Carmical v. Craven Reply Brief for Appellant
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January 1, 1970

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Brief Collection, LDF Court Filings. Cannon v. NC State Board of Education Memorandum in Support of Defendant-Intervenors Motion for Summary Judgment, 1996. 46e421be-ac9a-ee11-be37-00224827e97b. LDF Archives, Thurgood Marshall Institute. https://ldfrecollection.org/archives/archives-search/archives-item/77cd2ce2-9110-49ec-9184-3cecf544d5a8/cannon-v-nc-state-board-of-education-memorandum-in-support-of-defendant-intervenors-motion-for-summary-judgment. Accessed May 17, 2025.
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IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NORTH CAROLINA WESTERN DIVISION CIVIL ACTION NO. 5-96-C-115-BR(3) HAZARD CANNON, et al., Plaintiffs, v. NC STATE BOARD OF EDUCATION, et al., Defendants, and DURHAM COMMITTEE ON THE AFFAIRS OF BLACK PEOPLE, et al., Defendant- Intervenors Irving Joyner N.C. State Bar # 7830 1512 S. Alston Avenue Durham, North Carolina 27702 Telephone: (919) 560-6293 Elaine R. Jones Director- Counsel Norman J. Chachkin Jacqueline A. Berrien NAACP Legal Defense and Educational Fu n d , Inc. 99 Hudson Street, 16th fl. New York, New York 10013 Telephone: (212) 219-1900 MEMORANDUM IN SUPPORT OF DEFENDANT-ENTERVENORS’ MOTION FOR SUMMARY JUDGMENT Adam Stein N.C. State Bar #4145 Ferguson, Stein, Wallas, Adkins, Gresham & Sumter, P.A. 312 West Franklin Street Chapel Hill, North Carolina 27516 Telephone: (919) 933-5300 Anita S. Hodgkiss N.C. State Bar # 15597 Ferguson, Stein, Wallas, Adkins, Gresham & Sumter, P.A. 741 Kenilworth Avenue Charlotte, North Carolina 28204 Telephone: (704) 375-8461 Attorneys for Defendant-Intervenors Table of Contents Table of Authorities......................................................................................................... ii Statement of Relevant Facts .......................................................................................... 2 ARGUMENT - Standards for Granting Summary Judgment ................................................................5 I Plaintiffs’ Claims Are Barred By The Doctrine of Res Judicata....................................................................................................... 5 II The Undisputed Facts Establish That Plaintiffs Cannot Prevail On Their Shaw v. Reno Claim .................................................16 The law ................................................................................................... 16 The evidence .......................................................................................... 18 III Plaintiffs Cannot Prevail On Their Claim Under Section 2 Of The Voting Rights Act ................................................................ 24 The prerequisite showing ...................................................................... 25 The "totality of the circumstances" ....................................................... 27 IV There Is No Evidence To Support Plaintiffs’ Constitutional Claims ........................................................................................ 29 Conclusion .....................................................................................................................30 Page Exhibits (in separate volume) Table of Authorities Cases: Page Abels v. Renfro Corp., 335 N.C. 209, 436 S.E.2d 822 (1993), affg in part and rev’g in part id., 108 N.C. App. 135, 423 S.E.2d 479 (1992) ......................................................... 8-9 Bockweg v. Anderson, 333 N.C. 485, 428 S.E.2d 157 (1993) .......................................... 6, 8, 10, 11, 14 Bush v. Vera, __ U.S.___ , 116 S. Ct. 1941, 135 L. Ed. 2d 248 (1996) ............................................................................................ 17, 18 Cannon v. North Carolina State Bd. of Educ., 342 N.C. 399, 464 S.E.2d 43 (1995) ................................................ 4, 5, 10, 11 Cannon v. North Carolina State Bd. of Educ. 117 N.C. App. 399, 451 S.E.2d 302 (1994), rev’d 342 N.C. 399, 464 S.E.2d 43 (1995) ........................................ 4, 5, 10, 11 Chrisalis Properties, Inc. v. Separate Quarters, Inc., 101 N.C. App. 81, 398 S.E.2d 628 (1990), review denied, 328 N.C. 570, 403 S.E.2d 509 (1991) ................................. 7, 8 Clark v. Calhoun County, 88 F.3d 1393 (1996) ...................................................................................... 18n County of Rutherford v. Whitener, 100 N.C. App. 70, 394 S.E.2d 263 (1990) ..................................... 9, 13, 14, 15 Crump v. Board of Educ. of Hickory Administrative School Unit, 326 N.C. 60-3, 392 S.E.2d 579 (1990), modifying on other grounds and affg id., 93 N.C. App. 168, 378 S.E.2d 32 (1989) ....................................................... 12 - n - Table of Authorities (continued) Daly v. Hunt, 93 F.2d 1212 (4th Cir. 1996) ...........................................................................In Davenport v. North Carolina Dep't of Trans., 3 F.3d 89 (4th Cir. 1993) ...................................................................... 8, 11, 12 Dawson v. Allstate Ins. Co., 106 N.C. App. 691, 417 S.E.2d 841 (1992) ................................................ 7, 10 DeWitt v. Wilson, 856 F. Supp. 1409 (E.D. Cal. 1994), affd in part and appeal dismissed in part,__ U.S.___ , 115 S. Ct. 2637, 132 L. Ed. 2d 876 (1995) ...................................................................... 18 Growe v. Emison, 507 U.S. 25, 113 S. Ct. 1075, 122 L. Ed. 2d 388 (1993) ............................... 25 Hales v. North Carolina Ins. Guar. Ass'n, 337 N.C. 329, 445 S.E.2d 590 (1994) ................................................................9 Hogan v. Cone Mills Corp., 63 N.C. App. 439, 305 S.E.2d 213 (1983), vacated on other grounds, 315 N.C. 127, 337 S.E.2d 477 (1985), on remand, 94 N.C. App. 640. 381 S.E.2d 151 (1989), rev'd, 326 N.C. 476, 390 S.E.2d 136 (1990) ......................................................................... 7? 10 Holly Farms Foods v. Kuykendall, 114 N.C. App. 412, 442 S.E.2d 94 (1994) ..................................................... 7, 8 Johnson v. DeGrandy, 512 U.S.__ , 114 S. Ct. 2647, 129 L. Ed. 2d 775 (1994) ............................................................................................... 27n, 28 Johnson v. Smith, 97 N.C. App. 450, 388 S.E.2d 582, review denied, 326 N.C. 596, 393 S.E.2d 878 (1990) .............................................................. 15 Page - iii - Table of Authorities (continued) Pape Maine v. Thiboutot, 448 U.S. 1, 100 S. Ct. 2502, 65 L. Ed. 2d 555 (1980) ................................... 12 Matsushita Elec. Indus. Co. v. Epstein, __ U.S.___ , 116 S. Ct. 873, 134 L. Ed. 2d 6 (1996) ......................................6 Mears v. Town of Oxford, 762 F.2d 368 (4th Cir. 1985) ...................................................................... 9, 14 Miller v. Johnson, 515 U.S.__ , 115 S. Ct. 2475, 132 L. Ed. 2d 762 (1995) ................................................................................................. 16. 17 Nash County Bd. of Educ. v. Biltmore Co., 640 F.2d 484 (4th Cir.), cert, denied, 454 U.S. 878, 102 S. Ct. 359, 70 L. Ed. 2d 188 (1981) ...................................... 6, 8 Northwestern Fin. Group v. County of Gaston, 110 N.C. App. 531, 430 S.E.2d 689, review denied, 334 N.C. 621, 435 S.E.2d 337 (1993) ............................... 6, 8, 11, 12n Pearsall v. Phillips, 839 F. Supp. 11 (E.D.N.C.), affd. 1 F.3d 1234 (4th Cir.), cert, denied, 510 U.S. 998, 114 S. Ct. 565, 126 L. Ed. 2d 464 (1993) ......................................................... 7 Riley v. Murdock, 890 F. Supp. 444 (E.D.N.C.), affd mem., 83 F.3d 415 (4th Cir. 1996), cert, denied,__ U.S.___ , __ S. C t.___ , __ L. Ed. 2 d ___ , 1996 U.S. LEXIS 6614 (Nov. 4, 1996) (No. 96-324) .................................................................... 6 Rodgers Builders, Inc. v. McQueen, 76 N.C. App. 16, 331 S.E.2d 726 (1985), review denied, 315 N.C. 590, 341 S.E.2d 29 (1986) ................................................................................................. 8, 9, 11, 13 - iv - Table of Authorities (continued) Pape Shaw v. Hunt, __ U .S.___ , 116 S. Ct. 1894, 135 L. Ed. 2d 207 (1996) .......................................................................................................... 16, 17 Shaw v. Reno, 509 U.S. 630, 113 S. Ct. 2816, 125 L. Ed. 2d 511 (1993) 16, 19, 24 Swanson v. Faulkner, 55 F.3d 956 (4th Cir.), cert, denied,__ U.S. , 116 S. Ct. 417, 133 L. Ed. 2d 335 (1995) ......................................................... 6 Thornburg v. Gingles, 478 U.S. 30, 106 S. Ct. 2752, 92 L. Ed. 2d 25 (1986) .......................................................................................................... 25, 27 Tucker v. Frinzi, __ N.C.___ , 474 S.E.2d 127 (1996) .......................................... 6, 9, 13, 14, 15 United States v. National Financial Services, Inc. No. 95-2796, 1196 WL 583557 (4th Cir. October 11, 1996) ............................................................................................................ 5, 24 Wilson v. Eu, 1 Cal. 4th 707, 4 Cal. Rptr. 2d 379, 823 P.2d 545 (1992)............................... 18 Constitution and Statutes: U.S. Const, art. IV, § 1 .......................................................................................... 29 18 U.S.C. § 1738 ...........................................................................................................6 42 U.S.C. § 1973 ................................................................................................. 24, 25n 42 U.S.C. § 1973(b) ................................................................................................... 27 - v - Table of Authorities (continued) 42 U.S.C. § 1983 .......................................................................................................... 12 N.C. Gen. Stat. § 115C-68.1 ........................................................................................3 N.C. Gen. Stat. § 115C-68.3 ........................................................................................4 1991 N.C. Sess. Laws ch. 767, codified at N.C. Gen. Stat. § 115C-68.3 ............................................................................. 4 Legislative Materials: S. Rep. No. 97-417 (1982) ........................................................................................ 28n Rules: Fed. R. Civ. P. 26(a)(2) .......................................................................................... 19n Rule 5.03, United States District Court for the Eastern District of North Carolina .................................................................. 5 Other Authorities: 46 Am. Jr. 2d Judgments § 532 ................................................................................. 13 Page - vi - IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NORTH CAROLINA WESTERN DIVISION CIVIL ACTION NO. 5-96-C-115-BR(3) HAZARD CANNON, et al., Plaintiffs, v. NC STATE BOARD OF EDUCATION, et al., Defendants, MEMORANDUM IN SUPPORT OF DEFEND A YI-INTERVENORS’ MOTION FOR SUMMARY JUDGMENT and DURHAM COMMITTEE ON THE AFFAIRS OF BLACK PEOPLE, et al., Defendant- Intervenors In this action, plaintiffs challenge the districting plan for the consolidated Durham County school system on several federal constitutional and statutory grounds, all centering upon their claim that the plan is drawn for the purpose of separating voters on the basis of race and with the purpose or effect of diluting the voting strength of whites in Durham County.1 Defendant-intervenors have moved for the entry of summary judgment dismissing all of plaintiffs’ claims in this litigation with prejudice. In this Memorandum, we Plaintiffs also alleged that "the Durham County Commissions [sic] illegally used total voting age population figures in constructing the voting district plan rather than registered voters" (Complaint, 1115, at 6). This argument has been conclusively rejected by the Fourth Circuit. Daly v. Hunt, 93 F.3d 1212, 1223-28 (4th Cir. 1996). describe the factual evidence presented to the Court and explain why, considering all of that evidence, there are no facts in dispute that are material to plaintiffs* constitutional or statutory claims and those claims must, under governing law, be resolved in favor of defendants and defendant-intervenors. Statement of Relevant Facts Consideration by the Durham County Commissioners of the possibility of merging the city and county school systems commenced in the spring of 1988 with the creation of a citizen task force to study the question. See Minutes2 at 002-003, 006-011. A year later, following completion of the Task Force’s work (see Minutes at 016-017), the Commissioners hired consultants to develop a merger plan (id. at 019-020), who delivered their recommendations in 1991 (see id. at 025, 033-035). Initially, the Commissioners were presented with ten options for the election of a school board of either seven or nine members -- either all elected from single-member districts, all elected at-large, or some number elected by each method (see id. at 062-068). Following a public hearing (see id. at 083-092), the Commissioners formally adopted the seven single-member-district plan, by a 3-2 vote, for submission to the State Board of Education (see id. at 96). At the request of a committee of the State Board (see id. at 098-110, 112-117), the Commissioners reconsidered the plan and again decided by a 3-2 vote to resubmit it to the Board (id. at 117). The State Board rejected the plan because 2"Minutes” citations are to the excerpts from the Minutes of meetings of the Durham County Board of Commissioners introduced into evidence at the March 22, 1996 hearing as Original Defendants’ Ex. 1. Page references are to the Bates-stamped numbers below the text of each page. - 2 - - in light of the one-vote margin of approval by the Commissioners (see id. at 118-120) - it did not appear to have the support of the entire community. County Commissioners Reckhow (a white Commissioner) and Black (an African-American Commissioner), who had been on opposite sides of the split vote, then took the initiative to attempt to develop alternatives for electing the new school board that might meet with the State Board's approval (see id. at 122). One of the alternatives that they suggested was a "4-2-1" electoral structure. Independent of consideration by the Board of Commissioners, State Representative Paul Luebke (see id. at 123; Transcript of March 22, 1996 hearing ("Tr.") at 25-26), requested Gerry Cohen, Director of Legislative Drafting for the North Carolina General Assembly, to develop a possible district plan for a 4-2-1 electoral structure. This plan was provided to the Commissioners and, following another public hearing (Minutes at 129-133), the Board of Commissioners unanimously adopted the 4-2-1 plan for submission to the State Board of Education (id. at 136), which approved it. On February 13, 1992, Hazard Cannon, Norman Phillips (both of whom are named plaintiffs in this action) and Alvin Olds filed a lawsuit in the Superior Court of Wake County, North Carolina (No. 92CV-01682) challenging the merger plan and the 1991 statute (N.C. Gen. Stat. § 115C-68.1) establishing the procedure by which a merger - 3 - of school systems could be accomplished by action of a county Board of Commissioners.3 On April 14, 1992, the state trial court entered judgment in favor of plaintiffs, finding the 1991 statute and the merger plan to conflict with several North Carolina constitutional provisions. While Durham County's appeal from that decision was pending, the General Assembly enacted 1991 N.C. Sess. Laws ch. 767, codified at N.C. Gen. Stat. § 115C-68.3, ratifying and authorizing the Durham consolidation plan approved by the State Board of Education along with sixteen other such plans. On the basis of this latter statute, the Superior Court ruling in favor of the Cannon plaintiffs was ultimately vacated as moot, Cannon v. North Carolina State Bd. of Educ., 342 N.C. 399, 464 S.E.2d 43 (1995) ("Cannon IF), rev’g id., 117 N.C. App. 399, 451 S.E.2d 302 (1994) (”Cannon F).4 ’Plaintiffs in the state court action were represented by present plaintiffs’ attorney, John Randall, see 342 N.C. at 399, 464 S.E.2d at 43. Dan Sizemore, one of the plaintiffs in this action, is the son-in-law of Hazard Cannon, a plaintiff in both the state and federal court litigation (Answers to Interrogatories [Exhibit "1" hereto], at 3 11 11]). Sizemore discussed the state court lawsuit with Mr. Cannon in early 1992 (id. at 4 H 15), met Mr. Phillips and Mr. Olds "about the time of the original state court lawsuit" (id. at 2-3 HU 9, 10), and became a party to this action at the request of Mr. Cannon (id. at 5 11 16). 4During the course of proceedings in their state court suit, plaintiffs attempted to raise the claim that the districting plan constituted racial discrimination against white voters (see Complaint (in this case), at 5 11 10). The Supreme Court of North Carolina refused to pass upon the issue because plaintiffs had not "filed pleadings in th[e state court] matter alleging racial discrimination and thus did not properly present the issue for determination by the trial court." 342 N.C. at 399, 464 S.E.2d at 43. - 4 - ARGUMENT Standards for Granting Summary Judgment The governing standards for determining whether summary judgment is appropriate were most recently summarized by the Fourth Circuit as follows: Summary judgments are appropriate in those cases where there is no genuine dispute as to a material fact and it appears that the moving party is entitled to a judgment as a matter of law. Fed. R. Civ. P. 56(c); Adickes v. S.H. Kress & Co., 398 U.S. 144, 157 (1970). On summary judgment, any permissible inferences to be drawn from the underlying facts must be viewed in the light most favorable to the party opposing the motion. Matsushita Elec. Indus. Co. Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587- 88 (1986). However, where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, disposition by summary judgment is appropriate. Id. at 587; Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-49 (1986). United States v. National Linancial Services, Inc., No. 95-2796, 1996 WL 583557 (4th Cir. October 11, 1996) (attached as Appendix "A"; see Local Rule 5.03). I Plaintiffs’ Claims Are Barred By The Doctrine of Res Judicata Plaintiffs claims arise from identical operative facts and concern identical asserted rights as the claims at issue in a prior lawsuit (Cannon I and II) that resulted in a final judgment on the merits. All of the parties to the present suit were either parties to that former litigation or in privity with such parties. The doctrine of res judicata therefore bars plaintiffs’ claims, and the Court should accordingly grant defendant-intervenors’ motion for summary judgment dismissing plaintiffs’ claims. - 5 - The Full Faith and Credit Clause of the U.S. Constitution requires that a federal court give the same preclusive effect to a prior state judgment that the judgment would receive in that state’s courts. U.S. CONST, art. IV, § 1. See 28 U.S.C. § 1738; Matsushita Elec. Indus. Co. v. Epstein,__ U.S. ___ , 116 S. Ct. 873, 134 L. Ed. 2d 6 (1996); Swanson v. Faulkner, 55 F.3d 956 (4th Cir.), cert, denied,__ U .S.___ , 116 S. Ct. 417, 133 L. Ed. 2d 335 (1995). Under North Carolina law, a final judgment on the merits in a prior action bars parties to that action or their privies from asserting identical claims in subsequent litigation. Tucker v. Frinzi,__ N.C.___ , ___, 474 S.E.2d 127, 128 (1996). See Riley v. Murdock, 890 F. Supp. 444, 457 (E.D.N.C.), aff’d mem., 83 F.3d 415 (4th Cir. 1996), cert, denied,__ U.S.___ , ___S. C t.___ , ___L. Ed. 2d 1996 U.S. LEXIS 6614 (Nov. 4, 1996) (No. 96-324). The doctrine of res judicata is not merely a "technical rule but a rule of ‘fundamental and substantial justice,’" which promotes important values of "public policy and private peace." Nash County Bd. of Educ. v. Biltmore Co., 640 F.2d 484, 486 (4th Cir.), cert, denied, 454 U.S. 878, 102 S. Ct. 359, 70 L. Ed. 2d 188 (1981). By ensuring the finality of judgments and preventing repetitive litigation, the doctrine serves the dual goals of protecting litigants and preserving judicial economy. Bockweg v. Anderson, 333 N.C. 486. 491, 428 S.E.2d 157, 161 (1993); Northwestern Fin. Group v. County of Gaston, 110 N.C. App. 531, 430 S.E.2d 689, review denied, 334 N.C. 621, 435 S.E.2d 337 (1993). - 6 - For purposes of res judicata, dismissal of a claim with prejudice ordinarily constitutes a final judgment on the merits. Dawson v. Allstate Ins. Co., 106 N.C. App. 691, 417 S.E.2d 841 (1992) (holding claim barred by prior action that was dismissed for failure to state claim); Hogan v. Cone Mills Corp., 63 N.C. App. 439, 443, 305 S.E.2d 213, 215 (1983) ("In general, any dismissal other than a dismissal for lack of jurisdiction, for improper venue, or failure to join a necessary party, operates as an adjudication on the merits"), vacated on other grounds, 315 N.C. 127, 337 S.E.2d 477 (1985), on remand, 94 N.C. App. 640, 381 S.E.2d 151 (1989), rev’d, 326 N.C. 476, 390 S.E.2d 136 (1990); Pearsall v. Phillips, 839 F. Supp. 11, 13 (E.D.N.C.) (applying North Carolina law to preclude claim where prior action dismissed for failure to state claim), aff’d, 1 F.3d 1234 (4th Cir.), cert, denied, 510 U.S. 998, 114 S. Ct. 565, 126 L. Ed. 2d 464 (1993). In the North Carolina courts, dismissal is considered to be with prejudice unless the court expressly indicates otherwise. Dawson, 106 N.C. App. at 692, 417 S.E.2d at 842; Pearsall, 839 F. Supp. at 13. A final judgment will bar a party from raising in a subsequent lawsuit any matter that could have been raised in the prior action, even if that matter was not actually raised. Holly Farms Foods v.Kuykendall, 114 N.C. App. 412, 416, 442 S.E.2d 94, 97 (1994); Chrisalis Properties, Inc. v. Separate Quarters, Inc., 101 N.C. App. 81, 84, 398 S.E.2d 628, 631 (1990), review denied, 328 N.C. 570, 403 S.E.2d 509 (1991). This rule prevents claim splitting and requires parties to bring all matters arising from a single wrong in one action. Holly Farms, 114 N.C. App. at 416, 442 S.E.2d at 97; Chrisalis - 7 - Properties, 101 N.C. App. at 84, 398 S.E.2d at 631; Rodgers Builders, Inc. v. McQueen, 76 N.C. App. 16, 23, 331 S.E.2d 726, 730 (1985), review denied, 315 N.C. 590, 341 S.E.2d 29 (1986). Preclusion embraces "all material and relevant matters within the scope of the pleadings, which the parties, in the exercise of reasonable diligence, could and should have brought forward." Holly Farms, 114 N.C. App. at 416, 442 S.E.2d at 97; see also Chrisalis, 101 N.C. App. at 84, 398 S.E.2d at 631; Rodgers Builders, 76 N.C. App. at 22, 331 S.E.2d at 730. North Carolina courts have stopped short of adopting the widest possible application of the "transactional approach" to res judicata. See Bockweg, 333 N.C. at 493-95, 428 S.E.2d at 162-63; Northwestern Fin. Group, 110 N.C. App. at 537, 430 S.E.2d at 693; see also Davenport v. North Carolina Dep’t of Trans., 3 F.3d 89, 95 (4th Cir. 1993) (characterizing North Carolina approach to res judicata as a "cautious and flexible adoption[] of the “transactional7 approach"). But the state’s courts have steadfastly held that a party may not avoid the effect of res judicata merely "by shifting legal theories or asserting a new or different ground for relief’ with respect to the same wrongful act. Northwestern Fin. Group, 110 N.C. App. at 538, 430 S.E.2d at 693-94 (<quoting Rodgers Builders, 76 N.C. App. at 30, 331 S.E.2d at 735). Where a lawsuit concerns the same subject matter, alleges the same set of operative facts, asserts the same primary right, and rests upon the same underlying proof as a prior claim, it will amount to an identical claim and res judicata will bar relitigation. See Nash County Bd. of Educ., 640 F.2d at 487-88; cf. Abels v. Renfro Corp., 335 N.C. 209, 219, 436 S.E.2d 822, 828 (1993) (denying - 8 - summary judgment where first claim rested on proof that plaintiffs' injuries were covered by state workers’ compensation statute and second on proof that plaintiff was fired in retaliation for filing workers’ compensation claim), aff’g in part and rev’g in part id., 108 N.C. App. 135, 423 S.E.2d 479 (1992); see also Mears v. Town of Oxford, 762 F.2d 368, 373 (4th Cir. 1985) (applying Maryland law) (finding identical claim where prior state action and subsequent federal complaint rested on identical factual allegations). Res judicata applies to persons who were not themselves parties to the prior judgment but whose relationship to a party is such that the one represents the same legal right as the other. Tucker, __ N.C. at __ , 474 S.E.2d at 130; County of Rutherford v. Whitener, 100 N.C. App. 70, 76, 394 S.E.2d 263, 266 (1990). North Carolina courts have applied the notion of privity to determine when a prior judgment may preclude claims by persons themselves not parties. Hales v. North Carolina Ins. Guar. Ass’n , 337 N.C. 329, 337, 445 S.E.2d 590, 596 (1994). Factors that indicate that a litigant was in privity with a party to the prior action and should thus be barred by res judicata from relitigating an identical claim include whether that person had active control over or representation in the prior action, whether that person had a strong interest in its outcome, and whether the same attorney represented parties in both actions. See Tucker, __ N.C. a t___ , 474 S.E.2d at 130; Rodgers Builders, 76 N.C. App. at 29-30, 331 S.E.2d at 734. - 9 - The judgment of the North Carolina Supreme Court in Cannon II bars plaintiffs' claims here. In that case, the trial court granted the defendants' motion to dismiss as moot the plaintiffs' challenge to the election plan for the merged Durham City and County school systems, a decision ultimately affirmed by the North Carolina Supreme Court. 342 N.C. 399, 464 S.E.2d 43 (1995), rev’g 117 N.C. App. 399, 451 S.E.2d 302 (1994). Since the plaintiffs' claims were dismissed for reasons other than lack of jurisdiction, improper venue, or failure to join a necessary party, and since the court did not expressly state that its dismissal was without prejudice, the decision in Cannon II constitutes a final judgment on the merits. See Hogan, 63 N.C. App. at 443, 305 S.E.2d at 215; Dawson, 106 N.C. App. at 692, 417 S.E.2d at 842. Even though the plaintiffs in Cannon I and II did not actually litigate the issue whether the election plan was racially discriminatory, res judicata nonetheless bars that claim here. The North Carolina Supreme Court held that the plaintiffs had waived the racial discrimination claim by failing properly to present the issue to the trial court. 342 N.C. at 399, 464 S.E.2d at 43. Yet, had the plaintiffs acted with reasonable diligence, they could have brought that claim in the initial lawsuit. The claims here, which arise from the same facts and circumstances, and rest on the same underlying proof, are identical with the prior claims, and res judicata thus bars this action. The decision of the North Carolina Supreme Court in Bockweg v. Anderson is not to the contrary. There, the plaintiffs suffered multiple injuries during a course of continuing medical treatment. The court declined to preclude a claim under the - 10 - transactional theory of res judicata because the two claims arose from separate acts of medical malpractice: first, negligent failure to provide adequate nutrition, causing brain damage; second, negligent diagnosis and treatment, causing loss of reproductive organs. See 333 N.C. at 493, 428 S.E.2d at 162. In the initial action, a jury rendered a verdict on the first claim after the parties stipulated to voluntary dismissal of the second. Id. The North Carolina Supreme Court held that the prior verdict did not bar a later action on the second claim, which arose from a "separate and distinct negligent act leading to a separate and distinct injury" and did not represent mere shifting of legal theories or remedies sought. Id. at 494, 428 S.E.2d at 163 (emphasis supplied). In contrast, plaintiffs’ allegations here arise from the same act as the claims in Cannon I and II: the establishment of a consolidated school system for Durham County. It was that single act which gave rise to all of plaintiffs' claims in the prior and present actions. Plaintiffs' mere shifting of legal theories and grounds for relief does not create separate claims under the facts here. Cf. Bockweg, 333 N.C. at 494, 428 S.E.2d at 163; see Northwestern Fin. Group, 110 N.C. App. at 538, 430 S.E.2d at 693-94; Rodgers Builders, 76 N.C. App. at 30, 331 S.E.2d at 735. Davenport v. North Carolina Dep’t of Trans., in which the Fourth Circuit found no claim preclusion under North Carolina law, see 3 F.3d at 96, is also distinguishable. In that case, the plaintiff brought two successive claims arising out of his wrongful discharge from public employment. In the initial state action, the North Carolina Court of Appeals approved an administrative determination that the plaintiff was entitled to - 11 - reinstatement with pay. See 3 F.3d at 92. In the subsequent federal suit, plaintiff sought damages under 42 U.S.C. § 1983 for deprivation of federal and state constitutional rights. Id. at 96. Because the plaintiff could not have fully litigated his federal civil rights claim in the state administrative proceeding, and because his remedy in that proceeding was limited to reinstatement with pay, the Court of Appeals held that it would be unfair to bar the second claim because this would have forced the plaintiff to choose between "two remedial paths neither of which would allow fair litigation of all claims that otherwise properly could be asserted." Id. at 97. In contrast, the state court that heard these plaintiffs' claims in the prior litigation had concurrent jurisdiction over the present claims. Maine v. Thiboutot, 448 U.S. 1, 3 n.l, 100 S. Ct. 2502, 2503 n.l, 65 L. Ed. 2d 555, 558 n.l (1980); Crump v. Board of Educ. of Hickory Administrative School Unit, 326 N.C. 603, 614-15, 392 S.E.2d 579, 585 (1990), modifying on other grounds and aff’g id., 93 N.C. App. 168, 378 S.E.2d 32 (1989). Unlike the plaintiff in Davenport, then, the plaintiffs here could have asserted all their claims and obtained all their relief in the prior state court action.5 ■This case is also distinguishable from Northwestern Fin. Group v. County of Gaston, in which the North Carolina Court of Appeals denied summary judgment on grounds of res judicata even though the claim there "ar[o]se out of the same set of facts and circumstances" as a prior claim that resulted in a final judgment on the merits. 110 N.C. App. at 538, 430 S.E.2d at 694. The Northwestern Fin. Group plaintiff "allege[d] that its claims for damages [in the second suit] could not have been known until after it was granted the mandatory injunction" which it sought in the first action; this fact was "pivotal" in the court’s determination that the general rule requiring a plaintiff to seek all damages in a single action did not apply. Id. Here, in contrast, the electoral plan for the consolidated school board was already in place when plaintiffs brought their prior suit; the remedies that plaintiffs seek in this Court thus were available at the time (continued...) - 12- The parties in the present lawsuit are legally identical to the parties bound by the prior state court judgment. Of the three present plaintiffs, two - Hazard Cannon and Norman Phillips - were named plaintiffs in the prior suit. The third current plaintiff, Dan Sizemore, is bound by the prior judgment because he is "so identified in interest with [plaintiffs in the prior action] that [t]he[y] represent[] the same legal right." County of Rutherford, 100 N.C. App. at 76, 394 S.E.2d at 266 (quoting 46 Am. Jur. 2d Judgments § 532). Sizemore has a close relationship with plaintiff Cannon, who is his father-in-law. See Exhibit 1, at 3 11 11. Both are members of the same political organization, "Concerned Citizens of Durham." Id. By Sizemore's own admission, it was Cannon who solicited Sizemore to join as a plaintiff in this case. Id. at 5 11 16. Sizemore was, however, aware of the state court lawsuit at the time it was commenced and discussed that suit "several times with Mr. Cannon early in 1992 and [at other] times during 1992 and prior [to] January 1, 1993," id. at 4 11 15. He became acquainted with plaintiff Phillips and state court plaintiff Olds at the time the prior lawsuit was filed. Id. at 2-3 UH 9, 10. Thus, each of the present plaintiffs had active control or representation in the prior action, and a strong interest in its outcome. Cf. Tucker, _ N.C. at __ , 474 S.E.2d at 130. Finally, the same attorney, Mr. John C. Randall, represented the plaintiffs in the prior action and does so in the instant suit. Cf. Rodgers Builders, 76 N.C. App. at 29, 331 S.E.2d at 734. Since the plaintiffs in the two actions 5 5(...continued) of the first action, and the general rule mandating a single action bars plaintiffs’ claims here. - 13 - are identical or in privity, they are bound by res judicata based on the prior judgment. Bockweg, 333 N.C. at 491, 428 S.E.2d at 161. The defendants in this suit are likewise identical to or in privity with parties to the prior judgment. In the state action, the defendants were the North Carolina State Board of Education, the Durham County Board of Commissioners, and the (now defunct) Boards of Education for the city and county school units. Here, the defendants as originally named were the North Carolina State Board of Education, the Durham County Board of Commissioners, the Durham County Board of Elections, the President of the North Carolina Senate (Lieutenant Governor), and the Speaker of the North Carolina House of Representatives. The fact that plaintiffs named additional governmental bodies or officials in the second action does not negate the application of res judicata. These additional defendants are in obvious privity with the state and local officials who were parties to the prior action, in that they represented the same legal interest in sustaining the validity of the statute approving the consolidation and were adequately represented in the prior action. See Mears, 762 F.2d at 371 n.3 (applying Maryland law) (affirming grant of summary judgment on grounds of res judicata where defendants not parties to the prior action were sued in their official capacity and were in privity with the governmental units sued in the prior action). Cases such as Tucker, __ N.C. at __ , 474 S.E.2d at 130, and County of Rutherford, 100 N.C. App. at 76, 394 S.E.2d at 266, in which the courts have found different governmental actors not to be privies, are inapposite. In each of those cases, - 14 - the defendant sought to bar claims by one government agency on the basis of a prior judgment against a different government agency. Unlike the defendants here, the governmental plaintiffs in those suits had no control over, or representation in, the prior action and the governmental plaintiffs in the prior and successive actions each represented different substantive legal interests. See__ N.C. a t___ , 474 S.E.2d at 130; 100 N.C. App. at 76, 394 S.E.2d at 266. Moreover, assertion of res judicata by defendants against plaintiffs who have had a full and fair opportunity to litigate their claims is appropriate even if some of the defendants were not parties or privies of parties to the prior action. Cf Johnson v. Smith, 97 N.C. App. 450, 453, 388 S.E.2d 582, 584 (affirming summary judgment for defendants asserting non-mutual collateral estoppel), review denied, 326 N.C. 596, 393 S.E.2d 878 (1990). The doctrine of res judicata thus bars plaintiffs’ claims in the instant suit because they are identical to those in a prior action which resulted in a final judgment on the merits. Plaintiffs acting with reasonable diligence could have brought these claims and obtained any relief to which they were entitled in that prior litigation. Each party here was either a party to or in privity with a party to the prior judgment. Accordingly, the Court should grant summary judgment dismissing this suit. - 15 - II The Undisputed Facts Establish That Plaintiffs Cannot Prevail On Their Shaw v. Reno Claim This Court held, in denying plaintiffs' request for a preliminary injunction, that various allegations of the Complaint "appear to assert a Shaw [v. Reno, 509 U.S. 630, 113 S. Ct. 2816, 125 L. Ed. 2d 511 (1993)] racial gerrymandering claim," Order of April 1, 1996, at 11.6 We agree with defendants, as set forth in their motion for summary judgment and accompanying brief in support, that since none of the plaintiffs resides within the majority-African-American districts that plaintiffs allege were "gerrymandered," they have no standing to raise a Shaw claim - and we do not here further brief that issue. Even if that were not the case, however, as we demonstrate below plaintiffs will be unable (if a trial were held) to establish the factual predicate for their Shaw claim. The law. Decisions of the Supreme Court since Shaw v. Reno have clarified the prerequisites for the "analytically distinct" cause of action, see 509 U.S. at 652, 113 S. Ct. at 2830, 125 L. Ed. 2d at 532, recognized in that case. A Shaw plaintiffs burden of persuasion, Shaw v. Hunt,__ U.S.___ , __ , 116 S. Ct. 1894, 1900, 135 L. Ed. 2d 207, 218-19 (1996), citing Miller v. Johnson, 515 U.S.__ , __ , 115 S. Ct. 2475, 2488, 132 L. bPlaintiffs allege that the election districts for the school board were drawn "along lines of racial residential patterns" (Complaint, H 12, at 6), the "primary rationale for the geographical structure of the voting districts was racial" (id., 11 13, at 6), they have a right to participate in a "color-blind" election process (id., 11 20, at 10), and there is no justification for "racially discriminatory set-aside districts in Durham" (id., If 24 at 11). - 16 - Ed. 2d 762, 779-80 (1995) ("Miller"), is to show that "race for its own sake, and not other districting principles, was the legislature’s dominant and controlling rationale in drawing its district lines," Bush v. Vera,__ U.S.___ , __ , 116 S. Ct. 1941, 1951, 135 L. Ed. 2d 248, 256 (1996) ('Bush"), quoting Miller, 515 U.S. a t__ , 115 S. Ct. at 2486, 132 L. Ed. 2d at 777, and "that other, legitimate districting principles were "subordinated" to race." Bush,__ U.S. a t___ , 116 S. Ct. at 1951, 135 L. Ed. 2d at 257, citing Miller, __ U.S. a t___ , 115 S. Ct. at 2488, 132 L. Ed. 2d at 780. Irregularity of shape may be evidence of racial purpose, but only if the irregularity resulted from racial factors. See Bush,__ U.S. a t___ -__ , 116 S. Ct. at 1953-60,135 L. Ed. 2d at 259-68; id. a t__ , 116 S. Ct. at 1969, 135 L. Ed. 2d at 280 (O’Connor, J., concurring). If plaintiffs carry this burden, "strict scrutiny" applies and the challenged districts] can be sustained only if defendants prove that they "are narrowly tailored to further a compelling state interest." Bush,__ U.S. a t___ , 116 S. Ct. at 1960, 135 L. Ed. 2d at 268; see id. a t__ , 116 S. Ct. at 1970, 135 L. Ed. 2d at 280-81 (O’Connor, J., concurring); Shaw v. Hunt,__ U.S. a t___ , 116 S. Ct. at 1902, 135 L. Ed. 2d at 220-21, citing Miller, 515 U.S. at __ , 115 S. Ct. at 2490, 132 L. Ed. 2d at 782. (While defendant-intervenors believe that the 1991 districting plan for the merged Durham County school system would easily meet these standards, we do not detail in this Memorandum the evidentiary basis that would support that conclusion because plaintiffs have not made and cannot make the prerequisite showing required to trigger a "strict scrutiny" inquiry.) - 17 - It is not enough for plaintiffs to show merely that the decisionmaker intended to create a majority-minority district, or even that the districting was performed "with consciousness of race," Bush,__ U.S. a t___ , 116 S. Ct. at 1951, 135 L. Ed. 2d at 257: States may intentionally create majority-minority districts, and may otherwise take race into consideration, without coming under strict scrutiny . . . . [Ojnly if traditional districting criteria are neglected, and that neglect is predominantly due to the misuse of race, does strict scrutiny apply. Bush, __ U.S. at __ , 116 S. Ct. at 1969, 135 L. Ed. 2d at 280 (O’Connor, J., concurring) (emphasis in original).7 If race was only one factor, not displacing all others, that accounted for the configuration of a districting plan, there is no constitutional violation. See DeWitt v. Wilson, 856 F. Supp. 1409, 1413 (E.D. Cal. 1994) {citing Wilson v. Eu, 1 Cal. 4th 707, 4 Cal. Rptr. 2d 379, 823 P.2d 545 (1992)), aff’d in part and appeal dismissed in part, __ U.S. __ , 115 S. Ct. 2637, 132 L. Ed. 2d 876 (1995); Bush,__ U.S. a t ___ , 116 S. Ct. at 1969, 135 L. Ed. 2d at 280 (O’Connor, J., concurring). The evidence. Plaintiffs cannot prove their Shaw claim because there is overwhelming and uncontradicted evidence that the school board districting plan now 7As Judge Higginbotham of the Fifth Circuit has pointed out, seven members of the Supreme Court have rejected the contrary view advocated by Justices Thomas and Scalia and have held "that strict scrutiny does not [automatically] apply to all cases involving the intentional creation of majority-minority districts." Clark v. Calhoun County, 88 F.3d 1393, 1404 & n.2 (1996), citing Bush,__ U.S. a t __ , 116 S. Ct. at 1952, 135 L. Ed. 2d at 257, id. a t__ & n.7, 116 S. Ct. at 1977 & n.7, 135 L. Ed. 2d at 290 & n.7 (Stevens, J., dissenting), id. a t__ , 116 S. Ct. at 2007, 135 L. Ed. 2d at 328 (Souter, J., dissenting). - 18 - in effect was crafted to meet significant non-racial objectives and comports with traditional districting criteria. In denying plaintiffs’ request for preliminary injunction, this Court held it unlikely that plaintiffs would prevail on their Shaw claim, finding that "[a]t the hearing, plaintiffs produced no evidence supporting their argument that racial considerations predominated. In fact, the evidence suggests otherwise.” Order of April 1, 1996, at 14. The period for discovery in this litigation has now closed,8 and it may be said with confidence that plaintiffs will have no more evidence at trial than they were able to produce at the hearing on preliminary injunction.9 The "report"10 of plaintiffs' 8See Order of April 17, 1996 entered by Hon. Wallace W. Dixon, United States Magistrate Judge. Discovery closed October 14, 1996. ^Plaintiffs propounded no interrogatories to any other party; they took no depositions of any party or witness. Although they served three requests for admissions upon the original defendants herein, defendants responded by objecting to two of the three requests and, with respect to the third, admitting limited statistical, uncontroverted facts that have little or no bearing upon plaintiffs’ claims. Plaintiffs have made no effort to obtain further responses to their Request for Admissions or to challenge the asserted privileges. (Defendants’ response to the Request for Admissions is appended hereto as Exhibit "2" for the convenience of the Court.) luOn August 12, 1996 plaintiffs served upon the other parties a document entitled "Disclosure of Expert Testimony," purportedly satisfying the requirements of Fed . R. Civ. P. 26(a)(2) and indicating plaintiffs’ intent to offer Mr. W.M. Richardson, a real estate salesman, assessor and appraiser, to present expert testimony at the trial of this cause. The "Disclosure" was not accompanied by "a written report prepared and signed by the witness" meeting the requirements of the Rule, but only by a letter from Mr. Richardson to plaintiffs’ counsel summarizing work undertaken at the request of counsel. - 19 - "expert"11 adds nothing to the inadequate showing made by plaintiffs at the preliminary injunction hearing.12 Defendant-intervenors, in contrast, not only rely upon the evidence presented at the March 22 hearing (which, this Court has already found, suggests that racial considerations did not predominate in the drawing of the voting districts for the new school board, Order of April 1,1996, at 14), but also submit with this motion additional declarations and documentary materials that demonstrate that non-racial factors played a dominant role in the design of the school board plan. The uncontroverted evidence establishes that the plan reflects the practical compromises among divergent viewpoints that had to be fashioned in order to make possible a successful merger of the city and county school systems,13 a process that took years to accomplish.14 Mr. Cohen, who drafted the plan, was not asked to create districts having any particular racial composition (Tr. 26, 39, 56); instead, his primary charge was to devise a compromise between at-large and district election plans, which he understood to be the principal difference among supporters and opponents of the original seven-district nSee supra note 10. Defendant-intervenors do not concede the qualifications of this witness to give expert opinions on matters relevant to the issues in this case. 12Plaintiffs’ "Disclosure of Expert Testimony" is appended as Exhibit "3." Mr. Richardson's letter offers no opinion at all on the central issue that plaintiffs must address: whether race predominated over other factors in the creation of the districting plan. 13Supporters of the merger hoped to improve public education for all residents of Durham County and understood that this would require broad public support. See Declaration of Michael Freemark, M.D., attached hereto as Exhibit "4," 11 4. 14See supra pp. 2-4. - 20 - plan (Tr. 38, 41-43, 45; Cohen Dec].1" at 3 11 4). There was widespread support for such a compromise, both among the Commissioners and the general public;* 16 support for single-member districts did not come exclusively from blacks, nor did only whites favor at-large seats providing the opportunity for voters to cast ballots for more than one candidate (Freemark Decl., 1H1 5,6). Cohen's objectives in establishing districts, in addition to meeting one-person, one-vote requirements, were to foster support for the merged system by insuring initial representation on the new board of residents of both predecessor districts, by including some territory from both systems in each district, and by providing opportunities for voters to elect multiple candidates on both a district and an at-large basis (Tr. 45-46; Cohen Decl. at 3 11 4). For these purposes, he utilized the cores of the former systems in fashioning districts for the merged plan, beginning in the central city and then exploring combinations of precincts to create four numerically equivalent areas that achieved the objectives (Tr. 34, 43; Cohen Decl. at 3-5 UH 5,6). Cohen deliberately determined to use whole precincts as the building blocks for the plan in order to make it easy to understand and administer for the Board of ’"Exhibit "5" hereto is a declaration by Mr. Cohen which supplements his testimony at the preliminary injunction hearing. l6See, e.g., Minutes at 76 (Heron) (discussing possible compromise plans mixing district and at-large election); id. at 84 (comment at public hearing in support of mixed plan as "good compromise [that] would succeed in unifying the two school systems"), 85 (speaker urges Commissioners to find compromise between two kinds of plans), 135 (Commissioners Reckhow and Heron characterize 4-2-1 plan as compromise); Freemark Decl., 11 7 (current system is compromise designed to give as many people as possible some of what they wanted). - 21 - Elections, candidates and voters, and to avoid questions of manipulation that sometimes arise where precincts are divided (Tr. 41; Cohen Decl. at 2 11 2).17 Because the population of the old city system was predominantly African-American and that of the old county system predominantly white, it was evident to Cohen that any new districts were likely to be predominantly of one race or the other (Tr. 34-35);18 he therefore considered race in configuring the plan to the extent necessary to avoid dilution and to insure that the racial group that predominated in each district had a realistic opportunity to elect candidates of its choice (Tr. 46, 49; Cohen Decl. at 3 11 4). But Cohen responded clearly and consistently on the question of the degree to which racial considerations affected the districting plan: race was discussed and considered but was neither the only factor nor the dominant factor taken into account (Tr. 32, 39-40). See also Tr. 83, 85-86 [former Commissioner Giles: racial composition of districts was not most significant concern of Board as merger plan was being developed; she also wanted to assure countywide representation], 99-101 [former Commissioner Bell: racial 17Numerous Durham County voting precincts had previously been split between the former city and county school systems. See the table submitted as Exhibit "6," based upon a comparison of election returns (contained in Exhibit "7" submitted herewith) for the October 11,1983 city school board contest and the May 8,1984 county school board races [see Exhibit "7," at 018, 022 (Bates-stamped numbers at bottom of page)]. As defendant-intervenors’ expert witness, Dr. Gerald Webster, indicates, splitting voting precincts causes confusion and is regarded as a districting practice to be avoided unless necessary (see Webster Report, submitted herewith as Exhibit "8," at 17) ("Webster Report"). !8Cohen believes that in light of the demographic distribution of population in Durham County, any plan drawn to create four equipopulous districts for the county would have produced one or more majority-African-American districts (Cohen Decl. at 5 11 7). This perception is confirmed by Dr. Webster {see Webster Report at 9-10). - 22 - composition of districts not dominant consideration of Board of Commissioners]; Minutes at 095 [Bell: plan should provide "representation for all sections of the County"], 130 [Commissioner Black’s principles for acceptable plan included "countywide representation"]). Any irregularity in the shape of the four base districts in the plan results from adherence to precinct boundaries (Cohen Deck, at 2-3 11 3; Webster Report at 16)19 and pursuit of the non-racial objectives identified by the Commissioners and Mr. Cohen. This is evident even with respect to features of the plan upon which plaintiffs' designated expert focused his attention.20 Under these circumstances, plaintiffs raise 19Thus, for example, the "finger" of District 2 pointing to the southwest along Hope Valley Road and Third Fork Creek (see Ex. "A" to Cohen Deck) is Precinct No. 9, formerly divided between the city and county systems along Cornwallis Road. 20For example, Richardson's letter (see supra note 10 and accompanying text) asserts that District 2 "comprises mostly densely populated areas in or near the downtown, but excludes such white voter areas as [the] Duke University west . . . campus are[a] . . . as well as Trinity Park just north of the Duke east campus." Even if that were the case (which it is not), non-racial goals account for the configuration of the districts in the areas identified by Richardson. The Duke University west campus, for instance, is mostly within Precinct No. 5, which is in District 2 and which was previously split between the city and county systems (see supra note 17 and Exhibit "6" submitted herewith). Reuniting Precinct No. 5 and including it within District 2 brought a substantial number of former county system residents into a district whose core was the old city system, consistent with the objectives of Mr. Cohen and the County Commissioners (see supra pp. 21-23). Similarly, the Trinity Park area "just north of the Duke east campus" is divided among Precinct No. 1 (which had been entirely within the old city system), Precinct No. 2 (which was formerly split between the city and county districts), and Precinct No. 7 (which also had been entirely within the city unit). Placing whole Precincts 1 and 2 within District 3 thus included a substantial number of former city residents in a district whose core was the old county unit. The balance of the Trinity Park neighborhood, in Precinct No. 7, is within District 2. - 23 - no serious factual claim that race "predominated" in the construction of the Durham County school board electoral plan.21 Because "the record taken as a whole could not lead a rational trier of fact to find for the" plaintiffs, United States v. National Financial Services, Inc., 1996 WL 583557, at *3, summary judgment should be granted in favor of defendants and defendant-intervenors on the Shaw claim. Ill Plaintiffs Cannot Prevail On Their Claim Under Section 2 Of The Voting Rights Act In its ruling on plaintiffs' motion for preliminary injunction, this Court summarized the legal principles defining the elements of a valid claim under Section 2 of the Voting Rights Act of 1965, 42 U.S.C. § 1973 (Order of April 1, 1996, at 7-9) and then held that there was "considerable doubt as to whether plaintiffs can prove the required preconditions for a Section 2 claim": For example, plaintiffs introduced no evidence tending to show that white voters are politically cohesive. Moreover, there is considerable doubt as to whether plaintiffs can establish that the totality of the circumstances support their claim. For example, plaintiffs did not introduce evidence likely to establish past discrimination touching on the rights of whites to participate in the democratic process, that whites bear the effects of discrimination so as to hinder their ability to participate effectively in the 21 It is not without significance that plaintiffs have retained no expert nor offered any alternative election plan to demonstrate the validity of their contention that a districting arrangement based upon factors other than race would produce results markedly different from the plan adopted by the Board of Commissioners and authorized by the North Carolina General Assembly. - 24 - political process, that political campaigns have been characterized by overt or subtle racial appeals, or that there is a lack of responsiveness on the part of elected officials to the needs of whites. (Id. at 9.) It remains the case that the only evidence available to be introduced at a trial of this cause defeats, rather than supports, a putative Section 2 claim by plaintiffs. The prerequisite showing. The threshold elements of a Section 222 violation that a plaintiff must establish are: "First, ‘that [the protected group] is sufficiently large and geographically compact to constitute a majority in a single-member district’; second, 'that it is politically cohesive’; and third, 'that the [other group] majority votes sufficiently as a bloc to enable it . . . usually to defeat the minority’s preferred candidate[s].’" Growe v. Emison, 507 U.S. 25, 39, 113 S. Ct. 1075, 1084, 122 L. Ed. 2d 388, 403 (1993), quoting Thornburg v. Gingles, 478 U.S. 30, 50-51, 106 S. Ct. 2752, 2765- 66, 92 L. Ed. 2d 25, 46-47 (1986). The "protected group" whose Section 2 rights plaintiffs allege are violated under the school board election plan consists of white “ Section 2 of the Act, 42 U.S.C. § 1973, provides, in pertinent part: (a) No voting qualification or prerequisite to voting or standard, practice, or procedure shall be imposed or applied by any State or political subdivision in a manner which results in a denial or abridgement of the right of any citizen of the United States to vote on account of race or color . . . . (b) A violation of subsection (a) of this section is established if, based on the totality of circumstances, it is shown that the political processes leading to nomination or election in the State or political subdivision are not equally open to participation by members of a class of citizens protected by subsection (a) of this section in that its members have less opportunity than other members of the electorate to participate in the political process and to elect representatives of their choice. - 25 - voters.23 However, plaintiffs admit that whites "have been able to elect candidates of their choice in county-wide elections."24 To the extent that school board candidates preferred by some whites (apparently including plaintiffs) were not elected in 1992 under the plan that plaintiffs challenge, the facts lend no support to a claim that blacks in Durham County "voted sufficiently as a bloc . . . to defeat [such] candidate[s]." For example, county registration statistics from dates prior to and following the May 5, 1992 school board election indicate that there were more than twice as many white as black registered voters.25 Two white candidates ran for the at-large seat on the board, Joy Baldwin and Kathryn Meyers. Even assuming that Joy Baldwin was the "candidate of choice" of many Durham County whites,26 27 the fact is that Ms. Meyers won 54% of the total vote, including substantial numbers of votes in heavily white precincts2 and was elected by white, as well as black, voters. Furthermore, although analysis of election returns using bivariate ecological regression and extreme (or homogeneous) case analysis is a standard approach to 23See Complaint, at 8 11 16 (alleging "dilution and abridgement of voting rights of the non-black registered voters and voting age population of Durham County"); id. at 10-11 11 24 (referring to "racial discrimination against the white voters of Durham"). ~4See Exhibit 2 (Response to Request for Admission), at 2 H 5. 2"See Exhibit 7 submitted herewith, at 045, 051. 20Kathryn Meyers was endorsed by defendant-intervenor Durham Committee on the Affairs of Black People, see Tr. 86-87. 27For example, Precinct 43 (Durham Academy Gymnasium), had 2,497 white registered voters and 58 black registered voters as of January 2, 1992, and 2,570 white registered voters and 61 black registered voters as of May 28, 1992. See Exhibit 7, at 45, 51. Kathryn Meyers received 569 votes from this precinct in the 1992 election. See id. at 50. - 26 - proving racially polarized voting behavior and vote dilution in Section 2 cases, see, e.g., Thornburg, 478 U.S. at 52-53, 61-74, 106 S. Ct. at 2767, 2772-78, 92 L. Ed. 2d at 47-48, 53-61, plaintiffs have not designated any expert witness to perform or report on such an analysis. In short, plaintiffs have no proof at all of the prerequisites to a successful Section 2 claim on behalf of white voters in Durham County school board elections.28 The "totality of the circumstances." Not only must plaintiffs establish the threshold showing, but they must also demonstrate by probative evidence that, considering the "totality of the circumstances," white voters "have less opportunity than other members of the electorate to participate in the political process and to elect representatives of their choice," 42 U.S.C. § 1973(b). This Court set out, in its ruling on the preliminary injunction motion, the kinds of evidence typically considered in the * 4 2sUnder the school board election plan (Original Defendants’ Ex. 9 at 3/22/96 hearing), four of the seven members of the board are to be elected from geographic areas that contain white population and voting-age population majorities (Districts 3, 4, B. and the at-large seat elected from the entire county). Thus, if white voters were perfectly cohesive politically, voting for the same candidates, they would be an effective voting majority in four (or 57%) of the seats. Inasmuch as the total population of the county according to the 1990 Census was 60% white, the plan provides "substantial proportionality, " see Johnson v. DeGrandy, 512 U.S.__ , __ , 114 S. Ct. 2647, 2658, 129 L. Ed. 2d 775, 793 (1994), for white voters (see Tr. 45 [Cohen]). Although "substantial proportionality" is not a "safe harbor" against a claim of vote dilution, it is a significant factor weighing against such a finding unless it is overcome by "evidence otherwise indicating that . . . voters in [the plaintiff] group have ‘less opportunity than other members of the electorate to participate in the political process and to elect representatives of their choice.’" DeGrandy, 512 U.S. a t__ , 114 S. Ct. at 2663, 129 L. Ed. 2d at 799. - 27 - "totality of the circumstances" analysis. See Order of April 1, 1996, at 7-8.29 Plaintiffs have no such evidence to present. There is, for example, no history of voting-related discrimination against whites in North Carolina or in Durham County. Plaintiffs do not allege that elections in Durham have been racially polarized; to the contrary, they allege that white voters in Durham "have been more than fair to black candidates for public office," Complaint, at 11 H 24, and that "the Durham Committee on the Affairs of Black People .. . has been highly successful in influencing the election of both black and white public office holders . . . ." Id. See also defendant-intervenors’ Ex. 5, 3/22/96 hearing (affidavit of Lavonia Allison), at 5 f 12 (Durham Committee has endorsed both black and white candidates), indicating that white voters have not been excluded from any candidate slating process. Plaintiffs cannot demonstrate that any voting procedures or practices that enhance the opportunity for discrimination against whites have been implemented in Durham County. In sum, plaintiffs had no proof of either the threshold Section 2 factors or of matters relevant to the "totality of the circumstances" analysis at the time of the preliminary injunction hearing and they have no such proof now. Plaintiffs’ dissatisfaction stems not from any structural inability of white voters to elect candidates of their choice, but rather from the success of the Durham Committee on the Affairs of Black People in "pull[ing], haul[ing] and trading] to find common political ground," DeGrandy, 512 U.S. a t__ , 114 S. Ct. at 2661, 129 L. Ed. 2d at 796 with a majority of ~9See also S. Rep. No. 97-417, at 28-29 (1982) (listing "[tjypical factors" illustrative of minority vote dilution and relevant to Section 2 liability determination). - 28 - all voters in Durham County. At the preliminary injunction hearing, plaintiffs' counsel explained plaintiffs’ Section 2 claim as follows: MR. RANDALL: What we’re saying is, part of the package showing the blacks are able to and do elect the candidates of their choice. The Black Committee, in fact, dominates the scene, occupies it like a 500 pound gorilla. (Tr. 110-11.) Whatever else it may be, this is not a valid basis for relief under Section 2 of the Voting Rights Act, and plaintiffs’ claim under the Act should be dismissed. IV There Is No Evidence To Support Plaintiffs’ Constitutional Claims Finally, plaintiffs have alleged that the districting plan violates their rights under the Privileges and Immunities Clause, U.S. CONST., art. IV, § 2, and the Fifth, Fourteenth and Fifteenth Amendments to the Constitution. We outlined the difficult burden of proof that plaintiffs must meet to establish intentional discrimination - a required element of a Fourteenth or Fifteenth Amendment claim -- in our Memorandum in Opposition to Motion for Preliminary Injunction, at 10-13, and we respectfully refer the Court to that discussion.30 Plaintiffs have undertaken no discovery of any kind since the preliminary injunction hearing, much less discovery that in any way suggests they are aware of probative evidence on these issues. Summary judgment dismissing these claims is therefore also appropriate. 30As we said there (at 10 n .ll) concerning the claims under the Privileges and Immunities Clause and the Fifth Amendment, "[t]he inapplicability of these provisions to the facts of this case is patent and requires no discussion." - 29 - Conclusion For the foregoing reasons, summary judgment in favor of defendants and defendant-intervenors should be granted, dismissing plaintiffs’ claims with prejudice. Respectfully submitted, Irving Joyner N.C. State Bar # 7830 1512 S. Alston Avenue Durham, North Carolina 27702 Telephone: (919) 560-6293 Elaine R. Jones Director- Counsel Norman J. Chachkin Jacqueline A. Berrien NAACP Legal Defense and Educational Fu nd , Inc. 99 Hudson Street, 16th fl. New York, New York 10013 Telephone: (212) 219-1900 Adam Stein N.C. State Bar #4145 Ferguson, Stein, Wallas, Adkins, Gresham & Sumter, P.A. 312 West Franklin Street Chapel Hill, North Carolina 27516 Telephone: (919) 933-5300 Anita S. Hodgkiss N.C. State Bar # 15597 Ferguson, Stein, Wallas, Adkins, Gresham & Sumter, P.A. 741 Kenilworth Avenue Charlotte, North Carolina 28204 Telephone: (704) 375-8461 Attorneys for Defendant-intervenors - 30- APPENDIX A (Cite as: 1996 WL 583557 (4th Cir.(Md.)) UNITED STATES of America, Plaintiff-Appellee, v. NATIONAL FINANCIAL SERVICES, INCORPORATED, a corporation; Robert J. Smith, individually and as an officer of said corporation; N. Frank Lanocha, Defendants-Appellants. No. 95-2796. United States Court of Appeals, Fourth Circuit. Argued May 8, 1996. Decided Oct. 11, 1996. ARGUED: Matthew Scott Sturtz, Joseph William Hovermill, Miles & Stockridge, P C., Baltimore, MD, for Defendants-Appellants. Jacqueline H. Eagle, Office of Consumer Litigation, Civil Division, United States Department of Justice, Washington, D.C., for Plaintiff-Appellee. ON BRIEF: Christopher W. Keller, Thomas E. Kane, Division of Credit Practices, Federal Trade Commission, Washington, D.C., for Plaintiff-Appellee. Before RUSSELL and ERVIN, Circuit Judges, and NORTON, United States District Judge for the District of South Carolina, sitting by designation. Affirmed by published opinion. Judge ERVIN wrote the opinion, in which Judge RUSSELL and Judge NORTON joined. OPINION ERVIN, Circuit Judge: *1 National Financial Services, Inc. (NFS), Robert J. Smith, and N. Frank Lanocha are debt collectors who, primarily on behalf of companies selling magazine subscriptions, send out computer-generated dunning letters en masse. They appeal the imposition of civil penalties for violations of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. § 1692 et seq., and the Federal Trade Commission Act (FTCA), 15 U.S.C. §§ 45(m) and 53(b). The appellants object, first to the grant of summary judgment against them, contending that they raised material issues of fact for trial. Second, they argue that the district court abused its discretion when it determined that NFS and Smith must pay a civil penalty of $500,000 and that Lanocha must pay $50,000. We affirm. I. Background NFS is a collection agency primarily serving magazine subscription clearinghouses. According to Robert J. Smith, the owner and president of NFS, the company handled A-l - about 2,200,000 accounts each year in 1986 and 1987. About half of NFS’s accounts were placed by American Family Publishers (AFP). Every few weeks, AFP would provide NFS with magnetic tapes containing the names, addresses, and unpaid balances-averaging about $20.00-for 5,000 to 70,000 delinquent accounts. NFS fed that data into its computer, which merged the customer information onto pre-printed collection notices, or "dunning letters". The text of the letters, prepared by Smith, varied over time. A representative letter examined by the district court specified a deadline for payment, and then stated: [I]t is now being processed by our NATIONWIDE COLLECTION AGENCY DIVISION to enforce IMMEDIATE PAYMENT from you. Notification is hereby given that the date assigned above is your DEADLINE. If you fail to pay your bill by the DEADLINE, we will then take the appropriate action. Remember your attorney will also want to be paid. An envelope is enclosed for your payment. Our AUDIOTEX telecommunications system remain on line to answer your inquiry, twenty-four hours per day, seven days per week. Call anytime (301) 366-3217. YOUR ACCOUNT WILL BE TRANSFERRED TO AN ATTORNEY IF IT IS UNPAID AFTER THE DEADLINE DATE!!! The back of the letter included a "validation notice," which read: If you do not dispute the validity of this debt or any portion of it within 30 days after receipt of this notice, we will assume it is valid. If you dispute the validity of this debt or any portion of it in writing within 30 days we will mail verification of the debt to you. At your written request, within the 30 days, we will provide you with the name and address of the original creditor if different from the current creditor. Those consumers who contested the amount owed were removed from the NFS system. Customers who did not pay after receiving a series of the NFS "deadline notices"-about 85*% of the accounts-received one or more form letters on the letterhead of "N. Frank Lanocha, Attorney at Law." Lanocha was selected by Smith in response to AFP’s suggestion that attorney letterhead notices would increase collection rates. Lanocha, who had no separate agreement with AFP relating to collection letters, prepared the text and gave a copy to Smith. Smith would feed the "attorney at law" dunning text into the NFS computer, merge it with the AFP data, and mail out the letters. Several versions of these letters were sent on AFP accounts between 1983 and 1991. Four "Attorney at Law" letters contained in the record included the following text: *2 PLEASE NOTE I AM THE COLLECTION ATTORNEY WHO REPRESENTS AMERICAN FAMILY PUBLISHERS. I HAVE THE AUTHORITY TO SEE THAT SUIT IS FILED AGAINST YOU IN THIS A-2 - MATTER.... UNLESS THIS PAYMENT IS RECEIVED IN THIS OFFICE WITHIN FIVE DAYS OF THE DATE OF THIS NOTICE, I WILL BE COMPELLED TO CONSIDER THE USE OF THE LEGAL REMEDIES THAT MAY BE AVAILABLE TO EFFECT COLLECTION.... * * * I am the collection attorney hired by American Family Publishers to protect their interests in the United States. I have filed suits and obtained judgments on small balance accounts just like yours. My authority to collect these accounts includes the enforcement of judgments ... * * * LAW OFFICES-DEMAND NOTICE. YOU HAVE TEN DAYS TO PAY YOUR BILL IN FULL. CONTINUED FAILURE TO PAY WILL RESULT IN FURTHER COLLECTION ACTIVITY. ONLY YOUR IMMEDIATE PAYMENT WILL STOP FURTHER LEGAL ACTION. * * * YOUR ACCOUNT MAY NOW BE FOR SALE.... ACCOUNTS, LIKE YOURS, THAT ARE SOLD ... RUN THE RISK THAT THE BUYER WILL FILE SUIT AGAINST THEM. JUDGMENT CAN RESULT IN ASSETS BEING SEIZED. INSTRUCTIONS HAVE BEEN GIVEN TO TAKE ANY ACTION, THAT IS LEGAL, TO ENFORCE PAYMENT. The notices were not signed by Lanocha. Nor did he receive or review the information on the AFP computer tapes-either in general or in relation to any particular account. Lanocha did not read or review the letters prepared by the NFS computers under his name. He did not have a list of customers who received his letters. According to AFP’s Vice President of Finance, Stephen F. McCarthy, Lanocha did not confer with AFP regarding the text of the letters and, in fact, had no contact with AFP regarding any aspect of the collection activities from 1983 until 1990. McCarthy declared that AFP never paid Lanocha any money for any purpose. Lanocha did not forward payments or reports on collections to AFP. Rather, NFS paid AFP half of each account collected and, in its monthly performance reports to AFP, made no distinction between payments received from the NFS letters and payments from the "attorney at law" collections. Although Lanocha filed fifteen lawsuits in 1984, he did not file any lawsuits during the 1989 to 1991 period of time covered by this prosecution. Smith and Lanocha have had a long history of dealings with the Federal Trade Commission (FTC). In February 1980, in response to consumer complaints, the FTC sent NFS an access letter seeking to review the company’s debt collection practices. After Smith and Lanocha provided information and documents, the FTC recommended the elimination of references to "legal proceedings," "legal costs," "court costs," and the possibility that NFS and Lanocha would "recommend court action." The FTC found that the letters created a false impression that NFS played a role in whether a consumer was sued and misrepresented Lanocha’s role in the process. In September 1981, Smith wrote to the FTC that the attorney letters would be discontinued, and enclosed revised collection notices. The FTC responded that the new A-3 - notices still misrepresented the intent to sue, and asked NFS to immediately implement the changes it suggested. Smith responded that NFS would not purchase new forms until March 1992. The FTC began an investigation in 1987. On January 29, 1990. the Commission informed counsel for Smith and Lanocha that it was preparing to recommend a complaint be issued, and offered an opportunity to discuss settlement. The case was subsequently referred to the Department of Justice. On January 25, 1991, the Government filed an action for civil penalties and injunctive relief against NFS, Smith and Lanocha, alleging violations of 15 U.S.C. §§ 1692e(5), 1692e(10), and 1692g. The defendants moved for summary judgment and, in turn, the government moved for partial summary judgment. The district court granted the government’s motion, finding that the defendants had improperly threatened consumers with legal action (under § 1692e(5)), had made false threats to sue (under § 1692e(10)), and had sent notices containing contradictory information about a consumer’s time to dispute the debt (under § 1692g). The court then ordered the parties to submit memoranda on the appropriate remedies and what, if any, issues remained for a jury. *3 In response, the government asked for an injunction and at least $1.5 million in civil penalties. The government also moved to reopen discovery on remedies, and discovery was reopened for sixty days. The government conducted additional discovery during that time, but the defendants did not. The defendants also refused to provide any financial information until after the court determined that they had the requisite knowledge to support the assessment of penalties. The government moved to compel, and the court granted the motion. On December 20, 1993, the court entered an order of permanent injunction against the defendants. On November 18, 1994, a hearing was conducted on the assessment of penalties. On July 20, 1995, the court found that the defendants’ actions were deliberate, repeated, and numerous; that the violations produced substantial benefits to the defendants; and that the conduct constituted violations of Lanocha’s professional responsibilities. Accordingly, the court imposed civil penalties of $500,000 on Smith and NFS and $50,000 on Lanocha. II. Summary Judgment [1] The defendants contend that they were entitled to a jury trial to resolve disputed issues of material fact regarding whether their notices improperly threatened debtors under §§ 1692e(5) and (10), and whether the debt validation notices were effectively conveyed under § 1692g. We review the district court’s grant of summary judgment de novo. Pittman v. Nelms, 87 F.3d 116, 118 (4th Cir.1996). Summary judgments are appropriate in those cases where there is no genuine dispute as to a material fact and it appears that the moving party is entitled to a judgment as a matter of law. Fed.R.Civ.P. 56(c); Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 1608, 26 L.Ed.2d 142 (1970). On summary judgment, any permissible inferences to be drawn from the underlying facts must A-4 - be viewed in the light most favorable to the party opposing the motion. Matsushita Elec. Indus. Co. Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587-88, 106 S.Ct. 1348, 1356-57, 89 L.Ed.2d 538 (1986). However, where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, disposition by summary judgment is appropriate. Id. at 587, 106 S.Ct. at 1356; Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-49, 106 S.Ct. 2505, 2510-11, 91 L.Ed.2d 202 (1986). A. 15 U.S.C. §§ 1692e(5), (10) [2][3] The FDCPA protects consumers from abusive and deceptive practices by debt collectors, and protects non-abusive debt collectors from competitive disadvantage. 15 U.S.C. § 1692e. Section 1692e forbids the use of "any false, deceptive, or misleading representation or means" in debt collection, and provides a non-exhaustive list of prohibited conduct, including: (5) The threat to take any action that cannot legally be taken or that is not intended to be taken. * * * *4 (10) The use of any false representation or deceptive means to collect or attempt to collect any debt or to obtain information concerning a consumer. Thus, collection notices violate § 1692e(5) if (1) a debtor would reasonably believe that the notices threaten legal action; and (2) the debt collector does not intend to take legal action. Most courts that have considered the issue have applied a "least sophisticated debtor" standard in evaluating violations of § 1692e(5). See Russell v. Equifax A.R.S., 74 F.3d 30. 34 (2nd Cir.1996); Smith v. Transworld Systems, Inc., 953 F.2d 1025, 1028 (6th Cir.1992); Graziano v. Harrison, 950 F.2d 107, 111 (3d Cir.1991); Jeter v. Credit Bureau, 760 F.2d 1168, 1172-75 (11th Cir.1985) (deciding that Congress intended FDCPA to apply same standard as FTC Act, which was enacted to protect unsophisticated consumers, not only reasonable consumers who could otherwise protect themselves in the market place); Baker v. G.C. Services Corp., 677 F.2d 775, 778 (9th Cir.1982); Dutton v. Wolhar, 809 F.Supp. 1130, 1141 (D.Del.1992) (applying least sophisticated debtor standard to section 1692e(10) claim); Wright v. Credit Bureau of Georgia, Inc., 555 F.Supp. 1005, 1007 (N.D.Ga.1983) (adopting "least sophisticated" reader test of the FTCA rather than the "reasonable consumer" test developed under the Truth in Lending Act); Bingham v. Collection Bureau, Inc., 505 F.Supp. 864, 870 (D.N.D.1981) (least sophisticated reader); see also Bustamante v. First Fed. Sav. & Loan Ass’n, 619 F.2d 360, 364 (5th Cir.1980) (applying "reasonable consumer" standard includes protection for the "unsophisticated or uneducated consumer"). But see Swanson v. Southern Oregon Credit Service, Inc., 869 F.2d 1222, 1227 (9th Cir.1988); Blackwell v. Professional Business Services, of Georgia, Inc., 526 F.Supp. 535, 538 (N.D.Ga.1981) (applying "reasonable consumer" test). A-5 - In the instant case, the district court preferred the "least sophisticated debtor" standard. [FN1] As the Second Circuit has explained, evaluating debt collection practices with an eye to the "least sophisticated consumer" comports with basic consumer-protection principles: The basic purpose of the least-sophisticated-consumer standard is to ensure that the FDCPA protects all consumers, the gullible as well as the shrewd. This standard is consistent with the norms that courts have traditionally applied in consumer-protection law. More than fifty years ago, the Supreme Court noted that, [t]he fact that a false statement may be obviously false to those who are trained and experienced does not change its character, nor take away its power to deceive others less experienced. There is no duty resting upon a citizen to suspect the honesty of those with whom he transacts business. Laws are made to protect the trusting as well as the suspicious. *5 Clomon v. Jackson, 988 F.2d 1314, 1318 (2nd Cir.1993) (quoting Federal Trade Commission v. Standard Education Society, 302 U.S. 112, 116, 58 S.Ct. 113, 115, 82 L.Ed. 141 (1937)). While protecting naive consumers, the standard also prevents liability for bizarre or idiosyncratic interpretations of collection notices by preserving a quotient of reasonableness and presuming a basic level of understanding and willingness to read with care. Id. at 1319. The district court first examined the collection notices to assess whether they threatened legal action. Looking at the NFS notices, the district court found that both a reasonable and the "least sophisticated" debtor would perceive the language, "YOUR ACCOUNT WILL BE TRANSFERRED TO AN ATTORNEY IF IT IS UNPAID AFTER THE DEADLINE DATE," to mean that the account would receive different treatment from an attorney than it did from NFS. Because to most consumers, the relevant distinction between a collection agency and an attorney is the ability to sue, the court reasoned that the debtor would understand the disparate treatment to be the institution of suit. Similarly, the court found that the language, "remember your attorney will want to be paid," implies that the consumer will need a lawyer to defend himself or herself against a debt collection law suit. Turning to the Lanocha letterhead notices, the district court concluded that they also threatened legal action. The court further found that NFS and Smith had no intention of taking legal action at the time the notices were sent, because NFS had no internal procedure to get authorization to file suit. "In fact," the court found, based on Smith’s testimony, "NFS repeatedly conveyed its belief in the impracticality of filing suit when pressed by AFP to do so." Although there occurred some discussion with AFP regarding the general merits and mechanics of instituting legal actions, such conversations never concerned any particular debtor. Thus, the district court concluded that NFS’s notices violated section 1692e(5) of the FDCPA. A-6 - Similarly, the court further found that Lanocha did not intend to take legal action against any debtor who received one of his letters. Lanocha had filed no lawsuits during the period of time covered by this lawsuit. [FN2] Although Lanocha had had discussions with AFP regarding the mechanics of suing on a large-scale, and actually investigated various state small-claims procedures, Lanocha admitted that he had concluded that such an endeavor was not feasible. No evidence showed that Lanocha discussed with AFP which accounts warranted legal action. Thus, the district court concluded that Lanocha’s letter also violated section 1692e(5) of the FDCPA. On appeal, the defendants argue that their notices did not threaten legal action because they never state that a suit "will be" filed, or "is going to be" filed. All of their statements were open to interpretation, they contend. With regard to the NFS notices, they argue, for example, that referring a matter to an attorney does not necessarily imply that a legal action will be filed, but merely implies that the lawyer will consider whether to institute a proceeding against a consumer. [FN3] The defendants aver that a reasonable consumer might conclude that he would not be sued because of the small balance involved. [FN4] Concerning the statement, "remember your attorney will want to be paid," the defendants assert that they simply stated an irrefutable fact: a debtor weighing the risks of nonpayment may need to consult counsel, who will charge a fee. And if the debtor is sued, he or she will incur legal fees. While the defendants are literally correct, we do not believe that any consumer could reasonably believe that NFS intended to provide a public service by informing him about the basic functions and fee requirements of attorneys. *6 [4] With regard to the Lanocha letters, the defendants argue that they never say that a suit "will be" filed, or "is going to be" filed, but simply that Lanocha had the authority to do so. Their argument continues, he simply states that he will "consider" bringing a suit, not that he will do so. The statement, "only your immediate payment will stop further legal action," was used by Lanocha only after AFP advised him that it wanted to sue all the debtors across the country. And Lanocha’s statements that, "I have filed suits ..." and "I will consider the use of legal remedies ..." were merely factual statements of the common tasks performed by attorneys. Based on these assertions, they contend that this disagreement as to the meaning of the language of the notices is a question of fact for the jury. We disagree. The letters connote that a real attorney, acting like an attorney, has considered the debtor’s file and concluded in his professional judgment that the debtor is a candidate for legal action. Using the attorney language conveys authority, instills fear in the debtor, and escalates the consequences. [FN5] The defendants also insist that the letters were sent with the intention of bringing suit. They protest that NFS was simply a conduit for the desires of its client, and that it reasonably believed that AFP might take legal action against the debtors. AFP repeatedly stated its desire to sue the delinquent customers. Discussions between AFP and Smith and AFP and Lanocha concerned filing thousands of lawsuits. At one point, AFP indicated that it intended to sue all of the debtors. The defendants concede that NFS never intended to file suit, and indeed could not file suit against AFP’s debtors. But the defendants argue A-7 - that NFS was merely conveying the intentions of its client, AFP. A jury could reasonably conclude, the argument runs, that NFS reasonably believed that lawsuits might be instituted if the account was turned over to Lanocha. Similarly, the defendants aver that a jury could reasonably find that Lanocha believed that AFP intended to file suit against some or all of its debtors, because he had discussions with AFP regarding the mechanics of filing suits on small balances in various states. The fact that Lanocha filed 15 suits in 1984 (before the period covered by this lawsuit) means nothing in the context of the literally millions of notices sent out for years afterward. Lanocha had no real involvement with sending the letters. He never reviewed the files and he wasn’t involved in deciding when or to whom letters were sent. He exercised no judgment with regard to the files, he didn’t see the letters, didn’t sign them, and didn’t even know their identities. Likewise, even if Lanocha tossed around the idea with AFP of singling out some debtors for suit in particular regions in order to make examples out of them, there is no evidence that a determination to sue was actually made or even considered with regard to any of the millions of customers who received the N. Frank Lanocha correspondence. And even if it were remotely credible that AFP intended to sue every debtor, there is no evidence that AFP ever took any step toward that goal. An inchoate "intention" to someday sue "all debtors" cannot establish blanket justification for six years of sending millions of threatening letters. There must be a particularized intention to sue a particular debtor if he or she does not pay. *7 Smith knew that filing lawsuits was not viable, and knew that neither NFS, nor Lanocha, nor AFP would in fact file lawsuits against the customers receiving the notices. Likewise. Lanocha knew that filing suit would be impracticable and burdensome. He knew that AFP had no intention, because he in fact filed no suits. With these arguments, the defendants ask this court to adopt a hyper-literal approach which ignores the ordinary connotations and implications of language as it is used in the real world. We decline to do so. We concur with the district court’s analysis of the notices, and conclude that the defendants’ notices threatened to take legal action which they had no intention of taking, in violation of § 1692e(5). No reasonable juror could conclude that those statements were not meant to make debtors fear that they would be sued. To find otherwise would undermine the consumer protection goals of the statute and permit debt collectors to get away with accomplishing the threat under the flimsy disguise of "statements of fact." As we have said before in the context of § 1692g, "[tjhere are numerous and ingenious ways of circumventing [the law] under a cover of technical compliance. [The defendants have] devised one such way, and we think that to uphold it would strip the statute of its meaning." Miller v. Payco-General American Credits, Inc., 943 F.2d 482, 485 (4th Cir. 1991). Here, we have an obvious intention to make debtors afraid that they would be sued, an effective tactic no doubt, but one which violates the law. [5][6][7] Because we concur with the district court’s finding that the notices falsely threatened legal action, we concur with the court’s conclusion that the defendants also A-8 - violated § 1692e(10), which prohibits "the use of any false representation or deceptive means to collect or attempt to collect any debt...." Courts have consistently found that falsely representing that unpaid debts would be referred to an attorney for immediate legal action is a deceptive practice. Jeter v. Credit Bureau, Inc., 760 F.2d 1168, 1175 (11th Cir.1985). Reference to an attorney in a letter to a debtor is a false threat of suit where the attorney has not been retained to collect a particular debt and has reached no determination that a suit would be filed if payment is not made. Masuda v. Thomas Richards & Co., 759 F.Supp. 1456, 1459-61 (C.D.Cal.1991). The false representation that a lawyer may be called in may unjustifiably frighten an unsophisticated consumer into paying a debt that he or she does not owe. Id. Of course, the test is the capacity of the statement to mislead; evidence of actual deception is unnecessary. The district court considered the impact of the defendants’ notices on the "least sophisticated consumers," and correctly concluded that the false threats that legal action would be taken also violated § 1692e(10). B. § 1692g *8 [8] Section 1692g requires a debt collector to provide, in its initial communication with a consumer or within five days of that time, a debt validation notice informing the consumer of his or her right to dispute the validity of the debt. The statute requires the written notice to include, among other information: a statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector. 15 U.S.C. § 1692g(a)(3). To be adequate, the "validation notice" must be placed in such a way to be easily readable, and must be prominent enough to be noticed by an unsophisticated consumer. The notice also must not be overshadowed or contradicted by other messages. The district court held that the NFS deadline notice and two of the Lanocha letterhead notices, [FN6] violated § 1692g(a) because they either demanded payment in ten days, or demanded "immediate payment." The deadlines-generally ten days from the date of the notice-conflicted with the thirty days allowed in the validation notice itself, which was printed on the back of the form. The court also noted that the bold commanding type of the dunning text overshadowed the smaller, less visible, validation notice printed on the back in small type and light grey ink. The district court’s decision was compelled by Miller v. Payco-General American Credits, Inc., 943 F.2d at 484. The defendants raise no issue of fact concerning the district court’s determination that the conflicting time requirements in the text of the notice and the validation notice violate the Act. A-9 - III. Civil Penalties [9] The FDCPA provides for enforcement as though it were an FTC rule. 15 U.S.C. § 16921(a). Thus FDCPA violations can be punished under the Federal Trade Commission Act, which provides that the Government may impose civil penalties of up to $10,000 per each violation on any person, partnership or corporation which violates any [ ] rule ... with actual knowledge or knowledge fairly implied on the basis of objective circumstances that such act is unfair or deceptive and is prohibited by such rule. 15 U.S.C. § 45(m)(l)(A). The United States sought civil penalties totalling $1,500,000. The defendants argue that they had no actual notice that the precise language they were using violated the FDCPA. Whether a defendant has violated a rule with actual or implied knowledge is based on objective factors. A defendant is responsible where a reasonable person under the circumstances would have known of the existence of the provision and that the action charged violated that provision. S.Rep. No. 1408, 93rd Cong., 2nd Sess. 4, 1974 U.S.C.C.A.N. 1772. It is undisputed that the defendants were aware of the relevant provisions of the FDCPA and had extensive interaction with the FTC concerning how to comply with it. The defendants argue that they were entitled to a jury trial on "the disputed question of their state of mind." Smith testified that he did not believe that the notices violated the Act. The defendants concede they knew that the FDCPA prohibited threats of legal action not intended to be taken, but claim that they honestly believed that the NFS letters were compliant, and believed that AFP intended to take legal action. Smith submitted an affidavit attesting that the FTC saw "nothing wrong" with his notices. The FTC did not inform them that the letters violated the Act until three years after the investigation began. Similarly, the defendants argue that there is a genuine issue of material fact about whether Lanocha knowingly violated the Act, and they assert that he honestly believed that his notices accurately reflected AFP’s intentions. *9 [10] Civil penalty assessments are reviewed for abuse of discretion. United States v. Reader’s Digest Ass’n, 662 F.2d 955, 969 (3d Cir. 1981). The district court considered: (1) the good or bad faith of the defendants, (2) the injury to the public, (3) the defendants’ ability to pay, (4) the benefits derived from the violations, and (5) the necessity of vindicating the authority of the FTC. F.T.C. v. Hughes, 710 F.Supp. 1524, 1529 (N.D.Tex.1989). Addressing the defendants’ good faith, the district court found that the defendants’ actions were knowing and deliberate. They engaged in multiple violations over many years, knowing that the Act prohibits threats of legal action not intended to be taken. Lanocha admitted that he concluded that a plan to sue all the AFP debtors would be too burdensome, and Smith testified that he was aware of the economic impracticality of filing A-10 - suit. The defendants contend that there is abundant evidence of their good faith, including consulting an attorney to ensure their compliance, cooperating with the FTC, compliance with industry standards concerning the validation notices, and relying on the statements by AFP’s vice-president that AFP intended to file suit against every debtor. [11] Turning to injury to the public, the government need not prove actual harm to consumers in order to assess penalties. United States v. Reader’s Digest Ass’n Inc., 494 F.Supp. 770 (D.Del.1980), affd, 662 F.2d 955 (3d Cir.1981), cert, denied, 455 U.S. 908, 102 S.Ct. 1253, 71 L.Ed.2d 446 (1982). Threats of legal action are likely to be intimidating to consumers, and cause distress and anxiety. Stress resulting from false threats of suit has been recognized as a compensable injury in private suits under the FDCPA. See e.g., Carrigan v. Central Adjustment Bureau, 502 F.Supp. 468 (N.D.Ga.1980). Consumers might elect to pay a debt that they do not owe in order to avoid the threatened lawsuit. The court concluded that the millions of notices sent out bearing the violative language caused significant injury to the public. Injury also could result from the failure to supply proper validation notices adequately advising of the right to challenge a debt. The government submitted evidence establishing that the defendants sent out millions of notices containing the offending language, including the records of UARCO, a printing company that supplied NFS with many of its debt collection forms, and the declaration of David Dammen, UARCO’s district manager. (J.A. 808). From UARCO, NFS purchased nearly 3,000,000 NFS deadline notice forms pre-printed with language the district court found violated the FDCPA, and from 1986 to 1990, it purchased more than 9,000,000 Lanocha Letterhead forms. The government also submitted AFP performance data indicating that NFS mailed millions of notices to consumers whose names were supplied by AFP. (J.A. 771). These figures, which were not disputed by defendants, do not include notices mailed to consumers on other accounts. (J.A. 1149, 1155-58, 1161, 1164-65). The defendants submitted no documentation of how many collection notices were sent and did not challenge UARCO’s records. In response to government requests for actual figures regarding the number of notices sent, Smith and Lanocha provided nothing. Their failure to rebut creates an adverse inference. Vodusek v. Bayliner Marine Corp., 71 F.3d 148, 156 (4th Cir.1995). *10 Turning to the benefits received by the defendants, the defendants assert that it is "unclear" how much income each defendant earned from the AFP- related collection activities. But they offered no declarations or documents to establish the amounts of income each received. The FTC Act authorizes a civil penalty of up to $10,000 for each violation of the FDCPA. A separate violation occurs every time a prohibited threat or misrepresentation is made, or each time the required validation notice is not provided. Thus, each of the millions of collection letters that threatened suit was a separate violation of 15 U.S.C. §§ 1692e(5) and (10), and each letter with a defective validation notice was a separate violation of § 1692g. The government requested a penalty of at least $1,500,000. In light of the millions of accounts involved, and the fact that most accounts received more than one letter, the district court would have been within its discretion to impose penalties far greater than A-ll - $550,000. Although the penalty was larger than in most other FDCPA cases, the large scale of the violations justifies the penalty. Without a real sting, the defendants would be unlikely to be deterred from violating the Act, in light of the substantial profit to be made using aggressive and improper collection practices. IV. The district court was correct in finding that the defendants were guilty of violating the applicable laws and did not abuse its discretion in awarding civil penalties in the amounts imposed upon NFS, Smith, and Lanocha. Accordingly, the decision of the district court is AFFIRMED. FN1. However, the court also found that the appellants’ notices violated the FDCPA when viewed under a slightly higher, "reasonable debtor" standard. FN2. Lanocha filed actions against fifteen debtors in 1984, but was unable to recall whether they resulted in payment. FN3. Throughout their brief, the defendants seem to argue that they did not threaten to sue, rather they threatened to consider to sue. In light of the fact that no suit was ever filed, and Lanocha never reviewed any file, that threat was also false. FN4. This argument does not help the defendants, because it implies that although a suit was threatened, a consumer might disregard it in realization that the small balance makes a suit unlikely. In fact, some of the language in the Lanocha letters seems to be aimed at preventing that reasonable conclusion. For example, "I have filed suits and obtained judgments on small balance accounts just like yours." FN5. Because we affirm the district court’s finding that Lanocha violated § 1692e(5) and (10), we do not address the alternative ground that he violated § 1692e(3), which prohibits "[t]he false representation or implication that any individual is an attorney or that any communication is from an attorney." See Avila v. Rubin, 84 F.3d 222 (7th Cir.1996) (holding that mass-produced dunning letters bearing facsimile of attorney’s signature created false and misleading impression that communications were "from" attorney); Clomon v. Jackson, 988 F.2d 1314 (2d Cir.1993) (where attorney had no direct personal involvement in the mailing of collection letters, use of his letterhead and facsimile of his signature violated the FDCPA). FN6. The district court denied the government’s motion for summary judgment with regard to certain other of the Lanocha letters, which the court found did not contain the contradictory language and misleading type disparity. A-12 -