Frazier v. Morgan Stanley & Co, LLC
- Richard Sullivan
- 1:16-cv-00804
- U.S. District Court · Southern District of New York
- 6
In Frazier v. Morgan Stanley, Circuit Judge Sullivan denied plaintiffs’ requests for an immediate appeal or partial final judgment.
The named plaintiffs’ requests for immediate appellate review and partial final judgment were denied; their individual claims under 42 U.S.C. § 1981 remained unresolved, while the defendants avoided immediate appellate review of the dismissed class claims.
What happened
In Frazier v. Morgan Stanley & Co. LLC, the plaintiffs asked the court to allow an immediate appeal from its earlier refusal to let them file a Fourth Amended Complaint. That earlier decision had also dismissed their class claims alleging intentional discrimination through a widespread practice and unequal effects.
The plaintiffs alternatively asked the court to enter a final judgment on those dismissed class claims while their individual discrimination claims continued. They argued that the legal issues were unsettled and that delaying review could lead to repeated discovery or trials if an appeals court later reinstated the class claims.
Circuit Judge Richard J. Sullivan denied both requests. He found that the plaintiffs had not met the requirements for an immediate appeal and that the dismissed class claims were closely connected to the remaining individual claims, making a partial judgment likely to cause piecemeal appeals and delay.
The detailed version
- Frazier v. Morgan Stanley & Co, LLC · No. 1:16-cv-00804
- Richard Sullivan
- July 7, 2020
Background
Plaintiffs Kathy Frazier, Yared Abraham, O. Emmanuel Adepoju-Grace, Kwesi Coleman, Jeanna Pryor, and Aisha Rada sued Morgan Stanley & Co. LLC, Morgan Stanley Smith Barney LLC, and Morgan Stanley. They sought review of the court’s earlier decision denying leave to file a Fourth Amended Complaint. That earlier decision dismissed class claims alleging pattern-or-practice intentional discrimination and disparate impact. Individual claims under 42 U.S.C. § 1981 remained unresolved for three plaintiffs, and discovery on those claims was ongoing.
Plaintiffs asked for certification of an interlocutory appeal under 28 U.S.C. § 1292(b). An interlocutory appeal is an appeal before the district court enters a final judgment in the case. They argued that the earlier decision involved controlling legal questions and that there was substantial disagreement about the pleading requirements for pattern-or-practice class claims and the application of the Lily Ledbetter Fair Pay Act to their disparate-impact claims.
Plaintiffs also argued that an immediate appeal would materially advance the end of the litigation. They said the class claims involved nationwide policies, while the individual claims involved narrower discovery, and that proceeding with the individual claims first could result in duplicated discovery or new trials if the class claims were later reinstated.
Interlocutory appeal
The court explained that § 1292(b) requires the moving party to show: (1) a controlling question of law, (2) substantial ground for disagreement about that question, and (3) that an immediate appeal may materially advance the litigation’s ultimate termination. Even when those requirements are met, certification remains within the district court’s discretion.
The court concluded that an immediate appeal was not justified. Regarding the pattern-or-practice claims, it found that plaintiffs’ arguments mainly challenged the court’s application of legal standards to the complaint, rather than presenting a substantial disagreement about the governing legal rule. Regarding the Fair Pay Act, the court maintained that the Act’s accrual provisions did not apply to disparate-impact claims involving pay reductions flowing from other adverse employment actions, including the policies challenged in the complaint.
The court also held that plaintiffs had not shown that an immediate appeal would materially advance the litigation. The remaining individual § 1981 claims were still unresolved, and the possible duplication identified by plaintiffs was too contingent to justify immediate review. The court therefore declined to certify the earlier decision for interlocutory appeal.
Partial final judgment
Plaintiffs alternatively requested partial final judgment under Federal Rule of Civil Procedure 54(b). Rule 54(b) permits a court, in a case involving multiple claims or parties, to enter a final judgment on fewer than all claims or parties when at least one claim or party’s rights have been finally determined and the court expressly finds no just reason for delay.
The court denied this request because the dismissed class claims and the remaining individual claims were closely related. Although the claims were not identical, they involved overlapping allegations and the same basic legal theory—that defendants intentionally discriminated against plaintiffs because of race. Entering partial final judgment could therefore produce piecemeal appeals requiring multiple appellate panels to consider the same or related issues.
The court found that the relationship between the dismissed and surviving claims supported denying, rather than granting, Rule 54(b) relief. It distinguished the case cited by plaintiffs because that case involved a different procedural setting, including a completed trial on the class claims and an agreement to address the individual claims separately.
Disposition
The court denied plaintiffs’ request to certify an interlocutory appeal under § 1292(b) and denied their request to enter partial final judgment under Rule 54(b). The Clerk was directed to terminate the motion listed as document number 152.
Read the full 6-page opinion on CourtListener, the free public archive maintained by the Free Law Project.