United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued February 6, 2006 Decided March 31, 2006
Nos. 04-5448 and 05-5002
GUADALUPE L. GARCIA
FOR HIMSELF AND ON BEHALF OF
G.A. GARCIA AND SONS FARM ET AL.,
APPELLANTS
v.
MICHAEL JOHANNS, SECRETARY,
UNITED STATES DEPARTMENT OF AGRICULTURE,
APPELLEE
Appeals from the United States District Court
for the District of Columbia
(No. 00cv02445)
Stephen S. Hill argued the cause for the appellants. Alan M.
Wiseman, Robert L. Green and Kenneth C. Anderson were on
brief.
Charles W. Scarborough, Attorney, United States
Department of Justice, argued the cause for the appellee. Peter
D. Keisler, Assistant Attorney General, Kenneth L. Wainstein,
United States Attorney, and Robert M. Loeb, Attorney, United
States Department of Justice, were on brief.
2
Glen D. Nager, Shay Dvoretzky, Jason J. Jarvis and Robin
S. Conrad were on brief for amicus curiae Chamber of
Commerce of the United States of America.
Before: SENTELLE and HENDERSON, Circuit Judges, and
EDWARDS, Senior Circuit Judge.
Opinion for the court filed by Circuit Judge HENDERSON.
KAREN LECRAFT HENDERSON, Circuit Judge: This appeal
arises from one of several actions brought against the United
States Department of Agriculture (Department or USDA)
alleging discrimination in the administration of various
federally-funded loan and benefit programs for American
farmers.1 The appellants, individual Hispanic farmers, seek to
represent a class of similarly situated Hispanic farmers
throughout the nation who claim that the Department
discriminated against them in denying them farm loans and
other benefits because of their ethnicity and that it failed to
investigate the discrimination complaints they subsequently
filed with the Department. In the district court, the appellants
sought class certification and the USDA moved to dismiss, inter
alia, the failure-to-investigate claim. The district court granted
the Department’s motion to dismiss and denied class
certification, concluding that the appellants had failed to meet
the requirements of Federal Rule of Civil Procedure 23(a) and
23(b). For the reasons that follow, we affirm in part and remand
in part.
1
See, e.g., Pigford v. Johanns, 416 F.3d 12, 14 (D.C. Cir. 2005)
(black farmers); Keepseagle v. Glickman, 194 F.R.D. 1 (D.D.C. 2000)
(Native American farmers). A related appeal challenging the district
court’s denial of class certification to women farmers was heard the
same day as this appeal. See Love v. Johanns, No. 04-5449, slip op.
(D.C. Cir. March 3, 2006).
3
I.
The Farm Service Administration (FSA)2 administers the
Department’s various loan programs for American farmers
through county committees, the members of which are selected
locally and are located in over 2,700 counties nationwide. A
farmer seeking a loan must first obtain an application from his
county committee. 7 C.F.R. § 1910.4(b). He then submits the
completed application to the committee which determines
whether the farmer meets specific USDA loan criteria,
including, inter alia, citizenship, legal capacity to incur debt,
education and farming experience, farm size, inability to obtain
sufficient credit elsewhere and character. Id. §§ 1941.12 (2006),
1943.12(a) (2006), 1943.12 (1988), 764.4 (2006). If an
unsuccessful applicant believes the committee discriminated
against him in denying his application, he may lodge a
complaint with either the USDA Secretary or the USDA Office
of Civil Rights. Id. § 15.6. USDA regulations provide that
complaints “shall be investigated in the manner determined by
the Assistant Secretary for Civil Rights and such further action
taken by the Agency or the Secretary as may be warranted.” Id.
On October 13, 2000, ten Hispanic farmers filed this action
in the district court. The complaint set forth three counts.3
Count I sought a declaratory judgment to determine “the rights
of plaintiffs and the Class members under the defendant’s farm
programs including their right to equal credit, and equal
participation in farm program, and their right to full and timely
2
In 1994, the Farmers Home Administration (FmHA) was
combined with other Department entities to form the FSA. See United
States v. Lewis County, 175 F.3d 671, 673 n.2 (9th Cir. 1999) (citing
7 U.S.C. § 6932 (Supp. 1998)). All references are to the FSA.
3
Although they subsequently amended their original complaint
twice, see infra, n.5, the substantive counts did not change.
4
enforcement of racial discrimination complaints.” 2d Am.
Compl. at 56, reprinted in Joint Appendix (JA) 83. The second
count alleged a violation of the Equal Credit Opportunity Act
(ECOA), 15 U.S.C. §§ 1691 et seq.4 JA 84. Specifically, the
appellants alleged that the “[d]efendant’s acts of denying
plaintiffs and Class members credit and other benefits and
systematically failing to properly process their discrimination
complaints was racially discriminatory and contrary to the
[ECOA].” JA 84. Finally, the appellants alleged a violation of
the Administrative Procedure Act, 5 U.S.C. §§ 551 et seq. JA
84. The appellants sought declaratory relief as well as $20
billion in damages. JA 85. Their complaint also proposed a
class of
all Hispanic participants in FSA farm programs who
petitioned or would have petitioned had they not been
4
ECOA creates a private right of action against a creditor,
including the United States, 15 U.S.C. § 1691e(a), who
“discriminate[s] against any applicant, with respect to any aspect of a
credit transaction” “on the basis of race, color, religion, national
origin, sex or marital status, or age” or “because the applicant has in
good faith exercised any right under this chapter.” Id. § 1691(a). The
regulations governing ECOA define a “credit transaction” as “every
aspect of an applicant’s dealings with a creditor regarding an
application for credit or an existing extension of credit (including, but
not limited to, information requirements; investigation procedures;
standards of creditworthiness; terms of credit; furnishing of credit
information; revocation, alteration, or termination of credit; and
collection procedures).” 12 C.F.R. § 202.2(m). Although ECOA
claims are subject to a two-year statute of limitations, see 15 U.S.C.
§ 1691e(f), the Congress retroactively extended the limitations period
for individuals who had filed administrative complaints with the
USDA between January 1, 1981, and July 1, 1997 for alleged acts of
discrimination occurring between January 1, 1981 and December 31,
1996. See Pub. L. No. 105-277, § 741, 112 Stat. 2681 (reprinted in 7
U.S.C.A. § 2279 notes).
5
. . . prevented from timely filing a complaint [against]
USDA at any time between January 1, 1981, and the
present for relief from . . . racial discrimination . . . and
who, because of the failings in the USDA civil rights
complaint processing system . . . were denied equal
protection . . . and due process in the handling of their
. . . complaints.
JA 78 (emphasis in original).5
On December 22, 2000, the Department moved to dismiss
the complaint pursuant to Federal Rule of Civil Procedure
12(b)(1), contending that the court lacked jurisdiction over the
ECOA claim because the appellants had not exhausted their
administrative remedies and that, in any event, their claims were
time-barred. In addition, the Department moved to dismiss
under Federal Rule of Civil Procedure 12(b)(6), arguing that the
appellants had failed to state a claim under ECOA, the APA or
the Declaratory Judgment Act, 28 U.S.C. §§ 2201 et seq. On
March 20, 2002, the district denied the motion in part and
granted it in part, relying on its earlier—and similar—order in
Love v. Johanns, No. 00-2502 (D.D.C. Dec. 13, 2001). Garcia
v. Veneman, No. 00-2445 (D.D.C. Mar. 20, 2002), reprinted in
JA 95-99. Of relevance here, the court dismissed the failure-to-
investigate claim, concluding that the appellants failed to state
a claim under ECOA because the investigation of a
discrimination complaint is not a “credit transaction” within the
meaning of ECOA. JA 97-98. It further held that the claim was
not cognizable under the APA because ECOA provides “an
adequate remedy.” JA 97-98.
5
All references are to the appellants’ Second Amended Complaint.
The appellants eventually moved to file a Third Amended Complaint,
which the district court denied. See Garcia v. Veneman, 224 F.R.D.
8, 16 (D.D.C. 2004); see also infra n.13.
6
On December 2, 2002, the district court denied class
certification. Garcia v. Veneman, 211 F.R.D. 15 (D.D.C. 2002)
(Garcia I). It concluded that the appellants failed to show the
required “commonality” under Federal Rule of Civil Procedure
23(a)(2) and did not represent a certifiable class under Rule
23(b). They did not show commonality, the court concluded,
because they did not demonstrate that the Department operated
under a general policy of discrimination nor did they identify a
common USDA policy or practice that disparately affected
them. Id. at 19-22. The court then considered whether the
requested class could be certified under Rule 23(b) and
concluded that Rule 23(b)(2) certification was inappropriate
because the $20 billion in damages they sought predominated
over their request for equitable relief. Id. at 22-23. The court
also found Rule 23(b)(3) certification inappropriate because they
had not shown that common questions predominated. Id. at 23-
24.
After additional discovery, the appellants submitted a
supplemental brief on the issue of commonality, which the
district court treated as a renewed motion for class certification.
Garcia v. Veneman, 224 F.R.D. 8 (D.D.C. 2004) (Garcia II).
They had obtained in discovery 37 USDA loan and disaster
benefit files as well as two USDA databases which, they alleged,
showed the requisite commonality for both their disparate
impact and their disparate treatment allegations of
discrimination. Id. at 10. They argued that the files revealed
that the USDA had denied Hispanic farmers’ applications based
on the subjective, rather than the objective, eligibility criteria set
forth in 7 C.F.R. § 15.6 and that, as a result, the use of subjective
criteria had a disparate impact on them. Id. at 13-15. They also
claimed that the USDA as a “single actor” had treated them
discriminatorily through a pattern and practice of discrimination.
Id. at 10. They listed five sub-patterns of discrimination,
including (i) refusal to provide Hispanic farmers with loan
applications or assistance in completing applications; (ii)
7
subjecting Hispanic farmers to protracted delays in processing
and funding their loans; (iii) using subjective criteria to reject
the applications of Hispanic farmers; (iv) unnecessarily
subjecting Hispanic farmers to the inconvenience of supervised
bank accounts; and (v) delaying or denying loan servicing for
Hispanic farmers. Id. at 10. The court nevertheless concluded
that, even with their supplementation, they failed to demonstrate
commonality.
On September 24, 2004, the appellants moved the district
court to certify the order dismissing their failure-to-investigate
claim for interlocutory appeal under 28 U.S.C. § 1292(b), which
motion the court granted. Garcia v. Veneman, No. 00-2445
(D.D.C. Sept. 27, 2004). In accordance with Federal Rule of
Civil Procedure 23(f), the appellants petitioned this court on
September 22, 2004 for leave to file an interlocutory appeal of
the class certification denial, which petition we granted. In re
Garcia, No. 04-8008 (D.C. Cir. Dec. 16, 2004). Before us for
review, then, are three orders, namely Garcia, No. 00-2445
(D.D.C. Mar. 20, 2002) (granting motion to dismiss), Garcia I,
211 F.R.D. 15 (D.D.C. 2004) (denying class certification), and
Garcia II, 224 F.R.D. 8 (D.D.C. 2004) (denying class
certification again).
II.
As we have recognized, the district court is “uniquely well
situated” to rule on class certification matters. Wagner v.
Taylor, 836 F.2d 578, 586 (D.C. Cir. 1987). Accordingly, we
review a certification ruling “conservatively only to ensure
against abuse of discretion or erroneous application of legal
criteria,” id., and we will affirm the district court even if we
would have ruled differently in the first instance. See McCarthy
v. Kleindienst, 741 F.2d 1406, 1410 (D.C. Cir. 1984).
Under Federal Rule of Civil Procedure 23(a), a plaintiff
seeking class certification must show that:
8
(1) the class is so numerous that joinder of all members
is impracticable, (2) there are questions of law or fact
common to the class, (3) the claims or defenses of the
representative parties are typical of the claims or
defenses of the class, and (4) the representative parties
will fairly and adequately protect the interests of the
class.
Failure to adequately demonstrate any of the four is fatal to class
certification. See In re Lorazepam & Clorazepate Antitrust
Litig., 289 F.3d 98, 106 (D.C. Cir. 2002). The district court
found that the appellants failed to show “questions of law or fact
common to the class” or “commonality” under Rule 23(a)(2).
We affirm that ruling.6
To establish commonality under Rule 23(a)(2), a plaintiff
must identify at least one question common to all members of
the class. See In re Warfarin Sodium Antitrust Litig., 391 F.3d
516, 528 (3d Cir. 2004). Not every common question, however,
suffices under subsection (a)(2). As the United States Supreme
Court declared of an alleged disparate treatment class in a Title
VII action,
there is a wide gap between (a) an individual’s claim that
he has been denied a promotion on discriminatory
grounds, and his otherwise unsupported allegation that
the company has a policy of discrimination, and (b) the
existence of a class of persons who have suffered the
6
If a plaintiff meets the requirements of Rule 23(a), he must then
establish that class certification is appropriate under one of the three
alternatives of Rule 23(b). See Amchem Prods., Inc. v. Windsor, 521
U.S. 591, 613-16 (1997). Although the district court found that
certification was also inappropriate under subsections (b)(2) and (3),
we do not reach that holding because of our affirmance of its
subsection (a)(2) holding. See Love v. Johanns, No. 04-5449, slip op.
at 13 n.3 (D.C. Cir. March 3, 2006).
9
same injury as that individual, such that the individual’s
claim and the class claims will share common questions
of law or fact and that the individual’s claim will be
typical of the class claims.
Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 157 (1982).7
Following Falcon, we have required a plaintiff seeking to certify
a disparate treatment class under Title VII to “make a significant
showing to permit the court to infer that members of the class
suffered from a common policy of discrimination that pervaded
all of the employer’s challenged employment decisions.”
Hartman v. Duffey, 19 F.3d 1459, 1470 (D.C. Cir. 1994). And
in Love v. Veneman, we held that a showing of commonality for
a disparate treatment class under ECOA requires the plaintiff to
show “(i) discrimination (ii) against a particular group (iii) of
which the plaintiff is a member, plus (iv) some additional factor
that ‘permit[s] the court to infer that members of the class
suffered from a common policy of discrimination.’ ” No. 04-
5449, slip op. at 9. (emphasis in original) (citation omitted)
(alteration in original).
Regarding the appellants’ challenge to Department action
with an allegedly class-wide discriminatory impact, they must
make a showing sufficient to permit the court to infer that
7
Other courts have used Title VII precedent in cases involving
ECOA. See, e.g., Mays v. Buckeye Rural Elec. Co-op., Inc., 277 F.3d
873, 876 (6th Cir. 2002) (“Given the similar purposes of the ECOA
and Title VII, the burden-allocation system of federal employment
discrimination law provides an analytical framework for claims of
credit discrimination.”); Rosa v. Park W. Bank & Trust Co., 214 F.3d
213, 215 (1st Cir. 2000) (“In interpreting the ECOA, this court looks
to Title VII case law . . . .”); Bhandari v. First Nat’l Bank of
Commerce, 808 F.2d 1082, 1100 (5th Cir. 1987) (“The language [of
ECOA] is closely related to that of Title VII of the Equal Employment
Opportunity Act (“EEOA”), 42 U.S.C. § 2000e-2, and was intended
to be interpreted similarly.”).
10
members of the class experienced discrimination as a result of
the disparate effect of a facially neutral policy. See Cooper v. S.
Co., 390 F.3d 695, 716 (11th Cir. 2004). That is, similar to our
formulation of the commonality showing necessary for a
disparate treatment class set out in Love v. Johanns, the
appellants must show for their disparate impact class (i) a
discriminatory impact, (ii) affecting a particular group, (iii) of
which the plaintiffs are members, (iv) resulting from a common
facially neutral policy or practice.
A.
First, the appellants contend that the district court erred in
denying class certification of their discriminatory treatment
claim based on the geographic spread of the local
decisionmakers, labeling it a “pattern and practice” claim, see
Appellants’ Br. at 40. But see Garcia I, 211 F.R.D. at 22
(“Commonality is defeated . . . by the large numbers and
geographic dispersion of the decision-makers . . . .”). As with
a Title VII claim, to establish a charge of pattern and practice
discrimination under ECOA, a putative class must prove that
“discrimination was the company’s standard operating
procedure—the regular rather than the unusual practice.”
Bazemore v. Friday, 478 U.S. 385, 398 (1986) (quoting
Teamsters v. United States, 431 U.S. 324, 336 (1977)).
Similarly, to show commonality under Federal Rule of Civil
Procedure 23(a)(2), the plaintiff must “make a significant
showing to permit the court to infer that members of the class
suffered from a common policy of discrimination that pervaded
all of the [defendant’s] challenged . . . decisions.” Hartman, 19
F.3d at 1472.
“As is now well recognized, the class action
commonality criteria are, in general, more easily met when a
disparate impact rather than a disparate treatment theory
underlies a class claim.” Stastny v. S. Bell Tel. & Tel. Co., 628
F.2d 267, 274 n.10 (4th Cir. 1980). Establishing commonality
11
for a disparate treatment class is particularly difficult where, as
here, multiple decisionmakers with significant local autonomy
exist. Id at 278-80 (reversing class certification because of
geographic separation of workforce and autonomy of local
decisionmakers); see also Cooper, 390 F.3d at 715. The
appellants failed to identify any centralized, uniform policy or
practice of discrimination by the USDA that formed the basis for
discrimination against Hispanic loan applicants with varied
eligibility criteria in over 2,700 counties nationwide over a 20-
year period. Rather, despite the appellants’ allegation that the
USDA’s actions are those of a “single actor,” their claims arise
from multiple individual decisions made by multiple individual
committees. Moreover, they do not cite a single reversal of a
district court’s denial of class certification based on no
commonality resulting from the geographic spread of the
decisionmakers.8 Cf. Stastny, 628 F.2d at 278-79 (district court
abused discretion in certifying class of employees spread
through “great number of geographically dispersed facilities”
with “almost complete local autonomy”). Our standard of
review is deferential and the appellants have failed to convince
8
The appellants contend that we cannot rely on the geographic
spread of defendant decisionmakers in deciding whether to certify a
disparate treatment class. Appellants’ Br. at 40. They are wrong.
See, e.g., Bacon v. Honda of Am. Mfg., Inc., 370 F.3d 565, 571 (6th
Cir. 2004) (no abuse of discretion in denying certification of class of
all black employees at four separate facilities of defendant over 20
year period); Cooper, 390 F.3d at 715 (no abuse of discretion in
denying class certification to employees working for different
defendants throughout wide geographic area and encompassing range
of working environments); Stastny, 628 F.2d at 278-79 (no abuse of
discretion in denying class certification to employees working in
different plants with local decisionmakers throughout state); Webb v.
Merck & Co., Inc., 206 F.R.D. 399, 406 (E.D. Pa. 2002) (denying
class certification “cut[ting] across employment status, job categories,
facilities and geographic regions”).
12
us that the district court abused its discretion in denying class
certification to the appellants’ alleged disparate treatment class.
B.
We next consider the appellants’ claim that the district court
erred in failing to certify a class on whose members the
Department’s facially neutral action has had a discriminatorily
disparate impact. Assuming without deciding that a disparate
impact claim is cognizable under ECOA,9 the claim would
require a plaintiff to “identify a specific policy or practice which
the defendant has used to discriminate and must also
demonstrate with statistical evidence that the practice or policy
has an adverse effect on the protected group.” Powell v. Am.
Gen. Fin., Inc., 310 F. Supp. 2d 481, 487 (N.D.N.Y. 2004)
(recognizing disparate impact claim under ECOA).
The appellants press two alternative theories to support their
contention that the district court erred in not certifying a
disparate impact class. First, they argue that they do not need to
specify a facially neutral practice if it is impossible to determine
which of the USDA eligibility criteria have had the
discriminatory effect, instead borrowing from Title VII’s “one
9
Both Title VII and the Age Discrimination in Employment Act
(ADEA) prohibit actions that “otherwise adversely affect” a protected
individual. See 42 U.S.C. § 2000e-2(a)(2); 29 U.S.C. § 623(a)(2).
The Supreme Court has held that this language gives rise to a cause of
action for disparate impact discrimination under Title VII and the
ADEA. See Smith v. City of Jackson, 125 S. Ct. 1536, 1540 (2005)
(ADEA); Griggs v. Duke Power Co., 401 U.S. 424, 432 (1971) (Title
VII). ECOA contains no such language. We express no opinion about
whether a disparate impact claim can be pursued under ECOA. See
Eisen v. Carlisle & Jacquelin, 418 U.S. 156, 177-78 (1974) (court
should not examine whether “plaintiffs have stated a cause of action
or will prevail on the merits” in determining class certification vel
non).
13
employment practice” notion.10 Alternately, they argue the
USDA’s subjective decisionmaking process constitutes the
common facially neutral practice. We reject both theories and
instead affirm the district court’s denial of class certification
because the appellants failed to show a common facially neutral
USDA farm loan policy, resulting in the disparate effect on them
and the putative class of Hispanic farmers. See Caridad v.
Metro-North Commuter R.R., 191 F.3d 283, 292 (2d Cir. 1999)
10
The appellants cite the“one employment practice” language of
Title VII, see 42 U.S.C. § 2000e-2(k)(1)(B)(I), and argue that it
relieves them from having to tie a disparate impact to a facially neutral
USDA policy. Appellants Br. at 34-38. The Congress added the “one
employment policy” language following the Supreme Court’s holding
in Wards Cove Parking Co. v. Atonio, 490 U.S. 642 (1989). It
provides that “if the complaining party can demonstrate to the court
that the elements of a respondent’s decisionmaking process are not
capable of separation for analysis, the decisionmaking process may be
analyzed as one employment practice.” 42 U.S.C. § 2000e-
2(k)(1)(B)(I). Assuming—again, without deciding—the “one
employment practice” notion applies to an ECOA disparate impact
claim, it does not alter the required commonality showing under
Federal Rule of Civil Procedure 23(a)(2). The appellants erroneously
confuse the commonality showing with the prima facie case of
disparate impact discrimination. See Bacon v. Honda of Am. Mfg.,
Inc., 370 F.3d 565, 572 (6th Cir. 2004) (“Plaintiffs cannot avoid the
heavy lifting of showing eligibility for class certification by conflating
two exceptions to separate rules for adjudicating discrimination
cases.”). Under Rule 23(a)(2), the appellants must show that the
putative class members have something in common—they all suffered
an adverse effect from the same facially neutral policy, see id.—and
their showing must be “significant,” see Hartman, 19 F.3d at 1470.
On the other hand, courts have set a lower bar for establishing a prima
facie discrimination case. See, e.g., Tex. Dep’t of Cmty. Affairs v.
Burdine, 450 U.S. 248, 253 (1981); Bundy v. Jackson, 641 F.2d 934,
950 (D.C. Cir. 1981) (recognizing difficulty plaintiff faces in proving
motive behind employer’s actions).
14
(“Of course, class certification would not be warranted absent
some showing that the challenged practice . . . has a disparate
impact on African-American employees at Metro-North.”). As
the Supreme Court noted in Falcon—where class certification
was denied—“[t]he mere fact that an aggrieved private plaintiff
is a member of an identifiable class of persons of the same race
or national origin is insufficient to establish his standing to
litigate on their behalf all possible claims of discrimination
against a common employer.” Falcon, 457 U.S. at 159 n.15.
In Garcia I, 211 F.R.D. at 21-22, the district court rejected
the appellants’ disparate impact claim because they did not
connect disparate impact with a common facially neutral USDA
policy. They had submitted the declaration of Jerry Hausman,
an expert in econometrics and microeconomics, in which
declaration he concluded that Hispanic farmers received a lower
percentage of USDA loans than white farmers received in 1997.
JA 123. Hausman, however, analyzed all farmers (white and
Hispanic) as opposed to only those farmers (white and Hispanic)
who had applied for USDA loans. After further discovery
produced USDA loan databases, two of which the appellants
used to support their renewed class certification motion, they
submitted the declaration of statistician Karl Pavlovic, who
found that 72 per cent of white applications were approved in
the period from October 1997 to January 2003 while 59 per cent
of Hispanic applications were approved in the same period. JA
477. In Garcia II, the district court assumed a disparate impact
without discussion of Pavlovic’s declaration. Garcia II, 224
F.R.D. at 11. The court, however, again concluded that the
appellants had failed to connect the disparate impact to a
common facially neutral USDA policy. Id. (rejecting
appellants’ argument because “[n]ot only does it ‘leapfrog to the
merits,’ . . . but it also boils down to the proposition that
unexplained discrepancies in the distribution of government
benefits satisfy the commonality requirement of Rule 23(a)(2)
without more”).
15
The appellants attempted to connect the disparate impact to
USDA’s subjective loan decisionmaking criteria, relying in part
on statistical evidence. But their statistical analyses were
analytically flawed because they did not incorporate key
relevant variables connecting disparate impact to loan
decisionmaking criteria. See Bazemore v. Friday, 478 U.S. 385,
400 n.10 (1986) (“some regressions [are] so incomplete as to be
inadmissible as irrelevant”). It does not suffice under Rule
23(a)(2) to show an ethnic imbalance in the USDA’s award of
loans to farmers; rather, the appellants must show that a
common facially neutral policy caused the imbalance. See
Wards Cove Packing Co. v. Atonio, 490 U.S. 642, 656-57 (1989)
(“[A] Title VII plaintiff does not make a case of disparate
impact simply by showing that, ‘at the bottom line,’ there is
racial imbalance in the work force.”); Caridad, 191 F.3d at 292.
The appellants could have done this, for instance, by employing
multiple regression. See Love v. Johanns, No. 04-5449, slip
op. at 16 (“Instead of conducting a relatively simple statistical
analysis (such as a multiple regression) to control for any or all
of these variables, O’Brien simply reported a series of
elementary cross-tabulations, from which it is impossible—as a
statistical matter—to draw meaningful conclusions.”); see also
Segar v. Smith, 738 F.2d 1249, 1261 (D.C. Cir. 1984) (“Multiple
regression is a form of statistical analysis used increasingly in
Title VII actions that measures the discrete influence
independent variables have on a dependent variable such as
salary levels.”). The appellants’ statistics failed to account for
variables that affected the analyses such as whether fewer
Hispanic farmers were U.S. citizens, whether Hispanic farmers
had worse credit and whether Hispanic farmers had less
experience. Love, No. 04-5449, slip. op. at 15-16.
The district court thus acted within its discretion in rejecting
the appellants’ statistical showing as insufficient to infer
classwide discrimination arising from the Department’s
administration of the farmers’ loan programs. Its decision to
16
deny class certification “did not constitute a clear error of
judgment, nor [was it] otherwise outside the range of choices the
district court was allowed to make.” Cooper, 390 F.3d at 715.
We, of course, do not suggest that statistical evidence alone
could never show commonality; we simply believe that the
district court did not abuse its discretion in finding the
appellants’ statistical evidence inadequate. See Hartman, 19
F.3d at 1473 (“While statistics can generally be probative of the
question of commonality, we would feel uncomfortable in
resting on the trial statistics in the present record for a final
determination of commonality.”).11
11
We think the class certification issue here is similar to that in
Cooper v. Southern Co., 390 F.3d 695 (11th Cir. 2004), in which the
Eleventh Circuit affirmed the denial of class certification in a Title VII
action. Seven African-American employees of Southern Company
and several of its subsidiaries sought to represent a class alleging
disparate impact and disparate treatment claims in connection with
promotion opportunities, performance evaluations and compensation.
The court found that the “plaintiffs’ statistical evidence was
insufficient to establish a presumption of discrimination common to
the claims of all members of the putative class.” Id. at 719 (emphasis
in original). “[A]nalytical flaws in the statistical evidence” prevented
the Cooper plaintiffs from making a showing sufficient to “ ‘raise a
presumption of discrimination arising from the collective whole of
Defendant’s compensation and promotion policies. Thus, disparate
impact analysis produce[d] no evidence common to the claims of all
class members.’ ” Id. at 716 (quoting Cooper v. S. Co., 205 F.R.D.
596, 613 (N.D. Ga. 2001)) (alteration and emphases in original). The
statistical evidence there did not account for variables such as an
employee’s type or level of acquired skills and field of study, the
quality, type and relevance of an employee’s experience, an
employee’s job performance, etc., to ensure that black and white
employees were similarly situated. Compare id. at 717 with Caridad
v. Metro-North Commuter R.R., 191 F.3d 283, 293 (2d Cir. 1999)
(reversing denial of class certification because expert “controlled for
various factors that one would expect to be relevant to the likelihood
of disciplinary action and promotion”). In addition, the statistical
17
The other evidence the appellants relied on—namely, the 37
USDA case files—arguably may have come closer to
establishing commonality because it showed that the USDA
often used the infeasibility of an applicant’s farm plan as one
reason for denying a loan. See Garcia II, 224 F.R.D. 14 (farm
plan infeasibility given as one reason for almost half of loan
rejections). Nonetheless, mindful of our limited scope of
review, see supra at 9, we do not believe that the district court
abused its discretion in denying class certification. The USDA
denied loans for a variety of reasons, including inadequate farm
plans and lack of funds.12 Mem. in Response to the Court’s July
15, 2003 Order with Respect to Commonality at app. 7, Garcia
v. Veneman, No. 02-2445 (D.D.C. filed Dec. 5, 2003). The case
files as well as the anecdotal evidence upon which the appellants
relied showed that often the appellants were denied loans based
on objective financial data. See id. In sum, the Department
used an array of objective—and individual—justifications in
denying the appellants loans.13 Accordingly, we affirm the
evidence did not reference the named plaintiffs or their specific
similarly-situated comparators and, accordingly, the court found that
they had not established “commonality among these named plaintiffs’
claims and the overall affected class.” Cooper, 390 F.3d at 718
(emphasis in original).
12
For instance, Roberto Salinas and his son jointly applied for an
ownership loan in 2000 and Roberto Salinas solely applied for an
operating loan in the same year. The USDA denied both loans
because of the infeasibility of the farm plan as well as inadequate
verification of Roberto Salinas’s debt. Mem. in Response to the
Court’s July 15, 2003 Order with Respect to Commonality at app. 7,
Garcia v. Veneman, No. 02-2445 (D.D.C. Dec. 5, 2003).
13
In addition to the disparate impact and treatment classes already
discussed, the appellants sought certification of five subclasses.
Garcia II, 224 F.R.D. at 15-16. The five subclasses were set forth in
their proposed Third Amended Complaint, see JA 512-13, which the
18
district court’s denial of class certification of the appellants’
disparate impact claim.
III.
We have jurisdiction to review, in our discretion, the district
court’s dismissal of the appellants’ failure-to-investigate claim
under ECOA and the APA pursuant to 28 U.S.C. § 1292(b). The
appellants must persuade us that exceptional circumstances
justify a departure from the ordinary policy of postponing
appellate review until after entry of final judgment. See United
States. v. Philip Morris USA, Inc., 396 F.3d 1190, 1209 (D.C.
Cir. 2005).
We exercise our jurisdiction over the dismissal of the ECOA
failure-to-investigate claim, as we did in Love v. Johanns, and
affirm the district court’s dismissal for the same reason—the
failure to investigate a discrimination complaint is not a “credit
transaction” within the meaning of ECOA. Love v. Veneman,
No. 04-5449, slip op. at 17-18. We decline, however, to
exercise our jurisdiction regarding the appeal of the denial of the
appellants’ failure-to-investigate claim made under the APA.
As in Love, the class certification issues took most of the trial
court’s and the parties’ attention and unlike the straightforward
statutory construction issue the appellants’ ECOA failure-to-
investigate claim presents, we think this claim will benefit from
further development in the district court.14 Id. at 18.
district court denied without prejudice. Garcia II, 224 F.R.D. at 16.
Their challenge to the district court’s denial of their motion to amend
is supported by conclusionary assertions only, see Appellants’ Br. at
44, and they have therefore waived the issue. See United States v.
Yeh, 278 F.3d 9, 16 n.4 (D.C. Cir. 2002).
14
Before us, the appellants used slightly more than four pages of
their 59-page brief and no time at oral argument addressing the APA
failure-to-investigate claim.
19
For the foregoing reasons, we affirm the district court’s
denial of class certification as well as its dismissal of the failure-
to-investigate claim asserted under ECOA. We dismiss the
appeal of the APA failure-to-investigate claim and remand to the
district court for further proceedings consistent with this
opinion.
So ordered.