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STENDER v. LUCKY STORES

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA


January 7, 1992

NANCY J. STENDER, DIANE SKILLSKY, JULIE VALENTINE-DUNN, REBA BARBER-MONEY, IRMA HERNANDEZ, ANITA MARTINEZ and JON GOLD on behalf of themselves and all other similarly situated, Plaintiff, -v.- LUCKY STORES, INC., Defendant.

The opinion of the court was delivered by: MARILYN HALL PATEL

AMENDED MEMORANDUM AND ORDER

 Plaintiffs have brought this class action against Lucky Stores, Inc. on behalf of Black and female employees working in retail stores within Lucky's Northern California Food Division. Plaintiffs allege discrimination on the basis of race and sex in initial job placement, allocation of work hours, reclassification of part-time employees to full-time positions, and promotions. Claims are brought pursuant to Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.; 42 U.S.C. § 1981; and the California Fair Employment and Housing Act ("FEHA"), Government Code §§ 12900-12996.

 On November 21, 1991 the President signed into law the Civil Rights Act of 1991. The Act "respond[s] to recent decisions of the Supreme Court by expanding the scope of relevant civil rights statutes in order to provide adequate protections to victims of discrimination." Civil Rights Act § 3(4). The Civil Rights Act will affect the law in this case if it applies to cases which were pending at the time of its enactment. Plaintiffs contend that the Act is applicable to their claims while defendant argues that the provisions of the Act should not be applied to this case. The only case which this court has found which analyzes the question of the retroactivity of the 1991 Civil Rights Act in depth is Mojica v. Gannett Co., Inc., No. 90-C-3827 (N.D. Ill. Nov. 27, 1991). *fn1" That court held that the Act was applicable to cases which were pending at the time of its enactment. For the following reasons, this court holds that the Civil Rights Act of 1991 is applicable to plaintiff's claims.

 DISCUSSION

 A. The Plain Language of the Act

 "The starting point for interpretation of a statute 'is the language of the statute itself. Absent a clearly expressed legislative intention to the contrary, that language must ordinarily be regarded as conclusive.'" Kaiser Aluminum & Chemical Corp. v. Bonjorno, 494 U.S. 827, 110 S. Ct. 1570, 1575, 108 L. Ed. 2d 842 (1990) (quoting Consumer Product Safety Comm'n v. GTE Sylvania, Inc., 447 U.S. 102, 108, 64 L. Ed. 2d 766, 100 S. Ct. 2051 (1980)). The language of the 1991 Civil Rights Act indicates that the Act should apply to cases which were pending at the time of its enactment.

 Section 402 of the 1991 Civil Rights Act provides:

 (a) In General. -- Except as otherwise specifically provided, this Act and the amendments made by this Act shall take effect upon enactment.

 (b) Certain Disparate Impact Cases. -- Notwithstanding any other provision of this Act, nothing in this Act shall apply to any disparate impact case for which a complaint was filed before March 1, 1975 and for which an initial decision was rendered after October 30, 1983.

 The Ninth Circuit has stated that "the fact that Congress expressed its intention that [a] statute take effect upon enactment is some indication that it believed that application of its provisions was urgent." In re Reynolds, 726 F.2d 1420, 1423 (9th Cir. 1984). In Reynolds, the Omnibus Budget Reconciliation Act of 1981 was silent as to whether it should apply to cases which were pending when it was enacted. However, the court weighed the fact that the Act was to be effective upon enactment in favor of the Act's retroactive application.

 More importantly, reading clauses (a) and (b) of section 402 together makes it clear that the 1991 Civil Rights Act applies to cases which were pending at the time of its enactment. Section 402(b) carves out an exception to the Act for the parties in the currently pending Wards Cove case. *fn2" The Supreme Court has stated on many occasions that "no provision [of a statute] should be construed to be entirely redundant." Kungys v. U.S., 485 U.S. 759, 778, 99 L. Ed. 2d 839, 108 S. Ct. 1537 (1988); see also Arcadia v. Ohio Power Co., U.S. , 111 S. Ct. 415, 419 (1990). If the Civil Rights Act only applied prospectively, section 402(b) of the Act would be meaningless. The Supreme Court has also expressed a hesitancy "to adopt an interpretation of a congressional enactment which renders superfluous another portion of that same law." Mackey v. Lanier Collection Agency & Serv., Inc., 486 U.S. 825, 837, 100 L. Ed. 2d 836, 108 S. Ct. 2182 (1988). In this case, the only interpretation of Section 402 that does not make clause (b) meaningless is that the Act is applicable to cases which were pending at the time of its enactment, with the exception of Wards Cove.3

 The language of section 109 of the Act also supports interpreting the Act to apply retroactively. Section 109, which legislatively overrules E.E.O.C. v. Arabian American Oil Co., U.S. , 111 S. Ct. 1227 (1991), provides:

 (c) Application of Amendments. -- The amendments made by this section shall not apply with respect to conduct occurring before the date of the enactment of this Act.

 Like section 402(b), section 109(c) would be meaningless unless the Civil Rights Act applies to cases which were pending at the time of its enactment. *fn4"

 Accordingly, the court holds that the 1991 Civil Rights Act must be interpreted to apply to cases which were pending at the time it was enacted because that "construction is required . . . by necessary implication." Nelson v. Ada, 878 F.2d 277, 280 (9th Cir. 1989) (citing Bruner v. United States, 343 U.S. 112, 117 n.8, 96 L. Ed. 786, 72 S. Ct. 581(1952)).

 B. The Legislative History of the Act

 The legislative history of the 1991 Civil Rights Act does not contradict the fact that the plain language of the Act supports its retroactive application. See Kaiser, 110 S. Ct. at 1575. The statements and interpretive memoranda of different members of the House and Senate conflict on the question of retroactivity. *fn5" An amendment which would have explicitly made the Act prospective was not offered, *fn6" and the Justice for Wards Cove Workers Bill, which would explicitly make the Act retroactive, is still in committee. *fn7" Thus, the legislative history of the Act does not weigh in favor of or against the retroactive application of the Civil Rights Act. *fn8"

 Although the specific legislative history of the 1991 Civil Rights Act is unclear as to the propriety of its retroactive application, in general restorative legislation should be applied retroactively. Where "Congress enacts [a] statute to clarify the Supreme Court's interpretation of previous legislation thereby returning the law to its previous posture," the Act must be applied retroactively. Ayers v. Allain, 893 F.2d 732, 754-55 (5th Cir.), vacated on other grounds, 914 F.2d 676 (5th Cir. 1990) (en banc), cert. granted on other grounds, U.S. , 111 S. Ct. 1579 (1991). The Civil Rights Act reverses or modifies numerous recent Supreme Court cases including Waterhouse v. Hopkins, 490 U.S. 228, 104 L. Ed. 2d 268, 109 S. Ct. 1775 (1989); *fn9" Martin v. Wilks, 490 U.S. 755, 104 L. Ed. 2d 835, 109 S. Ct. 2180 (1989); *fn10" Lorance v. AT&T Technologies, Inc., 490 U.S. 900, 104 L. Ed. 2d 961, 109 S. Ct. 2261 (1989); *fn11" Patterson v. McLean Credit Union, 491 U.S. 164, 105 L. Ed. 2d 132, 109 S. Ct. 2363 (1989); *fn12" and West Virginia University Hospital, Inc. v. Casey, U.S. 113 L. Ed. 2d 68 (1991). *fn13" Congress' clear intention was to undo the effects of these cases, which it believed were wrongly decided, and to restore civil rights law to its previous state. The restorative intent behind the 1991 Civil Rights Act can only be fully satisfied by applying it to cases which were pending at the time of its enactment.

 With respect to the propriety of applying restorative legislation retroactively, the 1991 Civil Rights Act is similar to the Civil Rights Restoration Act of 1987. The purpose of the Civil Rights Restoration Act of 1987 was to overrule legislatively Grove City College v. Bell, 465 U.S. 555, 79 L. Ed. 2d 516, 104 S. Ct. 1211 (1984), which limited the scope of Title IX. The Civil Rights Restoration Act was silent as to whether it was to be applied retroactively. However with only one exception, every court which has addressed the issue has held that the Act should apply to cases which were pending at the time of its enactment. See Lussier v. Dugger, 904 F.2d 661, 665 (11th Cir. 1990) ("statutory changes that are procedural or remedial in nature apply retroactively."); Ayers v. Allain, 893 F.2d at 754-55; Leake v. Long Island Jewish Medical Center, 695 F. Supp. 1414, 1417 (E.D.N.Y. 1988), aff'd, 869 F.2d 130, 131 (2d. Cir. 1989) (per curiam); Bonner v. Arizona Dep't of Corrections, 714 F. Supp. 420, 422-23 (D. Ariz. 1989). But see DeVargas v. Mason & Hanger-Silas Mason Co., 911 F.2d 1377 (10th Cir. 1990), U.S. , cert. denied 112 L. Ed. 2d 860 (1991). *fn14" In this case, in addition to the express restorative purpose of the Civil Rights Act, the plain language of the Act also supports its retroactive application.

 C. Presumption of Retroactivity

 In addition, case law supports the retroactive application of the 1991 Civil Rights Act. The Supreme Court has acknowledged that there are two inconsistent lines of cases regarding what courts should do when the plain language and legislative history of a statute do not speak conclusively on the question of whether the statute is to be applied retroactively. Kaiser, 110 S. Ct. at 1577. One line of cases holds that "a court is to apply the law in effect at the time it renders its decision, unless doing so would result in manifest injustice or there is statutory direction or legislative history to the contrary." Bradley v. School Board, 416 U.S. 696, 711, 40 L. Ed. 2d 476, 94 S. Ct. 2006 (1974). The second line of cases holds that "congressional enactments and administrative rules will not be construed to have retroactive effect unless their language requires this result." Bowen v. Georgetown University Hosp., 488 U.S. 204, 208, 102 L. Ed. 2d 493, 109 S. Ct. 468 (1988).

 Although it has not explicitly decided the issue, Ayala-Chavez v. U.S. INS, 945 F.2d 288, 295 n.9 (9th Cir. 1991), the Ninth Circuit has followed Bradley and accepted the presumption of retroactivity. *fn15" See Kruso v. International Telephone & Telegraph Corp., 872 F.2d 1416, 1424-25 (9th Cir. 1989), cert. denied, 110 S. Ct. 3217 (1990); Gioda v. Saipan Stevedoring Co., 855 F.2d 625, 630 (9th Cir. 1988); De Gurules v. Immigration & Naturalization Service, 833 F.2d 861, 863 (9th Cir. 1987); and Northern Mariana Islands v. Kawano, 917 F.2d 379, 381-82 (9th Cir. 1990), cert. denied, 113 L. Ed. 2d 224, 111 S. Ct. 1116 (1991). But see Nelson v. Ada, 878 F.2d at 280 (stating presumption in favor of prospective application of legislative enactments without citing either Bradley or Bowen). *fn16" Indeed, this court has also accepted the Bradley presumption of retroactivity. See U.S. ex rel. McCoy v. California Medical Review, Inc., 723 F. Supp. 1363, 1367 (N.D. Cal. 1989). Therefore, this court will apply the presumption of retroactivity announced in Bradley and the Ninth Circuit cases following Bradley.17

 The Bradley presumption of retroactivity may only be rebutted if it will "result in manifest injustice or [if] there is statutory direction or legislative history to the contrary." Bradley, 416 U.S. at 711. In the case of the 1991 Civil Rights Act, the statutory direction indicates that the Act should be applied retroactively and the legislative history is unclear. In order to determine whether retroactive application of the Act would result in manifest injustice, the court must consider "(a) the nature and identity of the parties, (b) the nature of their rights, and (c) the nature of the impact of the change in law upon those rights." Bradley, 416 U.S. at 717.

 1. The Nature and Identity of the Parties

 The first prong of the Bradley "manifest injustice" test recognizes a distinction between merely private disputes and litigation which involves important public interests. The Bradley court stated that

 'in mere private cases between individuals, a court will and ought to struggle hard against a construction which will, by a retrospective operation, affect the rights of parties, but in great national concerns . . . the court must decide according to existing laws.'

 Bradley, 416 U.S. at 712 (quoting U.S. v. Schooner Peggy, 5 U.S. (1 Cranch) 103, 110 (1801)). Although this case involves private parties, it also involves matters of great public concern -- remedying race and sex discrimination and promoting equality. Thus, this first factor weighs in favor of the retroactive application of the 1991 Civil Rights Act.

 2. The Nature of Their Rights

 The second prong of the Bradley "manifest injustice" test focuses on whether retroactive application of the law would "infringe upon or deprive a person of a right that had matured or become unconditional." Bradley, 416 U.S. at 720. Defendant argues that the 1991 Civil Rights Act has significantly altered the law in disparate impact cases by expanding a defendant's liability for intentional discrimination, *fn18" by changing the rule that a plaintiff must link a statistical disparity to a specific employment practice, *fn19" and by shifting the burden of proof. *fn20"

 The court rejects defendant's argument that by expanding defendant's liability for intentional discrimination the Civil Rights Act has infringed upon its unconditional rights. Defendant has no unconditional right to limit plaintiffs to a particular type of remedy. Gulf Offshore Co., Div. of Pool Co. v. Mobil Oil Corp., 453 U.S. 473, 486 n. 16, 69 L. Ed. 2d 784, 101 S. Ct. 2870 (1981). In fact, the Supreme Court has upheld the retroactive application of laws which enhance economic penalties for conduct which occurred prior to the enactment of a statute. See Pension Ben. Guar. Corp. v. R.A. Gray & Co., 467 U.S. 717, 728-31, 104 S. Ct. 2709, 81 L. Ed. 2d 601 (1984). Moreover, defendant has always been subject to broader compensatory and punitive damages under the FEHA and 42 U.S.C. § 1981 for the same conduct.

 The court also rejects defendant's contention that the Civil Rights Act should only be applied prospectively because it has changed the substantive law in disparate impact cases. *fn21" The 1991 Civil Rights Act has not changed that substantive law. It has merely changed what plaintiffs must show to prove their case and the remedies available to plaintiffs. In fact, the 1991 Civil Rights Act has simply returned the law to the position that it was in when this complaint was filed in 1988, when Lucky designed its first affirmative action plan for the Northern Food division, when the E.E.O.C. issued its Determination finding reasonable cause to believe Lucky had engaged in classwide discrimination, and when discovery began in this case. After the filing of this action Wards Cove changed the rules applicable to disparate impact cases; the Civil Rights Act has restored the law to the state it was in when this claim arose.

 In addition, there have been no findings of fact in this case. Therefore, defendant cannot contend that application of the Civil Rights Act will infringe on any of its matured rights.

 3. The Nature of the Impact of the Change in Law upon those Rights

 Although the court has found that defendant has no substantive rights which are affected by the Civil Rights Act of 1991, nonetheless the court will address the third Bradley "manifest injustice" factor. This last factor concerns whether "new and unanticipated obligations may be imposed upon a party without notice or an opportunity to be heard." Bradley, 416 U.S. at 720. The discriminatory conduct which plaintiffs allege was unlawful under Title VII from the beginning of the liability period in this case to the present. Therefore, this last factor also supports the court's holding that the application of the 1991 Civil Rights Act to this case will not result in manifest injustice.

 CONCLUSION

 1. The Civil Rights Act of 1991 is applicable to plaintiffs' claims.

 2. The parties are ordered to submit simultaneous memoranda to the court within thirty (30) days of the date of this amended order concerning:

 a. How the Act affects the use of statistical evidence in disparate impact and disparate treatment cases.

 b. The appropriate post-Wards Cove analysis in disparate impact cases as a result of section 105 of the Act, 42 U.S.C. § 2000e-2 as amended.

 c. How the Act affects any other issues now pending before this court in Stender v. Lucky.

 The court will then decide if additional briefing or a hearing is necessary.

 IT IS SO ORDERED.

 Dated: JAN 7 - 1992

 MARILYN HALL PATEL

 United States District Judge


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