Claude RODRIGUEZ, Jr., Plaintiff, and Leroy Gibbs, Plaintiff-Appellant, v. GENERAL MOTORS CORPORATION, Et Al., Defendant-Appellee

Citations: 27 F.3d 396; 94 Daily Journal DAR 8497; 94 Cal. Daily Op. Serv. 4598; 1994 U.S. App. LEXIS 15014; 65 Empl. Prac. Dec. (CCH) 43,271; 65 Fair Empl. Prac. Cas. (BNA) 301; 1994 WL 267943Docket: 91-55170

Court: Court of Appeals for the Ninth Circuit; June 20, 1994; Federal Appellate Court

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Leroy Gibbs, an African-American employee at General Motors (GM), claimed he faced discriminatory treatment after being reassigned to housekeeping duties in 1980 while retaining his job classification and pay. Following his application for a more responsible position, GM promoted a Caucasian employee instead. Gibbs filed a lawsuit under 42 U.S.C. § 1981, but the district court initially granted GM summary judgment. The Ninth Circuit reversed this decision, noting that material factual disputes existed. However, the Supreme Court's decision in Patterson v. McLean Credit Union established that claims for denial of promotion under § 1981 required a new, distinct employment relationship, which led the district court to again grant summary judgment to GM.

Subsequently, Congress passed the Civil Rights Act of 1991, which rejected the restrictive interpretation of § 1981 from Patterson. The Ninth Circuit deferred submission of Gibbs' case pending Supreme Court rulings on the retroactive application of the 1991 Act. The Supreme Court determined that certain provisions of the Act, specifically § 102, would not apply retroactively, emphasizing that Congress had not clearly indicated retroactive intent within the Act's text. The court's analysis revealed that prospective application of the Act's sections would not undermine the explicit provisions regarding retroactivity. Consequently, the Ninth Circuit affirmed the district court's summary judgment in favor of GM, indicating Gibbs' claim could not proceed under the updated framework established by the 1991 Act.

The Supreme Court, in accordance with the judicial presumption against retroactive application, determined that the Act lacks clear Congressional intent for retroactive enforcement. A statute is considered retroactive if it alters legal consequences for actions completed prior to its enactment or modifies rights, liabilities, or duties associated with past transactions. The Court clarified that its earlier ruling in Bradley v. Richmond School Board, which allowed for the application of current law for attorney's fees, does not conflict with this presumption, as the new fee statute did not impose unforeseen obligations. In contrast, Section 102(b) of the Act, which introduces compensatory and punitive damages for intentional discrimination, confers new rights on plaintiffs and must be applied prospectively.

Additionally, in Rivers, the Court ruled that Section 101 of the Act, which alters the interpretation of 42 U.S.C. Section 1981 by broadening its scope, also does not apply retroactively. The Court rejected the notion that Section 101 should be retroactive merely because it reinstated a prior rule that existed before the Patterson decision, emphasizing that Patterson did not overturn any prior rulings but rather established the interpretation of "make and enforce contracts" under the Civil Rights Act of 1866. Consequently, the 1991 amendment would be retroactive if applied to cases before its effective date. Since Section 101 is not retroactive, the focus shifts to whether the district court correctly granted summary judgment to GM based on the limitations imposed by Patterson, which restricts actionable employment discrimination cases under Section 1981 to those involving discrimination in the making and enforcement of contracts.

Section 1981 does not cover discriminatory conduct by an employer after a contract has been established, such as breach of contract or discriminatory working conditions. The Supreme Court clarified that an employee's claim for refusal of promotion under Section 1981 is actionable only if the promotion represents an opportunity to enter into a new contract with the employer. For a claim to be valid, the promotion must signify a new and distinct relationship between the employee and employer. The Court referenced the case of Hishon v. King & Spalding as an example of such a relationship.

The Ninth Circuit, in Sitgraves v. Allied-Signal, Inc., noted that actionable promotion claims require not only an increase in pay but also a meaningful qualitative change in the contractual relationship. Key changes include new supervisory responsibilities, alterations in termination procedures, and modifications in compensation methods.

In the case at hand, Gibbs asserts that although he held the title of Level 7 General Supervisor, his job duties had diminished to those of a Level 6 Supervisor. He argues that applying for another Level 7 position in the Maintenance Department constituted a promotion, claiming that the difference between the two levels indicated a new relationship with GM. GM contends that Gibbs's application was merely for a lateral transfer, maintaining the same title and salary.

To assess whether Gibbs sought a new relationship, the court will examine the supervisory duties, salary, chain of responsibility, and additional responsibilities of the positions. Gibbs claims he did not manage Level 6 Supervisors, but evidence shows he did supervise them and managed hourly employees, similar to other Level 7 supervisors. Gibbs also argues he was compensated at a Level 6 salary, while salary data indicates he was within the range for Level 7 supervisors, albeit lower than some peers.

GM compensated Gibbs less than other general supervisors in the Maintenance department, but Gibbs did not provide evidence that he would have earned more had he been promoted to Potter's position. He also failed to demonstrate he was being paid at a Level 6 supervisor rate. Gibbs asserted that promotion would have changed his reporting structure from a general supervisor to a Level 8 Superintendent, specifically James Clark, which his performance appraisals confirmed. Gibbs claimed the new role would have included responsibilities such as negotiating labor agreements and managing departmental workloads; however, both his and Potter's performance evaluations indicated no significant job differences. Evidence showed that Wayne Ellington acted as department coordinator before and after Potter's promotion, and Gibbs did not substantiate his claim that Potter's role involved union negotiations. Under Patterson v. McLean Credit Union, a failure to promote is actionable under 42 U.S.C. Sec. 1981 only if it creates a new and distinct relationship with the employer, such as increased pay or supervisory duties. Gibbs did not prove that the denied promotion would have established such a relationship. Consequently, the district court correctly granted summary judgment to GM, which was affirmed. Additionally, the document notes that certain sections of Title VII protection and their applicability to past conduct are limited, and the review of summary judgment is conducted de novo, assessing the presence of genuine material fact disputes and the correct application of substantive law.