Equal Employment Opportunity Commission v. Gala AZ Holdings Incorporated

Filing 40

ORDER that Plaintiff's Motion for Reconsideration of the Court's August 8, 2012 Order (Doc. 39 ) is granted in part and denied in part as follows: If the parties choose to resubmit their Joint Motion to Approve Consent Judgment with langua ge requiring this Court to enter an injunction, such proposed injunction shall address the considerations set forth herein. Otherwise, the parties may resubmit their Joint Motion to Approve Consent Judgment as set forth in the Court's Order of August 8, 2012 (Doc. 38). Signed by Judge James A Teilborg on 8/27/2012.(KMG)

1

WO

2
3
4
5
6

IN THE UNITED STATES DISTRICT COURT

7

FOR THE DISTRICT OF ARIZONA

8
9

Equal
Employment
Commission,

Opportunity

No. CV-11-00383-PHX-JAT
ORDER

10

Plaintiff,

11

v.

12

Gala AZ holdings, Inc., d/b/a Del Taco, a
California corporation,

13

Defendant.

14
15
16

Pending before the Court is Plaintiff’s Motion for Reconsideration of the Court’s
August 8, 2012 Order (Doc. 39). The Court now rules on the Motion.

17

I.

18

On May 8, 2012, the parties submitted a Joint Motion to Approve Consent

19

Judgment (Doc. 37) to the Court. On August 8, 2012, the Court denied the Joint Motion

20

to Approve Consent Judgment without prejudice to the parties re-filing without the

21

language requiring the entry of an injunction. (See Doc. 38).

22
23

BACKGROUND

Specifically, the Court found that it could grant the consent decree if the following
language was removed:

24

Injunction

25

1.
Defendant and its officers, agents, employees,
successors, assigns and all persons in active concert or
participation with them, are permanently enjoined for the
duration of the decree from (a) discriminating against any
employee on the basis of sex and gender and (b) retaliating
against any employee because s/he (i) opposed discriminatory
conduct believed to be unlawful under Title VII , (ii) reported

26
27
28

conduct to be unlawful under Title VII to managers of
Defendant [sic] (iii) filed a charge or assisted or participated
in the filing of a charge of sex or gender discrimination, or
(iv) assisted or participated in an investigation or proceeding
resulting from any of the preceding items.

1
2
3
4
5
6
7
8
9
10
11

(Doc. 37-1 at 2:16-26).
In denying the injunction, the Court specifically found that “[t]he proposed
injunction appears to enjoin activity that is already prohibited by federal employment law
and, thus, the entry of an injunction would be duplicative and unnecessary.” (Doc. 38).
Plaintiff now seeks reconsideration of the Court’s Order.
II.

The Court will grant reconsideration of its prior non-appealable interlocutory

order1 if the party seeking reconsideration makes a showing that:

12

1)
There are material differences in fact or law from that
presented to the Court and, at the time of the Court’s decision,
the party moving for reconsideration could not have known of
the factual or legal differences through reasonable diligence;

13
14

(2)
There are new material facts that happened after the
Court’s decision;

15
16

(3)
There has been a change in the law that was decided or
enacted after the Court’s decision; or

17

(4)
The movant makes a convincing showing that the
Court failed to consider material facts that were presented to
the Court before the Court’s decision.

18
19
20
21
22

LEGAL STANDARD

Motorola, Inc. v. J.B. Rodgers Mech. Contractors, 215 F.R.D. 581, 586 (D. Ariz. 2003).
(emphasis added).
“A motion for reconsideration under Rule 59(e) should not be granted, absent

23
24
25
26
27
28

1

The Court notes that, under certain circumstances, the denial of a consent
judgment may be an appealable interlocutory order. See Sierra Club, Inc. v. Electronic
Controls Design, Inc., 909 F.2d 1350, 1353 (9th Cir. 1990). If the denial of a consent
judgment is an appealable interlocutory order, the Court applies the test set forth in
Federal Rule of Civil Procedure 59. If the denial of a consent judgment is not an
appealable interlocutory order, the Court applies the test set forth in Motorola. Rather
than specifying which standard it is moving under, Plaintiff has cited to cases applying
both the Motorola and Rule 59(e) standards. In analyzing Plaintiff’s Motion for
Reconsideration, the Court will apply both standards.
-2-

1

highly unusual circumstances, unless the district court is presented with newly discovered

2

evidence, committed clear error, or if there is an intervening change in the controlling

3

law.” McDowell v. Calderon, 197 F.3d 1253, 1255 (9th Cir. 1999) (internal quotation

4

and citations omitted).

5

III.

6

Plaintiff argues that the Court’s rejection of the injunction language in the parties’

7

consent judgment is “not in accord with binding Ninth Circuit law.” (Doc. 39 at 2).

8

Plaintiff specifically relies on the decision of the Ninth Circuit Court of Appeals in Equal

9

Employment Opportunity Commission v. Goodyear Aerospace Corp., 813 F.2d 1539 (9th

10

ANALYSIS

Cir. 1987) to support its position.

11

In Goodyear, an employee of Goodyear Aerospace Commission (“Goodyear”)

12

filed a charge with the EEOC alleging racially discriminatory promotion practices. 813

13

F.2d at 1541. The EEOC subsequently reached a settlement under which Goodyear

14

promised to consider the employee for promotion without regard to her race and not to

15

retaliate against her. Id. Thereafter, the employee filed a second EEOC charge alleging

16

that Goodyear failed to promote her because of her race and in retaliation for her first

17

EEOC charge. Id. After Goodyear refused to agree to a proposed consent decree, the

18

EEOC filed a charge in federal district court. Id. Thereafter, the employee signed a

19

settlement agreement, which provided that, in consideration for Goodyear’s promise not

20

to retaliate, Goodyear was released from any and all actions and the employee requested

21

that the EEOC dismiss the lawsuit. Id. at 1541-42.

22

Goodyear then moved for summary judgment arguing that the settlement mooted

23

the EEOC’s power to maintain the litigation. Id. at 1542. The district court granted

24

Goodyear’s motion for summary judgment, finding that the settlement was fair and

25

reasonable, private recovery beyond that obtained in the settlement was unavailable, an

26

injunction against retaliation was unnecessary because Title VII provided that protection,

27

summary judgment furthered Title VII’s policy favoring voluntary settlements, liability

28

for discrimination was questionable, further litigation was not in the public interest and
-3-

1

would waste the court’s time, and summary judgment would permit the employee to

2

pursue her career without the appearance of forced compliance with the promotion. Id. at

3

1542.

4

The Ninth Circuit Court of Appeals reversed, finding that the EEOC’s right of

5

action is independent of the employee’s private action rights. Id. at 1542. The Court of

6

Appeals also reversed and remanded on the question of whether the requested injunctive

7

relief should be entered. Id. at 1544. The Court of Appeals explained that permanent

8

injunctions are available as relief under section 706(g) of Title VII, which provides in

9

relevant part:

10
11
12
13
14
15
16

If the court finds that the respondent has intentionally
engaged in or is intentionally engaging in an unlawful
employment practice charged in the complaint, the court may
enjoin the respondent from engaging in such unlawful
employment practice, and order such affirmative action as
may be appropriate, which may include, but is not limited to,
reinstatement or hiring of employees, with or without back
pay (payable by the employer, employment agency, or labor
organization, as the case may be, responsible for the unlawful
employment practice), or any other equitable relief as the
court deems appropriate.
42 U.S.C.A. § 2000e-5(g)(1) (emphasis added).

17

The Court of Appeals held that the district court erred because the district court

18

assumed liability for the purposes of the summary judgment order. Goodyear, 813 F.2d

19

at 1544. Because a finding on liability was necessary before the Court could grant or

20

deny the injunction, the Court of Appeals remanded for the district court to make a

21

finding on liability. Id. at 1545. The Court of Appeals instructed that, if the district court

22

made a finding that Goodyear was liable for discrimination and retaliation, it should enter

23

the requested injunction. Id.

24

The Court of Appeals also found that the district court erred in finding that an

25

injunction against retaliation was superfluous because Title VII already prohibits that

26

conduct. Id. at 1544. In reasoning that an injunction was not superfluous, the Court of

27

Appeals found that:

28

An injunction would (1) instruct Goodyear that it must
-4-

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27

comply with federal law, (2) subject it to the contempt power
of the federal courts if it commits future violations, and (3)
reduce the chilling effect of its alleged retaliation on its
employees’ exercise of their Title VII rights. Section 706(g)
specifically gives courts the power to enjoin an “unlawful
employment practice.”
Id. In support of its decision that the district court could enjoin conduct already made
unlawful under Title VII, the Court of Appeals also relied on cases enjoining specific
employment practices, not already specifically prohibited by the law, such as an
injunction against the use of sex-segregated annuity tables. Id.
In this case, Plaintiff relies on the Court of Appeals’ reasoning in Goodyear to
support its contention that this Court must enter the injunction to which the parties in this
case have consented. The Court disagrees.
“[A] federal court is more than ‘a recorder of contracts’ from whom parties can
purchase injunctions; it is ‘an organ of government constituted to make judicial decisions
. . . .’” Local No. 93, Int’l Ass’n of Firefighters, AFL-CIO, C.L.C., 478 U.S. 501, 525
(1986) (ellipsis in original) (internal citation omitted). In evaluating whether to enter an
injunction pursuant to a consent judgment, this Court has a duty to consider the
implications and the Court’s own enforcement power of such an injunction. The Court is
not obligated to blindly enter an injunction without the Court’s and the parties’
understanding of the parameters of such an injunction.
Goodyear is distinguishable from this case because, in that case, the Ninth Circuit
Court of Appeals remanded for the district court to determine Goodyear’s liability for
discrimination and retaliation and, if the district court found such liability, it was to then
enter the injunction. This outcome comports with the plain language of 706(g) which
allows for an injunction “[i]f the court finds that the respondent has intentionally engaged
in or is intentionally engaging in an unlawful employment practice charged in the
complaint.” 42 U.S.C.A. § 2000e-5(g)(1) (emphasis added). In this case, the Court has
made no such finding and the parties have not stipulated to such a finding. In fact, the
proposed consent judgment in this case specifically notes that Defendant denies the

28
-5-

1

EEOC’s allegations that Defendant subjected its employee to unlawful sexual harassment

2

and retaliation, including termination in violation of Title VII. (See Doc. 37-1 at 1-2). In

3

such a circumstance, the Court questions the necessity and the propriety of entering an

4

injunction.

5

Further, in Goodyear, the Ninth Circuit Court of Appeals did not address this

6

Court’s primary concern in entering an injunction that does not differ from current

7

federal law. Because the injunction is precisely duplicative of federal law, it appears that

8

enforcement of the injunction could give this Court jurisdiction over all future cases

9

alleging that Defendant Gala AZ Holdings, Inc. d/b/a Del Taco discriminated against any

10

employee on the basis of sex or gender or retaliated against any employee who opposed

11

discriminatory conduct, reported unlawful conduct, filed a charge or participated in filing

12

a charge of sex or gender discrimination, or assisted or participated in an investigation or

13

proceeding resulting from any of the preceding items.

14

It is not clear from the injunction, as currently proposed, whether any future

15

employee of Defendant would be deprived of his/her right to choose the jurisdiction in

16

which to bring his/her case or if he/she would be forced to bring such an employment

17

action in this Court. Such an inequitable result would certainly violate many public

18

policy considerations in favor of allowing would-be plaintiffs to choose their own forum

19

and could possibly implicate issues of personal jurisdiction and venue. Further, this

20

Court simply does not have the resources to assert jurisdiction over all allegations of

21

discriminatory conduct against Defendant, who conducts business in more than ten states.

22

Moreover, even if the injunction did not purport to give this Court jurisdiction

23

over all future cases of discriminatory conduct by Defendant, it is unclear from the

24

injunction, as currently proposed, whether Defendant has consented to multiple

25

proceedings on the issue of whether Defendant has violated Title VII in a particular

26

instance. Further, it is unclear to the Court what the effect on the litigation would be if

27

there were inconsistent results arising from a contempt decision in this Court and a merits

28

decision in another Court. It is with these policy considerations in mind that the Court
-6-

1

refused the original request for an injunction in the consent judgment and these

2

considerations have not been alleviated by the Court of Appeal’s decision in Goodyear.

3

IV.

4

Based on the foregoing,

5

IT IS ORDERED that Plaintiff’s Motion for Reconsideration of the Court’s

6

CONCLUSION

August 8, 2012 Order (Doc. 39) is granted in part and denied in part as follows:

7

If the parties choose to resubmit their Joint Motion to Approve Consent Judgment

8

with language requiring this Court to enter an injunction, such proposed injunction shall

9

address the considerations set forth herein.

10
11
12

Otherwise, the parties may resubmit their Joint Motion to Approve Consent
Judgment as set forth in the Court’s Order of August 8, 2012 (Doc. 38).
Dated this 27th day of August, 2012

13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
-7-