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United States v. City of Erie

November 17, 2006

UNITED STATES OF AMERICA, PLAINTIFF,
v.
CITY OF ERIE, PENNSYLVANIA, DEFENDANT.



The opinion of the court was delivered by: McLAUGHLIN, Sean J., District J.

MEMORANDUM ORDER

Defendant, the City of Erie, has filed a motion to compel the production of documents relating to a number of individual claimants whom the United States asserts are entitled to relief under the Consent Decree entered in this case on June 15, 2006. This Court has scheduled a fairness hearing to be held on November 20, 2006, at which time it will address any outstanding objections to the United States' proposed awards of relief. The City contends that it needs certain information as to some of the claimants in order to prepare for the hearing. The United States responds that it has already provided the City with all of the information to which the City is entitled under the terms of the Consent Decree. This dispute has raised some issues relative to the operation of the Consent Decree, which the parties have asked this Court to address.

Boiling the City's arguments to their essence, the City asserts the following: (1) that, as for any particular claimant seeking an award of relief, the United States has the burden of proving at the hearing that the claimant would have been hired if she had passed the Physical Agility Test (PAT); (2) that, as for any claimant found to be ineligible for monetary relief following the November 20 fairness hearing, the portion of the $170,000 Settlement Fund allocated to that claimant must revert to the City; and (3) that, to the extent any claimant failed the written Civil Service exam administered in 2002, such claimant is automatically precluded from obtaining any relief, even for prior years in which she took and failed the PAT.

As a preliminary matter, we agree with the United States that these disputes are governed by the terms of the Consent Decree. The Consent Decree was freely entered into by the parties as a means of avoiding the expense and delay inherent in a full-blown remedies-phase trial. It contains detailed provisions setting forth, e.g., the claims procedures, the process for raising objections to the Plaintiff's relief determinations, and the standards to be used in adjudicating those objections. Accordingly, our analysis begins there.

Because consent decrees share many of the attributes of contracts, they are interpreted with reference to traditional principles of contract interpretation. See United States v. State of New Jersey, 194 F.3d 426, 430 (3d Cir. 1999). Thus, we begin our analysis with the language of the decree. Id. While the circumstances surrounding the formation of a consent decree are always relevant to an analysis of its meaning, a court may not resort to extrinsic evidence unless the decree itself is ambiguous. Id. A consent decree provision is considered ambiguous only when it is reasonably susceptible of at least two different interpretations from an objective standpoint. Id. Bearing these principles in mind, we turn to the City's various arguments.

I.

The City insists that, as to any claimant for whom an award of relief is proposed, the United States bears the burden of proving that the claimant would have been hired by the City but for its use of the PAT. We agree with the United States that such a view is contrary to the terms of the Consent Decree.

Paragraphs 47-55 of the Consent Decree set forth the procedures governing the determination of individual relief awards. Those provisions establish a period within which claimants may submit forms indicating an interest in obtaining relief ("Interest in Relief forms"). (Consent Decree ¶ 48.) Upon expiration of that period, the United States must file and serve a Relief Awards List indicating, among other things, the nature and amount of relief (if any) which the United States has determined should be awarded to eligible claimants. (Decree ¶ 49.) The United States' discretion in this regard is limited only by the mandate that it "shall determine the amount of relief to be awarded... in a manner that is reasonable and equitable in relation to the Claimant population and the total amount of the Settlement Fund and that is consistent with the provisions of this Decree." (Id.) Thereafter, claimants and/or (with respect to priority hires) the City may file objections challenging the United States' relief award determinations. (Decree ¶¶ 52 and 54.) The Court shall approve the Plaintiff's Relief Awards List as submitted, except to the extent the Court may find any objections "well-founded." As to monetary awards, the Court shall find that the objection is well-founded "only if the amount is not reasonable and equitable in relation to the Claimant population and the total amount of the Settlement Fund." (Decree ¶ 55.) With regard to priority hires, the Court shall find an objection (including one made by the City) to be "well-founded" only "if the objector(s) prove by a preponderance of the evidence that, at the time she failed the PAT, the Claimant was not qualified for the position of entry-level police office in the City's Bureau of Police using the lawful, objective hiring criteria in use by the City at that time..." (Id. (emphasis added).)

Thus, the terms of the Consent Decree make the United States' relief award determinations presumptively valid except to the extent they are successfully challenged by an objector. No provision of the Decree imposes upon the United States the burden of proving that an eligible claimant would have been hired by the City but for the PAT. In fact, insofar as the City's right to challenge potential priority hires is concerned, the Consent Decree places the burden squarely upon the City to prove that the claimant was objectively ineligible for hire at the time she failed the PAT. In this regard, the terms of the Consent Decree are consistent with controlling Title VII case law. See Intern'l Brotherhood of Teamsters v. United States, 431 U.S. 324, 359 & 361-62 (1977) (upon proof that the employer has engaged in a pattern or practice of discrimination, class members are presumptively entitled to relief and the plaintiff need not prove their qualification).

Indeed, it is the impracticability of determining with certainty which claimants would have been hired which justified the parties' use of the shortfall method of calculating damages in the first place. As we noted at the June 15, 2006 fairness hearing: it is impossible to determine with any certain[ty] which claimants would have been hired but for the City's use of the PAT. This is due both to the passage of time (in some cases up to 10 years) since the discrimination occurred and also to the fact that those who failed the PAT were not permitted to proceed further in the application process.

***

Nevertheless, the impossibility of pinpointing which claimants would have been hired in the absence of the PAT does not defeat the United States' claim for damages. Instead courts have held that, where discrimination has been established but it is not possible to determine with reasonable certainty which claimants would have been hired absent the unlawful practice [it] is appropriate to use a "shortfall" method to calculate monetary relief.

(Tr. of 6/15/06 Hrg., at 41-42.) In this case, the parties reached a negotiated compromise that a shortfall of five (5) hiring positions was appropriate and the amount of the Settlement Fund was computed accordingly, the $170,000 fund representing an average of $34,000 in backpay (less mitigation) for each of the five shortfall positions. This Court determined that dividing the $170,000 Settlement Fund among all eligible claimants was appropriate in light of the difficulties inherent in attempting to prove which claimants would have been hired in the absence of the PAT. (Tr. of 6/15/06 Hrg., at 49-50.)

As the United States points out, the City was duly represented at the June 15, 2006 hearing and made no objections to the Court's comments in connection with its entry of the Consent Decree. Thus, the "context" in which the Decree was entered also flatly contradicts the City's position that the United States must prove, as to any given relief determination, that the relevant claimant would have been hired by the City absent the PAT. See State of New Jersey, 194 F.3d at 431-32 (the court's opinion approving the consent decree after a fairness hearing and the fact that neither party objected to the court's comments constitute part of the "context" of the decree which inform its ...


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