IN THE UNITED STATES COURT OF APPEALS FOR THE EIGHTH CIRCUIT ____________________________________________ No. 11-1241 ____________________________________________ U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff-Appellant, and DENNIS ANDERSON, Plaintiff-Intervenor, v. PRODUCT FABRICATORS, INC., Defendant-Appellee. _________________________________________________________ On Appeal from the United States District Court for the District of Minnesota The Hon. Paul A. Magnuson _________________________________________________________ REPLY BRIEF OF THE PLAINTIFF-APPELLANT U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION _________________________________________________________ P. DAVID LOPEZ General Counsel CAROLYN L. WHEELER Acting Associate General Counsel JUSTIN MULAIRE Attorney U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Office of General Counsel 131 M St. NE Washington, D.C. 20507 (202) 663-4741 justin.mulaire@eeoc.gov TABLE OF CONTENTS ARGUMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 PFI OFFERS NO LEGAL OR FACTUAL BASIS FOR AFFIRMING THE DISTRICT COURT'S REFUSAL TO ENTER A DECREE DESIGNED TO CORRECT LONGSTANDING VIOLATIONS OF THE ADA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 A. "Systemic" Violations Are Not a Necessary Predicate for Entry of a Consent Decree, But in Any Event PFI's Violations of the ADA Were Not "Isolated". . . . . . . . . . . . . . . . . . . . . . . . . . . 2 B. The "Narrow Tailoring" Requirement for Prison Litigation Reform Act Consent Decrees Has No Application To This Case. . . . . . . . . 4 C. The District Court's Discretion to Fashion Injunctive Relief Post-Trial Is Inapposite. . . . . . . . . . . . . . . . . . . . . . . . . . . 5 D. The District Court Abused Its Discretion When It Rejected the Proposed Consent Decree Based on Legal Error or Clearly Erroneous Factual Conclusions. . . . . . . . . . . . . . . . . . . . . . . . 8 CONCLUSION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 TABLE OF AUTHORITIES CASES Angela R. by Hesselbein v. Clinton, 999 F.2d 320 (8th Cir. 1993). . . . . . . . 8 Cody v. Hillard, 139 F.3d 1197 (8th Cir. 1998). . . . . . . . . . . . . . . . . 5 EEOC v. Frank's Nursery & Crafts, Inc., 177 F.3d 448 (6th Cir. 1999). . . 2, 3 EEOC v. Siouxland Oral Maxillofacial Surgery Assocs., L.L.P., 578 F.3d 921 (8th Cir. 2009). . . . . . . . . . . . . . . . . . . . .5, 6 Grunin v. Int'l House of Pancakes, 513 F.2d 114 (8th Cir. 1975). . . . . . . . 9 Hines v. Anderson, 547 F.3d 915 (8th Cir. 2008). . . . . . . . . . . . . . . . 4 Int'l Brotherhood of Teamsters v. U.S., 431 U.S. 324 (1977). . . . . . . . . 3, 4 Little Rock Sch. Dist. v. Pulaski Cnty. Spec. Sch. Dist. No. 1, 921 F.2d 1371 (8th Cir. 1990). . . . . . . . . . . . . . . . . . . . . 7 Local No. 93, Int'l Ass'n of Firefighters v. City of Cleveland, 478 U.S. 501 (1986). . . . . . . . . . . . . . . . . . . . . . . . 5, 9 McDonald v. Carnahan, 109 F.3d 1319 (8th Cir. 1997). . . . . . . . . . . . . . 5 U.S. v. Cannons Engineering Corp., 899 F.2d 79 (1st Cir. 1990). . . . . . . . . 7 U.S. v. Metropolitan St. Louis Sewer Dist., 952 F.2d 1040 (8th Cir. 1992) 7 U.S. v. BP Amoco Oil PLC, 277 F.3d 1012 (8th Cir. 2002). . . . . . . . . . . . 7 FEDERAL STATUTES 18 U.S.C. § 3626(b)(2). . . . . . . . . . . . . . . . . . . . . . . . . . . 4 ARGUMENT PFI OFFERS NO LEGAL OR FACTUAL BASIS FOR AFFIRMING THE DISTRICT COURT'S REFUSAL TO ENTER A DECREE DESIGNED TO CORRECT LONGSTANDING VIOLATIONS OF THE ADA In support of the proposed decree, the EEOC pointed to two 16-year-long, ongoing violations of the Americans with Disabilities Act that the decree would bring to an end. PFI consented to the proposed injunctions. In its opening brief, the EEOC argued that the district court abused its discretion in refusing to enter the decree, either because it overlooked these facts or because it applied an erroneous legal standard in holding that these facts did not provide a jurisdictional basis for injunctive relief. PFI's arguments to the contrary are without merit. First, PFI's contention that the absence of "systemic or widespread" discrimination deprives a district court of jurisdiction over a proposed consent decree has no legal foundation, and in any event the EEOC did allege two pattern or practice violations affecting multiple employees. Second, in arguing that the district court applied the correct legal standard, PFI invokes the "narrow tailoring" requirement imposed by the Prison Litigation Reform Act, which has no application here and which the district court quite properly did not apply. Third, PFI relies on cases delineating a district court's discretion to fashion (or deny) injunctive relief after trial, when remedies are disputed, but these principles lend no support to the court's decision to reject a settlement agreement that satisfies all applicable legal standards. Finally, PFI makes the straw man argument that the consent of the parties does not "compel" a district court to approve a proposed settlement, but the EEOC has never suggested that it does. Rather, the EEOC's argument is that the court abused its discretion in this case by overlooking the factual bases of the complaint the decree was designed to correct. Because PFI similarly ignores those facts, its arguments that the court properly declined jurisdiction over the EEOC's effort to remedy longstanding ADA violations are unavailing. A. "Systemic" Violations Are Not a Necessary Predicate for Entry of a Consent Decree, But in Any Event PFI's Violations of the ADA Were Not "Isolated" PFI offers no legal support for its apparent contention that the existence of only an isolated violation of federal law would deprive the district court of jurisdiction over prospective, equitable relief. See PFI Brief at 14-16. If that proposition were correct, equitable remedies such as backpay and reinstatement would not be available in cases involving a single incident of discriminatory discharge. As the EEOC noted in its opening brief, however, even one instance of intentional discrimination is sufficient to support an award of injunctive relief. See EEOC Opening Brief at 18-19 (citing EEOC v. Frank's Nursery & Crafts, Inc., 177 F.3d 448, 467-68 (6th Cir. 1999)). PFI has cited no legal authority to contest this point and it should be considered conceded.<1> In any event, PFI's characterization of the alleged violations in this case as "isolated" is plainly inaccurate. Since 1995, the defendant is alleged to have engaged in an "ongoing pattern or practice" of "regularly collecting and maintaining information regarding the medical condition and/or history of employees in employee personnel files" and subjecting "its employees ... to unlawful collection and maintenance of information regarding medical conditions and/or history," in violation of two provisions of the ADA. See App. 11-12 (EEOC Complaint¶¶ 9-10). One of these patterns of unlawful conduct was the result of longstanding company policy. See id. ¶9. By definition, a pattern or practice is "more than the mere occurrence of isolated or 'accidental' or sporadic discriminatory acts." Int'l Brotherhood of Teamsters v. U.S., 431 U.S. 324, 336 (1977). That a company is engaged in a pattern or practice of violations means that "discrimination was the company's standard operating procedure the regular rather than the unusual practice." Id. The conduct that is the basis for the EEOC's suit was thus expressly identified as longstanding and repeated. PFI's assertions to the contrary are clearly without support. B. The "Narrow Tailoring" Requirement for Prison Litigation Reform Act Consent Decrees Has No Application To This Case In its brief, PFI contends that a consent decree "should be narrowly tailored to address a particular problem." PFI Brief at 14, 16. This contention is of no help to PFI for at least two reasons. First, the district court simply did not find that the relief provided by the proposed consent decree was insufficiently narrowly tailored. Rather, the district court found that there was no factual basis for exercising prospective jurisdiction over PFI at all. Second, PFI supports its narrow tailoring argument with a citation to Hines v. Anderson, 547 F.3d 915, 922 (8th Cir. 2008). See PFI Brief at 14, 16. Hines is a prison conditions case governed by the Prison Litigation Reform Act ("PLRA"), "which outlines appropriate remedies in civil litigation regarding prison conditions." Id. at 917. The PLRA imposes special constraints on remedies that may be provided in such cases. See 18 U.S.C. § 3626(b)(2) ("[A] defendant ... shall be entitled to the immediate termination of any prospective relief if the relief was approved or granted in the absence of a finding by the court that the relief is narrowly drawn, extends no further than necessary to correct the violation of the Federal right, and is the least intrusive means necessary to correct the violation of the Federal right."). This action does not concern prison conditions, and the proposed consent decree need not satisfy the special narrow tailoring requirement of the PLRA. The proposed decree need only more generally "spring from and serve to resolve a dispute within the court's subject-matter jurisdiction[,] come within the general scope of the case made by the pleadings, and ... further the objectives of the law upon which the complaint was based." Local No. 93, Int'l Ass'n of Firefighters v. City of Cleveland, 478 U.S. 501, 525 (1986) (internal quotation marks and citations omitted). The provisions of the proposed consent decree satisfy these basic requirements. PFI's narrow tailoring argument is not the basis for the district court's decision and in any event is without merit. C. The District Court's Discretion to Fashion Injunctive Relief Post- Trial Is Inapposite Citing EEOC v. Siouxland Oral Maxillofacial Surgery Associates, L.L.P., 578 F.3d 921 (8th Cir. 2009), PFI notes that a district court has "wide discretion to fashion appropriate relief." See PFI Brief at 13, 17; see also id. at 15, 18. Siouxland Oral involved a district court's denial of a request for certain injunctive relief following a trial. This Court held that the denial was within the district court's discretion because the factual record provided support for the district court's conclusion that such injunctive relief was not needed. PFI's argument appears to be that in rejecting the proposed consent decree the district court in this case was making a similar judgment call about the utility of injunctive relief. PFI argues that this is therefore an exercise of discretion within the scope of Siouxland Oral. PFI's reliance on Siouxland Oral is misplaced. The district court in Siouxland Oral was performing a fundamentally different task than the district court was required to perform in this case. Siouxland Oral involved a post-trial request for injunctive relief that was opposed by the defendant. In the absence of the defendant's consent, it is necessarily the task of a district court to fashion appropriate relief by choosing from among the range of remedies that find support in the record. The court naturally exercises discretion in carrying out that task. In the context of settlement, however, this Court's decisions make clear that the role of the district court is not plenary. The district court's function when presented with a proposed consent decree is not to fashion relief by its own lights, but rather "to review" the parties' proposed relief "for fairness, reasonableness, and adequacy." See U.S. v. Metropolitan St. Louis Sewer District, 952 F.2d 1040, 1044 (8th Cir. 1992); U.S. v. BP Amoco Oil PLC, 277 F.3d 1012, 1018 (8th Cir. 2002) ("Reasonableness, fairness, and fidelity to the statute are ... the horses which district judges must ride." (quoting U.S. v. Cannons Engineering Corp., 899 F.2d 79, 85 (1st Cir. 1990)). This Court has instructed that district courts should approach proposed settlements "with a presumption in their favor." See Little Rock School District v. Pulaski County Special School District No. 1, 921 F.2d 1371, 1388 (8th Cir. 1990). Thus in the context of settlement, "[j]udges should not substitute their own judgment as to optimal settlement terms for the judgment of the litigants and their counsel." Id. at 1385 (internal quotation marks omitted). When relief is contested following a trial, on the other hand, the judge necessarily must substitute his or her judgment for that of at least one (or maybe all) of the litigants. Therefore, if the district court in this case was, as PFI suggests, making a judgment call about the utility of having a consent decree rather than a private settlement agreement, that would have been an abuse of discretion. In the EEOC's view, the court did not step out of bounds in this way. In its opening brief, the EEOC noted that the district court did not find any substantive provision of the proposed consent decree to be unfair, unreasonable, or inadequate, and that the district court did not find that the consent decree would impose an unreasonable burden upon the court. EEOC Opening Brief, 13, 21 n.4. As PFI has not contested these statements, they are conceded. D. The District Court Abused Its Discretion When It Rejected the Proposed Consent Decree Based on Legal Error or Clearly Erroneous Factual Conclusions Nowhere does the EEOC contend, as PFI claims, that the parties' consent to a settlement agreement "compels" the district court to approve it. See PFI Brief at 18-20. PFI makes this straw man argument despite the EEOC's citation to cases setting out the governing standards for review of proposed consent decrees. See EEOC Opening Brief at 12-13, 17. It is well settled that a district court is "free to reject agreed-upon terms as not in furtherance of statutory objectives," or if they are not "consistent with the statute the consent judgment is to enforce" or does not "fairly and reasonably resolve[] the controversy in a manner consistent with the public interest." Angela R. by Hesselbein v. Clinton, 999 F.2d 320, 324 (8th Cir. 1993) (internal quotation marks omitted).<3> A court may reject a consent decree if it is beyond the subject matter jurisdiction of the court or is beyond the scope of the pleadings. See Local No. 93, 478 U.S. at 525. And when absent class members' rights or the interests of third parties are unfairly or unreasonably affected by a proposed settlement, the district court should act as their "guardian" and reject it. See Grunin v. International House of Pancakes, 513 F.2d 114, 123 (8th Cir. 1975). The fact that the parties' agreement does not compel approval does not, however, mean that a court's review of a proposed settlement is standardless or that an agreement may be rejected for an invalid reason. As with any exercise of discretion, the district court abuses its discretion if it rejects a proposed consent decree as the result of a clear error of fact or of an erroneous legal standard. The district court did not find the proposed consent decree to suffer from any of the above-noted deficiencies. Rather, as set forth in the EEOC's opening brief, see EEOC Opening Brief at 12-22, the district court in this case either overlooked the 16 years of ongoing, unlawful conduct identified by the EEOC or else believed that the EEOC must prove that conduct in order for the court to exercise jurisdiction over PFI. In so reasoning, the district court abused its discretion. CONCLUSION The sole ground identified by the district court for its decision derives from an error of law or a clearly erroneous factual analysis. Therefore, the EEOC respectfully requests that the district court's order be reversed and that this action be remanded with directions that the proposed consent decree be entered. Respectfully submitted, P. DAVID LOPEZ General Counsel CAROLYN L. WHEELER Acting Associate General Counsel s/ Justin Mulaire JUSTIN MULAIRE Attorney U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Office of General Counsel 131 M St. NE Washington, D.C. 20507 (202) 663-4741 justin.mulaire@eeoc.gov Dated: April 28, 2011 CERTIFICATE OF COMPLIANCE This brief complies with the type-volume limitation of Fed. R. App. P. 32(a)(7)(B) because it contains 2218 words, excluding the parts of the brief exempted by Fed. R. App. P. 32(a)(7)(B)(iii). This brief complies with the typeface requirements of Fed. R. App. P. 32(a)(5) and the type style requirements of Fed. R. App. P. 32(a)(6) because it has been prepared in a proportionally spaced typeface using Microsoft Word 2003 in Times New Roman 14 point. Pursuant to 8th Cir. R. 28A(h)(2), the electronic versions of this brief and the addendum have been scanned for viruses prior to filing and are virus free. s/ Justin Mulaire JUSTIN MULAIRE Attorney U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Office of General Counsel 131 M St. NE Washington, D.C. 20507 (202) 663-4741 justin.mulaire@eeoc.gov Dated: April 28, 2011 CERTIFICATE OF SERVICE I hereby certify that on today's date I served a copy of the foregoing brief by electronic means, via the Court's CM/ECF system to the following counsel of record: Counsel for Defendant/Appellee: Marlene S. Garvis Jardine Logan & O'Brien PLLP 8519 Eagle Point Blvd., Ste. 100 Lake Elmo, MN 55042 Counsel for Plaintiff-Intervenor: James R. Andreen Erstad & Riemer, PA 8009 34th Ave. South, Ste. 200 Minneapolis, MN 55425 s/ Justin Mulaire JUSTIN MULAIRE Attorney U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Office of General Counsel 131 M St. NE Washington, D.C. 20507 (202) 663-4741 justin.mulaire@eeoc.gov Dated: April 28, 2011 ********************************************************************************** <> <1> PFI states that consent decrees are "[t]ypically" used to resolve cases with class allegations or with defendants that have a history of employment discrimination. PFI Brief at 15. This is not true. For example, virtually all of the thousands of cases prosecuted and settled by the EEOC over the years have been resolved through entry of consent decrees, regardless of whether they involve individual or class allegations, and regardless of whether the defendants have a history of other violations. In any event, even if PFI's statement were true, PFI offers no reason to believe that it has any legal significance. <2> At page 19 of its brief, PFI also cites Cody v. Hillard, 139 F.3d 1197 (8th Cir. 1998), and McDonald v. Carnahan, 109 F.3d 1319 (8th Cir. 1997), which are also governed by the PLRA and concern the termination of a consent decree over the objection of a party - not the approval of a decree when all parties have consented. The cases have no application here. <3> PFI's brief quotes from Angela R. in various places. PFI Brief at 16-17, 19-20. In that case, the district court approved a complex consent decree that would have overseen the operation of a state agency. This Court reversed, on the grounds that the decree did not resolve key questions about who had standing to enforce the decree, that the decree implicated considerations of federalism, and that the decree raised the prospect of "extended judicial involvement" in the comprehensive oversight of the operations of a state institution. Angela R., 999 F.2d at 325-26. The consent decree proposed in this case does not implicate these concerns.