Easley v. General Motors Corporation Reply Brief of Plaintiff-Appellant
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May 10, 1990

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Brief Collection, LDF Court Filings. Easley v. General Motors Corporation Reply Brief of Plaintiff-Appellant, 1990. 1ff1ed6d-b09a-ee11-be36-6045bdeb8873. LDF Archives, Thurgood Marshall Institute. https://ldfrecollection.org/archives/archives-search/archives-item/e855f7e7-14f7-4c7d-bde0-87a4197f60b6/easley-v-general-motors-corporation-reply-brief-of-plaintiff-appellant. Accessed June 17, 2025.
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UNITED STATES COURT OF APPEALS FOR THE SEVENTH CIRCUIT 89-3613 HAROLD EASLEY, Plaintiff-Appellant, vs. GENERAL MOTORS CORPORATION, Defendant-Appellee. On Appeal from the United States District Court for the Southern District of Indiana, Indianapolis Division REPLY BRIEF OF PLAINTIFF-APPELLANT JULIUS LeVONNE CHAMBERS RONALD L. ELLIS CORNELIA T.L. PILLARD NAACP Legal Defense and Educational Fund, Inc. 99 Hudson Street Suite 1600 New York, New York 10013 (212) 219-1900 Attorneys for Plaintiff- Appellant TABLE OF CONTENTS TABLE OF AUTHORITIES.......................................... ii INTRODUCTION ................................................ 1 ARGUMENT .................................................... 2 I. GENERAL MOTORS OPPOSES MR. EASLEY'S CLAIMS OF DISCRIMINATION IN CONTRACT FORMATION SOLELY BY MISCHARACTERIZING THEM ........................... 2 II. MR. EASLEY'S CLAIM OF DISCRIMINATION IN THE FORMATION OF HIS EMPLOYMENT CONTRACT IS NOT TIME-BARRED ....................................... 4 III. PATTERSON DID NOT REVERSE THE ESTABLISHED APPLICABILITY OF SECTION 1981 TO CLAIMS OF DISCRIMINATORY DISCHARGE ......................... 10 CONCLUSION.................................................... 14 l TABLE OF AUTHORITIES CASES Barnes v. A.H. Robins. 476 N.E.2d 84 (Ind. 1985) Bazemore v. Friday. 478 U.S. 385 (1986) Eli Lilly & Co. v. EPA. 615 F. Supp. 811 (S.D. Ind. 1985) Hicks v. Brown Group. Inc. . Civil Action Nos. 88-2769/2817 (8th Cir, April 16, 1990) . . . . . . . Lavender v. V & B Transmissions and Automobile Repair. 1990 U.S. App. LEXIS 4975 (5th Cir. April 6, 1990) Lvtle v. Household Manufacturing, Inc.. 58 U.S.L.W. 4341 (Mar. 20, 1990) Neuhauser v. A.H. Robins Co., Inc.. 573 F. Supp. 8 (S.D.Ind. 1983) Overby v. Chevron USA, Inc.. 884 F.2d 470 (9th Cir. 1989) Ovens v. Okure. 102 L. Ed. 2d 594 (1989) Patterson v. McLean Credit Union. 105 L. Ed. 2d 132 (1989) Ulloia v. Midland Industries. Inc., 663 F. Supp. 491 (S.D. Ind. 1987) Wilson v. Garcia. 85 L. Ed. 2d 254 (1985) STATUTES 42 U.S.C. § 1981 42 U.S.C. § 1988 Indiana Code § 34-1-2-2 (Burns 1973) ii 10 9 11 13 11 6 13 5 passim 7, 9 5 passim 5 5 7 INTRODUCTION General Motors Corporation ("GMC") urges this Court to constrict the scope of 42 U.S.C. § 1981 further than did the Supreme Court in Patterson v. McLean Credit Union, 105 L. Ed. 2d 132 (1989). Mr. Easley contends that GMC discriminated against him by purporting to accept him on a non-discriminatory, probationary basis into a plant where in fact discrimination was rampant, and he contends that it did so with the covert intent to fire him after a few days rather than hire him as a permanent employee. In GMC's view, section 1981 should not prohibit such conduct, but should be limited to discrimination that not only occurs at the contract-formation stage, but that is communicated to the employee at that time. GMC also contends that Patterson's holding with respect to racial harassment admittedly does not apply to discriminatory discharge, but that this Court nonetheless should extend it to bar all discharge claims under section 1981. GMC urges a bar on discharge claims so categorical that even if the employer included prompt, automatic discharge as a term of black employees' contracts when they were formed, that discrimination would not be prohibited by section 1981. GMC bases its contention that Mr. Easley's claims are time- barred on its mischaracterization of the nature of the discrimination that he challenges. Although GMC's discrimination was covert when Mr. Easley was hired, the Company nonetheless asserts that the claims accrued at that time. A section 1981 claim might accrue on the day the contract was made if the 1 employer frankly stated to the employee that it had different plans and expectations for him because of his race, but Mr. Easley cannot be penalized because GMC was not so forthright. Mr. Easley's claims of discrimination in the formation of his employment contract did not accrue when he was hired as a probationary employee, because no concrete harm had taken place, and he had no reason yet to anticipate that it would. ARGUMENT I. GENERAL MOTORS OPPOSES MR. EASLEY'S CLAIMS OF DISCRIMINATION IN CONTRACT FORMATION SOLELY BY MISCHARACTERIZING THEM General Motors Corporation attempts to sidestep Mr. Easley's section 1981 claims of discrimination in the formation of his employment contract by contending that "[t]he terms of plaintiff's employment were precisely those contained in the collective bargaining agreement between GM and the UAW." Brief of General Motors Corporation Defendant-Appellee (Df. Br.), at 5. GMC correctly contends that Mr. Easley does not challenge any explicit terms in the collective bargaining agreement. Id. at 6. It falsely assumes, however, that merely because there was a written contract without expressed racially discriminatory terms, that contract is exclusive, and no other, discriminatory contractual terms existed. Plaintiff's contention, however, is that GMC imposed implicit discriminatory terms on him that were not equally imposed on white employees. See Brief of Plaintiff- Appellee (PI. Br.) at 13-23. For the reasons discussed in 2 plaintiff's initial brief, discriminatory terms need not be verbally expressed to in order to violate section 1981 as Patterson construes it. See PI. Br., at 18-19. Defendant does not even address the viability of such claims under section 1981.1 GMC similarly misses the thrust of Mr. Easley's claim in characterizing it as an argument that "postformation harassment or discrimination can relate back and taint a contract made on racially neutral terms." Df. Br., at 7. Mr. Easley does not allege mere post-formation harassment, but claims that his contract was not "made on racially neutral terms." GMC's discriminatory intent was present from the outset, and specific facts — such as the area hire obligation coupled with the prompt decision to fire him, and the immediate and pervasive discriminatory treatment to which he was subjected — relate the challenged discrimination to the point of contract formation. The Patterson case included no such allegations.' The Supreme Court explained that what distinguishes harassment from formation-stage discrimination actionable under section 1981 is whether the discrimination was intended at the time the contract was made. See Patterson. 105 L. Ed. 2d at 155 (stating that the determinative factor is whether "at the time of formation of the Defendant also contends that "GM was constrained by federal labor law from making a contract individually tailored for the plaintiff." Df. Br., at 6. The fact that GMC's imposition on Mr. Easley of additional, discriminatory contract terms beyond the terms of the collective bargaining agreement may also violate federal labor law does not mitigate the section 1981 violation. 3 contract, [the defendant] in fact intentionally refused to enter into a contract with the employee on racially neutral terms"). Although implicit discriminatory contract terms present problems of detection and proof that are absent when contract terms are explicitly stated, Patterson does not alter the established rule that contract terms may be implicit. It is GMC's argument, not Mr. Easley's, that proves too much. If claims of discrimination in the making of contracts could not be based on the circumstances immediately surrounding the contract formation, employers could easily subvert section 1981 by forming contracts that are racially neutral on their face, but that come with unwritten, discriminatory strings attached. II. • MR. EASLEY'S CLAIM OF DISCRIMINATION IN THE FORMATION OF HIS EMPLOYMENT CONTRACT IS NOT TIME-BARRED GMC contends that Mr. Easley's section 1981 claims of discrimination in the formation of his employment contract are time-barred because GMC hired him on February 9, 1987, and he did not file suit until February 20, 1989.2 Defendant correctly notes that the limitations period applicable here is the two- year period provided by the Indiana statute limiting personal injury claims.3 But defendant's statute of limitations defense GMC does not contend, nor could it, that Mr. Easley's discriminatory discharge claim is time barred. Because there is no statute of limitations provided by federal law that applies to section 1981 claims, the Indiana personal injury statute of limitations determines the timeliness of plaintiff's claims. See 42 U.S.C. § 1988; Owens v. Okure. 102 4 fails because it was not until February 20, 1987 that the limitations period began to run. Mr. Easley filed his suit on February 14, 1989. The suit was therefore timely under the applicable statute of limitations. Mr. Easley has three overlapping but distinct claims of discrimination in the formation of his employment contract under section 1981, and each of these claims was timely when filed. The first claim is that GMC hired Mr. Easley as a probationary employee on February 9, 1987 with the intent to discharge him before he completed the probationary term and became a full- fledged employee with enhanced job-related rights. See PI. Br., at 13-16. This claim is timely because (1) it did not accrue until the discharge contemplated by the contract took place on February 20, 1987, and (2) even if it had accrued on February 9, 1987, when GMC hired Mr. Easley intending to fire him, the limitations period was tolled until February 20, 1987, because Mr. Easley 'could not have reasonably discovered that discriminatory intent until GMC had carried it out by firing him. Mr. Easley's second claim of discrimination in contract formation, based on his hire into a discriminatory work environment, was also timely under the discovery rule. His third claim, that the evaluative probationary period was part of the discriminatory hiring process for permanent employment, was timely because it was a continuing violation that was not L. Ed. 2d 594 (1989); Wilson v. Garcia. 85 L. Ed. 2d 254 (1985). The limitations period applicable to personal injury claims is two years. Indiana Code § 34-1-2-2 (Burns 1973). 5 complete until February 20, 1987. Mr. Easley's first claim of hiring discrimination did not accrue until February 20, 1987, because it was then that the harm caused by this particular violation took place. "In Indiana a cause of action accrues at the time when both legal injury and damage have occurred, resulting in liability." Neuhauser v. A.H. Robins Co.. Inc.. 573 F. Supp. 8, 9 (S.D.Ind. 1983), citing Scates v. State. 178 Ind. App. 624, 383 N.E.2d 491 (1978); Merritt v. Economy Department Store. 125 Ind. App. 560, 128 N.E.2d 279 (1955).4 Two elements must be present before the limitations period begins to run: discrimination must have occurred, and harm must have resulted from it. The violation of section 1981 consisted of hiring Mr. Easley as a probationary employee with the racially motivated intent to fire him before he had completed the probationary period. The harm was the racially motivated discharge. The limitations period on Mr. Easley's challenge to this implicit, discriminatory contract term thus did not begin to run until GMC had carried out its discriminatory intent by firing Mr. Easley on February 20, 1987. The second reason that this discriminatory-hiring claim is Neuhauser was a personal injury suit seeking to recover for a miscarriage caused by a malfunctioning intrauterine device (IUD), in which the court applied section 34-1-2-2, Indiana's personal injury limitations law. The limitations period was calculated not from the time the IUD was inserted, or even from when the plaintiff became pregnant and was informed by her doctor that the IUD would likely cause a miscarriage. Rather, the limitations period began to run when the miscarriage took place. Similarly, in this case, the period did not begin to run when Mr. Easley first began his discriminatory probationary term, but on February 20, 1987, when he was fired. 6 timely is that until GMC cut short his probationary period on February 20, 1987, Mr. Easley reasonably was not aware that the Company had intended to deny him the opportunity to become a permanent employee. Under Indiana's "discovery rule," a personal injury cause of action is deemed not to accrue until the plaintiff knows or has reason to know of the injury and its cause. See Barnes v. A.H. Robins. 476 N.E.2d 84 (Ind. 1985); Ullom v. Midland Industries. Inc.. 663 F. Supp. 491, 492 (S.D. Ind. 1987). Mr. Easley does not claim that GMC explicitly told him on February 9, 1987 that it would hire him only on the condition that it could discharge him before his employment became permanent; his claim is rather that the GMC's intent to fire him was an implicit term of his employment contract. It was precisely because the term was not expressed to Mr. Easley that he could not reasonably be expected to have discerned it as soon as GMC imposed it on February 9, 1987. If GMC had told Mr. Easley on February 9, "We'll let you work here as a probationary employee, but because you are black, we will fire you in a few days," he would have known then that his rights had been violated. Discriminatory contract terms are rarely so expressed, however, and section 1981 does not require a plaintiff to allege that they were. Because Mr. Easley did not become aware of GMC's intent not to hire him as a permanent employee until it fired him, the statute of limitations on his claim did not begin to run until then. Mr. Easley's second claim of discrimination in contract ..................................................................................... _ / ■ ■ ■ ............. ............................ 7 formation is that his employment contract with GMC incorporated the preexisting racially discriminatory working conditions at the Hydra-matic plant, and was therefore discriminatory when made. See PI. Br., at 16-21. This, too, is a claim of implicit discriminatory terms of employment, present when the contract was formed but expressed to Mr. Easley primarily through the contract's performance. This claim is also timely under Indiana's discovery rule. Although GMC personnel treated him differently from his very first day at the plant, and continued to do so during the nine days that he worked on a probationary basis, it was not clear to Mr. Easley until after the fact that GMC had intended from the outset to employ him on discriminatory terms. The discrimination he suffered during his first few days at the plant, including selective enforcement of discipline, Complaint at ff 10, 13, 16-18 (A5-A6), racial slurs, id. at 5 28 (A7), and work assignments violative of GMC policy, id. at 5 5 20- 23 (A6-A7), might have been discrete instances of mistreatment. It was only with the clarity of hindsight that Mr. Easley could see that he had been hired into a plant where discrimination was the norm, and that GMC intended when it hired Mr. Easley to subject him to it. Where, as here, some evidence of illegality is known to the plaintiff, but the reasons for it are not, the discovery rule applies and the statute of limitations does not begin to run until the plaintiff knows or has reason to know the cause of the harm. See Ullom. 663 F. Supp. at 492 (holding that claims of plaintiffs who suffered symptoms of formaldehyde 8 exposure six years prior to filing suit were not barred by the two-year statute of limitations because their claims did not accrue until they knew or should have discovered that the formaldehyde had caused the symptoms). Mr. Easley's third claim of discrimination in contract formation challenges the discrimination that took place during the probationary period as discrimination in the process of forming — or, in this case, refusing to form — a contract for permanent employment. See PI. Br., at 21-23. The hiring process took place over several days, and was not complete until February 20, 1987, when GMC cut short the probationary period and rejected Mr. Easley as a candidate for a permanent job. Under the "continuing violations" doctrine in Indiana, this entire claim was timely because it challenges a continuing course of conduct which began on February 9, 1987, more than two years before plaintiff filed suit, but ended on February 20, 1987, within the two-year limitations period. In Indiana, the statute of limitations does not always begin to run at the first moment when a wrongful invasion of a protected interest might give rise to a cause of action .... Where the wrong is continuing, the statute of limitations does not begin to run until the wrong is 'over and done with.' Eli Lilly & Co. v. EPA. 615 F. Supp. 811, 822 (S.D. Ind. 1985) (holding that plaintiff's claims that EPA illegally issued and maintained registration on another company's product based on the plaintiff company's data was not time-barred notwithstanding that the issuance was prior to the limitations period because the maintenance of the illegal registrations constituted a continuing 9 violation occurring partly within the period), citing. Cooper v. United States. 442 F.2d 908, 911 (7th Cir. 1971); Taylor v. Meirick, 712 F.2d 1112, 1118 (7th Cir 1983).5 Here, although Mr. Easley arguably could have sued as soon as he began his probationary work under the discriminatory terms GMC imposed, the section 1981 hiring-stage violation was not "over and done with" until GMC rejected him on February 20, 1987, and he timely filed suit within two years of that date. III. PATTERSON DID NOT REVERSE THE ESTABLISHED APPLICABILITY OF SECTION 1981 TO CLAIMS OF DISCRIMINATORY DISCHARGE GMC concedes that "Patterson does not discuss the issue of discriminatory discharge," yet nonetheless asserts that "it is logical to conclude that discriminatory discharge is outside the ambit of Section 1981." Df. Br., at 10. Defendant neglects to point out, however, that the Supreme Court has unanimously recognized that Patterson did not foreclose discriminatory discharge claims. Lytle v. Household Manufacturing. Inc.. 58 Cf. Bazemore v. Friday. 478 U.S. 385, 386-87 (1986) (unanimously holding that a government program's discriminatory salary structure instituted before Title VII applied to public employees nonetheless violated the statute because "to the extent that an employer continued to engage in [a discriminatory] act or practice, he is liable under that statute."). Under the theory of Bazemore, a plaintiff may challenge the continuing application of discriminatory contract terms even if the contract is completely formed and its discriminatory terms known to the plaintiff prior to the limitations period. If the continuing violations theory did not apply to permit plaintiff to reach back and recover for the full violation, there is still no guestion that Mr. Easley has alleged that he suffered harm between February 14, 1987 and February 20, 1987, and that under Bazemore and Indiana's general accrual rule, his claim based on that harm is timely. 10 U.S.L.W. 4341, 4343 n. 3 (Mar. 20, 1990); id. at 4344 (opinion of O'Connor, J., concurring) (commenting that "the question whether petitioner has stated a valid claim under § 1981 remains open"). In the absence of a Supreme Court holding that discriminatory discharge claims are no longer covered, GMC's "logic" does not justify ignoring the long line of Supreme Court precedent establishing freedom from discriminatory discharge as the most important right that section 1981 confers.6 Patterson's own emphasis on the weight of stare decisis requires as much. See Patterson. 105 L. Ed. 2d at 147-50. The Eighth Circuit in Hicks v. Brown Group. Inc.. Civil Action Nos. 88-2769/2817, slip op. (8th Cir, April 16, 1990) (included in Appendix to Reply Brief of Plaintiff-Appellant), recently confirmed that Patterson does not authorize courts of appeals to reverse the Supreme Court's established interpretation of section 1981 as prohibiting racially motivated discharge: We believe that if the Supreme Court intended to call into question or overrule this substantial body of employment discrimination precedent in Patterson. it would have said so. We do not believe that the Supreme Court would reject by implication such seminal section 1981 cases without so much as even a word. Slip op. at 14. The Hicks court accordingly held that plaintiff's racially motivated discharge violated section 1981. Although section 1981 prohibits discrimination in the making and enforcement of all kinds of contracts, and bans discrimination in other areas as well, the statute is most frequently used in the employment context to redress discriminatory discharge. See generally Eisenberg & Schwab, The Importance of Section 1981. 73 Cornell L. Rev. 596, 599-601 (1988), cited in Hicks. slip op. at 15. 11 Even were this Court deciding on a clean slate whether section 1981 applies to discharge claims, it should not extend the reasoning of Patterson to preclude such claims. As the opinion in Hicks makes clear, the language and logic of the statute and the Congressional intent behind it support application of section 1981 to discriminatory discharges. Hicks held that the right to make contracts encompasses freedom from discriminatory contract termination because "discriminatory discharge goes to the very existence and nature of the employment contract. A discriminatory discharge completely deprives the employee of his or her employment, the very essence of the right to make employment contracts." Slip op. at 17. The court's extensive review of the legislative history of section 1981 supp'orts its conclusion that the right to make contracts refers as well to the right not to have one's contract "unmade" on discriminatory grounds. See slip op. at 23-37.7 The Eighth Circuit is the only appellate court to have analyzed in detail the status of discharge claims after Patterson, and its decision Holding that discriminatory discharge violates section 1981 does not, contrary to GMC's suggestion, Df. Br. at 10, require acceptance of Justice Stevens' view that a contract at will is constantly re-made. Justice Stevens presented this argument, and the majority rejected it, in the context of determining whether the imposition of new "conditions of continuing employment" necessarily violates section 1981. See, Patterson. 105 L. Ed. 2d at 156; id. at 179 (Stevens, J. , concurring in the judgment in part and dissenting in part). Neither the majority nor the dissent addressed discharges in relation to this concept. 12 in Hicks offers substantial guidance to this Court.8 The court in Hicks emphasized the logic of its holding in terms particularly apposite to Mr. Easley's section 1981 claims: We refuse to construe section 1981 as prohibiting an employer from refusing to hire someone on the basis of her race, but then permitting the discharge of that same employee because of her race a month or a year later. Such an absurd interpretation would allow discriminatory discharge to effectively annihilate the right to make contracts. Slip op. at 17. Mr. Easley has alleged that GMC has done precisely what the Eighth Circuit's holding seeks to avoid: it accepted Mr. Easley for a probationary period only to discharge him a few days later on racially discriminatory grounds. This is just the kind of "very specific (and unusual) fact situation[]" - - in which a discharge involves the formation of a contract — that the EEOC General Counsel identified as still actionable in the passage GMC quotes with approval. Df. Br., at 10. If section 1981 no longer prohibits this conduct, then the statute is truly a dead letter. Compare Hicks with Lavender v. V & B Transmissions and Auto Repair. 1990 U.S. App. LEXIS 4975 (5th Cir. April 6, 1990) (included in Appendix to Reply Brief), and Overby v. Chevron USA, Inc. . 884 F. 2d 470 (9th Cir. 1989). The courts of appeals that have rejected section 1981 discharge claims on the basis of Patterson have each done so for the same reason the district court in this case dismissed Mr. Easley's discharge claim: Each has read Patterson broadly and categorically to hold that everything that happens after the contract-formation stage is not actionable under section 1981. As our initial brief explains, that reading of Patterson is untenable, PI. Br. at 25, is inconsistent with this Court's prior opinions, id. at 23 and n. 10, and is inconsistent with the Supreme Court's own holding with respect to promotions, id. at 29-30. Decisions of the Supreme Court should be read narrowly so as not to overrule prior precedent by implication. 13 CONCLUSION For the foregoing reasons, and the reasons stated in the initial Brief of Plaintiff-Appellant, the decision below should be reversed and the case should be remanded to the district court. Respectfully submitted, CORNELIA T.L. PILLARD NAACP Legal Defense and Educational Fund, Inc. 99 Hudson Street 16th Floor New York, New York 10013 (212) 219-1900 Attorneys for Plaintiff-Appellant Dated: New York, New York May 10, 1990 14 CERTIFICATE OF SERVICE I hereby certify that on this 10th day of May, 1990 I have served counsel for defendant in this action with true and correct copies of the forgoing Reply Brief of Plaintiff-Appellant and the Appendix Accompanying Reply Brief by placing said copies in the U.S. Mail at New York, New York postage thereon fully prepaid addressed as follows: Wendell R. Tucker Gregory L. Padgett 300 North Meridian Street, #2700 Indianapolis, Indiana 46204 for Plaintiff-Appellant