author: EASTERBROOK, Circuit Judge.

text:
    Hortencia BOHEN, Plaintiff, v. The CITY OF EAST CHICAGO, INDIANA, et al., Defendants.
    Civ. No. H 83-0484.
    United States District Court, N.D. Indiana, Hammond Division.
    Sept. 11, 1985.

      Milan D. Tesanovich, Portage, Ind., Ivan E. Bodensteiner, Linda D. Moskowitz, Valparaiso, Ind., for plaintiff.
    Anthony DeBonis, Jr., Janet Bowermaster, Murphy, McAtee, Murphy, East Chicago, Ind., for defendants.
   OPINION

EASTERBROOK, Circuit Judge.

Hortencia Bohen worked at the fire department of the City of East Chicago between December 3, 1979, and May 9, 1983. She was a dispatcher. Dispatchers usually work in teams of two on eight hour shifts. Each dispatcher works five shifts per week. Nine or ten dispatchers (the department’s usual complement) can maintain 24 hour service while permitting vacations and time off.

Dispatchers receive calls about fires and medical emergencies. They must know the nature of the building at almost every address in East Chicago in order to know what equipment to send to a fire, and they also must know the function and location of all of the department’s equipment. The job calls for knowledge and the ability to remain calm under stress. Knowledge and a prompt, calm response may save lives.

Bohen, whose national origin is Mexican, complained in 1982 to the Equal Employment Opportunity Commission that the de-' partment had discriminated against her on account of her sex and national origin. She protested harassment by Solomon Ard, the Fire Chief, and discrimination in the administration of discipline. According to the charge, both white and black dispatchers had escaped discipline for events that, when committed by Bohen, had led to admonitions. Before the EEOC could make a preliminary determination, Bohen asked for and received a letter giving her the right to sue. The letter was dated May 9, 1983. Bohen received another, less welcome, letter dated May 9. This one was from James Dawson, Deputy Chief in charge of personnel. Dawson’s letter fired Bohen, explaining: “We have tried to be as tolerant as possible of your irrational actions. Your behavior has gotten to the point where good order and discipline on the Department has been jeopardized. Some of the problems that you have created have been manifested in other areas of the Department. We in the Fire Administration have come to the conclusion that a person of your character would be counter productive to good order, discipline and security.”

Bohen makes three claims: first, that she was the victim of sexual harassment and assault at the department, which she says violated Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e to 2000e-17, and the fourteenth amendment to the constitution, for which 42 U.S.C. § 1983 supplies the remedy; second, that she was fired in retaliation for filing a complaint with the EEOC, which she maintains violated Title VII, the first and fourteenth amendments, and 42 U.S.C. § 1981; third, that she would not have been fired but for her sex and national origin, which she says violated Title VII and both the thirteenth and fourteenth amendments. A bench trial was held on August 16, 19, and 20, 1985. This opinion contains the findings and conclusions required by Fed.R.Civ.P. 52(a).

The evidence demonstrates that Bohen was the victim of sexual harassment on the job, but that she was fired for obstreperous and insubordinate conduct. The charge filed with the EEOC, her sex, and her national origin did not cause or contribute to the discharge. Because she was not disciplined or discharged for resisting the sexual advances or protesting the sexually offensive speech, she cannot establish any entitlement to back pay or reinstatement; because the fourteenth amendment does not independently prohibit sexual advances and innuendo, and the remedies under Title VII are limited to back pay, reinstatement, and similar equitable relief, the defendants are entitled to judgment.

I

Dispatchers usually work in pairs. They sit at a small console in the communications room of the main fire station. The console contains telephones, radios and other equipment for dispatching fire trucks and medical teams and for communicating with the men in the field. (“Men” here is not global for “people.” The department has never had a female firefighter.) The room also contains two tape recorders, one making a permanent record of all conversations on the telephones and the other usually set to record but also available to replay any recent conversation. The dispatchers must sit close together while working.

The communications room adjoins the apparatus floor of the main fire station. On the other side of the apparatus floor is the administrative wing, with offices for the fire chief, deputy and assistant chiefs, and staff, and space for training. The firefighters work 24-hour shifts (one day on, two days off) and live above the apparatus floor. The communications room contains a small lounge with chairs, TV, and a coffee pot. The ranking administrators of the department (including fire captains) sometimes congregate in this lounge, although they are not supposed to do so; on occasion active firefighters also visit the lounge.

Shortly after joining the department, Bohen was assigned to work the shift from 11:00 p.m. to 7:00 a.m. with Joseph Creviston, who had been a firefighter from 1950 to 1971 and had been rehired as a dispatcher in 1978 by Robert Pastrick, the Mayor of East Chicago. Creviston was then the senior dispatcher. From July 1980 until the middle of 1982 Creviston was the Head Dispatcher, the supervisor of all dispatchers. (He was replaced as Head Dispatcher in 1982 by Cyrus Horvath, a former firefighter who became a dispatcher after being injured.) Bohen testified that on the first night she worked with Creviston she took a short nap and awoke at 4:00 a.m. to find Creviston’s hands pressed against her crotch. She rebuffed him; he invited her out for a drink; she reported the incident to an assistant chief.

According to Bohen sexual incidents with Creviston “went on and on” as the two worked the graveyard shift until July 1980. Creviston would spread his legs while sitting at the console so that Bohen could not move without touching him. When Creviston was standing, he would rub his pelvis against her rear. He insisted that she not close the door of the bathroom when using it. (A bend in the hall prevents someone at the console from seeing into the bathroom even when the door is open.) Once she had to fight Creviston off with a clipboard while trying to dispatch some equipment to a fire. When Creviston spoke to her, the talk was entirely about sexual matters — in what positions he liked to have sexual relations, how Bohen should comport herself, and so on.

The worst passed with the end of their joint shift. But sex was on the mind of those who visited the lounge in the communications room during the day, and according to Bohen the conversation there was exceptionally vulgar, with conversations about sexual positions and practices dominating all else, even food and the weather. On one occasion, Bohen reports, one of the visitors (Captain Bianci) told Bohen that she needed someone “to drag her into the bushes for a good fuck.” This implied threat of rape may have been related to a rumor spread by some senior officers of the department that Bohen was a lesbian — a charge that led to her nervous exhaustion and to a stay of several days in a hospital.

Bohen testified that she repeatedly complained to senior officers of the department about the sexual harassment. Some of the complaints were made to Michael Jancek, then an Acting Deputy Chief, while Bohen and Jancek were dating for a few months in 1980. A memorandum from Bohen to Chief Ard, dated January 6, 1981, complains that Creviston “continues to make advances at me,” protests the order to keep the bathroom door open, and reports episodes of rubbing. According to Bohen the chief promised to discipline Creviston but did not. Bohen also testified that from time to time supervisors would ask if anything had been done or otherwise indicate knowledge of the problem. But nothing was done, and the department did not even have a written policy against sexual harassment until after Bohen had been fired. To the contrary, before she took the job, she was warned in an office interview with then-chief Paganelli that the firefighters were “kind of nasty” and would “try anything;” as a result, the chief informed her, she must not socialize with the men, must not enter the apparatus room, and must dress to cover herself from neck to toe. Sexual problems lay ahead, and the department put the entire burden on the female dispatchers.

Bohen’s story depicts the communications room at the department as a den of lechery, of men verbalizing their fantasies when she would not yield physically. She reports that the atmosphere made the job unpleasant, that she became withdrawn, that she would take out her frustrations in pointless anger against her two children and her boyfriend, that she all but stopped talking with men on the job and off. She suffered humiliation, anguish, and the costs of two brief stays in the hospital.

The department in turn depicts Bohen as a liar. Almost every person who Bohen charged with sexual harassment — or with knowing about the problems she suffered — took the stand and denied both harassment and knowledge. Creviston denied making advances; two other female dispatchers (Adelle Herrera Granda and Constance Turner) denied that they had been hassled or that Bohen had complained to them; Chief Ard, Deputy Chiefs Dawson, Podkul, and Melyon, and Assistant Chiefs Jancek and Rizzardo all denied knowledge of any harassment. They portrayed Bohen as a chronic complainer (the personnel files of other employees are indeed full of complaints filed against them by Bohen), a malcontent who could not accept criticism and who lashed out against all who crossed her.

Bohen doubtless is a complainer, and as I explain below her outbursts and unsupported accusations against others were a sufficient cause of her discharge. There are, moreover, many other reasons to doubt her testimony. Her story has changed repeatedly. The charge filed with the EEOC does not mention sexual harassment. It mentions harassment by Chief Ard, but this pertains to an allegation of physical abuse. Bohen testified at her deposition only to the incidents of rubbing; the offensive touching and the clipboard incident came out only at trial. Bohen conceded that she had lied to Jancek about her efforts to obtain a uniform (one of the events for which she received discipline), although she also tried to say the lie had been harmless.

Some of Bohen’s testimony is simply incredible. For example, she testified that she had filed many complaints against Creviston because, she believed, he regularly came to work drunk. None of the personnel files at the department contained these complaints, Bohen asserted, because she had given them all to the EEOC, which had confiscated them. How she came to have the complaints, or why the EEOC would confiscate them (they did not show up in the EEOC’s investigative file) remains a mystery. Bohen also gave a vivid description of her firing. She had been away from work and returned on Friday, May 13, 1983. When she arrived at work she was summoned to the administrative wing where the senior officers were assembled. One officer tossed a letter to her (the one telling her she was fired), while all laughed at her discomfort and Jancek proclaimed: “It’s Friday the 13th, and don’t you ever forget today.” Yet at her deposition Bohen stated that she had learned of the discharge on Monday, May 9, and on cross-examination and redirect (as well as in an amendment to the deposition) Bohen changed the date of the meeting to Thursday, May 12. The vivid picture turned out to be an imagined one. A final example. Bohen asserted that during one confrontation Jancek injured her, causing a bruise that she showed a day or two later to Chief Ard when complaining about Jancek. But she also admitted that the event was at most an accidental touching with a pen in the course of signing a document. She did not explain how an accidental touch with a pen could cause a bruise, or why she would make a point of displaying the bruise to the fire chief. These and several more episodes, which I discuss below, cast substantial doubt on Bohen’s willingness to tell the truth — or perhaps on her ability to separate truth from fiction in her own mind.

Yet for all this I am convinced that Bohen was the victim of sexual harassment, just as she described it. Her testimony was strongly corroborated by Francine Rivera-Breger, now the assistant supervisor of dispatchers. Rivera-Breger joined the department in January 1979, and the defendants portray her as a model dispatcher — knowledgable, dedicated, cool under pressure, and very easy to work with. Her testimony was most impressive. She received the same initial warning from then-chief Paganelli. She recounted a harrowing series of encounters with Creviston during her initial (probationary) year. There is no need to relate them; they make Creviston’s advances on Bohen seem mild. Rivera-Breger says that she reported these encounters to Deputy Chief Podkul, though in less detail than on the stand. (It is easy to see why. It must be hard to report such personal humiliation to supervisors known to be life-long friends of Creviston. Rivera-Breger, said to be very strong, broke down on the stand even though Creviston’s advances ended in late 1979. And an expert witness testified that reticence about complaining and a diminished sense of self-worth are common in cases of sexual harassment.) Podkul denied receiving these reports, but Podkul had trouble remembering many other things, and I give his testimony little weight. There was another important source of corroboration. John Wozniak, formerly the head of training at the department, confirmed that firefighters engage in some pretty raw sexual talk. This was usually — but not always— kept out of the communications room. No surprise that firefighters behave this way, and it supports Bohen’s story.

Creviston denied everything. He denied coming to work under the influence, but every witness had heard about or seen evidence of his drinking. One incident illustrates the distance between Creviston and the truth. One night he arrived at the fire station with Carol Buitrón, another dispatcher, after an automobile accident. At Bohen’s request Creviston’s daughter arrived to take him home, and there was a shouting match in which his daughter accused him of infidelity to his wife. Witnesses too numerous to count described this traumatic event in the life of the fire station. Creviston, however, denied that anything had happened. Just a little scrape, said he, and I called my daughter who took me home without incident. As for drinking, I drank only an occasional beer with a sandwich, never anything more. The man’s testimony was fabricated from beginning to end.

I find that Creviston touched Bohen offensively and repeatedly, that Creviston insisted that Bohen keep the bathroom door open, that Captain Bianci made a veiled threat of rape, that the conversation in the fire station was filled with lurid sexual descriptions, and that when Bohen declined to take part in all this good fun some officers spread a rumor that Bohen is a lesbian. Jancek, Podkul, and other supervisory officials knew the general picture if not the details; more, Creviston was himself a supervisor, and his conduct is properly attributed to the department under 29 C.F.R. § 1604.11(d). See Horn v. Duke Homes, 755 F.2d 599, 604 (7th Cir.1985). But Bohen did not yield to any of this, and participating in sexual escapades was not a requirement of the job or a method of advancement on the job. The sexually offensive atmosphere simply made working as a dispatcher a great deal more aggravating and humiliating; had Bohen been male, she would not have suffered as she did. The sexual harassment was in that sense a “condition” of employment, just as it would have been a discriminatory “condition” of employment if women were required to work in dirtier or noisier places than men.

II

Bohen maintains that she was fired in retaliation for filing the charge with the EEOC and obtaining the right to sue. If that is so, she is entitled to relief. See Klein v. Trustees of Indiana University, 766 F.2d 275 (7th Cir.1985). She also maintains that even if she was not a model employee, she would not have been fired if she were black. Again, if that is so she is entitled to relief. See McDonald v. Santa Fe Trail Transportation Co., 427 U.S. 273 (1976). I need not decide whether Bohen has established a prima facie case on either line of argument. The department offered a plausible reason for her discharge. Now that the trial has been held, the only question is whether Bohen established that her charge, her sex, or her national origin was a but-for cause of her discharge. See Texas Department of Community Affairs v. Burdine, 450 U.S. 248, 254-55, 101 S.Ct. 1089, 1094, 67 L.Ed.2d 207 (1981); United States Postal Service v. Aikens, 460 U.S. 711, 715-16, 103 S.Ct. 1478, 1482-83, 75 L.Ed.2d 403 (1983).

She did not. The department demonstrated that almost from the day she joined the department Bohen was a eomplainer whose deportment became more and more obnoxious. For example, in February 1980, two months after she arrived, Bohen became involved in a shouting match with Connie Turner in which the two hurled epithets at one another — racial epithets from Bohen to Turner (who is black) and sexual epithets from Turner to Bohen (who Turner accused of being a lesbian). The two were about to come to blows (Turner was armed with the coffee pot) when supervisors intervened. The cause of the dispute is obscure. Bohen stalked off the job rather than discuss the affair. She was reprimanded and not paid for the day. Turner was reprimanded and relieved from duty for one day. Both were warned that further confrontations would lead to dismissal. Supervisors had legitimate concern that personal grievances not get in the way of performance on the job.

Turner promptly quit. In Bohen’s case there were many further confrontations. With the exception of Rivera-Breger, every witness in the case described Bohen as high strung and stuck up (she had two years of college and apparently never let anyone forget it, and she also made it painfully clear to all that she was much better at her job than they at theirs). When someone pointed out a flaw in her performance, she would deny the flaw and then try to find the same flaw in others. (Many of her written complaints against others are in the record.) Bohen also was nosy. Adelle Herrera Granda described an incident in which Bohen called Herrera’s boyfriend to pass on a rumor that Herrera was not entirely faithful to him. Needless to say this caused a set-to. Many witnesses testified that Bohen would abjure the small rules of the office — the uniform, the requirement that dispatchers stay at the console at all times — and that this caused a great deal of friction.

Many unpleasant episodes give the flavor of the working relation. In February 1982 Jancek informed Bohen, who had not been wearing the regulation uniform for 3V2 months, that she must do so immediately. She replied that it was not ready to be picked up. Further inquiry showed that this was because she had not appeared for a fitting. Jancek attempted to deliver a written reprimand, but Bohen refused to sign the reprimand to acknowledge its receipt. There followed a shouting match with Jancek, another shouting match with Creviston, and two charges of insubordination.

In March 1982 Assistant Chief Rizzardo, by all accounts a mild-mannered person, charged Bohen with making sarcastic remarks to him over the radio. Jancek reported in writing at the time that at a hearing to determine the truth of the matter Bohen took the charge, stuffed it in her bra, and huffed away; she denies all of this. According to Bohen, her perfectly civil denial of an unjust charge led to a meeting in Chief Ard’s office in which the chief tried to hoist her by her lapels, striking her on the chin. More on this below.

By April 1982 — well before Bohen filed a charge with the EEOC — things were sufficiently strained that Jancek asked Chief Ard to fire Bohen. Jancek’s memorandum to the chief charges that Bohen “shows no regard for the feelings and situations of her co-workers, causing constant turmoil and dissention, which in turn effects her co-workers ability to function”, that she “refuses to accept constructive criticism and further more will and does blame her mistakes on others”, that whenever reprimanded she “will bring race into the issue”, that she “displays severe persecution complex”, and perhaps most importantly from Jancek’s perspective that she “shows no respect for Departmental Authority and has constantly displayed abusive language and insubordinate action to Authority.” I conclude that as of April 1982 all of these charges were accurate descriptions of Bohen’s behavior and relations on the job. But Chief Ard rejected Jancek’s recommendation. He made a note on the memorandum that he had elected to give Bohen a verbal reprimand and another chance.

Things apparently did not improve. In addition to mundane events, the record shows an exchange of verbal abuse between Bohen and Deputy Chief Dawson in December 1982. Bohen wanted access to her personnel file, and Dawson’s request that she put the request in writing led to an extended contretemps. Bohen was charged with insubordination again and docked two days’ pay after she refused either to acknowledge the charge or attend the hearing on it.

On January 4, 1983, Bohen filed a criminal complaint against Chief Ard. She swore out the complaint based on the battery that she says occurred in Chief Ard’s office in March or April 1982. This charge also was a centerpiece of the conciliation hearing before the EEOC in January 1983, which Chief Ard attended. Bohen says she filed the charge because otherwise the EEOC would not believe her allegations against Ard. But the very fact of delay from March until January casts doubt on the veracity of the story. Chief Ard says that he left the conciliation hearing disgusted, not wanting to see Bohen again. I do not blame him, for the filing of an unfounded charge of battery is serious business. The local prosecutor declined to press the case. Chief Ard denies that the incident occurred, and I believe Chief Ard.

On February 17, 1983, Bohen filed a new charge, this time alleging that Assistant Chief Mulle had slashed the tires of her car. She complained to the police (who took no action), to the small claims court (which ruled in favor, of Mulle), and to the department, which opened an investigation. Mulle and Creviston (who had been in the parking lot when Mulle supposedly did the deed) signed written denials. Bohen demanded that polygraph tests be administered to both principals. Mulle took the test and passed. Bohen refused to take the test, ultimately bringing in a letter from counsel advising her not to do so. The letter gave no reason. Deputy Chief Dawson then issued a finding absolving Mulle from the charge.

There may have been some further unpleasantries, but apparently the criminal charges against Ard and Mulle exceeded the department’s endurance. Dawson drew up the letter firing Bohen while Ard was in the hospital, and when Ard returned to work he immediately consented to the idea. Dawson discussed the matter with the other senior members of the staff; there was no dissent.

Bohen argues, and both Dawson and Ard conceded, that none of the incidents standing alone led the department to fire her. There is some conflict in the testimony about the timing of the decision and which incident was deemed the last straw. It may even be that the chief responsibly could have given Bohen still another chance (although she had been teetering on the brink of dismissal since February 1980). An employer may conclude that incidents, individually not enough to discharge an employee, collectively demonstrate that the employment should come to an end. At all events Title YII does not require careful employment decisions. It does not establish merit selection in employment. A decision need not be right to be lawful; it is enough that the decision be the same one that would have been made if the employee were of a different sex or national origin, or if the employee had not filed the charge with the EEOC. See Furnco Construction Corp. v. Waters, 438 U.S. 567, 577-78, 98 S.Ct. 2943, 2949-50, 57 L.Ed.2d 957, 96 S.Ct. 2074, 2079-80, 48 L.Ed.2d 684 (1978); Bishop v. Wood, 426 U.S. 341, 349-50 (1976); Nellis v. Brown County, 722 F.2d 853, 858-61 (7th Cir. 1983). I am convinced that the decision to fire Bohen had been coming for a long time, and that the charge, her sex, and her national origin had nothing to do with the decision. The reasons to let her go were more than sufficient.

Now it might be that the department could not have fired Bohen for obstinate conduct if the sexual harassment were the cause of her attitude. I conclude, however, that it was not. Although an expert on sexual harassment testified for Bohen that harassment may lead to tension, anxiety, loss of sleep, diminished self-worth, nausea, cramps, and headaches, the expert did not suggest that harassment commonly leads to prolonged shouting matches and the filing of false criminal charges. Bohen was in trouble in February 1980, only two months into her employment; ours is not the case of a mild-mannered person slowly driven mad by unwanted sexual attention. A conclusion that the sexual harassment caused the attitudes that led to Bohen’s discharge would be pure speculation.

In saying that Bohen would have been fired no matter what, I have not overlooked her evidence of disparate treatment. Often the differential treatment of similarly-situated employees will be the best evidence of the motive for an action. The employer may deny taking sex into account — may even consciously believe that the employee’s sex, race, or origin did not matter — yet still violate the statute if one of the prohibited grounds in fact accounts for the action. See Mozee v. Jeffboat, Inc., 746 F.2d 365 (7th Cir.1984). Subconscious discrimination is nonetheless unlawful, and comparative evidence may be the best, even the only, way to find out what really matters to employment decisions.

Problems of attitude to one side, Bohen was a capable dispatcher. She has several commendations from Chief Ard. She scored second-best (behind Rivera-Breger) in a test of knowledge of what equipment to send to what kind of fire where. The training officer testified that she had good potential. Bohen’s comparative evidence is essentially that many of the employees who did not get fired were incompetent. Creviston is a drunken letcher. Carol Buitrón often arrived late and was not very good at the job when she arrived; once she was suspended for intoxication on the job. Delores Peterson was not very good. Catherine Casey was illiterate and incapable of sending the right equipment to the right place. Peterson and Casey are black, Creviston and Buitrón white.

Although the record contains evidence that Buitrón and Casey were disciplined, neither was fired. Creviston was made Head Dispatcher for two years and never disciplined. Peterson was tolerated for a long time; she is no longer with the department and may have been fired, but the record is unclear. The evidence is strongest with respect to Casey. Everyone at the department, from training officer to fire chief, regarded Casey as incompetent. For some time she was assigned to work in teams of three dispatchers; the other two apparently would do the work. The most anyone will say about Casey’s performance even today is that she has “improved;” no one says that she is good at the job.

Despite all this, I am convinced that sex and national origin played no role in Bohen’s discharge. None of the other employees charged Chief Ard or any other supervisor with a crime. Casey and Creviston apparently have political or personal patrons — Chief Ard for Casey, Mayor Pas-trick for Creviston. The position of dispatcher is not covered by the civil service, and patronage systems have been known to tolerate incompetence in employees of any color, age, and sex. Perhaps more important, I cannot resist the conclusion that in the fire department of the City of East Chicago competence is not highly valued. Creviston and then Cyrus Horvath got to be supervisors instead of Francine RiveraBreger because they were friends of the higher-ups, not necessarily because they were best for the job. (This is not the same as veiled discrimination, either. Chief Ard and Deputy Chief Dawson are black, other supervisors are white of many national origins, so that almost everyone had a potential friend. Friendship and political patronage are outside Title VII, and the fact that both the patron and the beneficiary must have some race and sex does not mean that Title VII prohibits all patronage.)

The department can and does live with substandard performance. There are two dispatchers on duty; one can cover for the other. What this paramilitary organization cannot live with is sass. Backtalk, disrespect, inattention to Authority — these are the capital offenses. They require disciplinary tribunals that consume time; and when the subject of the discipline does not fess up, the supervisors feel belittled.

This attitude may be good or bad. That really does not matter. What does matter is that a demand for respect is a dispositive factor other than sex, national origin, and the filing of a charge with the EEOC. Cf. Connick v. Myers, 461 U.S. 138, 103 S.Ct. 1684, 75 L.Ed.2d 708 (1983) (rejecting a first amendment challenge to a discharge for backtalk and rabble-rousing in the office). All of the other employees meekly jumped when Authority told them to jump. There is uncontradicted testimony that Casey and the others were cooperative, took correction well, and tried. The department was willing to excuse inadequate results. It was not willing to excuse sass. This is a choice a local government may make without violating Title VII or the constitution.

Ill

Bohen was the victim of harassment on account of her sex. But because she did not quit in disgust, and instead was fired for cause, she would not be entitled to reinstatement or back pay even if I should conclude that the harassment violated Title VII. Does the statute give Bohen any other remedy? The remedial provision, 42 U.S.C. § 2000e-5(g), states that a court may enjoin the employer from engaging in an unlawful practice “and order such affirmative action as may be appropriate, which may include, but is not limited to, reinstatement or hiring of employees, with or without back pay ... or any other equitable relief as the court deems appropriate.”

Bohen lacks standing to obtain an injunction or other “affirmative action” concerning the department, where she will not work again. See City of Los Angeles v. Lyons, 461 U.S. 95, 101-05, 103 S.Ct. 1660, 1664-66, 75 L.Ed.2d 675 (1983). Because the statute is limited to “equitable” relief, I also may not award damages, whether punitive or compensatory for mental anguish. Great American Federal Savings & Loan Association v. Novotny, 442 U.S. 366, 375, 99 S.Ct. 2345, 2350, 60 L.Ed.2d 957 (1979) (dictum); Bundy v. Jackson, 641 F.2d 934, 946 n. 12 (D.C.Cir.1981); DeGrace v. Rumsfeld, 614 F.2d 796, 808 (1st Cir.1980) (collecting cases). The Eighth Circuit once suggested that compensatory damages for humiliation or emotional suffering are available under Title VII, but it has reversed itself. Compare Williams v. Trans World Airlines, Inc., 660 F.2d 1267, 1272-73 (8th Cir.1981), with Muldrew v. Anheuser-Busch, Inc., 728 F.2d 989, 992 n. 2 (8th Cir.1984).

The Seventh Circuit has not addressed this question, but I think it likely to follow these decisions. The statute authorizes back pay and “other equitable relief”. An award of damages for humiliation and anguish is classic “legal” relief. It is compensation for harm done, not a restoration to a prior position. Title VII could not permit “legal” relief without affording both parties the right to trial by jury, which it does not. Every court that has considered the question has helti that because the statute permits only “equitable” relief, the Seventh Amendment does not apply. See Novotny, supra, 442 U.S. at 375 n. 19, 99 S.Ct. at 2350 n. 19 (collecting cases). Cf. Curtis v. Loether, 415 U.S. 189, 196-98, 94 S.Ct. 1005, 1009-10, 39 L.Ed.2d 260 (1974), in which the Court characterizes Title VII as authorizing only equitable relief and for that reason distinguishes Title VIII of the Civil Rights Act of 1968, which the Court holds permits recovery of actual and punitive damages and therefore is covered by the Seventh Amendment.

The remedial provisions of Title VII were designed to track those of the National Labor Relations Act, 29 U.S.C. § 160(c). See Albemarle Paper Co. v. Moody, 422 U.S. 405, 419 & n. 11, 95 S.Ct. 2362, 2372 & n. 11, 45 L.Ed.2d 280 (1975). The NLRA permits only reinstatement, back pay, and related equitable relief. An employee repeatedly insulted and harrassed on account of his membership in a union has no remedy unless he is fired (or quits in a constructive discharge), or unless the NLRB requires the employer to alter its employment practices in the future. The offended employee’s remedy is under the state law of torts, not under the federal statute. And so it goes with Title VII. E.g., Walker v. Ford Motor Co., 684 F.2d 1355, 1363-65 (11th Cir.1982).

A number of courts nonetheless have held that a harrassed employee may obtain “nominal damages” under Title VII. E.g., Katz v. Dole, 709 F.2d 251, 253 n. 1 (4th Cir.1983); Henson v. City of Dundee, 682 F.2d 897, 905-06 & n. 12 (11th Cir.1982) (collecting cases). The impetus for these holdings is pretty plain. In a case such as Bohen’s, in which back pay or reinstatement is impossible, if all sources of compensatory damages are foreclosed then the defendants must prevail in the litigation. A court may not enter a declaratory judgment of liability, for that would be an advisory opinion. The parties no longer have a live controversy about how the fire department shall run its operations; Bohen has no interest in anything but damages. If she cannot get damages she must lose outright. See Ashcroft v. Mattis, 431 U.S. 171, 97 S.Ct. 1739, 52 L.Ed.2d 219 (1977).

Judgment for the defendants means that the plaintiff does not get the psychological boost that comes from a judicial recognition that she has been wronged; it also means that her counsel cannot receive attorneys’ fees from the defendants. The plaintiff’s desire for psychological vindication, however deeply felt, cannot keep alive a case that is otherwise moot. See Ashcroft, supra; Lyons, supra; cf. Allen v. Wright, — U.S. -, 104 S.Ct. 3315, 3326-27, 82 L.Ed.2d 556 (1984) (abstract stigmatic injury is not a basis of standing); Valley Forge Christian College v. Americans United for the Separation of Church and State, Inc., 454 U.S. 464, 482-87, 102 S.Ct. 752, 763-66, 70 L.Ed.2d 700 (1982) (mental distress caused by violations of law do not give standing when there is no other basis of relief). Thus it is no surprise that judges have strained to find some way to award damages to people for whom reinstatement and back pay are foreclosed.

Although I understand why some courts permit the award of nominal damages, I do not agree with their decisions. Nominal damages are not “equitable” relief within the meaning of Title VII. The statute does not mention them, and I could not award them without offering the defendants a jury trial. Too, “nominal” damages are not something a court awards just to keep a case alive. The traditional award of one dollar is the remedy in a case in which compensatory relief is available in principle, but plaintiff did not establish the amount of injury and so cannot obtain a substantial award. Substantial injury yields a substantial award, nominal injury a nominal award. See Carey v. Piphus, 435 U.S. 247, 262-67, 98 S.Ct. 1042, 1051-54, 55 L.Ed.2d 252 (1978). A judge who lacks the power to award substantial damages that have been proved — and Bohen’s anguish would support an award of at least $20,000 in compensatory damages — may not use nominal damages as heart balm. The reasons that block an award of actual damages also block an award of nominal damages. See Harrington v. Vandalia-Butler Board of Education, 585 F.2d 192, 198 n. 6 (6th Cir.1978).

Because Bohen may not recover any award under Title VII, defendants must receive judgment whether or not there was a violation. I therefore do not decide whether Bohen would be entitled to relief if it were possible to award damages. Several courts of appeals have held that a sexually oppressive working environment violates Title VII because the humiliation women face is a “condition” of employment from which men are excused. This is undoubtedly so if submission to sexual advances is required for employment; then sexual favors are a requirement (“term or condition”) imposed on women but not on men. It is not so clear that “term or condition” of employment — which ordinarily means a written rule or requisite for being or staying employed, cf. Hishon v. King & Spalding, 467 U.S. 69, 104 S.Ct. 2229, 81 L.Ed.2d 59 (1984) — also encompasses the amenities of life on the job. There is no pertinent legislative history, and arguments on this subject may be made in several directions. Compare Vinson v. Taylor, 753 F.2d 141 (D.C.Cir.1985), with id., 760 F.2d 1330 (D.C.Cir.1985) (Bork, J., dissenting from the denial of rehearing en banc). The unavailability of any relief in this case makes it inappropriate for me to decide whether Bohen would have prevailed on the merits.

The restrictions on relief under Title VII do not apply to 42 U.S.C. § 1983. To recover compensatory or punitive damages under § 1983, however, Bohen must establish á violation of the equal protection clause of the fourteenth amendment. The Supreme Court has not held that sexual harassment violates the constitution. The Seventh Circuit once hinted that it does, see Huebschen v. Department of Health and Social Services, 716 F.2d 1167 (7th Cir.1983), but the case held only that there had been no distinction on account of sex and so did not reach the issue.

As an original matter it is most unlikely that the male legislators who enacted the fourteenth amendment well before women could vote created a right to be free of sexual harassment, or of any other distinctions on account of sex. When Reed v. Reed, 404 U.S. 71, 92 S.Ct. 251, 30 L.Ed.2d 225 (1971), first held that a distinction on the basis of sex is unconstitutional, it did so on the argument that sex was an irrational ground of distinction for the legislation at hand. Cf. Davis v. Passman, 442 U.S. 228, 99 S.Ct. 2264, 60 L.Ed.2d 846 (1979) (government may not decline to hire on the basis of sex). Since Reed the Court has repeatedly declined to place sex among the categories, such as race, that are almost always off limits to decisionmakers. Yet even with respect to race, the Court has never held that harassment and humiliation standing by themselves violate the fourteenth amendment.

Although in one sense the “government” has interfered with Bohen’s peace of mind and has denied her a working environment on a par with that available to male employees, in another sense the “government” has done nothing at all. The employees of the fire department all have their private agendas, some of which include making sexual advances on other employees or otherwise being obnoxious. The fundamental decision of the department was to do nothing — to offer no protection to its female dispatchers against the depradations of male employees. So far as this record shows, the decision to be passive offered everyone “equal protection” from such depradations — that it, the department offered no one protection of any kind. Males could accost females, males could accost males, females could accost males, females could accost females, and if the department had any bisexuals they could have accosted everyone in sight. The department did not offer women a lower degree of protection; no protection is all it offered anyone.

This may be cruel, but it is not unconstitutional. The constitution is a charter of negative liberties and does not require the state to protect women from rape and murder, let alone from obnoxious conduct by fellow workers. See Hinman v. Lincoln Towing Service, Inc., 771 F.2d 189, 194 (7th Cir.1985) (collecting cases). Title VII may impose such affirmative duties on employees, but the constitution is a different matter. The state is essentially a neutral bystander here. True, the department as an entity can be said to “know” — as much as a collective entity knows anything — that some women do not receive the same psychic benefits on the job even though they have the same formal conditions and salary as men. But this is not the same thing as intentional discrimination against women as a class. The equal protection clause does not proscribe all disparate effects; it bans only intentional discrimination. Here there was no decision by Chief Ard (or anyone else acting in the interests of the City or the Department) to treat women differently “because of” the injury it would do them; sexual harassment hurts rather than helps the government, because it makes it harder to attract competent employees; there was at most a decision to be passive “in spite of” the costs to the female dispatchers. Personnel Administrator of Massachusetts v. Feeney, 442 U.S. 256, 279, 99 S.Ct. 2282, 2296, 60 L.Ed.2d 870 (1979).

The constitution is not a fount of tort law. Parratt v. Taylor, 451 U.S. 527, 101 S.Ct. 1908, 68 L.Ed.2d 420 (1981); Baker v. McCollan, 443 U.S. 137, 99 S.Ct. 2689, 61 L.Ed.2d 433 (1979); Paul v. Davis, 424 U.S. 693, 96 S.Ct. 1155, 47 L.Ed.2d 405 (1976). In a number of states sexual harassment now is deemed tortious. The tort is similar to the intentional infliction of emotional distress, which is a few decades old but still, compared with the fourteenth amendment, quite new. See Prosser & Keeton, Torts § 12 (5th ed. 1984). The Seventh Circuit recently held that this tort — like libel, the much older tort discussed in Paul — is not secured by the fourteenth amendment. See Cameron v. IRS, 773 F.2d 126, 129 (7th Cir.1985). Cf. Gumz v. Morrissette, 772 F.2d 1395, 1408-09 (7th Cir.1985) (Easterbrook, J., concurring). Employees of the government may commit the tort without simultaneously violating the constitution.

For that matter, the constitution did not abolish the fellow servant rule of tort law. Well after the effective date of the fourteenth amendment, an employee could not recover from the employer for injuries inflicted by the negligence of fellow employees. Still less could the employee recover from the employer for the intentional torts of fellow employees; these were said to be personal frolics, outside the scope of employment. Tort law has changed dramatically in the interim, but the constitution neither requires nor follows all of these changes. Under § 1983 a governmental entity is responsible only for its own decisions and wrongs; not even so mundane a principle as respondeat superior (which predated 1869) applies. See City of Oklahoma City v. Tuttle, — U.S. -, 105 S.Ct. 2427, 85 L.Ed.2d 791 (1985). So even if sexual harassment when perpetrated as a matter of governmental policy violates the equal protection clause, Bohen cannot benefit from such a rule; the harassment here was not a matter of policy. And the people who did harass Bohen were not exercising governmental power.

This leads to a harsh result; Bohen loses even though she has been seriously wronged. But the constitution is an old document, and courts cannot mold it like Silly Putty to fit every new shape. The constitution is a framework of government, not a book of nostrums for every modern ill. Governments at many levels, and courts shaping the law of torts through the method of the common law, may respond to Bohen’s legitimate grievance. Congress has not yet dealt with cases in which harassment does not lead to discharge, and Bohen has not sought relief under state law. The disposition of this case may suggest to legislative bodies the need for attention to existing rules, but Bohen, unfortunately, must lose today. The clerk will enter judgment for the defendants.

      Of the Seventh Circuit, sitting by designation.

      . The defendants have not argued that the omission of sexual harassment from the charge precludes this Title VII litigation, and because the omission is not “jurisdictional” it is not appropriate for me to resolve the case on that ground. Cf. Jenkins v. Blue Cross Mutual Hospital Insurance, Inc., 538 F.2d 164 (7th Cir.) (en banc), cert. denied, 429 U.S. 986, 97 S.Ct. 506, 50 L.Ed.2d 598 (1976). Similarly, the defendants have not argued that the charge is untimely with respect to any incidents of harassment. Again the issue does not destroy subject matter jurisdiction. Zipes v. Trans World Airlines, Inc., 455 U.S. 385, 102 S.Ct. 1127, 71 L.Ed.2d 234 (1982).

      . For reasons discussed in Part III, I do not decide whether this is the meaning of “condition" in Title VII. It may be that "terms or conditions of employment” refers to the formal rules and standards of the job, rather than the amenities of work.

      . Bohen actually lost only one day's pay. One general note: Here and elsewhere, I need not and do not resolve who was in the right in these confrontations. The point is that the shouting match itself, and the refusal to attend the hearing, are well documented.

      . I do not mean that a plaintiff must produce an expert who links her problems to the harassment. "Experts” on this subject know no more than judges about what causes mental changes — which is to say that they know almost nothing. If Bohen had established some gradual change in her personality, I would be inclined to find causation. But Bohen did not do this; there is no evidence about her history of earlier employment (other than the fact that she held jobs, at least one of very short duration). None of her friends or children testified about her demeanor and how it changed over time. Bohen maintained, indeed, that the shouting matches never occurred, so perhaps she would have had a hard time simultaneously arguing that she came unglued as a result of harassment.

      . I put to one side the possibility that a court may give judgment for plaintiffs just because that would permit an award of fees. Such bootstrapping would eliminate the "case or controversy" requirement of Article III. Any plaintiff — even a bystander to the events in question — -could obtain a judicial decision by pointing to the fact that if he won the court would award fees, even if he was entitled to no other relief. I doubt that Congress meant, when creating an entitlement to fees, to wash away two centuries of jurisprudence limiting the power of federal courts to give advisory opinions. Unless a plaintiff establishes a right to relief independent of the desire to obtain legal fees, a court should not reach the merits of the dispute.

      . See the series of cases awarding sums in this range for unwarranted strip searches. E.g., Joan W. v. City of Chicago, 771 F.2d 1020 (7th Cir.1985). The humiliation Bohen suffered, and its effects, are at least as serious.

      . E.g., Katz v. Dole, 709 F.2d 251 (6th Cir.1983); Henson v. City of Dundee, supra; Bundy v. Jackson, 641 F.2d 934 (D.C.Cir.1981). The Seventh Circuit has held that an employer may not make “sexual consideration" a condition of employment but has not decided whether simple harassment violates Title VII. Horn v. Duke Homes, supra, 755 F.2d at 603 & n. 2. See also Rucker v. Higher Educational Aids Board, 669 F.2d 1179, 1182 (7th Cir.1982), which suggests in dictum that a working environment unpleasant on racial grounds is an unlawful “condition” of employment under Title VII.

      . If Bohen had shown that the department caused her harassment to advance some governmental interest, or maybe even the political career of Chief Ard, this might have been a different case. Cf. Bart v. Telford, 677 F.2d 622, 625 (7th Cir.1982).


source: Caselaw Access Project

author: REA, District Judge.

license: Public Domain

text:
    Seymour LAZAR On Behalf of Himself and All Others Similarly Situated, Plaintiff, v. James D. SADLIER, et al., Defendants. Dr. Harold GELB, as Trustee of the Harold Gelb, DMB, PC, Pension Plan, and All Others Similarly Situated, Plaintiff, v. James D. SADLIER, et al., Defendants.
    Nos. CV 84-8100 WJR(Px), CV 84-8781 WJR(Px).
    United States District Court, C.D. California.
    Sept. 23, 1985.

      William S. Lerach, Milberg, Weiss, Bershad, Specthrie & Lerach, San Diego, Cal., Ernest T. Kaufman, Los Angeles, Cal., for plaintiff.
    Briane Nelson Mitchell, Paul, Hastings, Janofsky & Walker, Los Angeles, Cal., for defendant Ernst & Whinney.
    Philip Gustlin, Gustlin, Golob & Bragin, Los Angeles, Cal., for defendant James D. Sadlier.
    Loyd P. Derby, Morgan, Lewis & Bockius, Los Angeles, Cal., for defendant Henry Scheinberg.
    Eugene W. Bell, Jones, Bell, Simpson & Abbott, Los Angeles, Cal., Henry Minnerop, Brown, Wood, Ivey, Mitchell & Petty, New York City, for defendants A.G. Becker Paribas Inc. and Merrill Lynch & Co.
    Paul D. Cass, Nossaman, Guthner, Knox & Elliott, Los Angeles, Cal., for defendant Arrays, Inc.
    Peter B. Gelblum, Mitchell, Silberberg & Knupp, Los Angeles, Cal., for defendants Stephen A. Koffler and Louis Kwiker.
    Neil S. Steiner, Kagel & Steiner, Beverly Hills, Cal., for defendant Henry H. Wald-man.
   REA, District Judge.

The Matter of Defendants’ Motions to Dismiss the Second Consolidated Amended Complaint having come on regularly for hearing before this Court, the Court having considered the papers filed in support and in opposition thereto, and the Court having considered the relevant legal authorities,

IT IS HEREBY ORDERED that the Motion is GRANTED IN PART and DENIED IN PART as follows:

DENIED as to Count I against all defendants;

DENIED as to Count II against all defendants;

DENIED as to Count III against all defendants.

Secondary liability allegations as to Count II are ORDERED STRICKEN;

Post-issuance misrepresentations and omissions are ORDERED STRICKEN as to Counts I and II.

The Matters of the parties’ Cross Motions for Sanctions having come on for hearing before this Court,

IT IS HEREBY ORDERED that the Cross Motions are DENIED. While the Court recognizes that one of the former attorneys for defendants was forced to appear to defend against plaintiffs’ Motion for Sanctions for the bringing of the original motion, it cannot be said that the motion for sanctions was brought in bad faith, as required by Federal Rule of Civil Procedure 11 in order to impose sanctions. Similarly, Defendants’ bringing of the original motions was not brought in bad faith, as the graveman of the motions was to challenge the sufficiency of the pleading rather than the factual basis for it. Therefore, regardless of defendants’ knowledge of the facts alleged in plaintiffs’ complaint, they were not precluded from challenging the contents of the complaint pursuant to the Federal Rules.

The Order Re Motions to Dismiss is based upon the following considerations.

■ Plaintiffs’ Complaint alleges causes of action under the federal securities statutes. Count I of the Complaint is brought under section 11 of the Securities Act of 1933, 15 U.S.C. 77k. Count II alleges violations of Section 12(2) of the Securities Act of 1933, 15 U.S.C. 111(2). Count III alleges violations of Section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. 78j(b), and Rule 10b-5 promulgated thereunder, 17 C.F.R. 240.10b-5.

I. Count I of the Complaint

Count I alleges violations of Section 11 of the Securities Act of 1933. That Section 11 provides:

(a) In case any part of the registration statement, when such part became effective, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading, any person acquiring such security (unless it is proved that at the time of such acquisition he knew of such untruth or omission) may, either at law or in equity, in any court of competent jurisdiction, sue—
(1) every person who signed the registration statement;
(2) every person who was a director of (or person performing similar functions) or partner in the issuer at the time of the filing of the part of registration statement with respect to which his liability is asserted;
(3) every person who, with his consent, is named in the registration statement as being or about to become a director, person performing similar functions, or partner;
(4) every accountant, engineer or appraiser, or any person whose profession gives authority to a statement made by him, who has with his consent been named as having prepared or certified any part of the registration statement, or as having prepared or certified any report or valuation which is used in connection with the registration statement, with respect to the statement in such registration statement, report, or valuation, which purports to have been prepared by him;
(5) every underwriter with respect to such security.
(b) Notwithstanding the provisions of subsection (a) of this section no person, other than the issuer, shall be liable as provided therein who shall sustain the burden of proof [of a number of defenses].

15 U.S.C. 77k. Defendants challenge the allegations in the complaint under this Section, on the grounds that plaintiffs have failed to adequately allege that the registration statement contained misrepresentations or omissions that were material. To allege a cause of action under Section 11, plaintiff must allege facts that establish 1) that misrepresentations were made, 2) which were material, 3) by a defendant enumerated in Section 11.

The Court finds that the allegations, in the complaint adequately allege facts which, if proved, would establish misrepresentations or omissions within the meaning of the statute. The allegations in paragraph 31-32 state what representations were made in the Registration Statement and the Prospectus “included in the Registration Statement”. The complaint does not allege any misrepresentations with respect to the Registration Statement itself, other than the conclusory statements in the introductory part of paragraph 39. However, the allegations in the lettered sub-parts of paragraph 39 reveal the falsity of the Prospectus, which is alleged to be part of the Registration Statement. Paragraph 40 alleges other actions of the defendants which furthered the illusion created by the Registration Statement. These paragraphs establish misrepresentations or omissions in the Registration Statement as required by Section 11. It cannot be said that these allegations fail to state a claim. Whether they are true or not is a matter for proof.

As to materiality, the complaint taken as a whole establishes facts that support a finding that the facts pled would be important to a reasonable investor, as the Ninth Circuit requires. Goldman v. Belden, 754 F.2d 1059 (9th Cir.1985). In paragraph 29, the purpose and effect of the defendants’ course of conduct, as detailed in the complaint, is set forth. Other effects of the alleged fraud in the public offering are detailed in paragraph 41 and 48.

The Court also finds that the complaint adequately states a claim against each of the defendants under Section 11. The five individual defendants are alleged to have signed the statement in paragraph 31, and thus are liable under subpart (1) of subsection (a), 15 U.S.C. 77k(a)(l). Section 11 provides liability for the underwriter, Becker/Paribas-Merrill Lynch. 15 U.S.C. 77k(a)(5). Ernst & Whinney’s liability is set forth in paragraph 17(2), at page 17 line 7, and paragraph 44, at page 37 lines 10-13, and satisfies, at least by implication, the requirements' of subpart (4) of Section 11 that the accountant can be held liable if it consented to being named as having certified any report used in connection with the Registration Statement complained of, 15 U.S.C. 77k(a)(4). Under notice pleading requirements, this is sufficient. Arrays Inc. is strictly liable under Section 11, subsection (b), 15 U.S.C. 77k(b). Therefore, Count I is not dismissed.

II. Count II of the Complaint

Count II alleges violations of Section 12 of the Securities Act of 1933, 15 U.S.C. Sec. Ill (2). Defendants, except Becker/Paribas-Merrill Lynch, challenge the adequacy of the complaint under this section on the basis that the defendants were not in privity with plaintiffs, nor were they substantial participants in the sales of securities to plaintiffs. This section provides in part as follows:

Any person who—
(2) offers or sells a security ... by the use of any means or instruments of ... communication in interstate commerce or of the mails, by means of a prospectus or oral communication, which includes an untrue statement of a material fact or omits to state a material fact necessary in order to make the statements, in light of the circumstances under which they were made, not misleading (the purchaser not knowing of such untruth or omission), ... shall be liable to the person purchasing such security from him____

15 U.S.C. 77i(2). The parties disagree about whether strict privity or substantial participation should be the test for stating a claim under this section. This Court has already noted that the rule for seller liability is one of “substantial participation” or “direct causal link.” Order Granting Motions to Dismiss, at 3. Under this test, courts have looked to the purpose of the section, which is to ensure that potential purchasers are given correct, material information before purchasing securities. Croy v. Campbell, 624 F.2d 709 (5th Cir.1980). This being the case, the issue becomes a fact question. If the allegations in the complaint can be seen as alleging a role for the defendant causally necessary and substantial in bringing about the transaction, then seller liability is present. Admiralty Fund v. Jones, 677 F.2d 1289, 1294 (9th Cir.1982). Such is the case here. As to each defendant, plaintiffs allege in paragraph 39 a role that, if proved, substantially caused the plaintiffs to purchase Arrays stock.

III. Secondary Liability

The allegations of secondary liability as to 12(2) violations are ordered stricken. No compelling case in the Ninth Circuit has been found which has extended secondary liability to Section 12(2). In fact, the cases support the contrary result. Judge Lucas in In Re Equity Funding Corp. of America Securities Litigation, 416 F.Supp. 161, 181 (C.D.Cal.1976) held that to impose secondary liability under Section 12(2) would circumvent the obvious intent of Congress to narrowly define both the prohibited conduct and the relief available against “precisely defined parties” under Section 12(2). Id. Hokama v. E.F. Hutton & Co., Inc., 566 F.Supp. 636, 642 (C.D.Cal.1983); Wright v. Schock, 571 F.Supp. 642, 658 (N.D.Cal.1983).

IV. Post-Issuance Allegations

Defendants contend that the allegations in the complaint which assert misrepresentations occurring after the public offering on January 12, 1984, should be stricken because the named plaintiffs purchased on January 12. Defendants assert that plaintiffs could not have been harmed by the post-issuance statements. This Court agrees to some extent. Plaintiffs have alleged three causes of action, two of which are based on a fraud in the public offering of Arrays stock. As to these causes of action, Counts I and II, the misrepresentations or omissions occurring after the issuance are immaterial, and should be stricken. But as to Count III, alleging a conceptually separate fraud under Section 10(b), the allegations set up a continuing conspiracy to manipulate the market in Arrays stock, which continued from the time plaintiffs purchased their stock until months later. The Court declines to strike these allegations as they relate to the 10(b) cause of action.

V. Count III of the Complaint

Count III alleges a cause of action under Section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. 78j(b) and Rule 10b-5 promulgated under it, 17 C.F.R. 240.-10b-5. Defendants contend that the complaint fails to plead this claim with sufficient particularity to comport with the fraud pleading requirements of Federal Rule of Civil Procedure 9(b).

Section 10(b) provides as follows: It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate commerce or of the mails, or of any facility of any national securities exchange—
(b) To use or employ, in connection with the purchase or sale of any security ... any manipulative or deceptive device or contrivance in contravention of such rules and regulations as the Commission may prescribe____

15 U.S.C. Sec. 78j(b). This section prohibits 1) misrepresentations 2) made by mail or a facility of a national stock exchange, 3) with intent to defraud, 4) in connection with the purchase or sale of securities, 5) which was relied upon by plaintiff (6) to his detriment. Because the section is generally considered to be an anti-fraud provision, courts have routinely required that pleading a 10(b) violation comport with the fraud pleading requirements of Federal Rule of Civil Procedure 9(b).

The Ninth Circuit has held that particularity in pleading fraud is necessary so that defendants may be able to adequately answer a complaint, thereby putting in issue those matters which are disputed. Walling v. Beverly Enterprises, 476 F.2d 393 (9th Cir.1973). The time, place and manner of the fraud must be alleged. Courts have also required that where there are multiple defendants, as in a securities fraud case, each defendant must be clearly associated with the actions he is alleged to have taken. Lastly, courts have also required that where pleading is on informatioh and belief, the source of the information and the facts supporting the belief must be pled.

This Court dismissed the First Amended Consolidated Complaint in this action because the complaint as framed did not meet these general requirements. The amended complaint passes muster under each of these standards. The source of the information upon which is based the pleading on information and belief is the attorney’s investigation, and the facts that support the belief are identified “in part” in paragraphs 31-37.

The parameters of the alleged fraud and each defendant’s role in it are clear in the complaint as drafted. In short, the complaint alleges that defendants devised a scheme whereby securities in an ailing software company would be sold to the public before the buyers could learn of the company’s ailments. Paragraphs 5-18 detail the roles of the defendants. Paragraphs 31-37 and 39-40 allege how the defendants perpetrated the scheme on the public, withholding revelation of the company’s declining condition until six months after the public offering. Taken as a whole, the complaint sets forth the time, place and manner of the alleged fraud in the paragraphs mentioned above.

Defendants Becker/Paribas-Merrill Lynch and Ernst & Whinney challenge the allegations against them because other courts have stated that merely performing one’s routine duties in assisting a public offering will not amount to liability under the securities. E.g. Klein v. Computer Devices, 602 F.Supp. 837 (S.D.N.Y.1985). This is a fact question. As the allegations are phrased, if proved, under plaintiffs’ there could be liability for violations for these defendants, depending upon their level of knowledge and intent during the various activities surrounding the offering and subsequent period.

Similarly, the allegations of secondary liability for this Section, while somewhat abrupt, survive the challenge to sufficiency. Plaintiffs appear to be pleading in the alternative, describing in another way the concerted activities of the various defendants. For the foregoing reasons, Count III of the Complaint is not dismissed. '

Because the Complaint has not been dismissed, the Defendants are required to Answer the Complaint within 20 days. The Court is also cognizant of the Plaintiff’s Motion for Class Certification, and ORDERS the following briefing schedule:

Defendants’ Oppositions, if any, are to be filed on or before October 21, 1985, at 4:00 p.m.

Plaintiffs’ Reply, if any, is to be filed on or before Oct. 29, 1985, at 4:00 p.m.

The hearing on the Motion for Class Certification is CONTINUED to Monday, November 25, 1985, at 10:00 a.m. in Courtroom “O”.


author: GESELL, District Judge.

text:
    UNITED STATES of America, Plaintiff, v. Ronald J. PERHOLTZ, et al. Defendants.
    Crim. No. 85-0255.
    United States District Court, District of Columbia.
    Oct. 7, 1985.
    On Motion for Permanent Restraining Order Oct. 21, 1985.
    Permanent Restraining Order Oct. 21, 1985.
    Memorandum And Order Oct. 31, 1985.

      Joseph Valder, Brian Murtagh, Asst. U.S. Attys., Washington, D.C., for the U.S.
    Leigh Manasevit, Washington, D.C., Steven Schaars, Springfield, Va., for defendant Perholtz.
    John F. Conroy, Washington, D.C., for defendant Jackson.
    William L. Gardner, William F. Patterson, Washington, D.C., for defendant Fletcher.
    Stephen P. Clark, Carol Ann Petren, Washington, D.C., for defendant Dillon.
    Edward F. Canfield, Larry S. Gondelman, Thomas R. Dyson, Washington, D.C., for defendant Root.
   MEMORANDUM OPINION AND ORDER

GESELL, District Judge.

The Court has before it the motion of defendant Ronald Perholtz filed on September 13 to set aside a restraining order signed by Chief Judge Robinson on July 30, 1985. The order was obtained by the United States in an ex parte hearing coincident with the filing of the original, sealed indictment in this case pursuant to 18 U.S.C. § 1963(e)(1). A copy of the order is attached. The indictment was unsealed on July 31 and a superceding indictment filed on August 6.

Defendant Perholtz maintains that the restraining order must be dissolved because it violates his right to due process and his Sixth Amendment right to retain the counsel of his choice. The Court found that the defendant bore the burden of proof on his contention that the restraining order prejudiced his Sixth Amendment rights. In an effort to meet this burden the defendant presented testimony, exhibits and argument which included an effort to demonstrate that the restraining order is overly broad. In responding to the defendant’s Sixth Amendment claim, the United States, without withdrawing its contention that the defendant bore the burden of proof in challenging the scope of the order, presented exhibits, testimony, a detailed exposition of the case against the defendant and argument to show that the properties named in the indictment were likely to be subject to forfeiture. Many of the materials which formed the basis of the United States’s presentation were made available to the defendants for inspection several weeks ago. The defendant responded to the United States’ legal arguments but did not directly contest any of its representations on what the United States’ evidence may show.

Based upon this factual hearing the Court finds by the preponderance of the evidence that the United States has established that the properties listed in the restraining order are likely to be subject to forfeiture ■ but that the order is overly broad to the extent it prevents defendant Perholtz from using funds covered by the order for payment of any federal taxes he now owes or may owe while the order is in effect. The Court further finds that when the order is so construed and limited, defendant Perholtz has failed to establish that the order has or is likely to prejudice his Sixth Amendment rights by depriving him of funds necessary for his defense.

The restraining order must nonetheless be vacated. The United States cannot obtain a permanent restraining order that prevents a defendant from disposing of his property by means of an ex parte proceeding. Due process requires that such an order be temporary and the United States must give affected defendants notice of a hearing within a brief amount of time or the ex parte order expires. A ten day limitation on the duration of such ex parte orders seems appropriate. The statute itself provides that ex parte orders obtained before indictment should expire within ten days. 18 U.S.C. § 1963(e)(2). Ten days is also the time period provided to secure the due process rights of civil litigants under Fed.R.Civ.P. 65(b) and numerous courts have held that the same limitation is appropriately imposed on restraining orders under this and parallel criminal forfeiture provisions. See United States v. Rogers, 602 F.Supp. 1332, 1342-45 (D.Co.1985) (interpreting 18 U.S.C. § 1963(e)); United States v. Spilotro, 680 F.2d 612, 617 (9th Cir.1982) (interpreting pre-1984 provision of 18 U.S.C. § 1963(b)); United States v. Lewis, 759 F.2d 1316, 1317 (8th Cir.1985) (interpreting 18 U.S.C. § 848); United States v. Crozier, 674 F.2d 1293, 1297 (9th Cir.1982) (same); United States v. Veon, 538 F.Supp. 237, 243-49 (E.D.Ca.1982) (same); see also Criminal Forfeiture and the Necessity for a Post Seizure Hearing: Are CCE and RICO Rackets for the Government?, 57 St. Johns L.Rev. 776 (1983).

The United States has taken the position that Congress intended for this statute to permit the imposition of a permanent restraining order in an ex parte hearing and the order may only be modified through the defendant’s motion for a hearing at which the defendant must bear the burden of proof. The Court cannot accept this view. The legislative history indicates that Congress realized that a subsequent hearing might be necessary after the entry of an ex parte restraining order. S.Rep. No. 98-225, 98th Cong., 2d Sess. 203, reprinted in 1984 U.S.Code Cong. & Ad.News 3182, 3183, 3386. The constitutional guarantee of a right to be heard on any deprivation of property requires that notice be given and a hearing be held within a brief time after the entry of the ex parte order.

Moreover, if the order is challenged it cannot become permanent until the United States has meet the burden of establishing that it is likely that it will be able to convince a jury that the property involved is subject to forfeiture in a hearing in which the defendant has an opportunity to respond, as has been done in this instance. The mere fact of indictment is not enough. The United States must make a prima facie showing that it will be able to prove the elements necessary for forfeiture. The statute prevents such a hearing from becoming a premature trial of the United States’ case by permitting the consideration of information which would be inadmissible under the Federal Rules of Evidence. 18 U.S.C. § 1963(e)(3).

It now appears to be well settled that rulings dissolving or granting restraining orders such as this are appealable. See United States v. Ferrantino, 738 F.2d 109, 110 (6th Cir.1983); United States v. Spilotro, 680 F.2d 612, 615 (9th Cir.1982). Because this ruling involves questions of first impressions the Court will stay its order vacating the restraining order for ten days to enable the United States, if it so desires, to seek review in the Court of Appeals. The stay will also permit defendant Perholtz to cross-appeal the aspects of the Court’s ruling and findings which are adverse to him, if he so desires. Clarification of the timing, burden and procedures for dealing with restraining orders under this new statute is necessary to avoid prejudice to defendants and uncertainty among prosecutors. The modification pertaining to federal taxes shall take effect immediately, however, as the United States does not oppose it.

Accordingly, it is ordered that the restraining order of July 30 is vacated. The order vacating the restraining order is stayed for ten days, during which period the restraining order is modified to permit defendant Perholtz to pay any federal taxes which are now due or become due by having any of the banks holding accounts which are subject to the restraining order issue a certified check payable directly to the United States Treasury.

SO ORDERED.

APPENDIX

RESTRAINING ORDER

This matter having come before this Court on motion of the United States of America for a restraining order pursuant to Title 18, United States Code, Section 1963(e)(1) which provides for the jurisdiction of the district courts to enter restraining orders and take such other actions in connection with any property or other interest subject to forfeiture pursuant to Title 18, United States Code, Section 1963; and this Court’s inherent power to make orders necessary and proper to the orderly carrying on of litigation brought within the Court’s jurisdiction;

IT IS HEREBY ORDERED that the defendants, Ronald J. Perholtz and Franklin W. Jackson, their agents, servants, employees, attorneys, family members, and those persons in active concert or participation with them, be and are hereby enjoined and restrained from selling, assigning, pledging, distributing, giving away, encumbering, or otherwise disposing of, or removing from its present location, with the intent to conceal and hide from the jurisdiction of the Court or removing from any checking or savings account, all or part of their interest, direct or indirect, in the property listed below, real, personal or choses in action, without prior approval of the Court upon written notice to the Attorneys for the United States, whose names appear below, and an opportunity for the United States to be heard, except as specified in this Order.

IT IS FURTHER ORDERED that the property which shall be subject to this Order shall include that listed below, which this court finds that a Grand Jury has determined there is probable cause to believe is subject to forfeiture to the United States pursuant to Title 18, United States Code, Section 1963, and which this Court also finds would be forfeitable to the United States in the event of a conviction pursuant to Counts One or Two of the attached indictment.

1. Defendant Property Description
PERHOLTZ $187,654.60 Royalties — Essex
PERHOLTZ $ 10,000.00 Consulting Fees — SDC
PERHOLTZ $300,625.00 Profit Share — PSC
PERHOLTZ $110,000.00 Promissory Note — PSC
PERHOLTZ $145,811.00 Consulting Fee — Remote
PERHOLTZ $116,400.00 Consulting Fee — Honeywell

The contents of the following bank accounts:

Bank Authorized Account Name Signatory Account Number
Maryland 75740985 National Ronald J. Perholtz Ronald J. Perholtz
Calvert 001-62851-0-101 Group Ronald J. Perholtz Ronald J. Perholtz
Calvert Group 001-00127488-5 ATL Corp. Ronald J. Perholtz
Calvert Group 001-22229401-9 ATL Corp. Ronald J. Perholtz
Calvert Group 001-22229402-7 ATL Corp. Ronald J. Perholtz
Citizens Bank & Trust 0317926 ATL Corp. Ronald J. Perholtz
of Maryland

Defendant Perholtz — a 38-foot pleasure craft, “Mistress,” a twin screw vessel, sport-fisher, type, hull number 38 159, Coast Guard Registry No. 548-069.

2. Defendant Jackson — a partnership interest in a condominium, to wit:

Condominium Unit 20-U in Brickell Town House, a Condominium according to and as more particularly described in the Declaration of Condominium thereof, recorded in Official Records Book 10526, at page 650, under Clerk’s File No. 79R-273350, in the Public Records of Dade County, Florida, and any amendment; together with a percentage interest in the common elements declared in said Declaration of Condominium to be an appurtenance to said above-described condominium unit which has the address of 2451 Brickell Avenue, Miami, Florida, 33129.

3. Defendant Ronald J. Perholtz’s 100% ownership interest in 100 shares of ATL Corporation, a corporation incorporated under the laws of the State of Maryland.

4. Defendant Ronald J. Perholtz’s interest in the realty, and any improvements thereon, located at 1620 Chester Mill Road, Silver Spring, Maryland, the corporate address for ATL Corporation, more particularly described as Lot numbered Fifty-five (55), in Block numbered Four (4), in the subdivision known as “Plat 1, Norwood Village” as per plat thereof recorded among the Land Records of Montgomery County, Maryland, in Plat Book 90 at Plat 9661.

5. All of defendant Ronald J. Perholtz’s rights in all patents, copyrights and licensing agreements pertaining to the ATAP software which the United States Postal Service uses in its automatic timekeeping and attendance system.

SO ORDERED this 30th day of July, 1985.

/s/ Aubrey E. Robinson CHIEF JUDGE

ON MOTION FOR PERMANENT RESTRAINING ORDER

The Court is once again confronted with construing a new, largely uninterpreted statute that authorizes pretrial restraining orders against the potentially forfeitable property of RICO defendants without describing the procedures or substantive standards courts should apply in granting such orders. On October 7, after an evidentiary hearing, briefing and oral argument, the Court vacated a permanent restraining order obtained under this provision in an ex parte hearing because it violated due process. The Court stayed its order vacating the restraining order to allow either side to appeal because novel issues of law were involved. Neither side has chosen to do so. Instead, the United States has moved for a permanent restraining order based on the evidence presented during the hearing on the ex parte order. Defendant Perholtz opposes the United States’ motion but has indicated that he does not wish to present any additional evidence. After briefing and full opportunity for argument by the United States and defendant Perholtz, the Court makes the following rulings.

Last year Congress amended the RICO statute to prove that “Upon application of the United States the court may enter a restraining order or injunction, require the execution of a satisfactory performance bond or take any other action to preserve the availability or [forfeitable] property ... upon the filing of an indictment or information” charging a RICO riolation and identifying property that may be subject to forfeiture after conviction. 18 U.S.C. § 1963(e)(1)(A). The Court has already held that due process requires that the statute be interpreted to require notice and a hearing before any permanent order lasting more than ten days may be entered. However, the Court rejects defendant’s argument that the ex parte order previously obtained by the United States precludes the Court from ever granting a restraining order after a hearing that satisfies due process. The remedy for the initial violation of due process is to hold the requisite hearing, as has been done in this instance. The fact that the United States, acting on a good faith interpretation of a new statute, obtained an ex parte order that proported to be permanent, does not forever disable the United States from obtaining the permanent restraining order Congress authorized if it provides notice and meets its burden in a hearing.

The statute is silent on what burden the United States must meet in applying for a post-indictment restraining order. In defining this burden the Court is guided, but not controlled, by the standards set out in the statute for pre-indictment restraining orders and the analogous requirements for a obtaining preliminary injunction. 18 U.S.C. § 1963(e)(1)(B); Metropolitan Area Transit Commission v. Holiday Tours, Inc., 559 F.2d 841, 843 (D.C.Cir.1977).

Initially, the United States must show that there is a substantial likelihood that it will be able to convince a jury that the property involved is subject to forfeiture. Meeting this burden requires proof that the United States is likely to prevail on the issue of guilt on the RICO violation charged and proof that the property to be restrained is likely to be forfeitable under § 1963(a). The Court found that the United States met this burden by a preponderance of the evidence in the previous factual hearing. Defendant Perholtz has not presented any further evidence or arguments to sway the Court from this finding. Although the grand jury’s finding of probable cause in returning the indictment may not always be sufficient to meet this burden, the defendants have not been able to show any irregularities in the lengthy grand jury proceedings to lead the Court to question its finding. Moreover, the indictment taken together with the affidavits, testimony, documents and exposition of the United States’ case, presented from charts based on documents that have been available to the defendants for some time satisfy the Court that the United States has meet its burden in this instance. Much of the proof presented at the evidentiary hearing will not be admissible in that form at trial, but the statute specifically provides that such hearings are not bound by the Federal Rules of Evidence in order to prevent hearings on restraining orders from becoming premature criminal trials.

The Court rules that to obtain a restraining order pending the outcome of the trial, the United States must also show a substantial likelihood (1) that failure to enter the order will result in the property being destroyed, removed from the jurisdiction of the court or otherwise made unavailable for forfeiture and (2) that the need to preserve the availability of the property outweighs the hardship that the order may impose on the party against whom the order is entered. Cf. 18 U.S.C. § 1963(e)(1)(B). The Court has already found, based on the previous evidentiary hearing, that the order, as modified to permit payment of federal taxes, does not impose any substantial hardship on defendant Perholtz. However, the United States has not in all respects provided persuasive evidence to meet its burden or showing that defendant Perholtz will conceal, destroy or otherwise disapate the property to evade forfeiture if a restraining order is not entered. Nevertheless, given the clear evidence in this case of use of manipulative devices to mask the origin and nature of transactions, there is an inherent risk that Perholtz’s cash and liquid assets will be removed from the jurisdiction of the Court if no restraining order is entered. Therefore, the Court finds that in a case such as this, where the underlying offense charged involves fraudulent and manipulative transactions, the United States is entitled to a presumption that negotiable and liquid assets may be made unavailable for forfeiture if not restrained, but it must make a more specific evidentiary showing with respect to non-negotiable assets and real estate. That showing is lacking. Consequently, the Court will enter a restraining order only against the defendants’ readily negotiable and liquid assets, which in this case include bank accounts, contractual rights to payment, and patent, copyright and licensing rights, and will not restrain the defendants’ use of real property that may be subject to forfeiture.

Defendant Perholtz has orally requested that the Court modify the order to permit him to pay state and local taxes and to move funds between accounts to facilitate the payment of federal taxes. The Court will not modify the order to permit payment of other than federal taxes since the defendant has not made a showing of hardship and permitting these payments may deprive the United States Treasury of funds that it will be entitled to by way of forfeiture. The Court will modify the order to permit defendant Perholtz to shift funds between the restrained accounts by certified check payable directly to the bank holding the account to which the funds are to be transfered.

An appropriate order is entered contemporaneously with the filing of this memorandum.

PERMANENT RESTRAINING ORDER

For the reasons given in a memorandum accompanying this order the Court grants, in part, the motion of the United States for a restraining order pursuant to 18 U.S.C. § 1963(e)(1) after a hearing at which the defendants were given an opportunity to be heard and to present evidence.

Accordingly, it is ordered that the defendant, Ronald J. Perholtz and his agents, servants, employees, attorneys, family members, and those persons in active concert or participation with him, be and are hereby enjoined and restrained from selling assigning, pledging, distributing, giving way, encumbering, or otherwise making unavailable for forfeiture, all or part of their interest, direct or indirect, in the property listed below, without prior approval of the Court upon a showing of good cause. Provided however, that the defendant Perholtz is permitted to pay any federal taxes which are now due or may become due by having any of the banks holding accounts which are subject to the restraining order issue a certified check payable directly to the United States Treasury. Provided further, that that the defendant Perholtz may transfer funds from one restrained account to another by certified check payable directly to the bank holding the account into which the funds are to be transfered.

1. (a) Property Description
$ 187,654.60 Royalties — Essex
$ 10,000.00 Consulting Pees — SDC
$ 300,625.00 Profit Share — PSC
$ 110,000.00 Promissory Note — PSC
$ 145,811.00 Consulting Pee — Remote
$ 116,400.00 Consulting Pee — Honeywell
(b) The contents of the following bank accounts:
Account Number Account Name Bank Authorized Signatory
Maryland National 75740985 Ronald J. Perholtz Ronald J. Perholtz
Calvert Group 001-62851-0-101 Ronald J. Perholtz Ronald J. Perholtz
Calvert Group 001-00127488-5 ATL Corp. Ronald J. Perholtz
Calvert Group 001-22229401-9 ATL Corp. Ronald J. Perholtz
Calvert Group 001-22229402-7 ATL Corp. Ronald J. Perholtz
Citizens Bank & Trust of Maryland 0317926 ATL Corp. Ronald J. Perholtz
2. Defendant Ronald J. Perholtz’s 100% ownership interest in 100 shares of ATL Corporation, a corporation incorporated under the laws of the State of Maryland.
3. All of defendant Ronald J. Perholtz’s rights in all patents, copyrights and licensing agreements pertaining to the ATAP software which the United States Postal Service uses in its automatic timekeeping and attendance system.

SO ORDERED.

MEMORANDUM AND ORDER

The Court has before it the motion of the United States for an Order Permitting the Foreman of the Grand Jury to Affix His Signature to the Superseding Indictment in this Case, Nunc Pro Tunc, the Motion of defendant Dillon to Dismiss the Indictment and the Motion of defendant Jackson to withdraw his plea. The other defendants joined in the Dillon and Jackson motions at the oral argument, following which, as then agreed, the Court was furnished additional grand jury records pertinent to the question presented. The motion of the United States is granted for reasons stated herein.

The original indictment in this case was returned on July 30 and was signed by the grand jury foreman and with the name of the United States Attorney, affixed by the head of the Grand Jury section of the Criminal Division. The superseding indictment was returned by the same grand jury on August 6 and signed with the name of the United States Attorney, affixed by the Chief of the Criminal Division, but was not signed by the foreman of the grand jury. The grand jury term expired before the United States discovered the absence of the foreman’s signature. Promptly after discovering the lack of signature the United States sought an order permitting the foreman to sign belatedly. Although the United States represented that the failure to sign was inadvertant, the Court directed that all defendants be informed and an expedited hearing be held because of the significance of the motion to the validity of an outstanding restraining order and the progress of this case.

The Court has examined the attendance records for the grand jury, the grand jury polling sheets which were signed by the grand jury foreman at the time that each indictment in this case was returned, the transcript of the presentation of the original and superseding indictment to the grand jury, the notes of the proceedings on the indictment in the grand jury log, and the transcript of the grand jury’s return of the superseding indictment before a magistrate of this Court on August 6. In addition, the foreman of the grand jury testified and was cross-examined by the defendants.

The foreman’s failure to sign was a purely clerical error due to inadvertance. The polling sheet of the grand jury vote on August 6, signed by the foreman, attests to the fact that the grand jury returned a true bill and confirms the foreman’s testimony that he intended to sign the indictment and believed he had signed it. The superseding indictment was presented to the magistrate by the full grand jury and specifically referred to in the course of that proceeding. The failure of the foreman to affix his signature was merely an oversight; the contemporaneous records do not permit any other conclusion.

The records also make clear that the superseding indictment was voted by more than twelve ordinary citizens after the actual terms of the indictment 'were fully presented to them. Gaither v. United States, 413 F.2d 1061, 1066-71 (D.C.Cir.1969). The grand jury that returned these indictments was comprised of 21 jurors. The transcript of the grand jury proceedings, polling sheet and log notes show that on July 26 the original indictment was read in its entirety to 17 members of the grand jury, all of whom voted to concur in returning the indictment, and the indictment was returned on July 30. The contemporaneous attendance records show that on August 6, twenty grand jury members were present when the United States Attorney presented the changes made in the superseding indictment to the grand jury in writing, and thoroughly described the changes orally. Nineteen members of this jury panel voted to return the indictment. Although the attendance records are not detailed enough to indicate which grand jurors voted, they establish that at least 15 of the grand jurors who concurred in returning the superseding indictment were present when the actual contents of the original and superseding indictment were given to the grand jury.

There is no federal rule or statute requiring that an indictment bear the signature of the grand jury foreman in order to be valid. Fed.R.Crim.P. 6(c) merely designates the grand jury foreman as the individual who is to attest to the action of the grand jury by affixing his signature. This task is merely clerical and ministerial in nature and does not confer any special powers upon the foreman or create any special significance to the foreman’s signing an indictment that has been validly returned by the grand jury. Consequently, the foreman’s duty to sign the indictment is a formality and the absence of the foreman’s signature on an indictment properly voted by the grand jury is a mere technical irregularity. Hobby v. United States, — U.S. -, 104 S.Ct. 3093, 3096-97, 82 L.Ed.2d 260 (1984); Frisbie v. United States, 157 U.S. 160, 163-65, 15 S.Ct. 586, 587-88, 39 L.Ed. 657 (1895).

The superseding indictment was also properly “signed by the attorney for the government” in accordance with Fed.R. Crim.P. 7(c). The Chief of the Criminal Division, by the regular policy and practice in the United States Attorneys Office has been and is authorized to sign the name of the United States Attorney, followed by his initials, as was done here. More formality in this obvious delegation might be desirable, but its absence clearly does not make the indictment defective. The signature of the attorney for the government merely attests to the authenticity of the indictment and the prosecutor’s concurrence in its return. An authorized assistant may sign the United States Attorney’s name and technical challenges to the signature on a valid indictment do not make the indictment defective. See United States v. Walls, 577 F.2d 690, 696 (9th Cir.1978) cert. denied, 439 U.S. 893 (1979); Little v. United States, 524 F.2d 335, 336 (8th Cir.1975), cert. denied, 424 U.S. 920, 96 S.Ct. 1125, 47 L.Ed.2d 326 (1976); United States v. Wright, 365 F.2d 135, 137 (7th Cir.1966), cert. denied, 386 U.S. 918, 87 S.Ct. 879, 17 L.Ed.2d 789 (1967); Abramson v. United States, 326 F.2d 565, 567 (5th Cir.1964), cert. denied, 377 U.S. 957, 84 S.Ct. 1636, 12 L.Ed.2d 500 (1964); see also Annotation, 5 A.L.R.Fed. 922 (1970 & 1985 Supp.).

Accordingly, the Court directs that the Clerk of Court permit the foreman of the grand jury to sign the original of the superseding indictment forthwith, as if it had been signed at the time it was returned on August 6 to cure the ministerial defect resulting from his inadvertant failure to sign.

SO ORDERED.

      . Other defendants have filed motions to generally join the motions of their codefendants without specifying which of the 46 motions filed in this case they actually wish to join. The Court understands that none of the defendants except Perholtz and Jackson have any direct interest in the restraining order and are not challenging it, except to record their objection to the attribution of ownership of certain property named in the indictment. This is clearly an issue to be resolved before the jury at trial. Accordingly, the Court’s order does not modify the restraining order with respect to any other defendants but Perholtz and Jackson.

      . Joseph B. Valder; Brian M. Murtagh.

      . Calvert Securities Corporation; Calvert Shareholder Services, Inc.; First Variable Rate Fund.

      . The United States’ motion also seeks to restrain the interest of defendant Jackson in a condominium. Since the United States has not presented any evidence to meet its burden of showing that the property is likely to be unavailable in the absence of a restraining order, the Court will not included this property in the order.