senter v. General Motors Corp., 532 
F . 2d 511, 12 FEP Cases 451 (6th Cir. 1976). * 2 3

4/ Cont'd .

(2) the party opposing the class has acted 
or refused to act on grounds generally applicable 
to the class, thereby making appropriate final 
injunctive relief or corresponding declaratory 
relief with respect to the class as a whole; 
or

(3) the court finds that the questions of 
law or fact common to the members of the class 
predominate over any questions affecting only 
individual members, and that a class action 
is superior to other available methods for the 
fair an efficient adjudication of the controversy. 
The matters pertinent to the findings include: (A) 
the interest of members of the class in indivi­
dually controlling the prosecution or defense of 
separate actions; (B) the extent and nature of 
any litigation concerning the controversy already 
commenced by or against members of the class; (C) 
the desirabilty or undesirability of concentrating 
the litigation of the claims in the particular 
forum; (D) the difficulties likely to be en­
countered in the management of a class action.

(c) Determination by Order Whether Class 
Action to be Maintained: Notice; Judgment: 
Actions Conducted Partially as Class Actions.

(1) As soon as practicable after the com­
mencement of an action brought as a class action, 
the court shall determine by order whether it is

- 43a -



Pursuant to Rule 23(c)(1) a district judge is 
required to determine by order "[a]s soon as

4/ Cont'd.

to be so maintained. An order under this subdivi­
sion may be conditional, and may be altered or 
amended before the decision on the merits.

(2) In any class action maintained under 
subdivision (b)(3), the court shall direct to 
the members of the class the best notice prac­
ticable under the circumstances, including indivi­
dual notice to all members who can be identified 
through reasonable effort. The notice shall 
advise each member that (A) the court will exclude 
him from the class if he so requests by a speci­
fied date; (B) the judgment, whether favorable or 
not, will include all members who do not request 
exclusion; and (C) any member who does not request 
exclusion may, if he desires, enter an appearance 
through his counsel.

(3) The judgment in an action maintained as 
a class action under subdivision (b)(1) or (b)(2), 
whether or not favorable to the class, shall 
include and describe those whom the court finds 
to be members of the class. The judgment in an 
action maintained as a class action under subdivi­
sion (b)(3), whether or not favorable to the 
class, shall include and specify or describe those 
to whom the notice provided in subdivision (c)(2) 
was directed, and who have not requested exclusion, 
and whom the court finds to be members of the 
class.

(4) When appropriate (A) an action may be 
brought or maintained as a class with respect 
to particular issues, or (B) a class may be 
divided into subclasses and each subclass treated 
as a class, and the provisions of this rule shall 
then be construed and applied accordingly.

- 44a -



practicable after the commencement of an action" 
whether an action commenced as a class action

4/ Cont1 d .

(d) Orders in Conduct of Actions, In the 
conduct of actions to which this rule applies, the 
court may make appropriate orders: (1) determining 
the course of proceedings or prescribing measures 
to prevent undue repetition or complication in the 
presentation of evidence or argument ; (2) requir- 
ing, for the protection of the members of the 
class or otherwise for the fair conduct of the 
action, that notice be given in such manner as 
the court may direct to some or all of the members 
of any steps in the action, or of the proposed 
extent of the judgment, or of the opportunity of 
members to signify whether they consider the 
representation fair and adequate, to intervene the 
present claims or defenses, or otherwise to come 
into the action; (3) imposing conditions on the 
representative parties or on intervenors; (4) 
requiring that the pleadings be amended to elimi­
nate therefrom allegations as to representation of 
absent persons, and that the action proceed 
accordingly; (5) dealing with similar procedural 
matters. The orders may be combined with an order 
under Rule 16, and may be altered or amended as 
may be desirable from time to time.

(e) Dismissal or Compromise. A class action 
shall not be dismissed or compromised without 
the approval of the court, and notice of the 
proposed dismissal or compromise shall be given 
to all members of the class in such manner as the 
court directs. As amended Feb. 28, 1966, eff. 
July 1, 1966.

- 45a -



is to be so maintainedThis Circuit had held 
that a district judge has an obligation sua 
sponte to determine whether an action shall 
proceed as a class action. Senter v. General 
Motors Corp., supra; Garrett v. City of Hamtramck, 
503 F . 2d 1236 (6th Cir. 1974). In this case the 
district court never certified the class nor made 
any determination that the prerequisites for a 
class action were met, specifically, that plain­
tiff's claims were the claims of the class 
or that plaintiff would fairly and adequately 
protect the interests of the class pursuant to 
Rule 23(a). Nor did the district court make any 
determination that the action was properly 
maintainable as a class action pursuant to Rule 
23(b).-7

5/ The " as soon as practicable after the 
commencement of an action" language of Rule 
23(c)(1) is mandatory. The district court has a 
duty to certify the class action whether requested 
to do so or not. Senter v. General Motors Corn. , 
532 F .2d at 520; Garrett v. City of Hamtramck, 503 
F.2d 1236 (6th Cir. 1974).

6/ There was and continues to be considerable 
disagreement among the parties as to whether this 
action was properly maintainable as a class 
action. The class action issues were not included 
in the pretrial order. However, it is indisput­
able that the case went to trial on the class 
action issues, both sides presenting proofs on 
this issue.

- 46a -



In East Texas Motor Freight Systems Inc, v .
Rodriquez, — ^431 U.S. 395 (1977), the Supreme
Court reiterated its prior rulings that the
procedural requirements of Rule 23 must be
adhered to with diligence.

We are not unaware that suits alleging racial 
or ethnic discrimination are often by their 
very nature class suits, involoving class­
wide wrongs. Common questions of law or fact 
are typically present. But careful attention 
to the requirements of 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

TJ In McBride v. Delta Air Lines,Inc., 551 F.2d 
113 (6th Cir. 1977)(Weick, J. dissenting), this 
Court remanded the case back to the district 
court for a determination of the appropriate 
scope of the class in light of Tipler v. DuPont, 
443 F.2d 125 (6th Cir. 1971), for findings of fact 
and conclusions of law on the charge that Delta 
had violated Title VII, and for appropriate class 
remedies if a violation were found. Our decision 
in McBride, however, was vacated and remanded by 
the Supreme Court for further consideration in 
light of East Texas Motor Freight Systems, Inc, v . 
Rodriquez, 431 U.S 395 (1977). On remand our 
Court affirmed the district court; McBride v . 
Delta Air Lines, Inc., No. 75-1955, Jan. 3, 1978 
(Edwards, J., concurring).

- 47a -



lawsuit will be an adequate representative of 
those who may have been the real victims 
of that discrimination, (emphasis added).

Id. at 405-06; See also Board of Commissioners v. 
Jacobs, 420 U.S. 128 (1975); Sosna v. Iowa, 419
U.S 393 (1975).

The need for certification is clear. When a
district court certifies a class, the class
of unnamed members acquires a legal status separate

8 /from the interests of the individual plaintiff.—  
Sosna v. Iowa, supra at 399. Moreover, certifica­
tion has important consequences for unnamed 
members of the putative class. Where a suit such 
as this one proceeds to decision on the merits, 
the district court's judgment will bind all 
persons allegedly members of the class. Sosna v . 
Iowa, supra at 399 n.8.

Additionally, certification indicates whether 
the action is maintainable as a Rule 23(b)(1), 
23(b)(2), or 23(b)(3) class, and what type of

8/ In Board of Commissioners v. Jacobs, 420 U.S. 
128 (1975), the Supreme Court further noted that 
where plaintiff students, who sued for violations 
of their First and Fourteenth Amendment rights to 
publish and distribute a school newspaper, had 
graduated and no longer had an interest to pro­
tect, the case was moot unless it had been duly 
certified, pursuant to rule 23. Id. at 129.



notice to class members, if any, is required
pursuant to Rule 23(c). In this Court's opinion
in Senter v. General Motors Corp., supra, Judge
Celebrezze noted the following procedure to be
followed in this Circuit in class action cases:

The proper procedure, of course, would have 
been for Appellant's attorney to indicate in 
the complaint that the suit was brought as a 
class action under Rule 23 and to identify 
the relevant subheading of the rule. Also, 
the District Court should have ruled on the 
maintainability of the class action "as soon 
as practicable" after commencement of the 
action. (emphasis added).

Id. at 522.
The district court here found after three 

days of testimony and examination of numerous 
exhibits, and after presentation of the evidence 
as to the TDES employees' belief that plaintiff 
was unqualified for the j.ob and that the job 
already had been filled, that plaintiff had not 
been discriminated against. These findings

8J  Cont'd ,

The need for definition of the class pur­
ported to be represented by the named plain­
tiffs is especially important in cases like 
this one where the litigation is likely to 
become moot as to the initially named plain­
tiffs prior to the exhaustion of appellate 
review.

Id. at 130.

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are not clearly erroneous. Plaintiff did not 
suffer injury as a result of the alleged discrimi­
natory practices and thus is not eligible to 
represent a class of persons who allegedly did 
suffer injury; that is, those Black persons who 
were, are, or will be discriminated against 
because of TDES1 referral practices.— ^East 
Texas Motor Freight Systems, Inc, v. Rodriguez, 
supra at 403-04.

9j  Plaintiffs in Rodriguez had failed to move 
for certification of their class action allega­
tions in the district court. The district court, 
noting this failure, dismissed the class action 
and additionally found against the individual 
plaintiffs. On appeal the Court of Appeals for the 
Fifth Circuit "discounted entirely plaintiffs' 
failure to move for certification" and certified 
the class on its own motion. East Texas Motor 
Freight Systems, Inc, v. Rodriguez, supra at 401. 
The Supreme Court found that the Court of Appeals 
plainly erred in declaring ,a class action "for the 
simple reason that it was evident by the time the 
case reached that court that the named plaintiffs 
were not proper class representatives under Fed. 
R.Civ.Pro. 23(a)." Id. at 403.

Even assuming, as a number of courts have 
held, that a district judge has an obligation 
on his own motion to determine whether an 
action shaM. proceed as a class action. See,

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Plaintiff's individual claim was dismissed 
and no certification whatsoever took place. 
Nonetheless, the district court proceeded to 
decide the merits of the class claims in the 
absence of a class representative, much less one 
who would fairly and adequately protect the in­
terests of the class of persons allegedly dis­
criminated against by TDES referral services,—  ̂
or the class of persons allegedly injured by the 
internal hiring and promotion practices of the

9/ Cont'd .

e.g., Senter v. General Motors Corp., 532 
F.2d 511, 520-521 (CA6) ; Garrett v. City of
Hamt r amc k , 503 F . 2d 1236, 1243 (CA6),
Castro v. Beecher, 459 F.2d 725, 731 (CA1),
the named plaintiffs' failure to protect the 
interests of class members by moving for 
certification surely bears strongly on the 
adequacy of the representation that those 
class members might expect to receive, 
(citations omitted).

Id. at 405.
See generally Developments in the Law: Class

Actions, 89 Harv. L. Rev. 1319 (1976); Note, Rizzo 
v. Goode: The Burger Court's Continuing Assault on 
Federal Jurisdiction, 30 Rutgers L. Rev. 103 
(1976).

10/ In Rodriguez the Supreme Court noted that 
[w]here no class has been certified, 
however, and the class claims remain to 
be tried, the decision whether the named 
plaintiffs should represent a class is 
appropriately made on the full record,

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Department of Personnel. Rogers v. Paul, 383 U.S. 
198 (1965). Furthermore, it is abundantly clear 
that plaintiff never was an employee of TDES and 
in fact never had applied for a job at TDES. We, 
therefore, fail to see how it can be said that 
plaintiff's claims are typical of the class of 
TDES employees who were, are, or will be discrimi­
nated against because of the internal hiring and 
promotion practices of the Department of Person­
nel. Rule 23(a)(3).

Senter v. General Motors Corp., supra, and 
Alexander v. Aero Lodge No. 735, International 
Association of Machinists and Aerospace Workers, 
AFL-C10, 565 F.2d 1364 (6th Cir. 1977), cert.
denied ____ U.S. ____ (1978), 46 LW 3751 (June
6, 1978), are not dispositive of this case. In 
both Senter and Alexander the named plaintiffs 
were found to be proper class representatives

10/ Cont'd.
including the facts developed at the 
trial of the plaintiffs 1 individual 
claims.

East Texas Motor Freight Systems, Inc, v . 
Rodriguez, supra at 406 n.12.

Even assuming that the district court erred 
in dismissing plaintiff's individual claim before 
completion of trial on the merits of the class 
claims, the individual claim was reconsidered upon 
plaintiff's motion and disposed of by the district 
court's opinion dismissing the class claims.

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with claims typical of the class. Senter v . 
General Motors Corp., 532 F.2d at 525; Alexander 
v. Aero Lodge No. 735, 565 F.2d at 1373. In the 
instant case, however, the district court ruled 
against Shipp's individual claim and this action 
left the purported class without a proper class 
representative. Where, as here, it is clear that 
the named plaintiff is not a proper class rep­
resentative under Rule 23(a), certification is 
improper. East Texas Motor Freight Systems, Inc. 
v. Rodriguez, supra, at 403.

This is not a case where a class was approp­
riately certified and it later developed that the 
named plaintiff was an inappropriate class 
representative. In that case, the class claims 
would not be mooted or destroyed. Here, the 
district court failed to certify the class even 
after trial on the merits of the individual and 
class claims. As the Supreme Court said in 
Board of Commissioners v. Jacobs, supra at 130:

Because the class action was never properly 
certified nor the class properly identified 
by the District Court, the judgment of the 
Court of Appeals is vacated and the case is 
remanded to that court with instructions to 
order the District Court to vacate its 
judgment and to dismiss the complaint.

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This complaint must be dismissed as to the 
purported class of persons allegedly discrimina- 
ed against by TOES' referral policies, the 
purported class of persons allegedly injured by 
the Department of Personnel's internal employment 
practices, and the purported class of TOES em­
ployees allegedly discriminated against by the 
Department's internal employment practices 
because the named plaintiff is not an appropriate 
class representative within the meaning of Rule 
23(a), his individual claim having been dismissed 
from this action prior to any certification. 
Because of our disposition of the case, we do not 
reach the merits of the class claims or the other 
issues raised by this appeal.

The district court's dismissal of plaintiff's 
individual claim is affirmed. The judgment of the 
district court with respect to the class claims is 
reversed and the case remanded with instructions 
to the district court to vacate its judgment 
and to dismiss the complaint for failure to comply 
with Rule 23.

Costs are assessed against the appellant 
Eroneous Shipp

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IN THE
UNITED STATES COURT OF APPEALS 

FOR THE SIXTH CIRCUIT 
WESTERN DIVISION

No. 76-1515

ERONEUS SHIPP, et al.,

Plaintiffs-Appellants,

v.

MEMPHIS AREA OFFICE TENNESSEE 
DEPARTMENT OF EMPLOYMENT SECURITY, 
et al. ,

Defendants-Appellees.

Before: WEICK, CELEBREZZE, and KEITH, Circuit
Judges.

Upon consideration of plaintiffs-appellants1 
"Petition for Rehearing" and "Motion" we are of 
the opinion that the issues were adequately 
discussed in our opinion and that the petition for 
rehearing is without merit.

We are further of the opinion that we do not 
have jurisdiction to add new parties to the appeal

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IT IS THEREFORE ORDERED that the petition for 
rehearing and the motion to add plaintiffs be, and 
they are hereby, denied.

ENTERED BY ORDER OF THE COURT

Clerk

Filed: October 26, 1978

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MEIIEN PRESS !NC, —  N. ¥. C. 3 «