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A class of 200 African-American employees failed to meet the prerequisites for class certification because they could not demonstrate that a class action was the predominant and superior avenue for efficiently trying their cases, held the 5th U.S. Circuit Court of Appeals. The employees, all of whom were salaried managerial, supervisory, or professional staff, claimed they had been racially discriminated against in the areas of fair performance evaluations, promotions and compensation. They sought both compensatory and punitive damages, which included damages for emotional suffering. ( Smith v. Texaco, Inc., 5thCir, 81 EPD 40,718) The district court determined that the employees met all criteria, even in the area of damages. The court held that, although the employees had filed both disparate treatment and impact claims, judicial economy and the Seventh Amendment right to a jury trial would be best served by holding one trial with the same jury deciding all issues and damages. The 5th Circuit held otherwise. While the court found that the employees met the requirements for class certification for liability, the problems lay in the commonality, predominance and superiority factors of their compensatory and punitive damages claims. First, the class failed to meet the commonality test in this area given the highly individualized, subjective legal evaluations of each employee’s emotional suffering, not to mention the employer’s intent. In essence, said the court, the company’s biased systemic practices did not outweigh the need to determine individual damages, and therefore, the group remedies failed to predominate over those available to each employee. Second, because damages lacked commonality among the employees, the superiority of a class action was eroded by this concern. Also, the likelihood of substantial damages mitigated the superiority required to certify a class action, since a negative value case is the most crucial reason for certifying a class. The court also stated that the Seventh Amendment right to a jury versus judicial economy problem had not been circumvented by the district court, since the same jury would likely have to remain impaneled for over a year to hear both liability and damages phases due to the presence of both disparate impact and disparate treatment theories. Accordingly, the decision to certify was reversed and remanded. � 2001, CCH INCORPORATED. All Rights Reserved.

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