Opinion
No. CIV 98-1294-PHX-RCB
September 27, 2001
Charles Robert Collins, Collins Collins, Phoenix, AZ, for Plaintiff.
John Robert Mayfield, Esq., US Attorney's Office, Phoenix, AZ, for Defendant.
ORDER
Defendant's Motion for Judgment Notwithstanding the Verdict is pending before the court. In the event that the court denies this motion, Defendant seeks a new trial. Barring that, Defendant proposes remittitur of the jury verdict and judgment. Plaintiff has responded. Plaintiff has also sought an award of attorneys' fees. The matters are fully briefed. Having carefully considered the arguments of the parties, the court now rules.
BACKGROUND
Plaintiff Lewis Kunzler is an employee of the Internal Revenue Service (IRS). He believed he had been discriminated against on the basis of his race and sex when he was denied a promotion. Subsequently, he felt that the IRS had retaliated against him for his protesting his treatment. He filed suit, contending that the IRS had violated Title VII. At the close of plaintiff's case-in-chief, the IRS timely moved for judgment as a matter of law. Minute Entry of October 31, 2000 (doc. #55). The court denied the motion and allowed the trial to proceed. On November 3, 2000, a jury agreed with Kunzler, awarding him $366,775.00 on the discrimination claim and $175,000.00 on the retaliation claim. Judgment (doc. #66).
DISCUSSION
A. Motion for Judgment as a Matter of Law.
Under Rule 50, judgment may be granted as a matter of law (j.m.o.l.) after a party has been fully heard on an issue and there is no legally sufficient evidentiary basis for a reasonable jury to find for that party on that issue. Fed.R.Civ.P. 50(a). A j.m.o.l. motion must be made before the case is submitted to the jury. If not granted at that time, the matter is given to the jury to produce a verdict, subject to the court's later deciding of the legal questions raised in the motion. The motion may be renewed after entry of judgment. Fed.R.Civ.P. 50(b).
Whether the evidence presented at trial is sufficient to create an issue of fact for the jury or will permit the court to enter judgment as a matter of law is a question of law. Lange v. Penn Mut. Life Ins. Co., 843 F.2d 1175, 1181 (9th Cir. 1988). the standard is whether the evidence is such that a rational jury could properly return a verdict only for the movant, Walker v. KFC Corp., 728 F.2d 1215, 1233 (9th Cir. 1984), which "mirrors" the standard for granting summary judgment. Reeves v. Sanderson Plumbing Products, Inc., 530 U.S. 133, 150, 120 S.Ct. 2097, 2110 (2000) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250-251, 106 S.Ct. 2505 (1986)). More than a scintilla of conflicting evidence must be adduced before there can be an issue requiring submission to a jury. 9A Charles A. Wright and Arthur R. Miller, Federal Practice and Procedure § 2524 at 253 (2d ed. 1995).
The court cannot weigh the evidence or assess witness credibility, but rather must draw all reasonable factual inferences in favor of the nonmovant, as it does in deciding motions under Rule 56. Lytle v. Household Mfg., Inc., 494 U.S. 545, 554, 110 S.Ct. 1331, 1338 (1990). "[A]lthough the court could review the record as a whole, it must disregard all evidence favorable to the moving party that the jury is not required to believe." Reeves, 530 U.S. at 151, 120 S.Ct. at 2110. The court should consider only properly admitted evidence to determine whether the non-movant's proof is sufficient. Weisgram v. Marley Co., 528 U.S. 440, 120 S.Ct. 1011, 1020-21 (2000).
1. Evidentiary challenges
Defendant challenges evidence admitted by the court on two grounds. Some evidence was allegedly admitted even though Kunzler violated the discovery rules and did not timely produce it to Defendant. Other evidence was admitted despite the court's in limine ruling to exclude it. Before reaching the question of evidentiary sufficiency, the court must ascertain what evidence is to be scrutinized.
a. Discovery violations
Defendant objects to Kunzler's late disclosure of trial exhibits. The issue here is whether a party must disclose every document that it intends to use at trial if the documents are fairly comprehended by the pretrial order. Pretrial orders simplify the issues for adjudication at trial and rationalize attorneys' efforts. United States v. First National Bank of Circle, 652 F.2d 882, 886 (9th Cir. 1981). To effectuate this purpose, the trial court must exclude contentions or evidence not listed in or disclosed in accordance with the pretrial order. Colvin v. U.S. for Use and Benefit of Magini, etc., 549 F.2d 1338, 1340 (9th Cir. 1977). Pretrial orders are to be liberally construed, but theories or evidence not suggested at least implicitly are barred. Bank of Circle, 652 F.2d at 887.
Under the disclosure rules, parties are obliged to do more than simply fit their trial exhibits under the general terms of the pretrial order. Under Rule 26(a)(3)(C), a party "shall provide" "an appropriate identification of each document or other exhibit, including summaries of other evidence, separately identifying those which the party expects to offer and those which the party may offer if the need arises." Fed.R.Civ.P. 26. These disclosures "shall" be made at least 30 days before trial. Id. The rule applies whether the offering party found the document among stacks produced from its adversary's files, obtained it from its adversary's employees, or caught it blowing around on the street.
i. Undisclosed trial exhibits
The IRS contends that exhibits 1-4, 6-14, 24, 26, 33 and 34 were not discussed or disclosed during discovery, were not part of the administrative record, and were not listed in the Final Pretrial Order. The IRS argues that under the Federal Rules of Civil Procedure, Rule 37 (c)(1), information that is not disclosed shall not be used as evidence at trial unless the failure to disclose is harmless or the proponent offers substantial justification.
The IRS made a similar argument just before trial began, which the court rejected. On October 25, 2000, the court denied the IRS's motion to strike Kunzler's trial exhibits. Minute Order (doc. #52). Having reviewed the recorded transcript of this proceeding, the court notes that it found that the February 28, 2000 letter of Kunzler's counsel put the IRS's counsel on notice of Plaintiff's intent to use several documents, and that he should have pursued them on receipt of the letter.
In its Motion to Strike Plaintiff's Trial Exhibits (doc. #45), the IRS objected to Kunzler's Exhibit's 1-14, 24, 26, 33 and 34 as not properly disclosed. The IRS also sought to strike Kunzler's Exhibits 30-32 on the grounds that the court had excluded them on Defendant's Motion in Limine. In response, Kunzler argued that the Pretrial Order, issued seven months before trial, indicated that he would introduce the exhibits objected to. Response (doc. #51). Kunzler's counsel also sent a letter to the IRS on February 28, 2000, purporting to enclose several challenged exhibits, notably Exhibits 7-9. Most of the challenged exhibits had been under the IRS's exclusive control, and Kunzler had to locate copies by other means when the IRS refused to produce them. Kunzler argued that many exhibits are public records subject to judicial notice and that disclosure was therefore not required. Finally, he argued that many of the challenged exhibits are referred to in the IRS's exhibits and therefore discredits the IRS's claims of surprise. The IRS filed an extensive reply, including the following points: (1) Defendant did not intentionally withhold the documents Kunzler obtained through other channels; and (2) even if Defendant should have produced them, Kunzler's failure to disclose his intent to use them cannot be excused. Reply (doc. #48).
The IRS now submits that this ruling was an abuse of discretion. According to the IRS's undisputed account, no initial disclosures were required because the parties had agreed at the Scheduling Conference that the trial would be conducted on the administrative record. The IRS argues that Rules 26(e)(1) and 26(a)(3)(C) require Kunzler to supplement any information beyond that contained in the administrative record and that Rule 37(c) bars the introduction of any information not disclosed. The IRS further argues that the exhibits in question cannot be fairly linked to Kunzler's requests for document production nor can they have put the IRS on actual notice of Kunzler's planned exhibits and theories of liability. The IRS states that it did not receive the exhibits Plaintiff's counsel claims to have included with a letter in February 2000. The IRS argues that as a result of the court's error with respect to this disclosure issue, Kunzler misrepresented its promotion selection process and the law governing Title VII nonselection cases.
In response, Kunzler's principal argument is that even discounting the challenged exhibits, the evidence supports the verdict and a Rule 50 motion cannot be granted. He argues that the defense had notice that he intended to introduce documents of the nature of the exhibits because of the Pretrial Order.
Kunzler's attempts to defend the court's ruling on the Motion to Strike are underwhelming. Carriger v. Stewart, 132 28 F.3d 463, 480 (9th Cir. 1997) (en banc), discusses a state prosecutor's duty, pursuant toBrady v. Maryland, 373 U.S. 83, 83 S.Ct. 1194 (1963), to disclose material exculpatory evidence to the defense, and has no obvious bearing on the significance of civil discovery violations. Kunzler also contends that the challenged documents were admissible — an issue completely distinct from whether or not they were properly disclosed.
The IRS reads Kunzler's limited response to concede that many of his exhibits were never produced before trial. The IRS believes it is fundamentally unfair to expect its counsel to have knowledge of all of the documents possessed by the IRS and to "divine and discern" those that Kunzler would use.
The court will confine its discussion of the sufficiency of the evidence to those admitted exhibits identified as the "focus" of the IRS's motion, skipping what must by implication be peripheral exhibits. The IRS has specifically targeted Exhibits 1, 2, 5, 6, 7, 8, 9, and 24.See Motion at 4. Exhibit 1 was not admitted. See Exhibit List (doc. #62). Defense counsel's objection at trial was sustained. There is no basis for prejudice to have accrued on account of this exhibit. The IRS does not indicate the grounds on which it objects to Exhibit 5, for Exhibit 5 was apparently the only exhibit the IRS received enclosed with the February 28 letter. The court will not analyze the impact of Exhibit 5. The following exhibits are subject to more serious challenge:
Exhibit 2: IRS Memorandum dated October 26, 1992
Exhibit 6: Objective 6 Strategic Business 1996
Exhibit 7: IRS Memorandum dated January 16, 1996
Exhibit 8: IRS Memorandum dated June 28, 1996
Exhibit 9: IRS Memorandum dated September 9, 1996
Exhibit 24: IRS Policy Statement on Promotions
Motion at 4.
If the court were to accept Kunzler's allegations about the enclosures with his February 28, 2000 letter, only Exhibits 2, 6, and 24 would be in question. Kunzler contends that the defense received Exhibits 7, 8 and 9 with when it received Exhibit 5, because defense counsel refers to "documents" in sending the letter and its enclosure(s) to his assistant. The IRS, on the other hand, has submitted what it avers to be a complete copy of Kunzler's attachments, which does not include exhibits 7, 8 and 9. The court determined before trial that counsel for the IRS was obliged to follow up on any exhibits missing from the February 28 enclosure because plaintiff's counsel's reference to multiple enclosures put defense counsel on notice. The court continues to believe this position is justified. The court shall consider the consequence of admitting Exhibits 2, 6 and 24 only.
Plaintiff plainly failed to comport with the rules, for it is undisputed that he did not provide defense counsel copies of Exhibits 2, 6, and 24. Plaintiff has not established any justification for failure to disclose the IRS publications he obtained, much less a substantial one. If he had doubts about the IRS's compliance with his discovery request, a motion to compel is the sanctioned course of action. Yet Kunzler never followed up on the IRS's responses to his interrogatories, but instead sought to bypass the discovery process by obtaining the documents he wanted from the IRS from other sources. This approach would presumably have been fine so long as Kunzler had supplemented his disclosures to Defendant to indicate to the IRS that he had found the IRS publications he sought from other sources and intended to use them. Instead, he waited until the eve of trial to announce his intent to use the documents. Kunzler's tactic had the effect of holding defense counsel responsible for every document created by the IRS simply because the IRS is his client. While this conduct is unreasonable, there is some question whether the IRS did comply with Kunzler's discovery request. On balance, the IRS has the better position.
ii. Remedy
Courts "shall" discipline discovery violations, but have discretion over which sanctions to apply. Amarel v. Connell, 102 F.3d 1494, 1515 (9th Cir. 1997). This discretion may be exercised by excluding evidence.Campbell Industries v. M/V Gemini, 619 F.2d 24, 27 (9th Cir. 1980). Rule 37(c)(1) provides:
A party without substantial justification fails to disclose information required by Rule 26(a) or 26(e)(1) shall not, unless such failure is harmless, be permitted to use as evidence at trial . . . information not so disclosed.
Fed.R.Civ.P. 37(c)(1). Exclusion of evidence for failure to comport with Rule 26 is a severe sanction, however, and may be inappropriate "unless the failure to disclose or supplement is in bad faith or the resultant prejudice to the opposing party cannot be cured because, for example, use of the evidence is `imminent or in progress.'" Fitz, Inc. v. Ralph Wilson Plastics Co., 184 F.R.D. 532, 536 (D.N.J. 1999). Under the circumstances, the court shall not consider the challenged documents to support the verdict when it reviews the sufficiency of the evidence.
b. Changed ruling
Prior to trial, the court granted Defendant's Motion in Limine to exclude what became Plaintiff's Exhibit 32, a list of promotions in the IRS over two years. Order of October 17, 2000 (doc. #43). Defendant assumed and the court accepted that Exhibit 32 was intended to demonstrate a pattern in the IRS's employment practices. The in limine ruling cited the lack of foundation for the document and excluded it without prejudice.
On October 26, 2000, Kunzler was allowed to testify on direct about the circumstances of other promotions he had actual knowledge of. On October 31, during cross-examination, defense counsel asked Kunzler whether he had ever claimed that he had been subjected to a hostile work environment. Kunzler's answer was somewhat nonresponsive. He did not state whether his claims included a hostile work environment theory. Instead, he stated quite emphatically that he felt that he had been subjected to a hostile work environment. He stated that "all emphasis" in the IRS's hiring and promotion policy was toward advancing women and minorities. He stated that he had made up a list at one point, which indicated that of twenty-odd promotions, only five went to males. Defense counsel cautioned Kunzler not to stray into areas precluded by earlier orders of the court. Plaintiff's counsel objected that the defense had opened the door to such a statement, and the court agreed that the door had been "cracked." Consequently, defense counsel attempted to disprove the alleged pattern of discriminatory promotions in the course of questioning other witnesses.
The court has reviewed the amended complaint (doc. #11), the joint pretrial order (doc. #24) and Plaintiff's proposed jury instructions (docs. #41, 57), and has found no articulation of a hostile work environment theory.
On November 2, during Plaintiff's rebuttal case, Plaintiff's counsel sought to admit Exhibit 32A, which differs from Exhibit 32 only in form. The court held that defense counsel had opened the door to the exhibit by inquiring into the circumstances of other promotions. The IRS objects that this was error. Kunzler does not address this issue. The court finds that while defense counsel did open the door to testimony on the subject of other promotions, the door was open to admissible evidence only. The question is whether Exhibit 32A was admissible for the purposes Kunzler sought.
Exhibit 32 was created by the EEOC. It was a one-page document that repeated the contents of a two-page document created by Kunzler. Kunzler's original version was admitted as 32A.
If the evidence were used to establish disparate impact, evidence of a pattern as to who received promotions is admissible only if it is sufficiently reliable. See, Watson v. Fort Worth Bank Trust, 487 U.S. 977, 996, 108 S.Ct. 2777 (1988). Proper comparison analysis is based on "the composition of the qualified population in the relevant labor market." Foss v. Thompson, 242 F.3d 1131, 1135 (9th Cir. 2001). There was no showing of an acceptable statistical basis for the conclusions Exhibit 32A may be read to suggest about a pattern of hiring women and minorities. The list showed only the names of persons who received promotions, the grade they were promoted to, the position they obtained, and the approximate date of promotion. It makes no representation that the information was gathered in a neutral and consistent way. There is no evidence about the composition of the qualified population competing for these promotions. Rather, it was entirely anecdotal. Indeed, Kunzler has described it as "his recollection" of events. Thus, it lacked the requisite degree of reliability and probativeness to be admitted as evidence of a pattern in the IRS's hiring and promotion practice.
On the other hand, if Exhibit 32A was not admitted for the purposes of showing disparate impact, and was admitted for some other purpose, whether it was statistically sound or derived from the relevant comparisons is unimportant. Kunzler described the list in the context of explaining why he felt retaliated against when he filed his discrimination complaint. It appears that he conceived of the list as expressing why his supervisors had a motive to retaliate. Regardless whether the list objectively demonstrated a pattern of discrimination in promoting, the perception of Kunzler's colleagues at the IRS was the key. As long as a pattern was perceived, the Defendants may have had cause to be defensive about Kunzler's complaint. Thus, the court concludes that to the extent the list was not intended to demonstrate an objective pattern of discrimination in promoting, but to suggest that Tapley and Brimacombe had cause to be furious when Kunzler complained about mistreatment in his case, it was admissible.
2. Sufficiency of properly admitted evidence
To grant the IRS's Rule 50(b) motion, the court must find that the properly admitted evidence does not make out a case for Kunzler. Weisgram v. Marley Co., 528 U.S. 440, 121 S.Ct. 1011, 1020-21 (2000). The IRS contends that Kunzler did not make out a prima facie case of discrimination or retaliation, and that he should not have been awarded front pay as damages. The IRS contends that Kunzler's evidence failed to support either a disparate treatment or disparate impact theory, although Kunzler never made clear the theory on which he relied. In response, Kunzler does not directly respond to the question about which theory of discrimination he used, but instead describes his burden by referring to the jury instructions. Response at 12.
While it is true that Kunzler's theory of discrimination is unclear, the IRS cites no authority for its position that because it is not clear on which theory the jury based its verdict, the verdict must be set aside. In the court's view, so long as the evidence supports a finding of discrimination under either the disparate impact or disparate treatment theory, the jury's verdict on the discrimination claim will stand.
a. Plaintiff's discrimination case
The analysis set forth in McDonnell Douglas Corporation v. Green, 411 U.S. 792, 802-05, 93 S.Ct. 1817 (1973), governs disparate treatment claims. Llamas v. Butte Community College District, 238 F.3d 1123, 1126 (9th Cir. 2001). A plaintiff must first establish a prima facie case of discrimination by offering evidence that "give[s] rise to an inference of unlawful discrimination." Texas Dept. of Community Affairs v. Burdine, 450 U.S. 248, 253, 101 S.Ct. 1089 (1981). If the plaintiff establishes a prima facie case, the burden then shifts to the defendant to articulate a legitimate nondiscriminatory reason for its employment decision. See McDonnell Douglas, 411 U.S. at 802-05. Then, in order to prevail, the plaintiff must demonstrate that the employer's alleged reason for the adverse employment decision is a pretext for a discriminatory motive. See id. The jury instruction formulation describes the disparate treatment standard, for it requires the defendant to be "motivated" by an unlawful factor, which bespeaks intentional discrimination.
At trial, two decision makers for the IRS testified that all other things being equal, women and minorities were promoted before white men. Mary Tapley, who was in a position to significantly influence the hiring decision, went further. In her view, women were to be promoted absent a "compelling reason" against them. Tapley's theory does away with the starting presumption that two candidates must be equal before the tiebreaking rule of preference is given; her theory is that even if the candidates are not equal, as long as a female candidate is capable of doing the job, she should have it. Other witnesses testified that they were rewarded for selecting female and minority candidates. There was also testimony that the selecting process could be jiggered to ensure the selection of the preferred candidate. The selecting officers had the power to decide that a certain quality was necessary after interviewing all the candidates. Conceivably, the selecting officers could require a quality unique to the preferred candidate as a way to justify selection of that candidate.
In Kunzler's case, the jury learned that a person in a subordinate position, albeit in a different district, skipped over him to become his superior. Colleagues testified to their opinion that Kunzler was better qualified for the promotion. The Defendant argued that the selecting officers had decided to put a premium on interview performance, and that Kunzler had not done well. This justification could be viewed as pretextual. The credibility of certain key defense witnesses was a serious issue for the consideration of the jury. A reasonable jury could conclude that the female candidate who was selected was not as well-qualified for the promotion as Kunzler because of her lack of experience with the complex tax cases she was to be managing. Tapley's testimony had much greater impact than the IRS publications allegedly admitted in error, for she made the specific decision in Kunzler's case, notwithstanding what the publications prescribed. To the extent that the court improvidently admitted certain documentary evidence, no substantial right of the parties was affected, and the harmless error doctrine precludes undoing the jury's verdict. Accordingly, the verdict finding in favor of Kunzler must be upheld.
By contrast, the court does not believe that the evidence presented correlates to a disparate impact claim, and therefore it cannot be maintained that Kunzler prevailed on that theory. Generally, in order to prevail on a disparate impact claim of age discrimination, a plaintiff must prove that a challenged employment policy or practice, while facially neutral, has a disparate impact on certain employees "because of their membership in a protected group," Watson v. Fort Worth Bank and Trust, 487 U.S. 977, 994, 108 S.Ct. 2777 (1988). To state a prima facie case under a disparate impact theory, a plaintiff must demonstrate (1) the occurrence of certain outwardly neutral employment practices, and (2) a significantly adverse or disproportionate impact on persons of a particular group produced by the employer's facially neutral acts or practices. Katz v. Regents of the University of California, 229 F.3d 831, 835 (9th Cir. 2000).
The facially neutral practice in issue here is Defendant's selecting process, which is supposed to result in the selection of female and minority candidates in the event of a tie. The evidence presented was anecdotal and does not demonstrate a disproportionate or significantly adverse impact on white males in general. Had Kunzler proceeded only on a disparate impact theory, or had the jury instructions supported only this theory, the discrimination verdict might have to be overturned. As it is, the failure of a disparate impact theory does not require modifying the verdict because it is justified on a disparate treatment theory.
b. Plaintiff's retaliation case
To establish a prima facie case for retaliation, plaintiff must show: (1) he has engaged in a protected activity; (2) he has suffered an adverse employment decision; and (3) there was a causal link between the protected activity and the adverse employment decision. Yartzoff v. Thomas, 809 F.2d 1371, 1375 (9th Cir. 1987); Morgan v. National Railroad Passenger Corp., 232 F.3d 1008, 1017 (9th Cir. 2000). On the second prong, an action is cognizable as an adverse employment action if it is based on a retaliatory motive and is reasonably likely to deter employees from engaging in protected activity. Ray v. Henderson, 217 F.3d 1234, 1243 (9th Cir. 2000) (adopting the EEOC guideline standard, which is also used in the First, Seventh, Tenth, Eleventh and D.C. Circuits). Under this standard, lateral transfers, unfavorable job references, and changes in work schedules are adverse employment actions, but offensive comments by co-workers alone are not. Id. at 1243. In other words, only "non-trivial" employment actions can ground a retaliation claim. See Brooks v. City of San Mateo, 229 F.3d 917, 928 (9th Cir. 2000). Under sufficiently severe or pervasive conditions, such that an abusive working environment developed, a hostile work environment may be the basis for a retaliation claim under Title VII. See Ray, 217 F.3d at 1244-45.
The following allegations comprised the basis for Kunzler's retaliation claim: (1) on January 26, 1998, one employee was removed from Kunzler's managerial oversight; (2) on February 4, 1998, Kunzler was unjustly criticized; (3) on February 9, 1998, Kunzler was denied compensation for actual travel expenses and instead given only a per diem amount, which was a departure from usual practice; (4) on February 10, 1998, Kunzler was unjustly criticized again; (5) on February 11, 1998, Kunzler was accused of trying to make the agency "look bad"; (6) on March 9, 1998, one of Kunzler's subordinates was reassigned to another supervisor without consulting him first; and (7) Kunzler was snubbed by Brimacombe, one of his superiors in the IRS hierarchy, at an IRS social event.
The IRS believes it was entitled to a directed verdict on Kunzler's retaliation claim, on the grounds that he suffered no legally cognizable adverse employment actions. It describes the alleged retaliatory events as "trivial events which are irrelevant, immaterial and permitting such matters to go to the jury only served to further prejudice the defendant." Motion at 26. Defendant attempted to make this point in its Fourth Motion in Limine, which the court recognized as an untimely dispositive motion. Assuming that there were adverse employment actions, it argues that the evidence does not support a $175,000 compensatory damages award. Reply at 17.
The IRS also maintains that the court failed to give a proper form of verdict. The IRS wanted inclusion of a "same decision" defense, which is described as an absolute bar to retaliation damages.
In response, Kunzler has tried to justify only the amount of the award, not its legal propriety.
As a matter of law, unjust criticism and being treated rudely are not actionable, unless they rise to the magnitude of a hostile work environment. Kunzler has not alleged as a theory of recovery that he was subjected to a hostile work environment. Therefore, the only events that register as potentially nontrivial are the reassignment of Kunzler's subordinates, events numbered as one and six, and the denial of reimbursement for actual expenses event number three. Kunzler testified that subordinates are not usually reassigned without deliberations involving the affected manager. The removal of subordinates could both decrease Kunzler's practical ability to accomplish his assigned responsibilities and be a bureaucratic affront. The denial of actual travel expenses can be viewed as a niggardly action specifically intended to annoy. Kunzler does not report a simultaneous decrease in his authority, however, much less a reduction in his pay or other prerogatives. Indeed, Kunzler himself admitted on cross-examination that these adversities were not of a sort that would cause him to forgo any protected activity. While the sufficiency of these incidents is a close call, the court concludes that the incidents are colorable.
Challenging Kunzler's showing on the third prong of the prima facie case, the IRS argues that Kunzler failed to show a causal link between his filing complaints about discrimination and the decisions to remove subordinates from his command. Causation may be inferred from the proximity of the protected activity and the adverse employment action, or causation may be established by direct evidence. See Miller v. Fairchild Industries, 797 F.2d 727, 731 (9th Cir. 1986). A long delay between the time of the allegedly triggering protected conduct and the retaliatory reaction can defeat an inference of causation, when the relationship between the parties during that time does not otherwise indicate hostility. See Brady v. Houston Independent School Dist., 113 F.3d 1419, 1424 (5th Cir. 1997).
By Defendant's calculation, 17 months elapsed between the time Kunzler first filed an informal complaint of discrimination, and the 1998 events. While the court does not have a complete record of Kunzler's relationship with the IRS during this time, it notes that the most significant adversity that he articulated during the time-barred period is his failure to be appointed temporary acting chief on certain occasions. There is no record of adverse performance reviews or other more typical retaliatory nastiness. Assuming that the filing of an informal complaint is an appropriate measure for beginning the proximity analysis — as opposed to later stages of Kunzler's challenge — the delay is significant. However, the testimony of defense witnesses betrayed their anger about Kunzler's actions, and their manner could give rise to an inference about the motives for their behavior. The court must draw inferences in favor of the verdict. While the issue of causation is a close call, the court finds that an inference supporting a finding of retaliation could fairly have been made. It concludes that there was sufficient evidence to support the causation prong of the prima facie test.
Therefore, Kunzler satisfied both the adverse employment action and the causation prong of his prima facie retaliation case, and presented sufficient evidence for a jury to find in favor of his claims. Defendant's motion for judgment as a matter of law on this claim is denied.
C. Plaintiff's claim to front pay damages
To receive front pay, a Title VII plaintiff must show that his employer's violations of Title VII caused his loss of employment.Gotthardt. v. National R.R. Passenger Corp., 191 F.3d 1148, 1155 (9th Cir. 1999). Reinstatement is the preferred remedy, but front pay awards are appropriate when reinstatement is impossible or inappropriate due to antagonism between the parties. Thorne v. City of El Segundo, 802 F.2d 1131, 1137 (9th Cir. 1986). Relief equivalent to reinstatement in a nonselection case is a retroactive promotion. The jury does not make a finding of hostility; rather, the court determines that reinstatement is not feasible. Cassino v. Reichhold Chemicals, Inc., 817 F.2d 1338, 1347 (9th Cir. 1987). Only if the court finds front pay available does the jury determine the amount. Id.; Passantino v. Johnson Johnson Consumer Products, Inc., 212 F.3d 493, 513 (9th Cir. 2000).
In this case, the court presented front pay instructions to the jury, but it made no express finding that reinstatement was impossible, and it entered judgment on the award. The court will suspend the award of front pay in order to make a determination of whether reinstatement is possible. It is undisputed that Kunzler continues to be employed by the IRS; any hostility between the parties is apparently not enough to render reinstatement impossible, notwithstanding Kunzler's conclusory arguments to the contrary. Kunzler strongly prefers front pay, but reinstatement is the remedy of first resort. The court is not informed, however, whether the promotion Kunzler sought is available to him.
The IRS argues that equity requires only that a successful plaintiff be awarded a retroactive promotion and then wait for the next available vacancy. Motion at 18. Courts have struggled with the conflict between putting an aggrieved employee in his "rightful place" and "bumping" an incumbent who is innocent of discrimination out of the job so the plaintiff can assume it. See Lander v. Lujan, 888 F.2d 153, 155 (D.C. Cir. 1989) (comparing circuit court decisions). As the Lander court recognized, a bumping remedy comes into play only with unique jobs that have no reasonable substitutes and low turnover, particularly upper-level positions. Id. Lander approved bumping in a case where the plaintiff had been wrongfully denied a promotion to be the chief official at the Bureau of Mines, Department of the Interior. While finding it appropriate to consider the effect of bumping on an incumbent, the court refused to view that concern as dispositive: "[W]e see no indication in the statute nor in logic to lead us to conclude that ordinarily the innocent beneficiary has a superior equitable claim to the job vis-a-vis the victim of discrimination." Id. at 157; accord Doll v. Brown, 75 F.3d 1200, 1205 (7th Cir. 1996). If bumping does not lead to the equitable result, even when unique jobs are at stake, then front pay is awarded. See, e.g., Walsdorf v. Board of Comm'rs, 857 F.2d 1047, 1053-1054 (5th Cir. 1988);Spagnuolo v. Whirlpool Corp., 717 F.2d 114, 121 (4th Cir. 1983).
Here, equity requires that Kunzler be promoted to the GS-15 position he sought in the Phoenix office. The IRS represents that a GS-15 position may be available for Kunzler, but if not, he should receive GS-15-level salary and benefits while continuing to perform his GS-14 job. The court finds the suggestion that Kunzler be paid at a GS-15 level while continuing to be deprived of the promotion to be an inadequate remedy, given the unique nature of the position. The court credits Kunzler's argument that more than money and benefits is at stake in a promotion, including the psychic benefits of job satisfaction, respect of one's peers, among others. Therefore, the Defendant shall have 30 days to either put Kunzler in the GS-15 job in Phoenix he was wrongly denied, or else concede the impossibility of reinstatement.
In the event that the Defendant is unable to place Kunzler in the position he sought, the next question is whether the jury's front pay award should stand. The IRS objects that the award of front pay is based on speculation about how long Kunzler will postpone retirement, because the award does not obligate him to stay for as long as he predicted at trial that he would, and he is already eligible for retirement. In defense of the amount of the award, Kunzler states that the front pay award was based on the evidence he provided about his retirement plans, and that evidence is not speculation. The court finds the jury's front pay award based on the best evidence available and shall uphold it in the event that reinstatement is not possible.
To the extent that Defendant objects to the award of front pay benefits in favor of Kunzler's wife, on the grounds that she was never party to the suit, see Motion at 12 n. 10, Defendant offers no authority for its assertion that the court lacked subject matter jurisdiction to enter judgment in favor of Kunzler's wife. Furthermore, this footnoted issue was not timely raised. The court will not pursue this tangent.
B. Motion for a New Trial
In the event that the court finds the evidence sufficient to uphold the jury's verdict, the IRS argues that trial errors justify a new trial. The IRS demands a new trial on the discrimination and retaliation claims, or at least on the question of damages.
The general grounds for a new trial are that the verdict is against the weight of the evidence, that the damages are excessive, or that the trial was otherwise unfair, and that substantial errors occurred in the admission or rejection of evidence or the giving or refusal of jury instructions. Montgomery Ward Co. v. Duncan, 311 U.S. 243, 251, 61 S.Ct. 189, 194 (1940). The court may grant a motion for a new trial upon a finding either that erroneously admitted evidence undermines Kunzler's case to a degree putting the outcome in doubt, or that evidence was admitted that was unduly prejudicial to the IRS. Weisgram v. Marley Co., 528 U.S. 440, 120 S.Ct. 1011, 1020-21 (2000). A new trial is necessary if the jury's verdict is the result of passion or prejudice. Pershing Park Villas Homeowners Ass'n v. United Pacific Ins. Co., 219 F.3d 895, 905 (9th Cir. 2000). Defendant bears the burden of showing harmful error. 11 Charles A. Wright, et al., Federal Practice Procedure § 2803 (2d ed. 1995).
With respect to the retaliation issue, the court finds no new trial necessary. While both the nature of the allegedly retaliatory events and the lapse of time between incidents and complaint make this claim a close call, the court finds the verdict fairly supported by the evidence.
With respect to the discrimination claim, the court is empowered to grant the motion for a new trial even though substantial evidence supports it, if the verdict is against the clear weight of the evidence.Landes Const. Co., Inc. v. Royal Bank of Canada, 833 F.2d 1365, 1371 (9th Cir. 1987). Having combed the motion, the court has identified three allegations by Defendant to support its demand for a new trial. First, Defendant argues that the jury erred by ignoring the evidence. See Motion at 12. Defendant's conclusory argument provides no grist for fact-based, case-specific analysis. For the reasons set out above, the court finds that the verdict is supported by the clear weight of the evidence.
Second, Defendant argues that the court erred by failing to give the jury instructions on the "mixed-motives" defense. Motion at 44. The focus of Defendant's argument is not so much on the jury instructions, but the special forms of verdict or special interrogatories it wished to use to present the mixed-motives defense. Defendant argues that special verdict forms were necessary not only to present the mixed-motives defense, but also because there were three theories of discrimination in play, and the damages available for the theories differ. Kunzler makes no express reference to the mixed-motives theory — or any other theory of Title VII liability, for that matter — but he contends that "the principles included in the instructions given allowed Defendant to argue the merits of his defenses." Response at 24.
A plaintiff can prevail under Title VII so long as the illicit criteria (here, sex and race) were "motivating factors" in the complained-of adverse treatment. 42 U.S.C. § 2000e-2 (m). The mixed-motives theory allows an employer to avoid liability for considering impermissible factors in making an employment decision, if it can prove that it would have reached the same decision regardless. Price Waterhouse v. Hopkins, 490 U.S. 228, 242, 109 S.Ct. 1775, 1786 (1989). While Price Waterhouse was partially overruled by the 1991 Civil Rights Act, the proposition still stands that an employer may limit the employee's remedy if it shows by a preponderance of the evidence that it would have made the same decision apart from an illegal motive. O'Day v. McDonnell Douglas, 79 F.3d 756, 760 (9th Cir. 1997).
Defendant proposed a mixed motives instruction with Requested Instruction No. 67, submitted on November 2, 2000 as part of a supplement to the sixty-three proposed instructions Defendant had submitted the week before. Requested Instruction No. 67 reads:
The defendant claims that even if Mr. Kunzler's race, color or sex was a motivating factor in its decision not to promote him, the defendant would have made the same decision to promote Ramona Feliciano even in the absence of the unlawful motive.
If you find [that the defendant] has established by a preponderance of the evidence that [it] would have, more likely than not, made the same employment decision even if the unlawful motive [were] not present, you should so indicate on the verdict form.
The court gave the following instruction:
If you find that the Plaintiff's race, color or sex was a motivating factor in the Defendant's decision not to promote the Plaintiff, the Plaintiff is entitled to your verdict, even if you find that the Defendant's conduct was also motivated by a lawful reason.
However, if you find that the Defendant's decision was motivated both by race, color or sex and a lawful reason, you must decide whether the Plaintiff is entitled to damages. The Plaintiff is entitled to damages unless the Defendant proves by a preponderance of the evidence that the Defendant would have made the same decision even if the Plaintiff's race, color or sex had played no role in the employment decision.
Jury Instructions at 6. The mixed-motives theory was clearly presented to the jury as an affirmative defense to damages, and not as a defense to liability. While the instruction given speaks in terms more general than Defendant proposed, its consistent focus on the actions of the Defendant vis-a-vis the Plaintiff is a clearer formulation and achieves the desired result. Accordingly, the court is satisfied that the jury was adequately instructed on the mixed-motives defense. The special verdict form and special interrogatories, asking the jury to consider whether the outcome of Kunzler's promotion bid would have been the same in the absence of impermissible considerations, would have been redundant. That use of a special verdict form has been upheld in an analogous case, see Medlock v. v. Ortho Biotech, Inc., 164 F.3d 545, 553.54 (10th Cir. 1999), certainly does not mean that a special verdict form is prescribed. The appropriate inquiry is whether the jury instructions as a whole are misleading or inadequate to guide the jury's deliberations. United States v. Holmes, 229 F.3d 782, 786 (9th Cir. 2000). Defendant's efforts to champion the special verdict form have not demonstrated that the instructions given were inadequate or misleading with respect to the mixed-motives defense.
As to the differing availability of damages under various theories of liability, any error was harmless. The court has held that Plaintiff could not prevail on a disparate impact theory. The only theories for recovery were disparate treatment, based on a showing of intentional discrimination, and retaliation. Having concluded that there was sufficient evidence to support a finding of intentional discrimination, the award of compensatory damages is permissible.
Third, Defendant argues that there was insufficient evidence to support compensatory damages of discrimination verdict of $366,775.00. Motion at 33-34; Reply at 19-20. Excessive damages may be grounds for conducting a new trial. Defendant argues that Kunzler failed to establish his entitlement to compensatory damages, because he did no more than testify that he felt aggrieved. Neither party offers an analysis of the facts presented at trial, but rather each supplies an opinion of the evidence generally. Cf. Hughes v. Electronic Data Systems, 976 F. Supp. 1303, 1307-8 (D.Ariz. 1997) (discussing the evidence supporting an award of compensatory damages). The parties' approach has not proved helpful.
In the absence of a persuasive factual analysis to the contrary, the court is satisfied that the evidence supports a jury finding of emotional and mental anguish and lost enjoyment of life. For better or for worse, work plays a predominant part in our lives, and workplace dynamics preoccupy many people. After having attained a fair amount of success and respect in one's career, being subjected to unjust humiliation in front of one's long-time co-workers could be felt as an agonizing blow. While Defendant asserts that the amount of the award is excessive, the fact that its view of the seriousness of the injury departs from that of the jury does not in itself make the jury verdict wrong. Indeed, defendant's notion of the amount of an appropriate award could arguably be characterized as unbefittingly low. The jury's verdict was fair, and fairly consistent with the injury suffered. Further, the mere fact that other compensatory awards have been substantially reduced does not give cause to disturb the judgment of the trier of fact in this case. The court concludes that the verdict is supported by witness testimony, particularly credibility determinations, and that any trial errors with respect to the admission of evidence were not so substantial as to deprive Defendant of a fair trial. The motion for a new trial is denied.
C. Remittitur
When a court, after viewing the evidence concerning damages in a light most favorable to the prevailing party, determines that the damages award is excessive but not a reflection of passion or prejudice in the jury, it has two alternatives. Seymour v. Summa Vista, 809 F.2d 1385 (9th Cir.) as amended 817 F.2d 609 (9th Cir. 1987). It may grant the motion for a new trial or deny the motion conditional upon the prevailing party accepting a remittitur. In the second alternative, the prevailing party is given the option of either submitting to a new trial or of accepting a reduced amount of damage which the court considers justified. Fenner v. Dependable Trucking. Co., 716 F.2d 598, 603 (9th Cir. 1983).
In reviewing alternative motions for remittitur or a new trial, the court must view the evidence concerning damages in a light most favorable to the prevailing party. Fenner, 716 F.2d at 603. Whether a new trial or remittitur is appropriate is a matter for the court's discretion, see 11 Charles Alan Wright, et al., Federal Practice and Procedure § 2815 at 162 (2d ed. 1995), as is the amount by which a judgment should be remitted. Snyder v. Freight, Construction, General Drivers, Warehousemen and Helpers, Local No. 287, 175 F.3d 680, 690 (9th Cir. 1999).
With respect to the first step, determining whether the verdict is excessive, the court is guided by the principle that jury findings on damages are generally accorded substantial deference. See Del Monte v. City of Monterey, 95 F.3d 1422, 1435 (9th Cir. 1996), aff'd on other grounds, 526 U.S. 687, 119 S.Ct. 1624 (1999). A jury's finding are to be upheld unless the amount is grossly excessive or monstrous, clearly not supported by the evidence, or based only on speculation or guesswork.Id. The Defendant attributes the $541,775 compensatory verdict to "nonpecuniary intangible damages such as emotional pain and suffering and mental anguish," Motion at 37, and asserts that such damages are worth no more than $10,000. Comparison with other Title VII awards forms the basis for Defendant's figure. Kunzler rebuts with a similar approach.
The court is not persuaded that the verdict amount is excessive. For the reasons set forth above in connection with the Rule 50 motion, the court shall not disturb this verdict.
D. Attorneys' fees
Kunzler has moved for an award of attorneys' fees pursuant to 42 U.S.C. § 2000e-5 (k). Defendant challenges the total hours claimed, arguing that some billing entries are not sufficiently described and that others are excessive for the activity described. Defendant contends that the 340.9 hours claimed is unreasonable for what plaintiff's counsel has elsewhere described as a straightforward discrimination case.
His initial request, filed November 9, 2000, failed to comport with Local Rule 2.20(e), in that it did not properly document the hours claimed. Defendant objected to this shortcoming and others. Kunzler then submitted an amended motion that included a task-based itemized statement and affidavit of counsel.
In his reply brief, Plaintiff's counsel explains that he customarily lumps several tasks together because his clients find such documentation sufficient. He argues that he has proposed a lower hourly rate as a "compromise so that the detail [sic] records now complained about by Defendant do not have to be kept." He contends that Defendant's habit of exceeding the page limitation on every brief filed belies his suggestion that the case was simple.
The burden is on Plaintiff's counsel to establish justification for the fees he claims. Hensley v. Eckerhart, 461 U.S. 424, 433, 437, 103 S.Ct. 1933, 1939 (1983). The party opposing the fee application may rebut by submitting evidence challenging the accuracy and reasonableness of the hours charged or the facts asserted by the prevailing party in its submitted affidavits. Blum v. Stenson, 465 U.S. 886, 892, n. 5, 104 S.Ct. 1541, 1545 n. 5 (1984). The court wields considerable discretion in determining a reasonable fee for the prevailing party. Hensley, 461 U.S. at 437, 103 S.Ct. at 1941. It remains incumbent on the court to ensure the reasonableness of Plaintiff's counsel's request, for the court is obliged to articulate reasons supporting either the fees claimed or a departure therefrom. Gates v. Deukmejian, 987 F.2d 1392, 1398 (9th Cir. 1992). A court may refuse to award any fees at all to a prevailing party if the documentation is unacceptable. Norris v. Sysco Corp., 191 F.3d 1043, 1052 (9th Cir. 1999).
The parties agree that $150 per hour is an acceptable lodestar fee. That Plaintiff's counsel finds his clients willing to accept lightly documented bills in deviation from standard civil practice does not justify the fees he seeks here. It is not without significance that Plaintiff and his counsel agreed to a contingency arrangement here, where the client may be less concerned with the amount of time spent by counsel. For the purposes of an attorneys' fee award, the government is entitled to billing records that would satisfy an ordinarily demanding client paying by the hour. There is no way to confirm that counsel's representation of the lumping method and time spent is accurate. Long after the billing dates, the parties are reduced here to conjecture about how those days were spent. It is impossible to authorize an award of fees without some degree of certainty about the award. After making a number of adjustments, as described below, the court shall reduce the amount of fees claimed by thirty percent for lack of adequate documentation.
In justifying a lodestar amount of $150 dollars per hour, counsel for Plaintiff argued, among other things, that the case was undesirable because of the possibility that the IRS might "retaliate against counsel in their personal taxes as a result of the verdict." The IRS justifiably objects to this as unfounded. The court agrees and does not consider it.
Because the parties agree on the lodestar amount, it is unnecessary to consider another argument by Plaintiff regarding the hourly fee; that is, that defense counsel did not approach settlement discussions in good faith. Defendant has objected to the propriety of this allegation.
1. Time spent communicating with client
The IRS objects that counsel spent too much time communicating with his client over the four-year period of litigation. According to the IRS, claimed telephone time totals 9 hours and 28 minutes, letter-writing time totals 20 hours and 12 minutes, and client meeting time totals 21 hours and 16 minutes. In reply, Plaintiff's counsel justifies the time as spread out over a long period. Given the long duration of the suit, the court does not find the client communication time unreasonable, and further, is unwilling to suggest that attorneys should be less responsive to their clients.
2. Lawyers delivering documents
The IRS objects that 9.6 hours are attributed to counsel personally delivering documents to the clerk's office or opposing counsel. The IRS argues that this was an unreasonable way for counsel to effect service, when the standard cost is $45. In reply, Plaintiff's counsel states that he does not employ paralegals, and that personal delivery by an attorney was useful in this case, for there was some dispute about which documents were delivered. The court agrees with the IRS on this issue. Counsel has a duty to delegate appropriate tasks to capable non-attorney staff. A certificate of service by a process server stands in for the personal testimony of a lawyer in the event of document disputes. The 9.6 hours are disallowed.
3. Administrative proceedings
Defendant objects to 23 hours claimed for work done between August 1996 and May 1998 in connection with administrative proceedings. The IRS points out that the work was performed prior to the fee agreement offered as evidence was dated, and that no detail is offered of the activities performed.
Plaintiff's counsel does not attempt to justify this time specifically. Since this time is subject to the thirty-percent reduction applied to the entire fee request for inadequate documentation, further reduction is unnecessary.
The Plaintiff's counsel has submitted that 340.9 hours were spent; total disallowed time is 9.6 hours, which reduces the hours to 331.3 hours. Further reduced by thirty percent for inadequate documentation, the court calculates compensable hours to be 231.9 hours. At $150 per hour, the attorneys' fee award shall be $34,786.50.
THEREFORE IT IS ORDERED, denying Defendant's Motion for Judgment as a Matter of Law (doc. #76-1);
IT IS FURTHER ORDERED, denying Defendant's Motion for a New Trial (doc. #76-2);
IT IS FURTHER ORDERED, denying Defendant's Motion for Remittitur (doc. #76-3);
IT IS FURTHER ORDERED, granting Plaintiff's Motion for Attorneys' Fees (doc. #84);
IT IS FURTHER ORDERED, denying Plaintiff's Motion to Require New Motion and to Extend Time as moot (doc. #72).