Carson v. American Brands, Inc. Brief for Respondent Unions

    NO. 79-1236

IN THE
#uprrmr Cnurt nf thrlltittrti g’tatrs

October Term, 1979

FRANK L. CARSON, LAWRENCE HATCHER, 
and STUART E. MINES, Petitioners,

V.AMERICAN BRANDS, INC., t/a THE AMERICAN 
TOBACCO COMPANY, LOCAL 182, TOBACCO 

WORKERS INTERNATIONAL UNION, and TOBACCO 
WORKERS INTERNATIONAL UNION,Respondents.

BRIEF FOR RESPONDENT UNIONS

Jay J. Levit 
Imperial Building 
Third Floor
422 East Franklin Street 
Richmond, Virginia 23219
James F. Carroll 
Air Rights Building 
7315 Wisconsin Avenue, N.W. 
Washington, D. C. 20014

Counsel for Respondent Unions
APPELLATE PRINTING SERVICES, INC., HERITAGE BLDG., RICHMOND, VA. (804) 643-7789



No. 79-1236

IN THE SUPREME COURT OF THE UNITED STATES 
OCTOBER TERM, 1979

FRANK L. CARSON, ET AL., PETITIONERS
v.

AMERICAN BRANDS, INC., ET AL

ON WRIT OF CERTIORARI TO THE UNITED STATES 
COURT OF APPEALS FOR THE FOURTH CIRCUIT

BRIEF FOR RESPONDENT UNIONS

QUESTIONS PRESENTED
1. Whether there is a "case or controversy" 
within the meaning of Article III of the 
United States Constitution.
2. Whether the District Court's Order 
refusing to enter a proposed consent 
decree is appealable under 28 U.S.C.
§§ 1291 or 1292 (a) (1) .



TABLE OF CONTENTS

Statement of the Case...............  2
Argument............. *............... 7

I. Since The Proposed Consent 
Decree May Not Now Be 
Entered By The District 
Court, The Issue Presented
By This Appeal Is Moot 8

II. The District Court's Order 
Refusing Entry Of A Pro­
posed Consent Decree Is Not 
Appealable Under The Judi­
cially Created "Collateral 
Order" Exception to
28 U.S.C. § 1291 19

III. The District Court's Order 
Refusing Entry Of The Con­
sent Decree Is Not Appeal- 
able Under The Congression- 
ally Created Exception To 
The Finality Rule, 28 U.S.C.

PAGE

§ 1292(a)(1) 22
Conclusion...........................  25

(i)



TABLE OF AUTHORITIES

CASES; PAGE

California Brewers Ass'n v.
Bryant, U.S. , 63 L.Ed.
2d 55 (1980)....................... 14

Carson v. American Brands, Inc.,
606 F.2d 420, 425 6

Ex Parte Baez, 177 U.S. 378, 390
(1900)....................    9

International Brotherhood of
Teamsters v. United States, 431
U.S. 324 (1977)............   13,14

Seigal v. Merrick, 590 F.2d 35
(2nd Cir. 1978)...................  5

United States v. Armour & Co.,
402 U.S. 673 (1971)...............  14

United Steelworkers of American, 
AFL-CIO-CLC v. Weber, 443 U.S. 193 
(1979)..... 20,21

West Los Angeles Institute for 
Cancer Research v. Mayer, 366 
F.2d 220 (9th Cir. 1966), cert. 
denied, 385 U.S. 1010 (1967).......  13

STATUTES AND RULES;
Civil Rights Act of 1964,

Title VII........................ 2,20,21
42 U.S.C. § 2000 (e) et seg_______  2
42 U.S.C. § 1981..................  2

28 U.S.C. § 1292 (a)(1)........ 15,22,23,24
28 U.S.C. § 1291....................  19

(ii)



STATUTES-Continued:

PAGE

Fed. R. Civ. P. 23(e)...............  16
Fed. R. App. P. 41..................  6
Rule 11(F), Local Rules of Practice. 8 
MISCELLANEOUS:
Williston on Contracts, 3rd Ed.

§ 1935... ................ .........  13

(iii)



No. 79-1236

IN THE
SUPREME COURT OF THE UNITED STATES 

October Term, 1979

FRANK L. CARSON, LAWRENCE HATCHER, 
and STUART E. MINES,

Petitioners,
v.

AMERICAN BRANDS, INC., t/a 
THE AMERICAN TOBACCO COMPANY 
LOCAL 182, TOBACCO WORKERS 
INTERNATIONAL UNION, and 

TOBACCO WORKERS INTERNATIONAL 
UNION,

Respondents.

BRIEF FOR RESPONDENT UNIONS



-2-

STATEMENT OF THE CASE 
Petitioners, Frank L. Carson, Lawrence 

Hatcher and Stuart E. Mines ("plaintiffs") 
filed this action against respondents American 
Brands, Inc., t/a The American Tobacco Company 
("American"), Local 182, Tobacco Workers 
International Union ("Local 182"), and Tobacco 
Workers International Union ("TWIU") (collect­
ively "defendants") on October 24, 1975, in 
the United States District Court for the 
Eastern District of Virginia, Richmond 
Division. Plaintiffs alleged that the suit 
was brought on behalf of themselves and a 
class consisting of "all black persons who 
have sought employment and who are employed 
or might in the future be employed by the 
Company's [American's] Richmond Leaf Depart­
ment . . . ." They alleged violations by 
defendants of Title VII of the Civil Rights 
Act of 1964, 42 U.S.C. S 2000(e) et seq. and 
of 42 U.S.C. § 1981 (J.A. la-12a). In their 
respective answers, defendants denied any



-3-

violation of the cited statutes and asked 
that the complaint be dismissed (J.A. 13a- 
23a) .

Pre-trial discovery was pursued by all 
parties beginning in January, 1976. On 
January 27, 1976, at a pre-trial conference, 
an Order was entered by the District Court 
setting the case for trial to begin on May 2, 
1977. Just prior to the final pre-trial 
conference established by this Order, counsel 
for plaintiffs, by letter dated March 25,
1977, informed the Court that the parties had 
settled the liability phase of the litigation 
and that they wished to discuss the entry of 
a proposed consent decree at the final pre­
trial conference on April 1.

At the April 1 conference, the Court 
expressed concern that the parties were no longer 
in an adversary posture and that certain pro­
visions of the consent decree might violate 
the United States Constitution. The parties 
were requested to submit memoranda in support 
of the entry of the proposed consent decree.



-4-

After the requested memoranda were submitted, 
the Court refused to enter the tendered 
decree by order dated June 1, 1977. On 
June 24, 1977, plaintiffs filed a notice of 
appeal from this order (J.A. 57a-58a).

On October 12, 1977, the Court of 
Appeals for the Fourth Circuit entered an 
order establishing a briefing schedule. On 
January 10, 1978, before briefs were due 
from appellees, defendants informed the Clerk 
of the Court of Appeals that they had no 
position on the merits of the appeal, that 
the appeal was not an adversary proceeding 
as required by Article III of the United 
States Constitution and that they, therefore, 
would not submit briefs unless the Court 
otherwise ordered (J.A. 59a-60a).

Subsequently, the plaintiffs filed a 
motion for summary reversal to which the 
defendants were ordered to respond. Plain­
tiffs' motion was denied by order entered 
on January 31, 1978, an order which was 
later rescinded. Then on March 27, 1978,



-5-

the motion for summary reversal was again 
denied and the clerk was directed to invite 
the defendants to file a brief addressing 
the merits of the appeal (J.A. 62a-64a).

After all briefs were submitted, oral 
argument was heard before a panel of the 
Court of Appeals on October 3, 1978. While 
the matter was under advisement, the parties 
were informed by letter from the clerk dated 
January 25, 1979, of the panel's concern as 
to whether it had jurisdiction to entertain 
the appeal in light of Seigal v. Merrick,
590 F.2d 35 (2d Cir. 1978). Counsel were 
requested to file supplemental memoranda by 
February 9 (J.A. 65a—66a). After the 
requested memoranda were submitted, the Court 
of Appeals, sua sponte, agreed to an en banc 
hearing of the case without oral argument 
on June 5, 1979.

On September 14, 1979, the Court of 
Appeals dismissed the appeal holding that the 
District Court's refusal to enter the pro-



-6-

posed consent decree was not appealable.
Carson v. American Brands, Inc., 606 F .2d 
420, 425. The mandate of the Court of 
Appeals issued on October 5, in accordance 
with Fed. R. App. P. 41.

After informing plaintiffs' counsel by 
letter that defendants no longer consented 
to the entry of the proposed decree, the 
defendants, by motion filed in the District 
Court on October 10, 1979, requested the Court 
to hold a pre-trial conference for the purpose 
of establishing a trial date. In the motion, 
the defendants stated that they no longer 
consented to the entry of the proposed 
decree which had been presented to the Court 
by the parties on April 1, 1977 (J.A. 67a- 
68a). On November 2, the parties were noti­
fied that this case was again placed on the 
docket for trial, and that the Court would 
hold a pre-trial conference on November 15 
(J.A. 69a-70a). At this pre-trial conference, 
the case was set for trial to begin on



-7-

February 4, 1980.
Two weeks after this case was set for 

trial, defendants were served with plaintiffs' 
application for an extension of time in 
which to file a petition for writ of 
certiorari. Thereafter, on December 5, 1979, 
plaintiffs moved the District Court for a 
stay of all further proceedings pending dis­
position of their petition. The requested 
stay was granted by order dated December 17, 
1979.

The petition for a writ of certiorari 
was granted on June 16, 1980, limited to the 
question of whether an order refusing to 
enter a proposed consent decree is an 
appealable interlocutory order.

ARGUMENT
I. Since The Proposed Consent 

Decree May Not Now Be 
Entered By The District 
Court, The Issue Presented 
By This Appeal Is Moot.

After having informed counsel for 
plaintiffs that the defendants no longer



-8-

consented to the entry of the proposed 
decree which had been presented on April 1, 
1977, the defendants filed a motion in the 
District Court on October 10, 1979, request­
ing a pre-trial conference for the purpose 
of establishing a trial date. Defendants 
stated in that motion that they no longer 
consented to the proposed decree.
Plaintiffs filed no memorandum in response 
to this motion in accordance with Rule 11(F), 
Local Rules of Practice, nor did they lodge 
an objection with either the Court or counsel 
to such withdrawal of consent.

Subsequently, the District Court held a 
pre-trial conference at which time the case 
was set for trial to begin on February 4, 
1980. Plaintiffs made no objection to this. 
And, by setting a trial date, the District 
Court apparently accepted the defendants' 
withdrawal of consent.

In view of defendants' withdrawal of 
consent which took place after the decision



of the Court of Appeals, this case is now 
moot. Since the proposed decree may not be 
entered by the District Court absent the con­
sent of the defendants, the question of the 
appealability of the order refusing to enter 
it in April 1977 is' purely academic. This 
appeal is moot because "there is no subject 
matter on which the judgment of the Court 
can operate." Ex Parte Baez, 177 U.S. 378, 
390 (1900).

To date, the only suggestion that the 
defendants may not withdraw their consent to 
entry of the proposed decree has been made 
by the United States and the Equal Employment 
Opportunity Commission in their joint brief 
(Br. of U.S. at 18, fn. 14). Without cita­
tion of authority, Amici contend that, under 
its terms, none of the parties had the right 
to repudiate the proposed decree before the 
District Court had an opportunity to act, 
though they concede that the parties remain 
free to argue that the decree should not be

-9-



-10-

enter ed "because of unforseeable changed 
circumstances." Id.

The answer to this argument is that the 
District Court, under the theory of the Amici, 
had an opportunity to enter the proposed 
decree at the time the case was remanded on 
October 5, 1979. Moreover, both the Court 
and the plaintiffs did not accept the plain 
invitation of the dissenting judges in the 
Court of Appeals to undertake or request a 
reconsideration of the June 1, 1977, order.
606 F.2d at 432. Not only did the District 
Court not attempt to enter the proposed 
decree sua sponte, it was not even presented 
to the District Court by the plaintiffs.
That Court, rather, on a motion of the defen­
dants, held a pre-trial conference and set 
the case for trial. The Unions contend that 
the solution proposed in the dissenting
opinion is not viable, in any event because

1it would require an amendment to the
^ The dissenting judges would require 
notice be given to members of Class 2. 606
F.2d at 431, fn. 3.



-11

proposed decree to which the defendants, at 
this stage, have not consented.

In addition, the Unions contend that 
their right to withdraw consent to the entry 
of the proposed decree cannot seriously be 
questioned under the circumstances of this 
particular case. This Court need not deter­
mine, as suggested by the United States and 
the EEOC (Br. of U.S. at 18, fn. 14) that 
the question of appealability depends upon 
the consent of one's adversary, but rather 
can, and should, decide this case on the 
facts presented.

The proposed decree recites that the 
parties were "desirous of resolving all of 
the issues set forth in the complaint without 
the time and expense of further litigation 
. . . "  (J.A. 25a) and that the defendants 
would provide certain relief to a class of 
plaintiffs "solely for the purposes of the 
settlement of this case and resolving the 
issues in the Complaint without the additional



-12-

expense of litigation . . . "  (J.A. 26a).
As a practical matter, the proposed decree 
has totally failed to achieve the essential 
purpose of the parties, that is, the avoid­
ance of prolonged litigation. Approximately 
three and one-half years have passed since 
this decree was tendered. The parties have 
thus not avoided litigation and seemingly 
cannot unless permitted an opportunity to 
settle this case on terms acceptable to the 
District Court or to try the case on the 
merits. In any event, these purposes will 
not be served or achieved by a determination 
that the order refusing to enter the proposed 
decree is, or is not, appealable.

The parties are presently in a position 
in which performance under the decree is 
arguably possible, but the value of the 
plaintiffs’ performance, i_.e., the withhold­
ing of the pressing of their claims, has been 
virtually destroyed by the refusal of the 
District Court to enter the decree and by



-13-

the subsequent appeals. The defendants and 
plaintiffs, as well, have not saved the time 
and expense of protracted litigation, the 
expressed purpose of the proposed decree. 
Accordingly, under the doctrine of frustra­
tion of purpose, either party has the right 
to rescind. Williston on Contracts, 3rd Ed., 
§ 1935. Clearly the failure to obtain the 
entry of the decree for some three and one- 
half years since its presentation was 
unforseeable and not the result of the fault 
of any party. Under these circumstances, 
any party may be excused from performance. 
See West Los Angeles Institute for Cancer 
Research v. Mayer, 366 F.2d 220 (9th Cir. 
1966), cert, denied, 385 U.S. 1010 (1967).

Though the defendants' reasons for 
withdrawing consent to the proposed decree 
are not in the record, many of them are 
obvious or readily apparent. The proposed 
decree was negotiated without the benefit 
of the Court's decisions in International



-14-

Brotherhood of Teamsters v. United States,
431 U.S. 324 (1977) and California Brewers
Ass'n v. Bryant, ___ U.S. ___ , 63 L. Ed. 2d
55 (1980). These two cases have contributed 
considerably to the state of the applicable 
law as it existed in early 1977. Given the 
nature of consent decrees and the type of 
negotiations which result in them, it is 
clear that the relative strengths and weak­
nesses of the parties1 cases and the risks of 
going to trial are entirely different than 
they were prior to April 1, 1977, when the 
decree was presented. See, United States v. 
Armour & Co., 402 U.S. 673 (1971). The 
Unions1 position is that recent developments 
in the law have put them in a substantially 
different posture than they were in when the 
proposed decree was presented, and that their 
withdrawal from a stale settlement proposal 
is entirely justified.

The argument of the Equal Employment 
Advisory Council ("EEAC") relative to the



-15-

appealability question under 28 U.S.C.
§ 1292(a)(1) emphasizes, perhaps uninten­
tionally, the problem with the passage of 
time as it relates to the parties' evaluation 
of the risk of litigation. The EEAC argues 
that once the question of liability is decided 
by the trial court, it is highly unlikely 
that the parties or the court would be will­
ing to agree to the terms of the "original 
consent decree" (Br. of EEAC at 13). This 
reasoning applies with equal force when a 
significant period of time has elapsed 
after agreement to the proposed decree.
Just as the risks change after a district 
court has tried a case and decided the 
question of liability, the risks have changed 
here through the passage of time and the 
development that has occurred in the applic­
able law.

Implicit in the agreement to a consent 
decree was the expectation of the parties 
that the decree would be entered within a



-16-

reasonable time after it was proposed to the 
District Court. In this case, the parties 
contemplated that the proposed decree would 
become final within 65 days after tender, 
which was the time specified therein to pro­
vide appropriate notice to members of the 
class and to give them an opportunity to 
object pursuant to Fed. R. Civ. P. 23(e)
(J.A. 30a-31a). More than three years have 
passed, however, and the decree has not been 
entered. By whatever standard is employed, 
the proposed decree was not made final within 
a reasonable amount of time after the parties 
proposed it to the District Court and there­
fore the withdrawal of consent to its entry 
in October, 1979, was manifestly justified.

The probable scenario for the immediate 
future makes the efficacy of the entry of 
the proposed decree even more unlikely. For 
example, should the Court hold that this case 
is not moot and that the June 1, 1977, order 
is appealable, the case must be remanded to



-17-

determine whether the trial court abused 
its discretion in refusing to enter the 
decree. If the Court of Appeals agrees with 
the plaintiffs and remands the case to the 
District Court for directions to enter the 
decree, many of its terms will have already 
expired. If the Court of Appeals should 
decide that the District Court did not abuse 
its discretion, the plaintiffs may attempt 
to return to this Court or they may seek to 
enter into another agreement with the 
defendants.

Additional justification for the with­
drawal of consent by the defendants is 
suggested by the United States and the EEOC 
(Br. of U.S. at 18, fn. 14). These Amici 
assert that "unforseeable changed circum­
stances" might be sufficient reason for 
withdrawing consent. As stated, the assump­
tion held by the parties in April 1977, was 
that the decree would be entered shortly 
after its presentation. Nothing could be



-18-

more unforseeable than the fact that the 
parties are now in the Supreme Court of the 
United States some three and one-half years 
later. It is all the more remarkable given 
that the case remains wholly unresolved, 
that the class of plaintiffs retain whatever 
rights and claims for relief they may have 
had at the time their suit was filed in 
October, 1975 and that, at this time, there 
is little hope of resolution of this case 
within the immediate future no matter what 
the result of this appeal. These serious 
problems were realized perhaps by the 
plaintiffs and the District Court at the 
time this case was set for trial the second 
time. Apparently, it did not occur to anyone 
at the November 15, 1979, pre-trial confer­
ence that entry of the proposed decree would 
be appropriate.

Since the defendants do not now consent 
to the entry of the decree, it may not be 
entered by the District Court even should



-19-

this Court determine the June 1, 1977, order 
to be appealable. Accordingly, there is not 
a live controversy with respect to this 
appeal within the meaning of Article III of 
the United States Constitution. This contro­
versy is moot. Should the Court conclude that 
this appeal is not moot, then, in the alter­
native, the Unions adopt the position of 
American Brands as set forth hereinafter.

II. The District Court's Order
Refusing Entry of a Proposed 
Consent Decree Is Not Appeal- 
able Under The Judicially 
Created "Collateral Order"
Exception to 28 U.S.C. § 1291.

The Unions agree with the position taken 

in the Brief of Respondent, American Brands, 

Inc. Accordingly, the Unions will simply 

summarize that position as follows.
The finality requirement of 28 U.S.C. 

§1291 represents a legislative judgment that 
a succession of separate appeals from inter­
locutory orders would have a delibitating 
effect on judicial administration. The
District Court's order rejecting a proposed 
consent decree does not come within the



-20-

small class of decisions excepted from the 
final judgment rule by the judicially-created 
"collateral order" doctrine.

The District Court's order does not 
satisfy any element of this Court's three- 
part collateral order test. First, the 
order did not conclusively determine any 
disputed question. Even assuming that there 
is a general right to settle litigation, 
nothing in the District Court's order pre­
cluded settlement at another time by the 
tendered decree or some alternative consent 
decree.

Second, the District Court's order did 
not resolve an important issue completely 
separate from the merits. Petitioners con­
tend that the important collateral issue is 
the right to settle a Title VII class action 
under Weber (United Steelworkers of America, 
AFL-CIO-CLC v. Weber, 443 U.S. 193 (1979)). 
The Weber opinion, however, was delivered 
two years after the District Court's order,
was not considered by the courts below, and



-21-

is encompassed within the questions denied 
review by the Court in this case. Even 
assuming that Weber is applicable to settle­
ment among parties in litigation, the 
District Court's order in this case of 
necessity involved considerations that were 
enmeshed in the factual and legal issues 
comprising petitioners' claims, and so no 
"collateral" rights were injured by the 
District Court's order. Furthermore, the 
importance of the right to settle Title VII

9

actions is no different from the right to 
settle any other litigation, and a special 
exception to the final judgment rule for 
Title VII cases should not be created.

Third, the District Court's order is 
effectively reviewable, both before and 
after possible trial, and therefore fails 
to satisfy the final prong of the collateral 
order test. The same or alternative consent 
decree proposals could be presented by the 
parties for the Court's consideration at any



-22-

stage of the litigation. If none are accepted 
and the parties go to trial, any party could 
advocate on appeal therefrom the settlement 
alternative most favorable to its position.
In situations where actual final determina­
tions are made to the detriment of legitimate 
rights, immediate appellate review is avail­
able through certification or mandamus. In 
sum, no irreparable harm would flow from a 
decision holding the collateral order 
doctrine inapplicable and postponing the 
appellate review until final judgment.

III. The District Court's Order 
Refusing Entry Of The Con­
sent Decree Is Not Appeal- 
able Under The Congressionally 
Created Exception To The 
Finality Rule, 28 U.S.C.
§ 1292(a) (1) .__________________

The Unions agree with the position 
taken in the Brief of Respondent, American 
Brands, Inc. Accordingly, the Unions will 
simply summarize that position as follows.

28 U.S.C. § 1292(a)(1), the statutory 
exception to the rule of finality held by



-23-

the Court of Appeals below to be inapplicable 
to the District Court's order rejecting a 
proposed consent decree, has always received 
a narrow interpretation by this Court. 
Postponing appellate review in this case 
presents no serious, irreparable consequences 
such as would warrant expansion of 
§ 1292(a)(1).

After rejection of the tendered decree, 
petitioners remained fully able to obtain 
injunctive relief through alternative 
settlement proposals, a motion for injunctive 
relief, an award of injunctive relief follow­
ing trial, or through imposition of such 
relief on appeal. Nothing in the opinions 
of the courts below foreclosed any of these 
opportunities to seek and obtain injunctive 
relief. The District Court's order thus 
produced no irreparable effect because it 
could be reviewed both prior to and after 
final judgment.



-24-

Denial of entry raised no serious or 

irreparable harm for the further reason that 

it did not dispose of any claims for injunc­

tive relief. The District Court may have 

expressed an opinion concerning the lawful­

ness of the tendered decree, but it did not 

pass on the legal sufficiency of petitioners' 
claims for injunctive relief in any other 

form and under any other factual circum­

stances .
The narrow interpretation accorded 

§ 1292(a)(1) by this Court has often followed 
from weighing the consequences of postponing 
appeal against the vital judicial interests 
militating against piecemeal review. The 
result urged here by petitioners would create 
the potential for multiple and unnecessary 
appeals, interjecting appellate courts 
indiscriminately into the trial process.
The consequences of postponing appeal of an 
order rejecting a consent decree, on the



-25-

other hand, are minimal and remediable both 
prior to and after final judgment.

CONCLUSION
For the reasons presented, the decision 

of the Court of Appeals for the Fourth 
Circuit should be affirmed and the appeal 
dismissed.

LOCAL 182, TOBACCO WORKERS 
INTERNATIONAL UNION and 

TOBACCO WORKERS INTERNATIONAL 
UNION

Counsel

Jay J. Levit 
Imperial Building 
Third Floor
422 East Franklin Street 
Richmond, Virginia 23219
James F. Carroll 
Air Rights Building, Suite 727E 
7315 Wisconsin Avenue, N.W. 
Washington, D. C. 20014