source: Caselaw Access Project

author: ADAMS, Circuit Judge.

license: Public Domain

text:
    CONSTRUCTION, LTD., a corporation of the State of New Jersey, Appellant, v. BROOKS-SKINNER BUILDING COMPANY, Defendant-Counterclaimant, and Van Noorden Company, Inc., a corporation of the Commonwealth of Massachusetts, et al., Defendants, and Firemen’s Insurance Company, Newark, New Jersey, a New Jersey corporation, Third-Party Defendant.
    No. 73-1089.
    United States Court of Appeals, Third Circuit.
    Argued Oct. 12, 1973.
    Decided Dec. 4, 1973.

      Philip J. Albert, Levy, Levy, Albert & Marcus, Trenton, N. J., for appellants; Seymour I. Marcus, on the brief.
    Charles E. Villanueva, Van Riper, Belmont & Villanueva, Newark, N. J., for defendant-counterclaimant-appellee, Brooks-Skinner Building Co.
    Before HASTIE, VAN DUSEN and ADAMS, Circuit Judges.
   OPINION OF THE COURT

ADAMS, Circuit Judge.

This appeal arises from a dispute between a prime construction contractor and one of its subcontractors, that generated a lawsuit by the prime contractor in which a counterclaim was interposed by the subcontractor. A jury returned a verdict for the latter. The questions with which we must deal concern the admissibility at trial of certain evidence and the propriety of a particular jury instruction.

In June of 1969, Construction, Ltd. was awarded a Government contract for the building of the so-called “South East Asia (SEA) Project” at Fort Dix, New Jersey. Under the terms of the contract, Construction was responsible for the installation of a series of control towers, latrines, classroom buildings, “test” buildings, a shower building, and various other facilities, on a range at Fort Dix. Construction was to receive $1,498,000 for the job.

On July 17, 1969, Construction entered into a subcontract with the Brooks-Skinner Building Company, whereby Brooks-Skinner agreed to supply and erect all of the prefabricated metal buildings for the SEA Project. Under the subcontract Brooks-Skinner was to deliver the buildings to the job site by October 28, 1969, and to finish its work by November 28, 1969. The subcontract specified a consideration payable to Brooks-Skinner of $175,000 The parties inserted a notation in their agreement to the effect that actual — not liquidated — damages would be recoverable in the event of a delay by Brooks-Skinner.

There was testimony at the trial that Brooks-Skinner was late in completing the work required of it, an admitted breach of the subcontract, and that only a few of the buildings were finished by Brooks-Skinner as of December 31, 1969. Further testimony indicated that Brooks-Skinner did not complete all of its work until May 8,1970.

Another critical item developed at trial was that the Government, during the course of construction of the SEA Project, had deleted its order for four of the latrines from the prime contract, its prerogative under the terms of that contract. The Government offered to take a “credit” of $10,963 for the four deleted latrines, and finally withheld payment from Construction for these latrines in the amount of $13,113.

Construction brought suit against Brooks-Skinner seeking to recover damages allegedly brought about by the subcontractor’s delay, and asserted that Brooks-Skinner’s tardiness had caused it a loss of $206,386. However, inasmuch as Construction still owed Brooks-Skinner $114,446 under the subcontract, Construction sought a judgment in the amount of only $91,940. Brooks-Skinner counterclaimed for the balance owing it under the subcontract, $114,446, and denied any liability to Construction based on the delay. There was a general verdict in favor of Brooks-Skinner in the amount of $68,925, and Construction appealed.

I.

At the trial, Brooks-Skinner introduced certain documents evidencing the profit made by Construction from the SEA Project. In addition, Brooks-Skinner elicited from several witnesses testimony concerning the same topic, as well as Construction’s general profitability and solvency. On this appeal Construction maintains, inter alia, that the evidence regarding its profits was irrelevant, that it tended to prejudice the' jury, and that its admission therefore constituted reversible error.

The theory offered by Brooks-Skinner at trial to establish the relevancy of the challenged evidence is contained in the following statement by Brooks-Skinner’s trial counsel:

“But your honor, if this project happened to be the most profitable project for a corporation that has been running in the red, I think it certainly shows that they didn’t sustain the loss that they are attempting to show ”

And again, in his summation to the jury, counsel repeated that “the amount of profit goes to whether or not these damages were actually sustained.” In other words, Brooks-Skinner contended at trial — and repeats the argument here —that evidence of an overall profit on the SEA Project tended to disprove Construction’s allegation that it actually suffered a loss because of the subcontractor’s delay, or at least indicated that any loss incurred was not as great as alleged.

Under ordinary circumstances, there would be serious doubt whether the evidence of profits bore the indispensible hallmark of legal relevancy — that it had some tendency to make the existence of a material fact more probable or less probable than it would be without the evidence. To illustrate, suppose Construction had planned to earn $100,000 on the SEA Project, over costs of $500,000, or a 20 per cent profit. Then assume further that losses, proved to be directly attributable to Brooks-Skinner, reduced the expected profit to a realized amount of only $50,000, or 10 per cent. The fact that 10 per cent was in fact earned, or that 10 per cent was a “fair” profit in the industry, or that it was the greatest percentage profit ever made by Construction, appear largely irrelevant to the question in issue — whether, by reason of Brooks-Skinner’s delay, Construction earned less than the gross amount it had contracted to earn.

At the trial, however, Construction failed to introduce any evidence of its itemized costs for the project, notwithstanding that Brooks-Skinner had caused a subpoena to issue in an attempt to obtain such evidence from Construction. Without evidence of itemized costs, Brooks-Skinner could not develop, the extent to which Construction’s projected profit for those aspects of the work subcontracted to Brooks-Skinner exceeded the profit actually made. Under these circumstances, with the jury in the dark regarding Construction’s projected and actual profits for the portion of the job done by Brooks-Skinner, and thus unable to gauge the magnitude of the alleged loss with any precision, evidence of overall profit became at least arguably relevant. Evidence that tended to show that Construction had indeed garnered a very high profit on the whole project had, in these circumstances, some tendency to prove that Construction did not suffer a loss of profits, or that its loss could not have been very great. Based on such evidence, the jury might rationally have concluded that Construction’s itemized cost and profit projections did not contemplate a greater profit than the high profit actually earned.

This is not to suggest that the challenged evidence of profits was in any sense conclusive as to the existence vel non of the alleged loss. But neither can it be said that, in the context of this case, the evidence was utterly without probative value. Thus we conclude that, standing alone, Construction’s assertion that the evidence was irrelevant does not warrant reversal of the district court’s judgment.

In sustaining the trial judge’s ruling on relevancy, we are mindful of the precept that:

“[A] trial court has a great latitude in ruling on the admissibility of evidence. His determination of legal relevancy is also an act of discretion not to be disturbed absent a clear showing of abuse.”

Inasmuch as the evidence possessed at least a modicum of rationally probative force, we decline to hold that the trial court abused its discretion by admitting it.

Related to Construction’s attack on the determination of relevancy is its contention that the evidence of profits had so great a potential to prejudice the jury that it should have been excluded. Rule 403, Rules of Evidence for the United States Courts and Magistrates, provides in part that:

“Although relevant, evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury

Construction maintains that, even if the evidence of profits were marginally relevant, the danger that it might have misled or prejudiced the jury “substantially outweighed” its probative worth.

The task of assessing potential prejudice is one for which the trial judge, considering his familiarity with the full array of evidence in a case, is particularly suited. As noted in the Advisory Committee’s commentary on Rule 403, “ [s] ituations in this area call for balancing the probative value of and need for the evidence against the harm likely to result from its admission.” The practical problems inherent in this balancing of intangibles — of probative worth against the danger of prejudice or confusion — call for the vesting of a generous measure of discretion in the trial judge. Were we sitting as the trial judge in this case, we might well have concluded that the potentially prejudicial nature of the evidence of profits outweighed its probative worth. However, we cannot say that the trial judge abused his discretion in reaching the contrary conclusion.

II.

Construction maintains that the charge to the jury was erroneous in several respects.

As mentioned above, the Government deleted its order for four of the latrines from its contract with Construction, and withheld payment of $13,113 for the deleted items. Construction claimed that Brooks-Skinner’s delay was the cause of the Government’s decision to delete these items and, accordingly, was the reason for the loss of the $13,113.

Construction excised its order for the four latrines from the subcontract with Brooks-Skinner, but the latter agreed only to accept a “credit” of $3,760 for the deletion. Rather than accede to this amount, Construction included the full $13,113 in its computation of damages attributable to Brooks-Skinner’s delay.

Regarding .Construction’s loss from the deletion of the latrines, the trial court charged the jury as follows:

“Now, the contract between the United States Government and the plaintiff Construction, Ltd. contains a provision that permitted the Government to delete items when not required for which appropriate deductions would be made by the Government. No such provision was included in the agreement between plaintiff Construction, Ltd. and the defendant-counterclaimant Brooks-Skinner. Therefore, the plaintiff Construction, Ltd. had no right to eliminate four latrines from the contract with Brooks-Skinner Building Company. When plaintiff Construction, Ltd. cancelled the erection and installation of four chemical latrines, the defendant-coun-terclaimant Brooks-Skinner Building Company was entitled from Construction, Ltd. to the contract price less the reasonable cost and completion of these latrines which defendant-coun-terclaimant Brooks-Skinner Building Company did not then have to complete.
“If you find that the Corps of Engineers, the United States Army, should credit to the plaintiff Construction, Ltd. for deletion of said four latrines, which credit included deletion of additional work, which is not responsible for defendant-counter-claimant Brooks-Skinner, the amount of said credit, therefore, cannot be considered in determining the amount of work reasonably required which the defendant-counterclaimant Brooks-Skinner Building Company was requested to perform.”

On its face, the quoted portion of the charge can fairly be taken to imply that, although the Government reserved the right in the prime contract to delete the latrines, Construction reserved no such right against Brooks-Skinner in the subcontract. Consequently, the jury may have been led to believe that it could not, under any circumstances, consider the $13,113 credit —“a loss” to Construction allegedly caused by Brooks-Skinner — in its assessment of damages, even if it found for Construction on all of the other issues in dispute. Given its susceptibility to such an interpretation, this aspect of the charge was erroneous.

The sixteenth article of the subcontract provides as follows:

“The' subcontractor [Brooks-Skinner] recognizes the right of the Government under the Prime Contract to terminate all or any portion of the work for its convenience. Should any action so taken apply to the work called for hereunder, this subcontract shall be terminated to the same extent, and the respective rights and obligations of the parties hereto shall be as set forth under section 8-706 of the Armed Services Procurement Act.”

It is clear from this provision that Construction, while bound to assent to any deletions by the Government, had the right to make correlative deletions vis-a-vis Brooks-Skinner. Indeed, section 8.706(a) (iii) of the Armed Services Procurement Regulations expressly provides that a Government contractor may make deletions from a subcontract upon receipt of a Government termination order. Moreover, section 8.706(f) (ii) of the Regulations permits such a contractor to deduct from amounts owed to the subcontractor, “any claim which the [contractor] may have against the [subcontractor] in connection with [the] contract.” These two sections of the Regulations were incorporated by reference into the subcontract. Thus, since the jury might have found from the evidence that the deletion by the Government of the four latrines was a result of the delay caused by Brooks-Skinner, the district court should have charged that Construction was entitled to include in its computation of damages an amount equal to the Government’s withheld payment — to wit, $13,113.

Brooks-Skinner argues earnestly that Construction has not proved that “the credit for the deletion of [the] four latrines claimed by Construction . was not part of the $45,521.04 damages assessed by the jury against Brooks-Skinner,” and that therefore the verdict ought not be disturbed. This argument would appear to miss the mark. Given the erroneous instruction, there exists a likelihood that the jury thought itself foreclosed from including the $13,113 in computation of any verdict against Brooks-Skinner. That very likelihood is a sufficient predicate for a finding of error.

Ordinarily, it would be necessary to reverse the judgment of the district court and remand this case for a new trial, in light of the deficiency in the instructions pertaining to the $13,113 item. However, at oral argument, counsel indicated that Brooks-Skinner would agree to a reduction of the verdict in the amount of $13,113. Since this procedure achieves, from Construction’s perspective, the most that could be accomplished by a new trial based on this defect, the judgment of the district court will be affirmed subject to this reduction of the verdict.

This ease will be remanded to the district court, with a direction to change the figure in the third line from the end of its judgment from “$68,925.00” to “$55,812.00.” See 28 U.S.C. § 2106.

      . Specifically, Brooks-Skinner was to supply and erect 43 chemical latrines, one waterborne latrine, 24 tower buildings, two test buildings and one shower building.

      . The contract between Construction and the Government stated that Construction would complete the entire SEA Project by May 11, 1970. Construction, however, intended to complete the work by December 31, 1969. It made this fact known to Brooks-Skinner, and included in the subcontract a stipulation to the effect that Brooks-Skinner understood December 31,- 1969 to be Construction’s completion date for the entire project.

      . As set forth in the fourteenth paragraph of the subcontract, “time is and shall be considered the essence of the contract on the part of the said sub-contractor

      . As pointed out in part II of this opinion, Construction maintains that the Government’s deletion order, and the attendant monetary loss to Construction, were a direct result of Brooks-Skinner’s untimeliness in providing the latrines.

      . Construction’s complaint also named as defendants the Van Noorden Company, Inc., and EG&G, Inc., and alleged that Brooks-Skinner was an “operating division” of these two corporations.
      Jurisdiction was grounded on diversity of citizenship. Construction is a New Jersey corporation and all the defendants are Massachusetts corporations, with respect both to incorporation and principal place of business.

      . Included in Construction’s computation of this figure, $206,386, is the $13,113 withheld by the Government for the deleted latrines.

      . The amount of damages sought ($91,940) was arrived at by subtracting the amount concededly owed Brooks-Skinner ($114,446) from the total of the alleged damages ($206,386).

      . The judgment ran as well against the Fireman’s Insurance Company, . Construction’s bonding company.

      . A related contention of Construction is that Brooks-Skinner’s counsel should not have been allowed to comment upon the evidence of profits in his summation to the jury. However, Construction’s counsel made no objection at trial to this aspect of the summation.

      . 5 Tr., p. 64.

      . 10Tr., p. 13.

      . See generally McCormick, Evidence § 185 (2d ed., 1972). Rule 407, Rules of Evidence for the United States Courts and Magistrates (July 1, 1973), contains a similar formulation for determining relevancy. The Rules, though approved by the Supreme Court, are still under consideration in Congress, and thus are not yet binding upon the federal courts.

      . Cf. 1 Wigmore, Evidence § 29 (3d ed., 1940) ; McCormick, Evidence § 185, p. 438 (2d ed., 1972) ; Stauffer v. McCrory Stores Corp., 155 F.Supp. 710 (W.D.Pa.1957).

      . Control Data Corp. v. Int’l Business Machine Corp., 421 F.2d 323, 326 (8th Cir. 1970). See also Beaty Shopping Center, Inc. v. Monarch Ins. Co. of Ohio, 315 F.2d 467, 471 (4th Cir. 1963) ; McCormick, Evidence § 185, p. 440 n. 35 (2d ed., 1972).

      . We reiterate that Buie 403, as such, is not yet binding upon the federal courts. See Note 12, supra. Nonetheless, it serves as a useful synopsis of extant law. See McCormick, Evidence § 185 (2d ed., 1972).

      . See McCormick, Evidence § 185, p. 440 (2d ed., 1972).

      . 10 Tr., pi). 70-71.

      . Construction duly objected to this portion of the charge at trial, in conformity with Rule 51, Federal Rules of Civil Procedure.

      . 32 C.F.R. § 8.706(a) (iii) (1972). The Regulations were erroneously referred to in the subcontract as the “Armed Services Procurement Act.”

      . 32 C.F.R. § 8.706(f) (ii) (1972).

      . Termination provisions in Government contracts, and correlative provisions in related subcontracts, are commonplace. See, e. g., Premier Roof Co. v. United States, 315 F.2d 18 (9th Cir. 1963) ; G. L. Christian and Associates v. United States, 312 F.2d 418, 160 Ct.Cl. 1 (1963).

      . It must be remembered that Construction did no more than to include the $13,113 in its computation of its entire loss, which amount was reduced by the amount owed Brooks-Skinner to arrive at the damages sought.

      . The so-called verdict “against Brooks-Skinner ($45,571) is arrived at by subtracting the verdict in favor of Brooks-Skinner ($68,925) from the total damages sought by Construction ($114,446).

      . Cf. Foster v. Moore-McCormack Lines, Inc., 131 F.2d 907, 908 (2d Cir. 1952), cert. denied, 318 U.S. 762, 63 S.Ct. 560, 87 L.Ed. 1134 (1943) (“Whether the jury . . . weighed the testimony in light of the judge’s instructions, of course, we do not know, and, indeed, are forbidden to inquire.”).

      . We have considered the several other contentions raised by Construction on this appeal and find them to be without merit.
      Reducing the verdict by the full $13,113 may well achieve more from Construction’s point of view than could be accomplished by a new trial. Unless Brooks-Skinner had provided the four deleted latrines to Construction for free — an unlikely possibility— Construction’s lost profit on these items would consist only of $13,113, minus whatever amount Construction owed Brooks-Skinner under the subcontract for the four latrines.


author: PER CURIAM:

text:
    UNITED STATES of America, Plaintiff-Appellee, v. Carl Eugene SADLER and Michael Alfred Brandes, Defendants-Appellants.
    No. 72-3797.
    United States Court of Appeals, Fifth Circuit.
    Jan. 17, 1974.

      Murray M. Silver, Atlanta, Ga. (Court-appointed), for Michael Brandes.
    Robert W. Rust, U. S. Atty., Barbara E. Vicevich, Kerry J. Nahoom, Asst. U. S. Attys., Miami, Fla., for plaintiff-appellee.
    Before GODBOLD, DYER and GEE, Circuit Judges.
   PER CURIAM:

Appellants Sadler and Brandes were tried before a jury in the United States District Court for the Southern District of Florida and found guilty of conspiracy to possess with intent to distribute some 80 pounds of marijuana, in violation of 21 U.S.C. § 846. Upon considering their appeal to this court, we find only two contentions which merit comment: (1) that the jury charge on entrapment was improperly phrased in terms of “lawful” and “unlawful” entrapment, and (2) that the court erred in not allowing the defense to introduce evidence in surrebuttal. After deliberating these and other issues not herein discussed, however, we conclude that their convictions must be upheld.

We recognize that the court below did not heed our warning in United States v. Groessel, 440 F.2d 602, 607 (5th Cir. 1971), that utilization of such terms as “lawful- entrapment” and “unlawful entrapment” may confuse the jury. But we also note that defense counsel failed to call this flaw to the court’s attention. Instead he requested a lengthy and somewhat redundant series of instructions which placed undue emphasis on the entrapment defense and which themselves made reference to “unlawful entrapment.” Under such circumstances we cannot say that the charge constituted plain error under Rule 52, Federal Rules of Criminal Procedure.

Appellants complain that the trial court erred in allowing the government to put its informer on the stand in “rebuttal” without permitting them to introduce evidence in “surrebuttal” to contradict and impeach his testimony. In order to evaluate this complaint, we begin with the general rule that whether material evidence which could have been received as part of the case in chief should be admitted in rebuttal lies solely within the discretion of the trial court. See Rodella v. United States, 286 F.2d 306, 309 (9th Cir. 1960), and cases cited therein. The court may properly decide that the prosecution should be allowed to rebut testimony by defense witnesses but that it should not be allowed to go into new matter which would prompt a surrebuttal by the defense. Indeed, this seems the most efficient manner of conducting, and terminating, a trial.

Prejudice occurs only if the prosecution witness goes beyond rebuttal and injects fresh issues on which the defendant is denied the right to present evidence. By objection, defense counsel should call to the court’s attention that a prosecution witness is going into new material which, if admitted, raises questions of rebuttal by the defense. If defense counsel makes no such objection, but waits until the prosecution witness steps from the stand, the court may properly require him to point out the new matter covered and show how he intends to refute it. The objective is efficiently to. conclude a trial when each side has had the opportunity to present his view of all issues fairly raised.

Here the government refrained from calling the informer who negotiated the deal until his testimony became necessary to rebut the picture painted by the appellants and their two co-defendants when they took the stand. His testimony covered the same course of negotiations as that of the defendants— differing only in his portrayal of their willingness to make the sale.

When defense counsel attempted to put on additional evidence, the trial judge faced a situation very similar to the one analyzed in Turner v. United States, 441 F.2d 736 (5th Cir. 1971). There the defendant had presented a vigorous alibi defense maintaining that he was not in the area of the crime when it was committed. The government called two witnesses, the defendant’s landlord and a police officer who had seen him, to testify in rebuttal of this contention. The Fifth Circuit upheld the trial court’s refusal to allow the defendant back on the stand, stating:

Appellant admits that it is within a proper exercise of the trial court’s discretion to permit a reopening of either the government’s case or that of the defendant after the other side has rested and relies mainly upon Dixon v. United States (5th Cir. 1964), 333 F. 2d 348, and upon 23 C.J.S. Criminal Law § 1053, page 1229, to the effect that “where new matter has been introduced by the state in rebuttal of an alibi defense the defendant may rebut the same on surrebuttal”. The testimony of the government’s rebuttal testimony in this case does not appear to us to be “new”. The government had maintained throughout that the Defendant Turner was in Miami during the commission of the offense and the testimony of the two rebuttal witnesses simply goes to corroboration of that fact. In the event defendant had been allowed to take the stand at the surrebuttal he would only have been able to reiterate what he and others had testified to previously and that was to the effect that he had not been in Miami since June 5,1966.

441 F.2d at 739. When essentially the same question arose again recently in United States v. Doe, 488 F.2d 93 (5th Cir. 1973), this court adhered to the reasoning of the Turner decision. We do so here as well.

Defense counsel at no time during the informer’s testimony objected on the basis of his going into new matter. When, after cross-examining the informer, defense counsel attempted to present more testimony, the court gave him the opportunity to demonstrate why additional evidence was necessary. This he was unable to do. He pointed to no new ground covered by the informer’s testimony and gave no indication that his witnesses would do more than reiterate the evidence presented in the case in chief. Now, on appeal, we are told that, given the chance, defendant would have impeached the informer’s testimony by showing that he was a user of narcotics with needle marks on his arm. If this intention had been made known to the trial judge, he might have felt obligated to admit the impeaching evidence. Unfortunately, it was not. In passing we are puzzled why, if the question of the informer’s drug use occurred to defense counsel at trial, he did not explore this subject on cross-examination. The court below properly drew the line short of surrebuttal.

Affirmed.

      . For our response to the argument that the trial court erred in refusing to grant defendants’ motion to inspect the grand jury minutes, see our opinion in United States v. Newcomb, 488 F.2d 190 (1974), disposing of the appeal of co-conspirators from their separate trial.


author: RONEY, Circuit Judge:

text:
    Chester JENNINGS, Plaintiff, Leonard Barnes and Eunice G. Farrington, etc., Plaintiffs-Appellants, v. Donald PATTERSON et al., Defendants-Appellees.
    No. 73-1541
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit
    Jan. 17, 1974.

      Fletcher N. Farrington, Jr., Savannah, Ga., for plaintiffs-appellants.
    Michael I. Kent, Opelika, Ala., for Patterson and Dennis.
    Charles R. Adair, Jr., Dadeville, Ala., for City of Dadeville, and others.
    Before THORNBERRY, GOLDBERG and RONEY, Circuit Judges.

       Rule 18, 5th Cir.; see Isbell Enterprises, Inc. v. Citizens Casualty Co. of New York et al., 5th Cir. 1970, 431 F.24 409, Part I.

   RONEY, Circuit Judge:

In this civil rights action plaintiffs allege violation of 42 U.S.C.A. §§ 1981, 1982, 1983, and 1985 in that they were denied access to a public street by a barricade erected by defendants Donald Patterson and Horace Dennis (“the private defendants”), which defendants City of Dadeville, Alabama and its governing officers (“the City”) failed to remove. Plaintiffs seek declaratory and injunctive relief.

At an earlier stage in the proceedings, this Court held that the complaint states cognizable statutory claims. Jennings v. Patterson, 460 F.2d 1021 (5th Cir. 1972). On remand the case was tried to a jury. In response to special interrogatories the jury found that the public had acquired a prescriptive right to use the street, that the private defendants had dedicated the street to public use, that this dedication had been accepted by the City, that the defendants had knowingly deprived the plaintiffs of their right to use thej street, but that this action'was not tak-| en under color of state law. The trial court then granted defendants judgment n. o. v., sua sponte, on the ground that the evidence was insufficient to support the jury findings on prescription and dedication. The Court also noted that the jury determination on state action should have precluded relief. We conclude that the District Court should not have set aside the jury findings of prescription and dedication. In addition, we hold that there was state action within the meaning of Section 1983, an issue of law which should never have been submitted to the jury.

In the early 1940’s, Will Patterson and Fletcher Farrington were adjoining owners of land now within the city limits of Dadeville. Their property was separated by a north-south section line fence. On the Patterson land a road, beginning in the west at Oak Street, extended eastward at least as far as the section line. This road, called Patterson Street, was paved only for about one half of its length, beginning at Oak Street. As portions of the Patterson land were sold off and developed, the paving was extended in segments — to include each new house as it was constructed — until. it reached the driveway of defendant Dennis, owner of the last lot in the tract, approximately 40 feet west of the section line.

In 1969, plaintiff Eunice Farrington (Fletcher’s widow) improved a continuation of the street east of the section line in the course of subdividing a portion of her tract. Thereafter, the City improved and maintained the street system of the newly developed Farrington tract. All lots except the one closest to the section line were sold to blacks. This lot was purchased by James Shaddix, a white.

In 1971, the private defendants constructed a barricade across Patterson Street at the section line, preventing residents of the Farrington tract from using the western portion of the street. Without this access, one and a half to two miles are added to the journey to town. Only James Shaddix, the sole white resident, was offered an easement permitting access to the street.

The defendants, both private and public, contend that the District Judge correctly set aside the jury’s findings on prescription and dedication. Under their view of the evidence, the unpaved strip of the street between the Dennis driveway and the section line remains private property. The private defendants, therefore, claim a right to erect the fence. The City maintains that it is without power to remove the fence from private property.

I.

The defendants filed no motion for judgment n. o. v. In the absence of a timely motion, normally a district court may not grant judgment notwithstanding the verdict. Johnson v. New York, N.H. & H. R.R., 344 U.S. 48, 50, 73 S.Ct. 125, 97 L.Ed. 77 (1952); see F.R.Civ.P. 50(b). In any event, there is ample evidence from which the jury could have found as it did — despite significant evidence supporting defendants’ contentions.

The plaintiffs introduced four Patterson deeds using the intersection of the north side of Patterson Street with the section line as a corner point. A fifth deed also referred to the intersection, and further identified Patterson Street as “also known as Pole Cat Springs Road.” Plaintiffs also introduced testimony that, in the 1940’s, Patterson Street continued eastward from the section line to Polecat Springs, a watering hole located on the Farrington tract that was noted for its mineral waters. This testimony indicated that, at the time, the public traveled the road to reach the Springs and that automobiles had used the road. Although defendants presented evidence that Patterson Street was blocked at the section line by a fence meant to keep cattle on the Farrington side of the line, some witnesses for the plaintiffs testified that there was either a gate or a cattle gap at that point.

The City’s practice of paving the street in sections as new houses were built could have been seen by the jury as the only reason the strip now in question remained unpaved. Similarly, the jury could have discounted the absence of formal dedication of the disputed strip in view of testimony that the City had paved the earlier segments without formal dedication. (The defendants conceded that the paved portions of Patterson Street are public.) Further, the private defendants did not attempt to have the City Council close the street and did not subsequently resort to self-help until a year and a half after the Patterson Street extension on the Far-rington tract had been paved and use of the disputed strip by the new residents of the Farrington tract had begun. The jury could have inferred that this delay stemmed from an earlier intent to dedicate the unpaved portion to public use or from a recognition of the public character of the strip. Evidence that the City maintained the extension and erected a street sign designating the extension as Patterson Street is also consistent with the jury’s findings that the street was public.

Where there is substantial evidence “of such quality and weight that reasonable and fair-minded men in the exercise of impartial judgment might reach different conclusions” a motion for judgment notwithstanding the verdict should be denied. Boeing Co. v. Shipman, 411 F.2d 365, 374 (5th Cir. 1969) (en banc). Accordingly, the jury’s special findings On prescription and dedication must be reinstated.

II.

We next come to the issue of state action under 42 U.S.C.A. § 1983. The Judge charged the jury on “color of state law” in a manner that restricted the jury’s consideration of the question solely to the actions of the private defendants in closing the street. The plaintiffs, however, did not assert state action in the closing of the street. Under their theory, state action was to be found in the City’s failure to remove the barricade.

It is abundantly clear that one reason the legislation was passed was to afford a federal right in federal courts because, by reason of prejudice, passion, neglect, intolerance or otherwise, state laws might not be enforced and the claims of citizens to the enjoyment of rights, privileges, and immunities guaranteed by the Fourteenth Amendment might be denied by the state agencies.

Monroe v. Pape, 365 U.S. 167, 180, 81 S.Ct. 473, 480, 5 L.Ed.2d 492 (1961). Accordingly, we hold that the failure ofl the City and its governing officials to dismantle the fence constitutes state ac-_ tion proscribed by Section 1983.

Although it establishes state action in this case, Monroe raises a jurisdiction issue which neither the trial court nor the parties to this appeal have addressed. In addition to expanding the definition of state action, that case restricted the coverage of Section 1983 by holding that municipal corporations could not be held liable for damages thereunder. 365 U.S. 187-192, 81 S.Ct. 473, 5 L.Ed.2d 492. This principle was recently reaffirmed in Moor v. County of Alameda, 411 U.S. 693, 93 S.Ct. 1785, 36 L.Ed.2d 596 (1973).

Shortly after Moor, the Supreme Court, in City of Kenosha v. Bruno, 412 U.S. 507, 93 S.Ct. 2222, 37 L. Ed.2d 109 (1973), eliminated all doubt that municipal corporations are also immune from injunctive relief under Section 1983. We must, therefore, modify our earlier conclusion, in Jennings v. Patterson, supra, that plaintiffs stated a claim for relief against the City of Dadeville. We remand for consideration by the District Court as to whether, in light of Kenosha, mandatory injunctive relief against the city’s officials, requiring them to set in motion the city’s machinery of government, is proper. See Campbell v. Masur, 486 F.2d 554 (5th Cir. 1973).

III.

The plaintiffs’ other civil rights claims received short shrift. The trial judge ruled that 42 U.S.C.A. §§ 1981 and 1982 had not been violated, stating that there had been

no proof in this cause of any discrimination in the blocking of the Street by the Pattersons. The white Plaintiff, Mrs. Farrington and the black Plaintiffs, Messrs. Jennings and Barnes, as well as others, were barred.

Yet it was shown at trial that, with one exception, all of the persons directly affected by the Pattersons’ barricade were black. The only white person affected, Shaddix, was offered private access to the closed street. And the jury found that the defendants had knowingly deprived these persons of the right to use the street. Clearly, these persons, because they are black, have been denied the right to hold and enjoy their property on the same basis as white citizens. See Jones v. Mayer Co., 392 U.S. 409, 88 5. Ct. 2186, 30 L.Ed.2d 1189 (1968).

The trial judge failed even to mention the plaintiffs’ 42 U.S.C.A. § 1985(3) claim. Yet the plaintiffs’ evidence tended to prove that (1) some of the Patterson clan had erected the barricade after securing the approval of others; (2) the construction of the barricade was a deprivation of rights secured to them under 42 U.S.C.A. § 1982; (3) construction of the barricade was an act in furtherance of the conspiracy; and (4) denial of convenient access to downtown Dadeville was an injury to the plaintiffs’ property. Such proof would meet the standards required to show a violation of 42 U.S.C.A. § 1985(3) as established by Griffin v. Breckenridge, 403 U.S. 88, 91 S.Ct. 1790, 29 L.Ed.2d 338 (1971).

On appeal, the plaintiffs also seek the award of attorney’s fees for their prosecution of this civil rights action. This, however, is a matter in the first instance for the trial court and should be considered there on remand.

The decision of the trial court setting aside the jury verdict is reversed, the judgment of the trial court is vacated and the case remanded for reinstatement of the findings of fact made by the jury and further proceedings consistent with this opinion.

Reversed in part, vacated in part and remanded.

      . Originally, the defendants demanded trial by jury. On appeal, however, they contend that the jury was only advisory. Although the trial judge nowhere in the record specifically stated that the jury was one of right, his every action indicates that he treated it as such. Having at trial demanded and received a jury as of right, the defendants will not be heard on appeal to complain either that the grant of jury trial was error or that the jury itself was less than full-fledged. cf. Law v. United States, 266 U.S. 494, 496, 45 S.Ct. 175, 69 L.Ed. 401 (1925). Accordingly, we need not decide whether the grant of jury trial was appropriate in this case. See generally, Ross v. Bernhard, 396 U.S. 531, 538, 90 S.Ct. 733, 24 L.Ed.2d 729 (1970) ; Dairy Queen, Inc. v. Wood, 369 U.S. 469, 479, 82 S.Ct. 894, 8 L.Ed.2d 44 (1962) ; Beacon Theatres, Inc. v. Westover, 359 U.S. 500, 504, 79 S.Ct. 948, 3 L.Ed.2d 988 (1959) ; Whitehead v. Shattuck, 138 U.S. 146, 151, 11 S.Ct. 276, 34 L. Ed. 873 (1891) ; United States v. Williams, 441 F.2d 637, 643, 644 (5th Cir. 1971).

      . 42 U.S.C.A. § 1983:
      Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory, subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdietion thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress.

      . See, e. g., Harkless v. Sweeny Indep. School Dist., 427 F.2d 319 (5th Cir. 1970), cert. denied, 400 U.S. 991, 91 S.Ct. 451, 27 L.Ed.2d 439 (1971) ; Garren v. City of Winston-Salem, 439 F.2d 140 (4th Cir. 1971), vacated on other grounds, 405 U.S. 1052, 92 S.Ct. 1489, 31 L.Ed.2d 787 (1972) : Schnell v. City of Chicago, 407 F.2d 1084 (7th Cir. 1969) ; Adams v. City of Park Ridge, 293 F.2d 585 (7th Cir. 1961).

      . Rather than invite reversal by insisting on our law of the case, we should apply the law as it now exists. See IB Moore’s Federal Practice U 404 [10]. Although a federal appellate court will normally depart from a ruling established previously in the same case only in unusual- circumstances, an intervening change in the controlling law justifies the court’s reversing itself. See Lumbermen’s Mutual Casualty Co. v. Wright, 322 F. 2d 759 (5th Cir. 1963).

      . 42 U.S.C.A. § 1981:
      All persons within the jurisdiction of the United States shall have the same right in every State and Territory to make and enforce contracts, to sue, be parties, give evidence, and to the full and equal benefit of all laws and proceedings for the security of persons and property as is enjoyed by white citizens, and shall be subject to like punishment, pains, penalties, taxes, licenses, and exactions of every kind, and to no other.
      42 U.S.C.A. § 1982:
      All citizens of the United States shall have the same right, in every State and Territory, as is enjoyed by white citizens thereof to inherit, purchase, lease, sell, hold, and convey real and personal property.

      . 42 U.S.C.A. § 1985(3) :
      If two or more persons in any State or Territory conspire or go in disguise on the highway or on the premises of another, for the purpose of depriving, either directly or indirectly, any person or class of persons of the equal protection of the laws, or of equal privileges and immunities under the laws; or for the purpose of preventing or hindering the constituted authorities of any State or Territory from giving or securing to all persons within such State or Territory the equal protection of the laws; or if two or more persons conspire to prevent by force, intimidation, or threat, any citizen who is lawfully entitled to vote, from giving his support or advocacy in a legal manner, toward or in favor of the election of any lawfully qualified person as an elector for President or Vice President, or .as a Member of Congress of the United States; or to injure any citizen in person or property on account of such support or advocacy; in any case of conspiracy set forth in this section, if one or more persons engaged therein do, or cause to be done, any act in furtherance of the object of such conspiracy, whereby another is injured in his person or property, or deprived of having and exercising any right or jn'ivilege of a citizen of the United States, the party so injured or deprived may have an action for the recovery of damages, occasioned by such injury or deprivation, against any one or more of the conspirators.

      . To come within the legislation a complaint must allege that the defendants did (1) “conspire or go in disguise on the highway or on the premises of another” (2) “for the purpose of depriving, either directly or indirectly, any person or class of persons of the equal protection of the laws, or of equal privileges and immunities under the laws.” It must then assert that one or more of the conspirators (3) did, or caused to be done, “any act in furtherance of the object of [the] conspiracy,” whereby another was (4a) “injured in his person or property” or (4b) “deprived of having and exercising any right or privilege of a citizen of the United States.” Griffin v. Breckenridge, supra, 403 U.S. at 102-103, 91 S.Ct. at 1798, 1799.


author: SIMPSON, Circuit Judge: PER CURIAM:

text:
    Peter J. BRENNAN, Secretary of Labor, United States Department of Labor, Plaintiff-Appellee-Cross Appellant, v. J. M. FIELDS, INC., Defendant-Appellant-Cross Appellee.
    No. 72-1066.
    United States Court of Appeals, Fifth Circuit.
    Nov. 16, 1973.
    Rehearing and Rehearing En Banc Denied Jan. 17, 1974.
    See also D.C., 335 F.Supp. 731.

      Eli H. Subin, Orlando, Fla., for defendant-appellant.
    Kalvin M. Grove, S. Richard Pincus, Chicago, 111., for American Retail Federation, amicus curiae.
    Beverley R. Worrell, Regional Sol., Dept, of Labor, Atlanta, Ga., Richard F. Schubert, Sol. of Labor, Bessie Margolin, Carin Ann Clauss, U.S. Dept, of Labor, Washington, D. C., for plaintiff-appellee.
    Before TUTTLE, WISDOM and SIMPSON, Circuit Judges.
   SIMPSON, Circuit Judge:

We review on this appeal the decision below in a case arising under the Equal Pay provisions of the Fair Labor Standards Act (FLSA), Title 29, U.S.C., § 201 et seq. The district court found that the appellant, J. M. Fields, Inc. (Fields) had discriminated on the basis of sex in the payment of wages to supervisory personnel in three of the sixty-odd Fields’ retail outlets. The court ordered payment to named employees of the minimum wages and overtime due them under the provisions of the Equal Pay Act (EPA or the Act). The court also enjoined further violations of the Equal Pay Act “. . .in any of [Fields’] stores now in operation or hereafter operated by it.” Fields as appellant and the Secretary of Labor (the Secretary) as cross-appellant each appeal from portions of the lower court’s order.

I. BACKGROUND: THE FIELDS ORGANIZATION

A. The National Organization

Fields, a subsidiary of Food Fair Stores, Inc., is a chain-store enterprise operating more than sixty retail outlets in eleven states on the Eastern Seaboard of the United States. Fields’ home offices are in New York City and Philadelphia, Pa. Its territory is divided into three regions for purposes of personnel administration. Each' region is headed by a director who oversees the personnel files of employees in his area. The Fields’ Industrial Relations Department in New York maintains all personnel files. Initial hiring of personnel and setting of salary rates for each of the individual Fields’ stores is conducted either by the regional personnel director or by a representative of the New York office. In addition, the New York office issues periodic directives detailing salary ranges appropriate for different geographical areas and classes of employees. Finally, all wage increases are subject to approval either by the regional personnel director or by the New York office.

B. The Local Retail Outlets

The individual Fields stores are each headed by a Store Manager and two Assistant Store Managers. Each of the departments within the store is headed by an Area Supervisor (also referred to as a Department Manager). Fields follows what is apparently an industry-wide practice of dividing its departments into two categories — softline goods and hardline goods. In softlines are included clothing and infant accessories (cribs, furniture, mattresses). The hardline departments contain all the other goods sold by Fields (housewares, cosmetics, automobile accessories and numerous other lines).

The function of the Area Supervisors in the hardline and softline departments is roughly similar, save in the matter of ordering replenishment stocks. The basic re-ordering of most softline goods is handled by a computer which is fed pre-punched portions of sales tickets removed by cashiers when the items are purchased. Re-ordering of hardline goods is based, for the most part, upon physical counts of merchandise on hand. The Area Supervisors in the hardline departments are responsible for these counts. Managers in both hardline and softline departments must be cognizant of fast-moving items and reorder accordingly.

II. THE COMPLAINT

On June 14, 1968, the Secretary filed a complaint alleging that Fields had violated and was continuing in violation of Sections 6(d) and 15(a)(2) of the Fair Labor Standards Act in at least three of its retail outlets in Florida — those in Eau Gallie, Merritts Island, and Tallahassee. The Secretary’s allegations were substantially as follows: (1) that male softline Area Supervisors were generally paid more than their female counterparts; (2) that male hardline Area Supervisors generally were paid more than their female counterparts; (3) that soft-line Area Supervisors were generally female; (4) that the softline Area Supervisors were generally paid less than the hardline Area Supervisors; (5) that there was no basis for a distinction between hardline and softline Area Supervisors for the purposes of the Equal Pay Act. The Secretary further alleged that Fields had had knowledge of the provisions of the Equal Pay Act during the entire period of the violations, and therefore, that the violations were wilful violations for the purposes of the Portal-to-Portal Act, Title 29, U.S.C., § 255(a); and that this had the effect of exposing Fields to possible liability for the payment of minimum wages and overtime for a three year (rather than a two year period in the case of non-wilful violations) period prior to commencement of the Secretary’s suit.

Fields’ answer asserted that it had not wilfully violated the Act in that it had not intended to discriminate among its Area Supervisors according to sex. Fields alleged that it had hired its Supervisors at the going market rate and that compensation had been based solely on the going market rate and not upon sex. Fields further answered that there was a basis for differentiation between the hardline and softline managers based on the skill and responsibility required of these respective positions. Particular reference was made in this respect to the different methods of ordering goods prevailing in the two types of departments, hardline and softline.

III. THE OPINION BELOW

This district court entered findings of fact and conclusions of law supporting in the main the Secretary’s position. The court found the existence of discrimination based upon sex in some particulars in each of the three Fields stores involved. The court also found that the duties of Area Supervisor in the hardline and softline departments differed so substantially in terms of skill and responsibility as to require their being considered unequal for the purposes of the Equal Pay Act. The court concluded as a matter of law that the discriminations in wages between sexes constituted violations of the Equal Pay Act. The court concluded further that the discriminations were unintentional and therefore not wilful for the purposes of the Portal-to-Portal Act, Title 29, U.S.C. § 255(a).

The district court judgment required Fields to refrain from withholding minimum wages and overtime compensation from the employees found to have been the object of violations of'the Act, and further enjoined Fields from committing violations of the Act “. . . in any of its stores now in operation and hereafter operated by it.” Both parties appeal from the findings, conclusions and judgment. We now consider the issues raised on appeal.

IV. THE HARDLINE/SOFTLINE DISTINCTION

The district court found that there existed a distinction between the jobs of hardline Area Supervisor and softline Area Supervisor such that the two could not be compared for purposes of the Equal Pay Act. This finding was un-dergirded by Findings of Fact Nos. 8 and 9:

8. The method of ordering in the hardline departments imposes on those Area Supervisors an added responsibility which required a substantial portion of their working time.2 [Footnote 2 read: “Witness Peggy Smith, a Tallahassee hardlines supervisor testified that she spent four hours a day working on the preprint books.”]
9. The skill and responsibility required of hardline managers is substantially greater than that required of softline managers. * * * [Emphasis added.]

Fields urges on appeal that we not only adopt the district court’s findings of the existence of a distinction between hardline and softline managers, but also that we expand the scope of the softlines category to include “curtains and domestics.” On cross appeal, the Secretary urges that the distinctions between hardline and softline managers’ jobs are so minimal as to require their being considered equal for the purposes of the Equal Pay Act.

We begin by noting that the Findings of Fact numbered 8 and 9, and 22 are so conclusory in nature as to preclude the necessity of our applying the “clearly erroneous” standard of Rule 52 (a), F.R.Civ.P., on review. Baumgartner v. United States, 1944, 322 U.S. 665, 64 S.Ct. 1240, 88 L.Ed. 1525; Shultz v. Wheaton Glass Co., 3 Cir. 1970, 421 F.2d 259, 267. In this situation we are required to consider only whether the findings are correct in the light of the provisions of the Equal Pay Act, the regulations thereunder, and prior decisions.

The Equal Pay Act mandates equal pay for jobs “the performance of which requires equal skill, effort, and responsibility, and which are performed under similar working conditions . . .” * * * (E.P.A., Title 29, U.S.C., § 206 (d)(1). Emphasis added). The Regulations promulgated by the Department of Labor, 29 C.F.R. § 800.0 et seq., provide that: “The terms” [skill, effort, and responsibility] “are considered to constitute three separate tests, each of which must be met in order for the equal pay standards to apply.” (29 C.F.R. § 800.-122).

We noted in Hodgson v. Brookhaven General Hospital, 5 Cir. 1970, 436 F.2d 719, 722, that the Secretary of Labor has the burden of proving “equality of work and inequality of pay.” In meeting this burden, the Secretary is, however, required only to show that the jobs under consideration are “substantially equal,” Hodgson v. Fairmont Supply Co., 4 Cir. 1972, 454 F.2d 490, 493. We think the Secretary met his burden in the instant case. He showed that the Area Supervisors in both hardline and soft-line departments were responsible for ordering merchandise, for assisting customers with their purchases, and for maintaining orderly and properly displayed racks of merchandise in their respective departments. This showed that the jobs were “substantially equal.”

The principal factor involved in the district court’s decision that the hardline and softline managers’ jobs were unequal was the different method of ordering replacement merchandise prevailing in the two types of departments. Considered in the light of the tripartite test of substantial job equality, it cannot be said that the two methods differed in terms of skill involved. The record is • unsatisfactory as to the existence of a possible ground for sustaining a blanket distinction between hardlines and soft-lines based on either effort or responsibility.

The regulations promulgated by the Department of Labor under the E.P.A. state that “skill includes consideration of such factors as experience, training, education, and ability . . .”29 C.F.R. § 800.125. The evidence indicates no additional requirements for the position of hardline manager based on any of these factors. Indeed, the evidence as to training was precisely to the contrary: the softline managers received more extensive training in terms of time spent in the training program. Thus, we overturn the finding by the district court that the job of hardline manager required more skill than that of softline manager. Such a finding is without support in this record.

Because the findings of fact permit no conclusion on oúr part as to the elements of responsibility and effort involved in the different managerial positions, we remand for further findings on these two points. Our concern in this area of job equality between the two kinds of Area Supervisors is primarily with the sweeping nature of the district court's finding of job inequality and the meager support in the findings of fact for such a pronouncement. The district court found for example that the method of ordering in the hardline departments consumed a substantial portion of the working hours of the hardline managers. In support of this finding the court cited the fact that the manager of one of the hardline departments in one of the Fields’ stores spent four hours a day reordering for her department. This did not rebut the Secretary’s proof of job equality, and does not support a finding that all hardline managers in all hardline departments spend an equal amount of time in reordering merchandise. Requisite to such a finding is proof that this single hardline Area Supervisor's experience typifies the requirements of the job of hardline manager; that the housewares manager, the garden shop manager, the automotive manager, and all the other hardline managers are required to exert this effort in order to maintain their stocks — and further, that the softline managers are not similarly required to spend this amount of time checking the stock in their departments. Any lesser amount of proof would not support the broad distinction found by the district court to exist between the two positions. Accordingly, we remand the case to the district court for further findings as to the comparative degrees of effort and responsibility required in the supervision of hardline and softline departments. We add the admonition that the company-wide practice of distinguishing between hard-lines and softlines is no basis without more for a conclusion of the existence of requisite distinction for purposes of E.P.A. Hodgson v. Golden Isles Convalescent Homes, Inc., 5 Cir. 1972, 468 F.2d 1256. The district court should explain its reasons for finding distinctions between hardline and softline in terms used in the Regulations. It is difficult if not impossible for us properly to evaluate district court findings and conclusions on review on any other basis.

V. WILFUL OR NON-WILFUL VIOLATION?

The district court decided as a matter of law that Fields’ violations of the Equal Pay Act were not wilful for the purpose of the Portal-to-Portal Act’s three-year statute of limitations on claims for minimum wages and overtime due. 29 U.S.C., § 255(a). The determination was rather that the discrimination found was merely the unintended result of Fields’ practice of hiring persons at whatever wage it could. The Secretary urges on cross-appeal that the district court’s finding on the question of wilfulness is contrary to our holding in Coleman v. Jiffy June Farms, Inc., 5 Cir. 1970, 458 F.2d 1139, rendered some five months after the findings and conclusions were entered in the instant case.

In Jiffy June Farms, we considered a violation of the Fair Labor Standards Act occurring within the context of a collective bargaining agreement in which the employees had agreed to exempt themselves from FLSA provisions in exchange for a raise in pay. The record there disclosed in addition that the employer had sought and secured advice of counsel that this arrangement would in fact exempt the employees from the FLSA. Judge Wisdom, speaking for the court, proposed the following as the test of wilfulness to be applied in cases concerned with civil liability for violations of the FLSA: “Stated most simply, we think the test should be: Did the employer know the FLSA was in the picture?” Id. at 1142. Judge Wisdom stated: “The entire legislative history of the 1966 amendments of the FLSA indicates a liberalizing intention on the part of Congress. Requiring employers to have more than awareness of the possible applicability of the FLSA would be inconsistent with that intent.” Id.

In the instant case, the record discloses that Fields’ central office sent memoranda to its district managers and store managers advising them of the implementation of the E.P.A., and of the requirements of the Act. In addition, Fields’ regional personnel managers were under instructions to make periodic examinations of the personnel files of the Fields stores and to report any possible violations of the E.P.A. to the New York office. This was sufficient to establish that Fields knew “that the FLSA was in the picture.” In defense of the district court finding Fields argues that the random pattern of wage discrimination together with the cessation of per se violations of the Act prior to trial indicates that the violations were negligent and not wilful. We apply the test as enunciated in Jiffy June Farms, supra, as the correct test. To allow exceptions for “random” discrimination or in situations where an employer, once charged with violating the Act, corrects the unlawful practice, would sap much of the E.P.A.’s vitality. Such a construction would create unnecessary problems for future courts attempting to construe the Act. We determine that the district court erred in finding that Fields’ violations were not wilful for the purposes of the Portal-to-Portal Act’s three-year statute of limitations. We remand with directions to modify the judgment so as to allow employees overtime and minimum wages for a period of three years from the date that the cause of action accrued.

VI. THE CHAIN-WIDE INJUNCTION

The district court by its decree enjoined Fields from violating the provisions of the Equal Pay Act “in any of its stores now in operation and hereafter operated by it . . . ” Fields here challenges the issuance of a chain-wide injunction on the facts of the instant case, and urges that the injunction be modified. In support of the district court’s injunction the Secretary points out that the violations in the instant case occurred in the context of close centralized supervision over wage scales and pay policies in the individual stores, and urges that a chain-wide injunction was appropriate to restrain what had apparently been a company policy regarding hiring and setting of wage scales.

We start with the rubric that the granting of injunctive relief in FLSA suits is a matter within the sound discretion of the district judge. We will not overturn or modify an injunction in such suits without a showing of clear abuse of that discretion. In determining the existence vel non of an abuse of discretion it is necessary to examine policies underlying the FLSA and the purposes served by injunctions in suits under the FLSA. Wirtz v. Ocala Gas Co., 5 Cir. 1964, 336 F.2d 236, 240.

See Goldberg v. Cockrell, 5 Cir. 1962, 303 F.2d 811, 814, where we considered the role of the injunction in the context of the FLSA:

“Issuance of an injunction in cases such as- these does not subject an employer to any penalty for his past violations of the law. It merely says: in the future do what the law requires you to do. The injunction shifts the responsibility for compliance onto the employer’s shoulders. * * * The Wage and Hour Division cannot reasonably be charged with the responsibility of checking back on past violators to make sure that they are obeying the laws. Fairness and economy of administrative effort both dictate that after an employer has once violated the Act he should bear his own responsibility for the future.”

In Wirtz v. Ocala Gas Co., supra, 336 F.2d at 240, we noted further:

“Inasmuch as [the injunctions] are a means of effecting general compliance with national policy expressed by Congress, they are to be utilized in the light of the purposes of the Act, in aid of the administrative efforts at enforcement, and not grudgingly.”

See further our statement in Hodgson v. First Federal Savings and Loan Ass’n, 5 Cir. 1972, 455 F.2d 818, 826, that “courts should not be loath to issue injunctions of general applicability.” We review the context in which the injunction in the instant case issued in the light of these principles.

Fields, as stated, has more than sixty stores in its chain. Evidence introduced at trial indicated that Fields’ hiring and wage policies were subject to centralized control of a significant degree. It was hardly an abuse of discretion in these circumstances for the district court to enjoin Fields as a corporate defendant rather than to enter a limited injunction against the individual stores found to be in violation of the Equal Pay Act. It would frustrate the broad purposes of the FLSA in suits involving large corporate defendants with extensive branch operations to require the Secretary to investigate and prove violations in all or substantially all of the defendant's branches to justify the issuance of a chain-wide injunction. Considerations of administrative necessity are persuasive as warranting the chain-wide injunction issued below. Again we quote Wirtz v. Ocala Gas Co., supra, 336 F.2d at 240:

“These FLSA injunctions are not excessively burdensome as this Court has pointed out heretofore. They subject the defendants to no penalty or hardship. They require no more than that the defendants comply with the law. [Citation omitted] Their aim is remedial and not punitive. * * * ”

We find that the issuance of a chain-wide injunction in this ease was not an abuse of discretion, and affirm the district court on this point.

The language of the injunction was overly broad in this one respect: the district court framed its injunction in terms that apply not merely to the class of employees involved in the instant litigation, the Area Supervisors, but as well to all Fields’ employees. There was no proof of discrimination in classes of employees other than Area Supervisors, and accordingly we direct that the terms of the injunction be modified to limit its applicability to this class of employees. The language contained in the injunction against further violations of the Equal Pay Act should be modified by substituting the term “Area Supervisor” for the term “employee(s)”. Cf. Hodgson v. Corning Glass Works, 2 Cir. 1973, 474 F.2d 226, cert. granted, — U.S. -, 94 S.Ct. 839, 38 L.Ed.2d 737 (1973).

Affirmed in part, reversed in part, modified in part, and remanded for further consideration.

ON PETITIONS FOR REHEARING AND PETITION FOR REHEARING EN BANC

PER CURIAM:

The motion of the Secretary of Labor to strike the last paragraph of the Court's opinion of November 16, 1973, is not passed upon.

The Secretary of Labor’s alternative petition for rehearing is granted to the extent that the last paragraph of the body of the printed slip opinion, page 16, commencing with the words “The language of the injunction * * * ” and ending with the words “ * * * Cf. Hodgson v. Corning Glass Works, 2 Cir. 1973, 474 F.2d 226.” is withdrawn in its entirety, and said petition is otherwise denied.

The petition for rehearing of J. M. Fields, Inc. is denied and no member of this panel nor Judge in regular active service on the Court having requested that the Court be polled on rehearing en bane, (Rule 35, Federal Rules of Appellate Procedure; Local Fifth Circuit Rule 12) the petition for rehearing en banc is denied.

      . 29 U.S.O., § 206(d).

      . Under the provisions of 29 U.S.C., § 206(d) (3) amounts owing to employees as a result of violations of the Equal Pay Act are denominated “unpaid minimum wages or unpaid overtime compensation.”

      . Section 6(d) of the FLSA, Title 29, U.S.C., § 206(d), provides, in pertinent part:
      (d) (1) No employer having employees subject to any provisions of this section shall discriminate, within any establishment in which such employees are employed, between employees on the basis of sex by paying wages to employees in such establishment at a rate less than the rate at which he pays wages to employees of the opposite sex in such establishment for equal work on jobs the performance of which requires equal skill, effort, and responsibility, and which are performed under similar working conditions, * * *.
      Section 15(a)(2) of the FLSA, Title 29, U.S.C., § 215(a)(2), provides in pertinent part:
      (a) After the expiration of one hundred and twenty days from June 25, 1938, it shall be unlawful for any person—
      (2) to violate any of the provisions of section 206 or section 207 of this title, or any of the provisions of any regulation or order of the Administrator issued under section 214 of this title; * * *.

      . Hodgson v. J. M. Fields, M.D.Fla.1971, 335 F.Supp. 731, 732-733, Findings of Fact Nos. 10-20.

      . Id. Findings of Fact Nos. 8, 9, and 22.

      . Id. at 733, Conclusion of Law No. 2.

      . Id. Conclusion of Law No. 4.

      . Id. Finding of Fact No. 22.

      . Finding of Fact No. 8 and Note 2 thereto, text, supra.

      . This approach was justified by this state-meat in the opinion:
      “ * * * Unlike most statutes regulating conduct, the Fair Labor Standards Act does not carry any immediate sanetion. In effect it gives each employer one free offense: on proof of violation he is liable at most for repayment of the wages that he originally should have paid his employees, to the extent that the unpaid wages can be proven. This rule may be justified on the basis of avoiding punishment of those who are ignorant of the law or do not believe that it applies to them; but no law can be effectively enforced if individuals are allowed to make repeated violations of it with impunity. One unexplained offense is enough.” 303 F.2d at 814.


text:
    Nelson SIMPSON, Jr., Plaintiff-Appellant, v. SPERRY RAND CORPORATION, Defendant-Appellee.
    No. 73-1716.
    United States Court of Appeals, Fifth Circuit.
    Dec. 10, 1973.

      Glen H. Smith, Shreveport, La., for plaintiff-appellant.
    John T. Cox, Jr., Shreveport, La., for defendant-appellee.
    Harold C. Nystrom, Associate Sol., Bobbye D. Spears, Atty., U. S. Dept, of Labor, Washington, D. C., amicus curiae.
    Before THORÑBERRY, GODBOLD and CLARK, Circuit Judges.
   PER CURIAM:

Nelson Simpson, Jr., an employee of Sperry Rand Corporation, brought this private action against his employer under Title III of the Consumer Credit Protection Act, 15 U.S.C. § 1671 et seq. The court below entered summary judgment for the employer based upon its conclusion that Simpson was within the ambit of Section 304(a) of the Act, 15 U.S.C. § 1674(a), but that no private right of action was provided or implied. In light of asserted but unestablished fact issues concerning pre-Act indebted-nesses as well as pre- and post-Aet levies, our intervening decision in Brennan v. General Telephone Company, 488 F.2d 443 (5th Cir. 1973), may indicate that Simpson is outside the mantle of the statute’s protection.

In its brief here Sperry Rand asserts, without contradiction from Simpson or the amicus, Secretary of Labor, that Simpson was assessed by the United States for delinquent tax liabilities on June 7, 1968 and again on May 23, 1969; that a notice of levy (garnishment) was issued to Sperry Rand on the first assessment on December 20, 1968; ■ and that a third assessment (debt) was entered on May 15, 1970. However, the summary judgment record is silent as to each of these matters. Title III of the Consumer Credit Protection Act became effective July 1, 1970. Additional notices of levy were issued to Sperry Rand on September 4, 1970 and October 5, 1970. Simpson was discharged October 9, 1970 pursuant to Sperry Rand’s published policy regarding multiple garnishments. The parties disagree whether these last two notices of levy were based upon only one or upon ’ the last two of the assessments. The district judge grounded his belief that only one debt was involved upon an allegation in the complaint that was never the subject of an answer or specific response.

As Brennan demonstrates, both pre- and post-Act garnishments and indebt-ednesses can form the basis for discharge consideration under the provisions of Section 304(a). If the facts on remand really show three debts and three garnishments against Simpson that were eligible for Sperry Rand’s consideration — more than was necessary to violate established company policy- — then under Brennan he has no statutory standing to complain. Since neither the trial court nor the parties had Brennan’s guidance at the time of the proceedings below, we deem it just under the circumstances to vacate the summary judgment appealed from and remand this cause to permit such further fact development as may be necessary to determine Simpson’s status. We intimate no views as to the private action enforcement issue upon which the present judgment is based.

Vacated and remanded.

      . § 304: Restriction on discharge from employment hy reason of garnishment

      (a) No employer may discharge any employee by reason of the fact that his earnings have been subjected to garnishment for any one indebtedness.

      . See 28 U.S.C. § 2106.


text:
    Chester McKINNEY, Petitioner-Appellant, v. James C. PARSONS, in his Capacity as Chief of Police of the City of Birmingham, Alabama, Respondent-Appellee.
    No. 73-2056.
    United States Court of Appeals, Fifth Circuit.
    Jan. 17, 1974.

      Robert Eugene Smith, Gilbert H. Deitch, Atlanta, Ga., Ferris S. Ritchey, Jr., Birmingham, Ala., D. Freeman Hutton, Atlanta, Ga., for petitioner-appellant.
    Herbert Jenkins, Jr., Asst. City Atty., Birmingham, Ala., for respondent-appel-lee.
    Before GODBOLD, ■ DYER and GEE, Circuit Judges.
   PER CURIAM:

Chester McKinney appeals from denial of his petition for habeas corpus relief from sentences imposed by the Circuit Court of Jefferson County, Alabama, following conviction on six charges of violating ihe Birmingham obscenity ordinance. One of appellant’s points on appeal is that the District Judge below improperly abdicated to the Magistrate his responsibility to reach a decision based upon a personal inspection of the allegedly obscene material. Because of our agreement with appellant on this point, we do not reach the substantive question of obscenity.

28 U.S.C. § 636 enables District Courts to establish local rules whereby United States Magistrates may be assigned duties “not inconsistent with the Constitution,” .including:

(3) preliminary review of applications for posttrial relief made by individuals convicted of criminal offenses, and submission of a report and recommendations to facilitate the decision of the district judge having jurisdiction over the case as to whether there should be a hearing. 28 U.S.C. § 636(b).

The United States District Court for the Northern District of Alabama has adopted rules which we construe to grant the local Magistrates such jurisdiction over petitions for habeas corpus as is allowed by the above quoted provision in the Federal Magistrates Act.

Upon the filing of McKinney’s petition, the District Judge referred it to a Magistrate for review and recommendation. The Magistrate considered the four magazines and two films involved and made a “finding” that all were obscene. The District Judge then entered a brief order which recites, “The Court hereby adopts and accepts this finding [of obscenity] made by the Magistrate,” and indicates that the Court’s conclusion was reached merely “[a]fter considering all the pleadings in this ease together with the Magistrate’s report. . . .’’It thus appears that the District Judge did not personally inspect the allegedly obscene material. This it was his ineluctable duty to do, with or without the preliminary assistance of the Magistrate. Whatever beneficial services Magistrates may properly render in habeas corpus and other eases, they may not be the sole arbiters of the decisive issue of obscenity.

Appellant would also have us hold that on remand the District Court is required to conduct an evidentiary hearing on his petition so that he may introduce expert testimony as' to whether the material is obscene. This contention has very recently been rejected in this Circuit. See Gornto v. MacDougall, 482 F.2d 361 (5th Cir., 1973). Habeas applicants are entitled to the same independent constitutional judgment on the issue of obscenity as are those on appeal; they are not entitled to a de novo proceeding.

We therefore vacate the order below denying relief to McKinney and remand for the District Judge to fulfill his obligation, however unpleasant, to reach a decision from personal inspection of the materials and the record in state court.

Vacated and remanded.

      . Independent constitutional review is required in this First Amendment case. We have no occasion to reach, and do not reach, the question of a magistrate’s power to conduct evidentiary hearings in habeas corpus cases in general. In this connection, we note, however, the recent decision of the Sixth Circuit that he has no such power. See Wedding v. Wingo, 483 F.2d 1131 (6th Cir., 1973).


author: HUFSTEDLER, Circuit Judge:

text:
    Fred DANFORD, Plaintiff-Appellee, v. Albert E. SCHWABACHER, Jr., et al., Defendants-Appellants.
    No. 72-1811.
    United States Court of Appeals, Ninth Circuit.
    Dec. 3, 1973.
    Rehearing Denied Jan. 24, 1974.
    Thomas A. Welch, and E. Judge Elder-kin (argued), San Francisco, Cal., for defendants-appellants.
    Thomas A. H. Hartwell (argued), of Cooley, Godward, Castro, Huddleson & Tatum, San Francisco, Cal., for plaintiff-appellee.
   OPINION

Before MERRILL and HUFSTEDLER, Circuit Judges, and HILL, District Judge.

HUFSTEDLER, Circuit Judge:

Schwabaeher & Company (“Schwa-baeher”) and its codefendants appeal from an order denying their motion to stay Danford’s district court, action pending referral of Danford’s claims to arbitration pursuant to 9 U.S.C. § 3. We hold that the order is not appealable.

The grant or denial of a stay of an action pending arbitration under 9 U.S.C. § 3 is not a “final decision” appealable under 28 U.S.C. § 1291. (Alexander v. Pacific Maritime Ass’n (9th Cir. 1964) 332 F.2d 266, 267; New England Power Co. v. Asiatic Petroleum Corp. (1st Cir. 1972) 456 F.2d 183.) Appellants did not attempt to invoke the Interlocutory Appeals Act of 1958 (28 U.S.C. § 1292(b)). Therefore, the appeal is foreclosed unless the denial of the stay is an interlocutory order refusing an injunction within the meaning of 28 U.S.C. § 1292(a)(1).

Determination of the section 1292(a)(1) issue necessarily requires an inquiry into the procedural anomalies created by the Enelow-Ettelson rule, which makes appealability turn on whether the underlying action is properly characterized as one “at law” or “in equity” as those terms were used prior to the merger of the two forms of action. The Supreme Court has recognized that the Enelow-Ettelson rule is a remnant from the jurisprudential attic and has confined its operation, but it has refused to discard the rule. (Baltimore Contractors, Inc. v. Bodinger (1955) 348 U.S. 176, 184-185, 75 S.Ct. 249, 99 L.Ed. 233.) In its surviving form, Enelow-Ettelson permits an appeal from an interlocutory order granting or denying a stay pending arbitration if (a) the action in which the motion for a stay was made could have been maintained as an action at law before the merger of law and equity, and (b) the stay was sought to permit prior determination of an equitable defense or counterclaim. (E.g., Chronicle Publishing Co. v. National Broadcasting Co. (9th Cir. 1961) 294 F.2d 744, 746; Standard Chlorine of Delaware, Inc. v. Leonard (2d Cir. 1967) 384 F.2d 304, 308; Jackson Brewing Co. v. Clarke (5th Cir. 1962) 303 F.2d 844, 845; see 9 Moore's Federal Practice tffl 110.20[3], 110.20 [4.-1] (2d ed. 1973).)

The second half of the Enelow-Ettelson test for appealability — interposition of an equitable defense or counterclaim — has been met in the case at bench. Reliance upon an arbitration agreement to avoid immediate litigation is deemed an equitable defense, even though the Chancellor might have been astonished to receive that intelligence. (Shanferoke Coal & Supply Corp. v. Westchester Service Corp. (1935) 293 U.S. 449, 452, 55 S.Ct. 313, 79 L.Ed. 583; Standard Chlorine of Delaware, Inc. v. Leonard, supra at 308.)

We are required, therefore, to examine the complaint to decide whether the first step of Enelow-Ettelson has been satisfied. Characterization of modern pleadings according to rules of a bygone legal system is a simple, though peculiar, exercise if the averments and prayers closely resemble either their legal or equitable ancestors. (E. g., Ross v. Twentieth Century-Fox Film Corp. (9th Cir. 1956) 236 F.2d 632, 633 (action for breach of contract clearly common law type action).) The difficulty of the task is not significantly increased when the legal and equitable claims are only slightly mixed. (E. g., Alexander v. Pacific Maritime Ass’n, supra at 267-268 (damage demands “plainly subordinate” to prayers for equitable relief).) However, Enelow-Ettelson is virtually impossible to apply to a complaint like Danford’s in which the averments and prayers are a purée of legal and equitable theories and of claims that had no antecedents in the old bifurcated system.

Danford alleged facts which, if true, reveal a scheme contrived by the defendants to induce Danford, by fraud, coercion, and various forms of conduct violating provisions of the federal securities laws, to become a general partner of Schwabacher in order to gain control of his customer account. Through personal investments during his 48 years of employment with Schwabacher, Danford had accumulated more than $1,500,000 in his account with the firm, a securities and commodities broker-dealer. Unknown to Danford, Schwabacher was in extremely poor financial condition when the defendants succeeded in persuading him to invest $15,000 for a partnership interest. Danford alleges that, through a series of misrepresentations and non-disclosures and under coercive pressure and economic duress, he was induced by defendants to execute a series of documents. Under the terms of the agreements he signed, Danford became both a partner in the firm and a member of the New York Stock Exchange, Schwabacher gained control of his customer account, and he participated in the merger of Schwabacher into Blair & Co., Inc. (“Blair”), another securities and commodities broker-dealer. Blair was also in financial difficulty when the merger occurred. It later succumbed, first to liquidation supervised by the New York Stock Exchange and then to involuntary bankruptcy proceedings.

Danford’s claims against Blair will be subordinated and all of Blair’s assets will be distributed to prior creditors. Accordingly, unless Danford either can undo his participation in these transactions or can be made whole by recovering damages from the defendants, his venture into the Schwabacher firm will cost him more than $1,500,000. Danford sought rescission, declaratory relief, and compensatory and punitive damages; he invoked both equitable and common law theories of recovery and asserted a right to relief under sections 12(2) and 17(a) of the Securities Act of 1933 (15 U.S.C. §§ 771(2), 77q(a)) and section 10(b) of the Securities Exchange Act of 1934 (15 U.S.C. § 78j(b)), which is neither “legal” nor “equitable,” but rather is “statutory.”

The dominant purpose test, suggested in Alexander v. Pacific Maritime Ass’n, supra, 332 F.2d at 267, and endorsed by Judge Friendly in Schine v. Schine (2d Cir. 1966) 367 F.2d 685, 688, as a way of solving the Enelow-Ettelson characterization problem, is not useful in this case because we cannot determine from the face of Danford’s complaint whether its legal features are stronger than its equitable components. We fashion a slightly different test of appeal-ability to meet the difficulty posed by Danford’s complaint: When a complaint is a homogenization of legal, equitable, and statutory elements, and it cannot fairly be said that either the legal or the equitable aspects predominate, the complaint shall be deemed equitable for the purpose of applying the Enelow-Ettelson rule.

We recognize that this test has its own inherent fiction. We nevertheless adopt it because it provides an answer to a problem that is otherwise unsolvable, an answer that comports with the policy of strictly limiting interlocutory appeals to those expressly authorized by statute. (See, e. g., Baltimore Contractors, Inc. v. Bodinger, supra, 348 U.S. at 178, 181, 75 S.Ct. 249.) Since 1958 interlocutory arbitration orders have been reviewable in accordance with the procedures prescribed by 28 U.S.C. § 1292(b). Utilization of a test less demanding than the one we adopt today would weaken the discretionary scheme embodied in section 1292(b), add vitality to the anachronistic Enelow-Ettelson rule, and frustrate congressional policy against piecemeal appeals.

The appeal is dismissed.

       Central District of California, sitting by designation.

      . 9 U.S.C. § 3 provides:
      “If any suit or proceeding be brought in any of the courts of the United States upon any issue referable to arbitration under an agreement in writing for such arbitration, the court in which such suit is pending, upon being satisfied that the issue involved in such suit or proceeding is referable to arbitration under such an agreement, shall on application of one of the parties stay the trial of the action until such arbitration has been had in accordance with the terms of the agreement, providing [sic] the applicant for the stay is not in default in proceeding with such arbitration.”

      . Section 1292(a)(1) provides: “The courts of appeals shall have jurisdiction of appeals from:
      “(1) Interlocutory orders of the district courts of the United States, the United States District Court for the District of the Canal Zone, the District Court of Guam, and the District Court of the Virgin Islands, or of the judges thereof, granting, continuing, modifying, refusing or dissolving injunctions, or refusing to dissolve or modify injunctions, except where a direct review may be had in the Supreme Court[.]”

      . Enelow v. New York Life Ins. Co. (1935) 293 U.S. 379, 55 S.Ct. 310, 79 L.Ed 440; Ettelson v. Metropolitan Life Ins. Co. (1942) 317 U.S. 188, 63 S.Ct. 163, 87 L.Ed. 176. See also Baltimore Contractors, Inc. v. Bodinger (1955) 348 U.S. 176, 75 S.Ct. 249, 99 L.Ed. 233.

      . Application of the Enelow-Ettelson rule cannot be escaped here as it was in Power Replacements, Inc. v. Air Preheater Co. (9th Cir. 1970) 426 F.2d 980 and A. & E. Plastik Pak Co. v. Monsanto Co. (9th Cir. 1968) 396 F.2d 710. In those two cases we held appealable orders denying motions to abate arbitration commenced before the initiation of the district court actions in which the motions were made, reasoning that the exercise of power to interfere with a proceeding already pending in a different forum is a “classic” form of injunctive relief and hence within the express terms of 28 U.S.C. § 1292(a)(1). (See 426 F.2d at 982-983 ; 396 F.2d at 713.) The motion before us, however, sought to stay the district court action in favor of a future arbitration.

      . Further details concerning the pleadings are supplied in the district court opinion, Danford v. Schwabacher (N.D.Cal.1972) 342 F.Supp. 65.

      . Cf. American Safety Equip. Co. v. J. P Maguire Co. (2d Cir. 1968) 391 F.2d 821, 824; 9 Moore’s Federal Practice If 110.20 [3], at 243-44 n. 23.

      . Speaking of complaints that mix prayers for legal and equitable relief, Judge Friendly observed: “The best solution of an essentially insolvable problem appears to be the dominant purpose test, with any fair doubt being resolved against the claim that the action was predominantly one at law.” (Concurring op’n.)