Newman v. Piggie Park Enterprises, Inc.

PETITIONER:Newman
RESPONDENT:Piggie Park Enterprises, Inc.
LOCATION:Piggie Park No. 1 — Drive-in Restaurant

DOCKET NO.: 339
DECIDED BY: Warren Court (1967-1969)
LOWER COURT: United States Court of Appeals for the Fourth Circuit

CITATION: 390 US 400 (1968)
ARGUED: Mar 07, 1968
DECIDED: Mar 18, 1968

Facts of the case

Question

Audio Transcription for Oral Argument – March 07, 1968 in Newman v. Piggie Park Enterprises, Inc.

Earl Warren:

Number 339, Anne P. Newman et al., Petitioners, versus Piggie Park Enterprises Incorporated et al.

Mr. Greenberg.

Jack Greenberg:

Mr. Chief Justice and may it please the Court.

This case is here on petition for writ of certiorari to the United States Court of Appeals for the Fourth Circuit.

The issue is the correctness of the standard which was announced by the Fourth Circuit sitting en banc for a provision of Title 2 of the United States’ Civil Rights Act of 1964 which prove — the public accommodations provision which provides for counsel fees in public accommodations cases.

The provision is on page 2 of our brief and I will read it, it’s very brief.

In any action commenced pursuant to this subchapter of the court in its discretion may allow the prevailing party other than the United States a reasonable attorney’s fee as part of the costs.

Case arose in the following way, the respondent corporation owns six restaurants which serve southern style barbeque various locations in the State of South Carolina, five of these restaurants are drive-ins, one is a sit down restaurant in downtown Columbia.

The president of the respondent corporation has been in such business for decades and has called himself in the record a pioneer in the drive-in barbeque business in South Carolina.

The businesses are substantial in size, food purchases are in excess of a quarter of a million dollars a year and the gross volume is — of sales is obviously in excess of that.

Five of the six restaurants are in interstate highways and all of them discriminated on the basis of race.

There’s no doubt that the policy of discrimination was followed after passage of the 1964 Civil Rights Act after decisions of this Court uphold in the constitutionality of the Act.

The answer or the answers filed by respondent in this case knew of the decisions of this Court and asserted that they were incorrectly decided.

The plaintiffs brought suit in December 1964, and respondent filed an answer and two amended answers, one in February, the next in August 1965 and the third in March 1966.

These answers submitted an array of defenses.

First of all, the first second and third answer denied the practice of racial discrimination.

The answers denied, they served interstate travelers, they denied that they served the substantial amount of food moving in commerce.

They asserted that the petitioner had a constitutional right under the Thirteenth Amendment not to be subjected to involuntary servitude and serve persons against his will.

It was the First Amendment religious privilege claim that petitioner asserted that his religion required him to act this way.

There was an equal protection and due process claims submitted by petitioners and then there was a claim that drive-in restaurants were not covered by the 1964 Civil Rights Act and there was a claim that I mentioned that courts were not foreclose if the lower court is not foreclosed by decisions of this Court because those decisions were wrong.

There was finally a well over a year following the filing of complaint, a trial that went into two days and at this trial the plaintiff proved discrimination, went to a great deal of trouble to prove that the food which was served in the restaurant had moved in interstate commerce and indeed we have not printed the entire record in order to spear ourselves in the court but more than a hundred pages of record goes into one of the origins in the root that this food has traveled before it came to rest in the drive-in restaurants.

Our witness who testified by discrimination the other witness were cross-examined and then the respondent put on his case and after all this, the respondent did admit having practiced racial discrimination although it was denied in three answers and admitted that a substantial amount of food had actually moved in interstate commerce.

The District Court entered an order that one of the restaurants which was a sit-down restaurant in downtown Columbia was required to end discrimination under the 1964 Act.

It said that the drive-ins were not covered by the Act because as it read the statutory language a principle part of the food served — principle amount of the food served was not served for consumption on the premises being a drive-in and people would drive a way and it — there was a prayer for counsel fees which is the issue in this case and the trial court held simply with no explanation that petitioner were not entitled to counsel fees.

Court of Appeals reversed on the question of whether drive-ins are covered by the 1964 Act and there has been — that is not an issue here.

It also wrote on the question of counsel fees page 165 of the record, that is the majority of the court did that in exercising its discretion the District Court may properly consider whether any of the numerous defenses interposed by defendants were presented for purposes of delay and not in good faith but the test should be and this is what the court termed it, a subjective one for no litigant ought to be punished under the guise of an award of counsel fees or in any other manner from taking a position in court in which he honestly believes however lacking in merit that position may be.

The court also — may also consider whether defendants acted in good faith in denying discrimination.

Judge Winter wrote a concurring opinion in which on the counsel fees as long as Judge Sobeloff adjoined which disagreed with the majority standard and Judge Winter wrote good faith standing alone should not always immunize the defendant from an award against him.

Specifically in this case defendants are not entitled to the defense good faith and regard to the major portion of their defenses.

And that the District Court should be instructed to make an allowance in regard to some of defendant’s defenses and in its discretion to consider an allowance for the remainder of defendant’s defenses depending upon its determination of defendant’s good faith and honest belief.

Jack Greenberg:

We submit that the majority of the Court interpreted the counsel fee provision of the 1964 Act incorrectly and we also submit that the minority test while it might to some extent forward the purposes of the Act and be consonant with the Act is also not the test which this Court should adopt as a proper standard for awarding counsel fees in public accommodations, Title 2 cases.

The generality, the very generality of the provision obviously leaves it to the courts to announce and develop standards.

What’s the sealing on that statute on counsel fees?

Jack Greenberg:

There is no monitory amount.

Of percentage in that?

Jack Greenberg:

No, there is — by sealing, you mean how much money can be awarded?

The statute says nothing and I would assume that the lower courts would use the ordinary standards that they do in a variety of cases in which counsel fees are awarded and those standards depend upon a good number of factors.

The amount of time put in bar associations standards, what opposing counsel has been paid and various matters of that sort.

Potter Stewart:

Of course as far as — unless I’m mistaking and maybe I am but as far as we now know the District Court might award counsel fees or I’m mistaken.

This is a remand by the Court of Appeals —

Jack Greenberg:

This was remand by the Court of Appeals to award counsel fees according to a subjective test standing.

Potter Stewart:

Right and that test is not yet been applied by the District Court.

Jack Greenberg:

That’s true.

Potter Stewart:

Is that correct?

Jack Greenberg:

That test has not been applied by the District Court but —

Potter Stewart:

So if it —

Jack Greenberg:

— if it were applied —

Potter Stewart:

Yes.

Jack Greenberg:

— if it were applied, it would be difficult to know first of all how petitioners could meet that subjective test, how petitioners could prove what went on in the mind of respondent particularly reminder — mind of respondent, a corporation.

And then secondly, whether the amount of counsel fees awarded under that test would be less than the amount awarded under either Judge Winter’s and Sobeloff’s test —

Potter Stewart:

(Inaudible)

Jack Greenberg:

— or the test that we are proposing here, yes.

Potter Stewart:

But still remains true that for all we now know despite of those difficulties the District Court might in its discretion applying that test award the plaintiff’s full counsel fees in this particular case.

I’m just —

Jack Greenberg:

Well, it might but —

Potter Stewart:

Thinking out loud that perhaps this isn’t right for adjudication.

Jack Greenberg:

That is possible but so — at least so far as petitioners are concerned in arguing of making a presentation to the court as to what counsel fees should be.

Petitioners would be at a disadvantage almost to the point of finding themselves in an impossible position as to request counsel fees on a subjective test standard.

Our position is that Congress did more than codify the preexisting law of equity.

Obviously under existing standards without the statute counsel fees have been awarded though not frequently in litigation generally and in some few Civil Rights cases.

Jack Greenberg:

They’ve been awarded as in the Rolex case or other cases cited in our brief in which a party has acted unconscionably or vexatiously or perhaps presented frivolous defenses.

But we submit that the key factors in this case ought to be those which carry out the broad remedial purposes of Title 2 after all Title 2 was a great innovation in American law, its purpose was for the first time to make public accommodations available to all Americans without regard to race throughout the country.

That purpose could be achieved in a variety of ways the most desirable way would be voluntary compliance.

Thereafter, the next most desirable way would be some sort of judicial compulsion which would encourage the greatest degree of voluntary compliance.

William J. Brennan, Jr.:

Mr. Greenberg, if you bring out that one of these — as to what the (Inaudible) — does he have to pay the assessed counsel fees here?

Jack Greenberg:

The statute says prevailing party and that would be possible.

The standard —

William J. Brennan, Jr.:

(Inaudible)

Jack Greenberg:

No, that’s not happen.

The standard that we would propose would be that whereas in all cases in which the plaintiff prevails he is entitled to counsel fees cases in which he loses counsel fees ought not to be assessed against him unless he acted for purpose of harassment or in bad faith or in some other way which is so unusual is not likely to occur because the purpose of the statute is to encourage compliance and —

William J. Brennan, Jr.:

Does it apply the same statutes for the defenses.

Jack Greenberg:

That’s correct.

In other words, it would not be — put it bluntly, it would not be a two-way street under the standard we proposed.

William J. Brennan, Jr.:

(Inaudible) the — yes, the plaintiff will be assessed only if (Inaudible)?

Jack Greenberg:

Yes.

William J. Brennan, Jr.:

Is the — the defense —

Jack Greenberg:

Would be assessed in any action which the plaintiff prevail.

William J. Brennan, Jr.:

I mean, just because (Inaudible)

Jack Greenberg:

Yes.

William J. Brennan, Jr.:

But just because you (Inaudible).

Jack Greenberg:

Unless, it would be so unusual an action if there were no reason at all where the action should’ve been brought for example there were an offer of judgment.

William J. Brennan, Jr.:

Let’s assume if the plaintiff of a lawsuit —

Jack Greenberg:

Yes.

William J. Brennan, Jr.:

— was not guiltless, and he lost them.

In that situation you would say he is not to be assessed counsel fees unless he has been guilty of harassment or something like that.

Jack Greenberg:

Yes.

William J. Brennan, Jr.:

Is that right, it might just the plaintiff, whereas the defendant puts in a defense and it may influence, assume it’s not frivolous, and not a frivolous defense and yet it doesn’t prevail you would say nevertheless he should be assessed there.

Jack Greenberg:

Yes.

And the reason is that.

William J. Brennan, Jr.:

But that (Voice Overlap) —

Jack Greenberg:

— if the standard —

William J. Brennan, Jr.:

— if the defendant loses, if he puts the defense and loses he has to pay the counsel.

Jack Greenberg:

That’s correct and the reason for that is that if that were not the standard there would be essentially a price of admission to any restaurant which is that you’ve got to at least go to the point of following a lawsuit in order to get into a restaurant.

If the restaurant were decides that he wants to maintain a policy of discrimination and we submit that would not advance the policy of the statute that it is very difficult to conceive of situations in which plaintiffs are likely to bring lawsuits for any purpose other than the purpose of attempting to secure admission to a restaurant, a hotel or anything of the sort.

But it is not difficult to conceive of situations and indeed there are situations in which defendants have said essentially okay, if you like to get in to this place sue me and that means essentially the plaintiff has to at least employ a lawyer and pay some sort of a fee and even if at that point the defendant puts up a non-frivolous defense and or even essentially then entered — or it makes an offer of judgment.

The plaintiff has at least had to pay the cost of seeing a lawyer for an initial visit and that ought not to be the ticket of admission we say to a public accommodation.

Earl Warren:

Is there any legislative history that will help up Mr. Greenberg?

Jack Greenberg:

Are — there is some very slight legislative history, it tends to point away from the subjective test it has set forth in our certiorari petition and it’s cited in our brief and it essentially talks about frivolity but it’s not — it really is not very, very extensive.

Essentially the matter has really been left to the courts to interpret and we would submit that it ought to be interpreted in order to carry out the general purposes of the statute.

What sort of fee (Inaudible) being allowed?

Jack Greenberg:

Well, there has —

Have there been any?

Jack Greenberg:

There has not been till now as I know a fee in a Title 2 case.

There has — (Inaudible), he knows the fee.

Well, the — no one has given me a dollar amount.

All they tell me is what I did know, the fees are moderate several hundred dollars in cases of this sort.

I do know that there has been a major Title 7 litigation in which counsel fees were allowed in the — in Virginia and Richmond involving — that was a quite a major case involving this defendants the Philip Morris Corporation and the American — and the Tobacco Workers Union.

And the court awarded counsel fees and parties then negotiated the fees between themselves and came to an agreement and that isn’t a matter of several tens of thousands of dollars but that was quite a major lawsuit.

Ordinarily when you have these fees, initially large fees, the question is essentially a case by case proposition.

Jack Greenberg:

Yes.

(Inaudible)

Jack Greenberg:

These cases —

(Voice Overlap) different cases and your asking us to lay down the Court of Appeals for something (Inaudible) more of a general rule here than what are usual (Inaudible) since you’re having discretionary (Inaudible).

Jack Greenberg:

Mr. Justice Harlan, I’m not — I am not asking the court lay down the general rule as to the amount of fees.

I think that —

I don’t mean that but the standards —

Jack Greenberg:

Well, I would say that the stand —

The court should’ve never done that sort of thing in cases regarding (Inaudible).

Jack Greenberg:

Well, I think that for types of litigation there are standards for example an ordinary school desegregation case.

The standard as of this point seems to be that if the defendant has dragged up a litigation has interposed a lot of dilatory defenses has put the plaintiff to a great deal of troubles some courts have awarded counsel fees in those situations.

Jack Greenberg:

In other cases, the general rule has been one which turns upon the extent to which a party has acted vexatiously but this a statutory provision, the statute essentially says that counsel fees ought to be allowable and the question now was, what standard should the court device to carry out not only that purpose of the statute, not into the statute but the general purposes of the statute.

William J. Brennan, Jr.:

Well, as I understand it, you are conceding that statute contemplates and awarded fees to these prevailing party or plaintiff.

Jack Greenberg:

Yes.

William J. Brennan, Jr.:

Now, what you’re suggesting however is that standard in the case of the defendant, this kind of litigation.

It should be — if he loses you should say that if he loses then the court should award the counsel fee?

Jack Greenberg:

Yes.

William J. Brennan, Jr.:

Whereas in the case of the plaintiff, if the plaintiff rule the defendant should not be awarded the counsel fees unless it’s established that the plaintiff brought to shoot to harass the defendant.

Jack Greenberg:

That is my position.

Abe Fortas:

What would you do with the words in its discretion in the statute relating to the District Court’s function?

Jack Greenberg:

Well, there are two things to be said about that, I think that discretion in this context ought to be read as in other context that it ought to be according to some standards not to unfetter unbridled discretion.

And even according to standard that I have given if discretion is used pursuant to implement that standard it would not ordinarily be reviewed.

Second, —

Abe Fortas:

But you — the only standard, you says, (Inaudible).

Jack Greenberg:

No, that’s not the only standard.

There are cases in which let us say a plaintiff might’ve acted for purposes of harassment or may have for example could’ve won his case in a rather simple way but went to a great deal trouble to just multiply the record and in that —

Abe Fortas:

You had really read in a kind of a — with reverse English, wouldn’t you that the court shall allow prevailing party unless the court find some reason in the plaintiff’s behavior which justifies not awarding counsel fees.

Jack Greenberg:

I think that’s comparable with the language and certainly with the purpose but I think the word “discretion” —

Abe Fortas:

Well, I know that’s your position is —

Jack Greenberg:

Yes.

Abe Fortas:

— I wouldn’t — suggesting he was compatible with the purpose of the law, I don’t know at the moment.

Jack Greenberg:

Yes, and the word “discretion” I think also should be read as to going to amount as distinguished to whether or not there should be an award.

Earl Warren:

Did we reach the standard for a plaintiff being required to pay counsel fees —

Jack Greenberg:

Certainly not.

Earl Warren:

— this case?

Jack Greenberg:

Certainly not.

Earl Warren:

We need not do that.

Jack Greenberg:

That is certainly not this case.

Earl Warren:

Was that argued below?

Jack Greenberg:

No.

That certainly was not — certainly not this case.

Jack Greenberg:

Now, the alternatives are that if a plaintiff wants to bring a suit and as our brief indicates there are hundreds or thousands of establishments and not the large institutions like the big chain hotels but this smaller place that do discriminate that if a plaintiff wants to bring a suit either has to be able to afford some fee for lawyer which a typical plaintiff would not have.

The plaintiffs in this case were two of them were students and another one was an NNACP Executive Secretary.

Or he would have to go a civil rights organization and none of them are capable of bringing the large number of suits that are necessary or to the Department of Justice which also must has been the three sources or else he may bring no case.

Potter Stewart:

In this case, at the District Court level the plaintiff lost five or six of its case, didn’t he?

Jack Greenberg:

Pardon me, I didn’t hear you.

Potter Stewart:

At the District — at the trial level in this case if I understand it correctly the defendant won five – six of his case and the plaintiff was five – six —

Jack Greenberg:

Depends what you’re measuring, the plaintiff lose is to five out of six restaurants —

Potter Stewart:

Yes.

Jack Greenberg:

— but he won in all the legal issues and all of evidentiary issues except one which the question of whether or not drive-ins are covered —

Potter Stewart:

That one lost him — five out of the six.

Jack Greenberg:

Well, but the Court of Appeals that that was mistaken so he really ended winning six out of six.

Potter Stewart:

Well, that’s — so, I — that leads to my real question Mr. Greenberg.

You think the prevailing party should be the — after all the appellate procedures are completed.

That’s (Voice Overlap).

Jack Greenberg:

If there are appellate proceedings.

Potter Stewart:

Yes, as they were in this case.

Jack Greenberg:

Many of these cases it is found that once the case is filed and there are some movement towards litigation, the establishment which is discriminating will cease discrimination but nevertheless the plaintiff for somebody has Department of Justice’s Civil Rights organization has had to buy the ticket of admission which is a visit to the lawyer’s office filing of a complaint and so forth.

Now —

William J. Brennan, Jr.:

Mr. Greenberg, don’t you have some other federal statutes perhaps (Inaudible) like the FELA and other statues which makes — provides for counsel fees?

Jack Greenberg:

There are some other federal statutes that provide for counsel fees.

The Sherman Act, Clayton Act for example provide for counsel fees but that is rather explicit, it says, in fact I was about come to that and I was going to say that if respondent had counsel argument here today he might argue that if Congress had intended that a provision like the provision in the Clayton Act — the Sherman Act applied would’ve said so explicitly rather than use the general kind of language that it used.

But it’s — I don’t think it’s unusual for Congress to leave aspects of enforcement and interpretation in flushing out of various statutes to the courts and that —

William J. Brennan, Jr.:

It’s rather (Inaudible)

Jack Greenberg:

Well, that’s apparently what happened in this case.

The language is very general and if it’s to be interpreted we would submit that in order to be interpreted to affect the purposes of the statute it has to be interpreted along with other provisions and doctrines that it affect the award of counsel fees but those go over of variety if they are essentially in two categories goes on which the plaintiff is vindicating the public right and those which the plaintiff is vindicating his own private right as a —

William J. Brennan, Jr.:

But the other statutes that we — you’re suggesting are explicit form of offense.

Jack Greenberg:

Well, some of the Sherman Act is explicit.

I am — I have some of the other ones here —

William J. Brennan, Jr.:

Well, just — this is general and they’re explicitly what or what the —

Jack Greenberg:

Well, the — let’s see I have some of them here.

Jack Greenberg:

As I have said the Sherman Act is explicit, this Court last year had a case under the trade mark statute here and which the term “counsel fee” is not used at all, this question of interpretation of cost, the courts said, “Well, that did not include counsel fees.”

In — there was a case last term involving rights of a seaman and it was held that counsel fees ought to be awarded.

As of subject statute form in two categories, those in which the plaintiff is asserting a public right as a Sherman Act case and this kind of case where the plaintiffs is asserting a public right after all when he wins the case it’s hardly worth several hundred dollars to him just to purchase a single dinner certainly not in a monetary sense but he’s essentially won something for the entire community and we submit that this —

William J. Brennan, Jr.:

And this (Inaudible).

Congress here made the provision for fees for both sides to the prevailing (Inaudible).

Jack Greenberg:

Yes it did but it didn’t say in what instances I mean even the Court of Appeals says that prevailing party in some situations and as to some issues —

William J. Brennan, Jr.:

Yes, but the (Voice Overlap).

But don’t you (Inaudible) make the provisions for counsel fee only for the plaintiff?

Jack Greenberg:

I honestly don’t recall Mr. Justice Brennan.

We would submit that even though the statute does speak about prevailing party the test which we offer to the court is one which — does allow award of counsel fees to the prevailing party in certain kinds of cases and any event certain standards are going to have to be adopted.

And we would submit that the standard that we have proposed to the court is one which would best fulfill the purposes of the law that the test that Judges Winter and Sobeloff have proposed were to some extent fulfill that purpose, it would stop the interposition of defenses which increase the cost of litigation and essentially increase the expense of the plaintiff but would not illuminate essentially the price of admission which is at least to visit to a lawyer’s office in a filing of a lawsuit and perhaps even the litigation of a lawsuit which is necessary, would be necessary if the Winter-Sobeloff test were adopted.

Hugo L. Black:

Suppose one should disagree with your pointing to apply a different test for the plaintiff (Inaudible), then what test or standard would you suggest?

Jack Greenberg:

Then I would say that the Winter-Sobeloff test would be the —

Hugo L. Black:

Be the proper —

Jack Greenberg:

— would be the next best test but I don’t feel that would carry out the purposes of the law and I feel that if there were a plaintiff and there could be who would want to bring these suits just for — to oppress and the test that we would propose is one certainly would allow awarding counsel fees against him.

But that is hardly like be the case but it could occur.

Earl Warren:

There being no brief on file for the respondent under our Rule 446, this case has ended in return.