Beck v. Boeing Co.

MEMORANDUM^**

1. The district court did not err in certifying the class of women employed at Boeing’s Puget Sound facilities for purposes of determining whether the employer engaged in a pattern or practice of discrimination against its female employees because of sex (Phase I). See, e.g., Int’l Bhd. of Teamsters v. United States, 431 U.S. 324, 97 S.Ct. 1843, 52 L.Ed.2d 396 (1977). In a systemic disparate treatment case seeking class-wide injunctive or declaratory relief, plaintiffs are “not required to offer evidence that each person [who] seek[s] relief was a victim of the employer’s discriminatory policy” to establish their prima facie case. Id. at 360. Rather, their burden is to prove only that “discrimination was the company’s standard operating procedure.” Id. at 336. This may be done through statistics alone. See id. at 339-40.

Because the employer’s defense must be “designed to meet the prima facie case” established by plaintiffs’ statistical proof, the focus of its rebuttal case likewise “will not be on individual [employment] decisions.” Id. at 360 n. 46. Instead, to meet its rebuttal burden, the employer must demonstrate that the plaintiffs’ statistical evidence “is either inaccurate or insignificant.” Id. at 360.

Hence, Boeing cannot defeat class certification at the liability phase by arguing that it is entitled to introduce individualized evidence that each of its employment decisions was motivated by a legitimate nondiseriminatory reason. See, e.g., Probe v. State Teachers’ Ret. Sys., 780 F.2d 776, 780 (9th Cir.1986) (recognizing the applicability of Fed.R.Civ.P. 23(b)(2) to Title VII actions). At various points in its appellate brief, Boeing seems to concede as much. See, e.g., Appellants’ Opening Br. at 23. If there is a finding that Boeing engaged in class-wide discrimination, the district court may award at least declaratory and injunctive relief.

2. The district court abused its discretion when it certified the class for purposes of determining plaintiffs’ punitive damages claims (Phase II). Although there is no rule against “hybrid certification” under both Rule 23(b)(2) and 23(b)(3), see Smith v. Univ. of Wash. Law Sch., 233 F.3d 1188, 1196 (9th Cir. 2000), certification here was premature, see Teamsters, 431 U.S. at 361 (“[T]he question of individual relief does not arise until it has been proved that the employer has followed an employment policy of unlawful discrimination.” (emphasis added)). The district court’s order certifying the Phase II class indicates that liability in Phase I would depend on plaintiffs’ ability to prove a pattern or practice of discrimination, and that “the punitive damages assessed against defendants (if any) will flow from that finding.” However, a finding that the employer engaged in a pattern or practice of discrimination does not automatically entitle every class member to damages. See 42 U.S.C. § 1981a(b)(1) (allowing the award of punitive damages when the employer acted with reckless indifference to the federal rights of “an aggrieved individual”). To receive punitive damages in a Title VII case, a plaintiff must have suffered some harm as a result of a defendant’s illegal behavior. Hence, membership in the Phase II class must be restricted to those who allege that they were harmed by the employer’s proven pattern or practice of discrimination. The district court’s order contravenes these principles. Because the district court did not certify a class for backpay, the action will terminate upon an award of punitive damages, which, according to the order, automatically “flow from” a finding of a pattern or practice of discrimination. If the district court’s certification of the Phase II class were upheld, the beneficiaries of the punitive damages award would necessarily include those class members not affected by the alleged discriminatory policy as well as those who were. This may not be done. We therefore vacate the district court’s certification order with respect to punitive damages (Phase II).

3. Because we hold that questions about systemic disparate treatment should be decided first and vacate those aspects of the district court’s order that relate to class-wide punitive damages, Rule 23(b)(2)’s “predominance” requirement is not violated. See Molski v. Gleich, 307 F.3d 1155, 1165-70 (9th Cir.2002).

We reject Boeing’s argument that a bifurcated trial plan violates the Seventh Amendment’s Reexamination Clause. See Arthur Young & Co. v. U.S. Dist. Court, 549 F.2d 686, 692-93 (9th Cir.1977); see also Hilao v. Estate of Marcos, 103 F.3d 767, 782 (9th Cir.1996).

We affirm the district court’s certification order in all other respects.

AFFIRMED in part, VACATED in part. No costs.

** This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by Ninth Circuit Rule 36-3.