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Chicago-based Sara Lee Foods Corp. has agreed to pay $3.5 million to settle 139 separate race discrimination lawsuits brought by black workers at Hygrade Food Products Corp., a Sara Lee subsidiary, who said they were the victims of racially biased policies at a Philadelphia plant. The workers were forced to file separate lawsuits after U.S. District Judge Lowell A. Reed Jr. refused to certify a proposed class action lawsuit brought by nine black workers at the Hygrade plant that produced and packaged hot dogs, bacon and ham. In February 2001, Reed held that Title VII cases are no longer appropriate for class treatment due to the provisions of the Civil Rights Act of 1991 that allow for compensatory and punitive damages. “Calculating compensatory and punitive damages, as opposed to simply back pay, of [up to] 200 persons would prove to be quite an individualized task,” Reed wrote. In the wake of Reed’s ruling, the team of plaintiffs’ lawyers — Stephen A. Whinston and Shanon J. Carson of Philadelphia’s Berger & Montague; sole practitioner Robert T. Vance Jr. of Philadelphia and Cynthia L. Butler of Butler & Spears in Washington, D.C. — filed separate lawsuits for all 139 workers. A second proposed class action was filed that accused Hygrade of retaliating against the black workers by closing the Philadelphia plant in August 2001 to punish them for bringing the lawsuits. The settlement, announced Tuesday, resulted from negotiations supervised by U.S. Magistrate Judge Linda K. Caracappa, and covers all pending cases, including the second class action. Although specific terms of the individual settlements were not disclosed, lawyers said they vary depending on employment tenure, filing as an original lead plaintiff and other factors. The $3.5 million settlement includes attorney fees. Vance and Whinston issued a joint statement for the plaintiffs that said they described the settlement as “fair and amicable.” “The plaintiffs are now able to move forward with their lives and focus on their futures,” Vance said. William A. Geoppinger, chief executive officer of Sara Lee Foods, said the company “is committed to a workplace free from any form of harassment or discrimination.” Geoppinger stressed that the company’s decision to close the Philadelphia plant was “based purely on business factors,” and that the company would not knowingly tolerate harassment of any kind. In the suits, workers alleged that Hygrade’s employment decisions regarding discipline, termination, compensation, training, work assignment, hiring of temporary employees and promotions were determined in a “highly subjective” manner at the hands of a “small, virtually entirely non-black, central group of people.” The suits also alleged that Hygrade condoned “a racially hostile work environment.” The original plaintiffs sought to represent a broad-based class of all blacks employed at — or who were not hired for permanent employment from a temporary position at — the Philadelphia facility from May 1, 1993, to June 1, 2000. But Hygrade’s lawyers — Patrick J. Doran and Howard A. Rosenthal of Pelino & Lentz in Philadelphia, along with William A. Blue, S. Craig Moore and Angela Marie Hubbell of Constangy Brooks & Smith in Nashville, Tenn. — strongly opposed class certification, arguing that the nine workers could never meet the test under Rule 23 to establish commonality and typicality of the claims. To respond, the plaintiffs’ team brought in a group of class action specialists from Berger & Montague. But Reed sided with the defendants and held that the case was sure to entail too many individual issues since the plaintiffs were alleging across-the-board discrimination in the areas of discipline, termination, compensation, training, work assignment, hiring of temporary employees and promotions, as well as a hostile work environment. “The plaintiffs are not claiming that each worker was affected by the alleged discriminatory practices in the same manner. Rather, subjective standards will apply as the putative class includes individuals employed in different divisions, under different supervisors, for varying durations of time over a seven-year period,” Reed wrote. After the 3rd U.S. Circuit Court of Appeals affirmed Reed’s ruling, the plaintiffs filed separate lawsuits that were consolidated before Reed.

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