 |
|
Part VIII B of the opinion, concerning front pay damages has been amended.
|
|
|||
|
|||
|
|
|||
|
|
|||
|
|
|||
| FindLaw: Laws: Cases and Codes: 9TH CIRCUIT COURT Opinions | |
Email a Link to This Case
http://laws.findlaw.com/9th/9736191v2.html
JENNIFER L. PASSANTINO, and the marital community; CHARLES PASSANTINO, and the marital community, Nos. 97-36191 Plaintiffs-Appellees- 98-35036 Cross-Appellants, D.C. No. v. CV-96-05044-RJB JOHNSON & JOHNSON CONSUMER ORDER AND PRODUCTS, INC., dba Customer AMENDED Support Center, OPINION Defendant-Appellant- Cross-Appellee. UNITED STATES OF AMERICA, Intervenor.
Appeals from the United States District Court
for the Western District of Washington
Robert J. Bryan, District Judge, Presiding
Argued and Submitted
March 11, 1999--Seattle, Washington
Filed March 10, 2000
Amended April 27, 2000
Before: Betty B. Fletcher, Stephen Reinhardt, and
Sidney R. Thomas, Circuit Judges.
Opinion by Judge Reinhardt;
Partial Concurrence and Partial Dissent by Judge Thomas
_________________________________________________________________
SUMMARY
The summary, which does not constitute a part of the opinion of the court,
is copyrighted C 2000 by West Group.
_________________________________________________________________
Labor and Employment/Employment Discrimination
The court of appeals vacated a judgment of the district
court in part and affirmed in part. The court held that in a fed-
eral action alleging sex discrimination in the workplace, the
district court may allocate compensatory damages to state-law
retaliation claims when a jury finds for the plaintiff under
both Title VII and state law, and does not specify any particu-
lar allocation.
During her career with appellant Johnson and Johnson Con-
sumer Products, Inc. (CPI), appellee Jennifer Passantino
became one of the firm's most successful female sales manag-
ers. Even though she worked within the "old boy network" of
the military division, her performance reviews were consis-
tently favorable and reflected that she was well qualified for
promotions.
Passantino began to suspect that she was passed over for
promotions for which she was qualified because of her sex.
Supervisor Williams referred to female employees in sexually
derogatory ways, said that most women probably just wanted
to stay home, and told Passantino that she should look for a
job outside the company because neither CPI nor his boss
were committed to promoting women. Co-workers VanDer-
veer and Kenan exhibited a condescending attitude toward
women.
In 1993, Passantino complained to Williams about his con-
duct and that of VanDerveer and Kenan. Williams was curt
and brusque, telling Passantino that it was her problem to get
along with co-workers. The offensive behavior of all three
men increased in degree and frequency, and in her next per-
formance evaluation, Williams gave Passantino a low rating
for peer relationship. From this point on, Passantino perceived
that she was no longer taken seriously by co-workers and
managers.
Passantino was passed over for several positions. When she
complained, Williams told her it was hard for women to suc-
ceed in the military division. A salary-analysis document
placed in Passantino's personnel file falsely stated that Kenan
and another male manager had received very favorable perfor-
mance ratings, when they had not. At a division meeting,
Hogan made comments indicating that Passantino would be
fired if she did not stop complaining.
When Passantino filed an equal employment opportunity
complaint, CPI removed some of her job responsibilities,
transferred her accounts to other employees, excluded her
from division managers' meetings, and reduced her perfor-
mance goals--indicating that she was less capable.
Williams became distant and communicated less with Pas-
santino, and belittled her participation in policy groups she
had joined at his suggestion. She received product and sales
information late, and lost bonuses and sales opportunities.
Hogan told Passantino that she would have to accept de facto
demotions to get ahead. Her review rated her as unqualified
for high-level positions.
Passantino began feeling the effects of stress, including
various physical ailments that required medical attention.
Fearful that she would lose her job due to her declining per-
formance ratings, she spent less time with her family. Her
advancement within CPI ended.
Passantino sued CPI for violations of Title VII and the
Washington anti-discrimination law. The district court
instructed the jury that punitive damages could be awarded
only if the jury awarded compensatory damages on Passan-
tino's federal claims. Without specifying any particular allo-
cation between the federal and state-law claims, the jury
returned a large verdict for Passantino: $100,000 in backpay;
$2 million in frontpay; $1 million in compensatory emotional
distress damages; and $8.6 million in punitive damages.
The district court allocated all of the compensatory dam-
ages, backpay, and frontpay to the state-law claims, and all of
the punitive damages to the Title VII claim. The result was
that the punitive damages award was reduced to the $300,000
Title VII cap for employers with more than 500 employees.
Both sides appealed.
[1] Under Title VII, a plaintiff may establish a prima facie
case of retaliation by showing that she engaged in activity
protected by Title VII, the employer subjected her to an
adverse employment decision, and there was a causal link
between the protected activity and the employer's action. Pas-
santino's complaints to Williams constituted a protected
activity. Actions taken after those complaints were appropri-
ately the subject of her retaliation claim.
[2] There was evidence that Passantino's complaints
affected a performance review and resulted in decreased job
responsibilities. CPI responded to her complaints by transfer-
ring her accounts, excluding her from meetings, and prevent-
ing her from receiving needed information. CPI downgraded
her promotability status, and she failed to receive promotions.
Such actions are sufficient to establish retaliation.
[3] The purpose of Title VII's anti-retaliation provision is
to bar employers from taking actions that could have a delete-
rious effect on the exercise of rights by others. Title VII
allows employees to freely report actions that they reasonably
believe are discriminatory. The type of actions Passantino
asserted that her employer engaged in could have discouraged
other employees from speaking freely about discrimination.
The actions the jury could have properly attributed to CPI
were sufficient to constitute retaliation within the meaning of
Title VII.
[4] Causation may be established based on the timing of
relevant actions. When adverse employment decisions are
taken within a reasonable period after complaints of discrimi-
nation have been made, retaliatory intent may be inferred.
Moreover, evidence based on timing can be sufficient to let
the issue go to the jury, even in the face of alternative reasons
proffered by the defendant.
[5] While a defense may be available when the employer
can disclaim liability for a hostile environment created by a
supervisor in contravention of company policy, it is not avail-
able to allow the employer to escape liability for discrimina-
tory tangible employment actions, because such actions are
necessarily those of the company.
[6] The jury found for Passantino on both federal and state-
law retaliation claims, and awarded damages without specify-
ing any particular allocation. The most reasonable assumption
was that the jury awarded the same damages on the federal
and state claims. However, the damages were duplicative
because the two claims were essentially the same; they
involved the same conduct and were evaluated under the same
legal standard. The district court had authority to allocate the
damages to either claim. The awards were effectively fungi-
ble, and the court's action was within its discretion and con-
sistent with the verdict.
[7] Compensatory damages allocated by the court to other
than Title VII claims should not be subject to Title VII's cap.
[8] The jury's entire award was lawful under state law, and its
punitive damages award was lawful under federal law. The
district court's allocation decision was not an abuse of discre-
tion. Subjecting the whole award to Title VII's cap would
have been inconsistent with Title VII.
[9] Although the evidence was sufficient and the verdict
supported an award of punitive damages, the district court
was to determine on remand whether CPI was entitled to pre-
sent the vicarious liability defense.
[10] The Ninth Circuit has held inS 1983 cases that puni-
tive damages may be awarded in the absence of compensatory
or nominal damages, as long as the plaintiff has shown that
the defendant violated a federally protected right.
[11] Although the district court acted properly in allocating
the compensatory part of the damages award to Passantino's
state-law claim, the jury awarded compensatory damages
under both federal and state-law retaliation claims. That is all
that is required to permit an award of punitive damages in
cases in which predicate damages are necessary. The jury
thought it was awarding federal damages because it was told
that it could not award punitive damages without awarding
federal damages, and it did award punitive damages. The
compensatory damages were adequate to sustain the award of
punitive damages.
[12] An employer may be liable for punitive damages
where it discriminates in the face of a perceived risk that its
actions will violate federal law. Egregious conduct is not
required to establish punitive damages liability. In general,
intentional discrimination is enough. [13] In this case, the jury
had substantial evidence based on which it could have found
malice or reckless indifference to Passantino's federal pro-
tected rights. Those actions were sufficient to permit a jury to
conclude that CPI could not have reasonably believed that its
conduct was lawful.
[14] Under some circumstances, corporations may not be
subject to punitive damages for actions taken by managerial
employees. A sufficiently senior individual must be treated as
the corporation's proxy for liability purposes. [15] If Hogan
and Williams held sufficiently high positions, they would
have been CPI's proxies, which would have barred CPI from
asserting a vicarious liability defense to punitive damages.
The district court was to examine this matter on remand.
[16] The record did not contain enough about CPI's anti-
discrimination policy to allow the court of appeals to deter-
mine whether it was implemented in good faith. Even if a
defendant shows that the relevant actors were merely manage-
rial, it can escape punitive damages liability only if it has
undertaken sufficient good-faith efforts at Title VII compli-
ance.
[17] While CPI had a policy against workplace discrimina-
tion and a complaint mechanism to which Passantino turned,
CPI did not introduce evidence that the policy was enforced.
Unless the district court were able to determine that one of the
individuals responsible for the retaliation was a CPI proxy,
the proxy and good faith issues would be subject to resolution
only following further evidence on remand.
Concurring in part and dissenting in part, Judge Thomas
would have affirmed the judgment in its entirety, without
remand.
_________________________________________________________________
COUNSEL
Steve B. Berlin, Ronald J. Holland, Terry Chapko, Katherine
C. Franklin, Littler, Mendelson, et al., Seattle, Washington;
Susan L. Barnes, McCay, Chadwell & Matthews, Seattle,
Washington; Paul G. Ulrich, Ulrich, Kessler & Anger, Phoe-
nix, Arizona; for the defendants-appellants.
Marsha S. Berzon, Altshuler, Berzon, Nussbaum, Berzon &
Rubin, San Francisco, California; John R. Connelly, Jr., Vic-
toria L. Vreeland, Gordon, Thomas, Honeywell, Malanca,
Peterson & Daheim, Tacoma, Washington; for the plaintiffs-
appellees.
David O. Ogden, Marleigh D. Dover, and Dana J. Martin,
Department of Justice, Washington, D.C., for the intervenor.
Elliot L. Bien and E. Elizabeth Summers, Bien & Summers,
Novato, California, for amicus curiae Chamber of Commerce
of the United States.
C. Gregory Stewart, Philip B. Sklover, and Robert J. Gregory,
EEOC, Washington, D.C., for amicus curiae Equal Employ-
ment Opportunity Commission.
_________________________________________________________________
ORDER
Part VIII B of the opinion, concerning front pay damages,
has been amended.
_________________________________________________________________
OPINION
REINHARDT, Circuit Judge:
Defendant, Johnson and Johnson Consumer Products, Inc.
(hereinafter CPI), a subsidiary of Johnson & Johnson, appeals
the district court's decision and order entering judgment for
plaintiff, Jennifer Passantino (hereinafter Passantino), after a
jury awarded her substantial damages. We affirm the district
court's decision in all respects but one. We remand for a new
trial on the punitive damages issue in light of the Supreme
Court's decision in Kolstad v. American Dental Association,
119 S.Ct. 2118 (1999). With respect to the other issues on this
appeal, we hold that venue was proper, that the evidence was
sufficient to support the jury's finding that CPI retaliated
against Passantino, that the district court did not abuse its dis-
cretion in admitting a taped interview into evidence, that the
district court did not err in its jury instructions, and that the
district court acted within its discretion in allocating all front
pay, backpay, and compensatory damages to Passantino's
state law claims while allocating the punitive damages to Pas-
santino's Title VII claim. Additionally, we hold that, under
Washington state law, the district court did not err in deter-
mining the front pay, backpay, and compensatory damage
awards. Finally, we affirm the district court's award of attor-
neys' fees.
I. FACTS
Jennifer Passantino began working for Johnson & Johnson
Consumer Products Inc. (CPI) in 1979, when she was 25
years old. Over the next 18 years, she rose through the ranks
at CPI to become one of its most successful female managers,
and was characterized by executives as "a leader in her field."
She was personally responsible for selling $12 million in
product annually, within a division with total sales of $48 mil-
lion. Her success is all the more remarkable because she
worked within CPI's "military" division, characterized by one
of its own executives as an "old boy network. " In spite of her
success, Passantino's career prospects deteriorated rapidly
after she complained that her advancement within the com-
pany was being limited by sex discrimination.
Passantino started with CPI in 1979 as a Health Care terri-
tory manager in the San Francisco Bay area. In 1982, she was
promoted to territory manager for northern California and
Washington state in the military sales department. After a
brief stint in the child development products division, she was
asked to return to the military sales department. She became
area manager for the western region in the military sales
department in 1986. Her title was changed to Western
Regional Manager in 1987. In 1988, with CPI's permission,
Passantino relocated to Tacoma, Washington. She was pro-
moted to National Account Manager in December, 1989, a
position she held for the remainder of her employment with
CPI.
Passantino maintained a home office, as CPI requested.
(Most sales persons within CPI had home offices.) Passantino
testified that she was on the "developmental" path, which is
the career path for employees within sales who are in line for
executive and management positions. Her testimony is con-
firmed by her performance reviews, which were consistently
"outstanding" and "above average." For example, her 1992
performance report which was considered at her May 1993
performance evaluation meeting with her supervisor, Lew
Williams, stated that "Jennifer demonstrates very strong sell-
ing skills, organizational ability, and good business judgment.
She has developed the sales and promotional plan for Key
Accounts, generating 12 million dollars in Johnson & Johnson
annual volume." It added that she was "well qualified" and
should be "strongly considered" for promotions within CPI's
parent company, Johnson & Johnson. In fact, Williams dis-
cussed several promotional opportunities with her. As the
Western regional manager, Passantino was rated the employee
with the greatest promotional potential in her division.
Here, it is useful to describe CPI's advancement track in
order to help explain Passantino's history with the company.
The track was composed of multiple "levels." Level 3
includes mid-level managers, Level 4 includes upper level
managers and staff directors, and Level 5 refers to executive
and corporate officer jobs. Passantino, as a National Account
Manager, held a high-end Level 3 position. Making the step
between Level 3 and 4 is very important to staying on the
"promotion" track, and Level 4 pays approximately $50,000
more than Level 3. Level 5 positions carry very high compen-
sation, as much as $200,000 more than Passantino's salary at
Level 3. In spite of the importance of promotion, the method
for determining who was to advance within the company was
neither systematic nor fair. Instead, employees were promoted
through what the district court called "the worst kind of a
good old boy system that allowed discrimination and discour-
aged reasonable questions about the promotion process."
Despite her qualifications for promotion and her string of
positive reviews, Passantino began to suspect that, because of
her sex, she had been passed over for several promotions for
which she was qualified. Several events gave her reason to
suspect discrimination. First, Williams, her supervisor, exhib-
ited sexist behavior. He referred to women buyers as "PMS,"
"menstrual," and "dragon lady." He also stated that most
women probably just wanted to stay home. This sexism was
not limited to Williams. Passantino also testified that two co-
workers, VanDerveer and Kenan, had a condescending atti-
tude towards women. Most important, during her 1993 perfor-
mance evaluation meeting, Williams told Passantino that she
should consider looking outside the company for employment
because he did not believe that either the company or his boss
was committed to promoting women.
In 1993, both Passantino and Jackie Upshaw, the only other
female manager in the military division, voiced complaints to
Williams. First, Passantino complained about the conduct of
VanDerveer and Kenan, as well as about Williams' behavior.
Upshaw also told Williams that she found his use of crude
language troublesome. Both women testified that Williams'
response was inadequate; Williams was short and brusque
with Passantino and told her that it was her problem to get
along with her co-workers.
Following the complaints by Passantino and Upshaw, the
offensive behavior of all three men increased both in degree
and frequency. Although Passantino's 1993 performance
report was good overall, Williams was brusque at the subse-
quent performance evaluation meeting and gave her a low rat-
ing for "relationship with peers."1 From this point on,
Passantino felt she was slighted when trying to speak, and
was the subject of derision generally -- co-workers rolled
their eyes at her suggestions, and there were side-bar conver-
sations among other managers that excluded her. In short,
after Passantino complained, she was no longer taken seriously.2
In 1994, her opportunities for advancement within the com-
pany appeared to further close down. Following Johnson &
Johnson's reorganization, Passantino expressed interest in a
particular sales administration manager position, but she was
not interviewed for the job and the position was filled by a
male co-worker about whom she had complained to Williams.
In October of that year, Passantino learned about three newly-
created positions (National Commissary Manager, Director of
Trade Marketing, and Manager of Sales Administration) that
she felt would offer her greater exposure, experience, and
higher sales volume than her current position. However, these
jobs were filled, before she had a chance to apply and, with-
out being advertised openly, by the two men she had com-
plained of and by a third male employee from outside the
division.
In November 1994, Passantino contacted CPI's EEO offi-
cer and was warned several times that if she made a com-
plaint, she would have to "live with the burden of coming
forward" because the decision to complain "could have many
ramifications." In spite of these warnings, Passantino formally
complained to Doug Soo Hoo in the Human Resources
department. Soo Hoo offered to try to determine whether he
could raise her concerns without revealing Passantino's iden-
tity. He also offered to perform a salary analysis in order to
see if there was any truth to Passantino's suspicion that she
was being paid less than similarly-situated male workers. Pas-
santino testified that Soo Hoo never provided her with the
results of his inquiry.
In December, 1994, Passantino decided to lodge a formal
complaint. In response to her complaint, Soo Hoo contacted
Upshaw, who supported Passantino's version of the facts and
echoed her concerns about discrimination. In January 1995, a
meeting was held in New Jersey with Soo Hoo, Williams,
John Hogan, who was Vice President of Sales, Passantino,
and Ruth Hague from the Employee Assistance Program. At
this meeting, Passantino recounted her complaints. Williams,
her supervisor, responded that the military market was an "old
boy network" in which it was hard for women to be success-
ful. He also asked Passantino directly if she thought he was
a sexist.
A second meeting was held in February, also in New Jer-
sey. First, Williams and Hogan conducted Passantino's 1995
performance review, based on her 1994 evaluation report. She
was given a good review and told she was qualified for a
number of promotional positions. Then, Hogan told Passan-
tino that his salary analysis had revealed no discrepancies and
no discrimination. Although Passantino never saw this analy-
sis, a salary analysis document was placed in her personnel
file. This document falsely reported that Kenan -- one of Pas-
santino's colleagues about whom she had complained--
received a performance rating of "5," while in fact he had
received a "4." Another performance review in the document
similarly misrepresented another male manager's perfor-
mance rating. Passantino asserts that these ratings were fabri-
cated in order to justify the fact that these male workers were
better paid than she. Apart from this, her complaints were not
addressed.3
At a subsequent division meeting, Hogan said that every-
one needed to "shape up and act professional" or they would
be "off the team." He also indicated his support for Williams.
Both Passantino and Upshaw testified that they understood
this to be a public rebuke of them for their complaints. Both
women felt that they were being told that if they did not shut
up they would be fired.
Passantino remained unsatisfied with CPI's response to her
complaint. On March 16, 1995, she informed Soo Hoo of her
intentions to seek private legal counsel. She filed an EEOC
complaint in June, 1995. Thereafter Passantino testified that
she experienced a range of retaliatory acts by CPI, making it
nearly impossible for her to perform her job effectively. Job
responsibilities (such as her training duties) were removed,
accounts (including the European account) were transferred to
other employees without notice, and she was no longer
included in division managers' meetings, such as those con-
cerning development of the division business plan. In addi-
tion, her performance objectives were reduced (which,
according to her testimony, indicated that she was considered
less capable than before her complaint) and her job title was
changed (and then restored after she protested). Passantino
also testified that other actions were taken which undermined
her performance. She stated that Williams became distant and
communicated less with her, that she received product and
sales information late, and that she lost out on bonuses
(including an award trip) and sales opportunities as a result.
Finally, Passantino stated that Williams made comments
demeaning her participation in the policy groups that she had
joined, even though she had joined them upon his suggestion,
in order to enhance her advancement within the military divi-
sion.
Passantino testified, and provided documentary corrobora-
tion to prove, that prior to her complaints she was consistently
regarded as well-qualified for promotion into upper manage-
ment. After her complaints, and particularly after her public
EEOC complaint, however, it was a different story. Passan-
tino was told by Hogan that she would have to accept taking
a step back in order to advance, and that she should accept a
district manager job, which is the lowest position within her
job grade. Her review also stated, for the first time in years,
that she was not qualified for a national account manager
position. Her 1997 promotional assessment described her as
"not to VP level," an obvious sign that, as Passantino put it,
she was "losing ground." For some unexplained reason, Wil-
liams was instructed to send his evaluations of Passantino and
Upshaw to Hogan, the Vice President, before releasing them
to the two women. No other employees' evaluations were
similarly screened.
CPI also retaliated against Passantino by offering her
demotions, without always making clear that the jobs offered
were below her current level. After initiating her complaints,
Passantino received three offers of district manager positions.
She rejected these jobs as demotions. Then, in August 1995,
she was offered the position of National Accounts Manager in
Dallas. Although this would have been a lateral move, it
would have been undertaken as a part of a test group, with the
distinct possibility of layoffs in the immediate future, Passan-
tino accepted on the condition that CPI guarantee her one year
of employment, absent cause for termination, as insurance
against the inherently risky undertaking. CPI refused. In
March 1996, Passantino rejected a district manager position in
Los Angeles because it was a "step backwards" with no
potential for salary growth (and a higher cost of living). Pas-
santino was then offered a demotion to a position as a sales
administration manager, with a much lower salary range. In
this position, she would have lost her company car, had no
opportunity for commissions, and would have had to live in
a more expensive area. Passantino accepted the position, how-
ever, on the condition that she receive a year of guaranteed
employment. Again rejecting her conditional acceptance,
Hogan told her not to take the job, that the position was two
steps backwards, and that it was only offered to Passantino
because it was one of the jobs involved in her litigation.
Finally, she rejected another position which was a step back
with no potential for salary growth. During the same period,
on a different occasion, when Passantino expressed interest in
a new military marketing position, Williams told her she
should not be interested in that position because it paid less,
even though in fact that position paid $20,000 more than the
position she held at the time.
Ultimately, Hogan told Passantino that because she refused
to accept these district manager positions (which were demo-
tions), she would not be considered for higher positions. He
also told her that her decision not to accept the demotions
meant that she could be deemed no longer promotable. After
August 1996, Passantino did not receive any further offers.
Throughout this period, which followed her complaints,
CPI executives were repeatedly vague about whether posi-
tions offered to Passantino were promotions, demotions, or
lateral transfers. For example, Hogan initially characterized
the district manager demotions as promotions. In a letter sent
several months later, he called them laterals. Others in the
corporation told her that these jobs would be demotions. The
same dissembling and equivocation marked CPI's other job
offers and its responses to her inquiries:4 Passantino never
knew if she was considering a job that would improve her
prospects or effectively end her career's advancement oppor-
tunities.
Passantino testified that, as a result of this stressful series
of events, she constantly worried, cried, and felt trapped and
upset. She felt she was forced to spend less time with her fam-
ily because she feared she would lose her job, given that her
performance rating had been declining. She suffered stomach
problems, rashes, and headaches which required medical
attention. In addition, she sought counseling from her pastor.
Most important, her advancement within the company was
brought to a halt.
II. PROCEDURAL HISTORY
In January, 1996, Passantino brought this action in the
United States District Court for the Western District of Wash-
ington for violations of Title VII and the Washington Law
Against Discrimination. CPI immediately moved for a change
of venue to New Jersey, which was denied.
Following a jury trial, the jury returned a large verdict in
Passantino's favor. The jury found that although CPI had not
discriminated against Passantino initially, it did retaliate
against her for complaining about what she perceived as sex
discrimination. The jury awarded Passantino $100,000 in
back pay, $2,000,000 in front pay, $1,000,000 in compensa-
tory emotional distress damages, and $8,600,000 in punitive
damages. CPI moved to strike or reduce the punitive and
compensatory damage awards, which the court granted in part
and denied in part. The court allocated all of the compensa-
tory damages, front pay, and back pay to Passantino's state
law claim and all of the punitive damages to the Title VII
claim. It then reduced the punitive damage award to the
$300,000 Title VII cap and affirmed the remainder of the award.5
CPI then moved for judgment as a matter of law, or in the
alternative for a new trial, or to amend the judgment; all were
denied. The court then awarded Passantino $580,414 in attor-
ney's fees, costs, and expenses.
III. VENUE
CPI argues that venue was improper in Washington,
because the unlawful employment practices at issue occurred
in New Jersey. We review the district court's venue ruling de
novo. Decker Coal Co. v. Commonwealth Edison Co. , 805
F.2d 834, 841 (9th Cir. 1986). CPI argues that when a plain-
tiff alleges a discriminatory or retaliatory failure to promote,
the decision not to promote is the sole act that can constitute
the unlawful employment practice for venue purposes. Thus,
under CPI's theory, for purposes of promotion claims, unlaw-
ful employment action "is committed" where the decision to
take that action is made. Passantino counters that the unlawful
action occurs where its effects are felt.6
Title VII authorizes suit "in any judicial district in the State
in which the unlawful employment practice is alleged to have
been committed" as well as in the district where employment
records are kept, in the district where the plaintiff would have
worked but for the alleged unlawful practice, and, if those
provisions fail to provide a forum, in the district where the
defendant keeps its principal office. 42 U.S.C.S 2000e-
5(f)(3); Johnson v. Payless Drug Store Northwest , 950 F.2d
586 (9th Cir. 1991).7 Some courts have noted that "this broad
provision for alternative forums was necessary to support the
desire of Congress to afford citizens full and easy redress of
civil rights grievances." Richardson v. Alabama State Board
of Education, 935 F.2d 1240, 1248 (11th Cir. 1991). In fact,
the only limitation contemplated by the provision is that it
seeks to "limit venue to the judicial district concerned with
the alleged discrimination." Stebbins v. State Farm Mutual
Ins., 413 F.2d 1100, 1102 (D.C. Cir. 1969); Ford v. Valmac
Industries, Inc., 494 F.2d 330, 332 (10th Cir. 1974).
In general, the effect of Title VII's venue provision is to
allow suit in the judicial district in which the plaintiff worked
or would have worked. See, e.g., Montero v. AGCO Corp.,
192 F.3d 856 (9th Cir. 1999) (suit brought in district where
plaintiff worked). This is consistent with our case law in anal-
ogous contexts. For example, in Varsic v. United States Dis-
trict Court, 607 F.2d 245 (9th Cir. 1979), a case involving a
suit against a pension fund, we found venue to be proper
where the employee works (and earns his pension credits). Id.
at 247. We rejected the Fund's argument that venue should be
limited to the district in which the Fund is administered
because that district is where the decisionmaking for the
plan's administration takes place. Id. at 248.
We have also held that personal jurisdiction over a defen-
dant may be proper where the defendant has committed an act
which has effects in a state, because the defendant "purpose-
fully directed" its economic activity towards that state. Hais-
ten v. Grass Valley Medical Reimbursement Fund, 784 F.2d
1392, 1397-98 (9th Cir. 1986). In Haisten, we held that juris-
diction was proper even though the defendant had absolutely
no physical contact with California, because its policies had
effects in the state, and because California had an interest in
providing a forum for the protection of its residents. Id. at
1399. See also Gordy v. Daily News, 95 F.3d 829 (9th Cir.
1996) (finding personal jurisdiction proper in California defa-
mation action against New York newspaper because 13 to 18
California residents subscribed to the paper).8 Thus, the stat-
ute itself and analogous case law suggest that venue should be
found where the effect of the unlawful employment practice
is felt: where the plaintiff works, and the decision to engage
in that practice is implemented.
CPI, however, would have us reject such a rule, at least for
cases involving failure to promote, in favor of one that would
allow venue only where the decision to commit the unlawful
employment practice is made. We find this theory unpersua-
sive for several reasons. First, CPI's theory would require us
to draw a distinction between promotion claims and other
types of Title VII claims -- which allow venue where the
plaintiff is employed. Had Passantino been wrongfully dis-
charged or subjected to a hostile work environment, she could
have sued in the district in which she worked. Nothing in the
text or history of the statute's venue provision suggests that
a different rule should apply in failure-to-promote cases.
Plaintiffs unlawfully denied a promotion, like those dis-
charged, feel the effects of their injury where they actually
work.
CPI suggests that the rule advanced by Passantino would
leave corporations which employ people in far-away home
offices vulnerable to suit in distant fora, a problem which it
warns will increase in the internet age. CPI is concerned that
"potential plaintiffs could evaluate their preferred locations
for bringing a lawsuit and simply locate their home offices
within that jurisdiction." This forum shopping scenario seems
fanciful; we doubt that many people would reorganize their
entire lives by moving home offices to other judicial districts
in anticipation of as yet uncommitted acts of discrimination,
in order to file Title VII actions in those districts. It is of more
concern that national companies with distant offices might try
to force plaintiffs to litigate far away from their homes, as CPI
seeks to do here. Forcing the plaintiff to litigate in a federal
court on the other side of the country would significantly
increase the plaintiffs' costs of prosecuting her action. CPI's
theory would create a substantial burden on plaintiffs working
for national sales companies, a burden inconsistent with the
beneficent purposes of Title VII.
This is not to suggest that an action involving a failure to
promote is not also appropriately brought in the district in
which the employment decision is made. CPI rightly points
out that that district also has some interest in an action involv-
ing promotions. Here, however, we need not choose between
districts. Title VII's venue provision obviously contemplates
the possibility that several districts could provide an appropri-
ate venue for the same action. For example, a company could
keep business records in an office located in one judicial dis-
trict, but engage in discriminatory hiring practices at a differ-
ent office in another district. An action could properly be
brought in either district. See 42 U.S.C.S 2000e-5(f)(3). Thus,
we hold that venue is proper in both the forum where the
employment decision is made and the forum in which that
decision is implemented or its effects are felt.
IV. RETALIATION
CPI also appeals the district court's denial of its motion for
judgment as a matter of law on Passantino's retaliation claim.
We review the district court's decision de novo, and reverse
only if the evidence, viewed in the light most favorable to the
prevailing party, admits only of a contrary conclusion. Omega
Environmental, Inc. v. Gilbarco, Inc., 127 F.3d 1157, 1161
(9th Cir. 1997).
[1] Under Title VII, a plaintiff may establish a prima facie
case of retaliation by showing that (1) she engaged in activity
protected under Title VII, (2) the employer subjected her to
an adverse employment decision, and (3) there was a causal
link between the protected activity and the employer's action.
Yartzoff v. Thomas, 809 F.2d 1371, 1375 (9th Cir. 1987). Ini-
tially, we note that Passantino's informal complaints to Wil-
liams in 1993 constitute a protected activity, such that actions
taken against her after these initial complaints are appropri-
ately the subject of her retaliation claim. See, e.g., Moyo v.
Gomez, 40 F.3d 982 (9th Cir. 1994) (allowing retaliation
claim based on informal protest of allegedly discriminatory
policy).
[2] CPI contends that Passantino suffered no adverse
employment action. However, ample evidence exists in the
record for the jury to have made a contrary finding. There was
evidence that her complaints affected a performance review
she received and resulted in decreased job responsibilities.
Other evidence supported her contention that CPI responded
to her complaints by transferring accounts out of her portfolio,
excluding her from planning meetings, and preventing her
from receiving information she needed. The jury could also
have found that CPI substantially downgraded her promota-
bility status and that she failed to receive promotions because
of her complaint. We have held such actions sufficient to
establish retaliation. For example, in Hashimoto v. Dalton,
118 F.3d 671, 675 (9th Cir. 1997) we held that the dissemina-
tion of a negative job reference constituted retaliation. Simi-
larly, in Yartzoff, we held that transfers of job duties and
"undeserved" performance ratings were adverse employment
decisions. Yartzoff, 809 F.2d at 1376. See also Strother v.
Southern California Permanente Group, 79 F.3d 859, 869
(9th Cir. 1996) (exclusion from meetings, denial of adminis-
trative support, and transfer of duties deemed retaliatory).
[3] The purpose of Title VII's anti-retaliation provision is
to bar employers from taking actions which could have "a del-
eterious effect on the exercise of these rights by others." Gar-
cia v. Lawn, 805 F.2d 1400, 1405 (9th Cir. 1986). Title VII
allows employees to freely report actions that they reasonably
believe are discriminatory, even if those actions are in fact
lawful. Moyo, 40 F.3d at 985. Absent a judicial remedy, the
type of actions Passantino asserts her employer engaged in
could discourage other employees from speaking freely about
discrimination. We hold that the actions the jury could prop-
erly have attributed to CPI were sufficient to constitute retali-
ation within the meaning of Title VII.
[4] CPI also argues that there was insufficient evidence to
establish that the adverse employment actions occurred
because of CPI's desire to retaliate against Passantino. How-
ever, we have held that causation may be established based on
the timing of the relevant actions. Specifically, when adverse
employment decisions are taken within a reasonable period of
time after complaints of discrimination have been made, retal-
iatory intent may be inferred. Yartzoff, 809 F.2d at 1375-76
(finding causation based on timing of retaliation); Miller v.
Fairchild Industries, Inc., 885 F.2d 498, 505 (9th Cir. 1989)
(holding that discharges 42 and 59 days after EEOC hearings
were sufficient to establish prima facie case of causation);
Hashimoto, 118 F.3d at 680. Moreover, we have held that evi-
dence based on timing can be sufficient to let the issue go to
the jury, even in the face of alternative reasons proffered by
the defendant. Strother, 79 F.3d at 870-71. While CPI cor-
rectly notes that there was some evidence at trial that the alter-
ation in job responsibilities and the obstruction of information
may not have been due to retaliatory motives, the evidence as
a whole does not compel this conclusion.9
[5] Finally, CPI argues that we should order a new trial on
liability to allow it to pursue an affirmative defense under
Burlington Industries v. Ellerth, 524 U.S. 742, 118 S.Ct. 2257
(1998). Burlington establishes an affirmative defense to liabil-
ity where an employer shows by a preponderance of the evi-
dence that "the employer exercised reasonable care to prevent
and correct promptly any sexually harassing behavior," and
that "the plaintiff employee unreasonably failed to take
advantage of any preventive or corrective opportunities pro-
vided by the employer." Id. at 2270. However, as Burlington
expressly states, "[n]o affirmative defense is available . . .
when the supervisor's harassment culminates in a tangible
employment action." Id. at 2270. Thus, while the defense may
be available when the employer can disclaim liability for a
hostile environment created by a supervisor in contravention
of company policy,10 it is not available to allow the employer
to escape liability for discriminatory tangible employment
actions, because such actions are necessarily those of the
company itself.11
V. ADMISSION OF THE HOGAN TAPE
CPI argues that the district court erred by allowing Passan-
tino to impeach defense witness Hogan using a portion of a
tape of the interview he conducted with Passantino. CPI
claims that because its copy of that portion of the tape was
allegedly unclear, it was error to admit Passantino's version
of the tape. The tape exposed Hogan lying to Passantino about
whether a particular job was a promotion, a lateral, or a demo-
tion. We review the district court's decision for abuse of dis-
cretion. EEOC v. Pape Lift, Inc., 115 F.3d 676, 680 (9th Cir.
1997). The moving party must demonstrate prejudice. Cali-
fornia Sansome Co. v. U.S. Gypsum, 55 F.3d 1402, 1405 (9th
Cir. 1995).
Here, we need not reach the merits, because CPI cannot
show prejudice. While CPI complains of the prejudicial effect
of Hogan's statements recorded on Passantino's version of the
tape (which the jury heard), Hogan also stated on a different,
uncontested part of the tape that the job Passantino inquired
about was on the "same level" as her current job. In addition
to being false, this statement was essentially identical to the
statement from the contested part of the tape. Thus, the jury
would have heard Hogan's false and damaging statement
regardless of which version of the tape was used.
CPI asserts that it need not show prejudice where plaintiff
has engaged in intentional misconduct. Although we could
find no Ninth Circuit case that supports this proposition, we
need not reach the question because there is no evidence of
intentional misconduct here. Both CPI and Passantino had
copies of the tape. If, as CPI alleges, its copy of the tape was
inaudible, it could have requested an audible copy prior to
Passantino's introduction of the tape into evidence. The dis-
trict court's decision to include the whole tape did not consti-
tute an abuse of discretion.
VI. JURY INSTRUCTIONS
CPI argues that the district court erred by not giving the
mitigation instruction described in Ford Motor Co. v. EEOC,
458 U.S. 219, 241 (1982), and by not giving an instruction
explaining reduction to present value. Because all of the non-
punitive damages were allocated to the state law claims, state
law governs the substance of the jury instructions given at
trial. In re Asbestos Cases, 847 F.2d 523, 524 (9th Cir. 1988);
Miller v. Republic National Life Insurance, 789 F.2d 1336,
1338-39 (9th Cir. 1986) (holding that, in diversity action, sub-
stance of jury instructions is governed by state law). We
review errors for abuse of discretion and reverse only if we
find prejudice. Abromson v. American Pacific Corp., 114 F.3d
898, 902 (9th Cir. 1997).
CPI cites no case suggesting that the Ford instruction,
authorized in the Title VII context, is required under Wash-
ington law, and we have found no cases requiring it. In fact,
as a general matter, Washington discrimination law remedies
are more robust than those authorized under Title VII. See
Martini v. Boeing Co., 971 P.2d 45, 53 (Wash. 1999) (en
banc). In any case, any error would have been harmless. The
jury's verdict with respect to retaliation makes clear that it did
not think that the offers made to Passantino were promotions,
so it would not have found that Passantino failed to mitigate
by not accepting the retaliatory offers. Moreover, the jury
received a general mitigation instruction which is consistent
with the Ford instruction, and counsel, with the court's
approval, was given the opportunity to argue the Ford instruc-
tion to the jury.
CPI also argues that the Supreme Court's decision in Mon-
essen Southwestern Railway Co. v. Morgan, 486 U.S. 330
(1988) requires that the jury be instructed to discount its dam-
ages award to present value.12 In Monessen, the Supreme
Court reversed a decision after the trial judge told the jury it
could not discount its damage award to present value. 486
U.S. at 339. However, nothing in that opinion requires any
particular method of dealing with present value issues, except
insofar as it requires that "the present value calculation is to
be made by the `trier of fact.' " Id . at 341.
The district court refused to give the instruction here
because there was no evidence presented as to what the appro-
priate discount rate should be. This decision was correct,
because under Washington, a present value instruction should
not be given where no evidence of appropriate discount rates
has been introduced. See Hinzman v. Palmanteer , 501 P.2d
1228, 1233-34 (Wa. 1972).13 Thus, the rule applied by the dis-
trict court was completely consistent with Monessen and the
relevant Washington law.
VII. ALLOCATION OF DAMAGES
CPI argues that the district court erred in allocating the
jury's damage award. The district court allocated all of the
compensatory damages, front pay, and backpay to Passan-
tino's state law claim, while allocating the punitive damages
to her Title VII claim. CPI contends that the entire award
(apart from backpay) should have been subject to the
$300,000 Title VII damages cap.14 While the district court
generally has discretion regarding how to allocate the damage
award, to the extent that the allocation decision rests on an
interpretation of the statute, we review it de novo. Hudson v.
Reno, 130 F.3d 1193, 1198 (6th Cir. 1997); Johnson v. Sha-
lala, 35 F.3d 401, 405 (9th Cir. 1994).
[6] CPI claims that because the jury instructions said that
punitive damages could be awarded only if the jury awarded
compensatory damages on Passantino's federal claims, and
because the jury awarded punitive damages, the jurors must
have intended to award federal compensatory damages. While
this reasoning is correct, it does not follow that the court erred
by allocating the compensatory damages to the state law
claims. As the verdict form indicates, the jury found for Pas-
santino on both federal and state law retaliation claims, and
awarded damages without specifying any particular alloca-
tion. Thus, the most reasonable assumption is that the jury
awarded the same damages on both the federal and state
claims. The damages were duplicative, however, because the
two claims were essentially the same; they involved the same
conduct and were evaluated under the same legal standard. In
the absence of a contrary directive, such as a statutory man-
date that damages be allocated to one claim rather than
another, the district court had authority to allocate the dam-
ages to either claim. Faced with the general verdict, the dis-
trict court chose to allocate the award to the state rather than
the federal claim. As the jury had awarded damages without
differentiating between the claims, the awards were effec-
tively fungible, and the district court's action was entirely
within its discretion and consistent with the jury's verdict. See
Martini v. Federal National Mortgage Association, 178 F.3d
1336, 1349-50 (D.C. Cir. 1999) (treating damage award as
interchangeable under local and federal law where standards
of liability are identical).
[7] In contrast to the district court's allocation method, CPI
suggests that all the damages should be allocated to Passan-
tino's Title VII claim, ignoring the fact that the jury found for
Passantino on her state retaliation claim. CPI's suggested allo-
cation would partially nullify the jury's state law determina-
tion, by effectively subjecting the entire compensatory award
to Title VII's cap. We have held, under similar circumstances,
that compensatory damages allocated by the court to claims
other than Title VII claims should not be subject to Title VII's
cap. Pavon v. Swift Transportation Co., 192 F.3d 902, 910-11
(9th Cir. 1999). In Pavon, the plaintiff recovered damages in
excess of $300,000 on discrimination claims under state law,
Title VII, and S 1981. The district court allocated the damages
in excess of $300,000 to the S 1981 and state law claims. Id.
Although the jury's verdict form, like the form in this case,
did not differentiate among the claims in awarding damages,
we rejected the argument that the entire award should be sub-
ject to Title VII's cap and upheld the district court's allocation
method, noting that neither S 1981 nor Title VII was intended
to force plaintiffs to choose between remedial statutes. We
can find no relevant distinction between Pavon and the pres-
ent case.
In addition to nullifying the state cause of action in this
case and violating our rule in Pavon, CPI's allocation method
would drastically curtail the ability of states to provide dam-
age remedies greater than those authorized by Title VII. Such
a rule would violate Title VII's explicit prohibition against
limiting state remedies. See 42 U.S.C. S 2000e-7; Pavon, 192
F.3d at 911; Martini, 178 F.3d at 1349-50 (holding that "were
we not to treat damages under federal and local law as fungi-
ble where the standards of liability are the same, we would
effectively limit the local jurisdiction's prerogative to provide
greater remedies for employment discrimination than those
Congress has afforded under Title VII.")
[8] Moreover, CPI's proposed allocation would conflict
with the district court's general obligation to preserve lawful
jury awards when possible. The jury's entire compensatory
damage award was lawful under state law, and its punitive
damage award was lawful under federal law (subject to any
constitutionally valid limitation imposed by the statutory cap).
An allocation that would serve to reduce lawfully awarded
damages would fail to respect the jury's verdict and conflict
with the purpose and intent of one or both statutes. Thus, we
hold that the district court's allocation decision was not an
abuse of discretion, and furthermore that, in circumstances
such as these, subjecting the whole damage award to Title
VII's cap would be inconsistent with Title VII's provisions.
VIII. DAMAGES
CPI argues that the district court erred in refusing to grant
its motion for judgment as a matter of law, or in the alterna-
tive its motion for a new trial, because there was insufficient
evidence to establish any of the damages. We review de novo
the district court's decision to deny judgment as a matter of
law. EEOC v. Pape Lift, Inc., 115 F.3d 676, 680 (9th Cir. 1997).15
We hold that the district court committed no error in holding
the evidence sufficient and denying the motions. As the dam-
age awards involving backpay, front pay, and emotional dam-
ages were allocated to the state law claim, we analyze those
awards under Washington law, and affirm. We discuss the
punitive damages question separately below.
A. Backpay
CPI claims that there was "no evidence" to support any
backpay, let alone the $100,000 backpay award. This claim is
without merit. At the least, the jury clearly was entitled to find
that Passantino would have won a bonus trip, worth $12,000,
had CPI not prevented her from receiving timely information.
Moreover, the jury was entitled to believe Passantino's testi-
mony that she would have received one of several National
Account Manager positions for which she was qualified. Wil-
liams stated that she was clearly qualified for those positions
as of 1993 (if not earlier), and such positions were available
after she complained of discrimination. The actual amount
awarded by the jury, $100,000, could easily be derived from
Passantino's testimony estimating that she would have
received between $130,000 and $200,000 more in salary had
she been promoted to one of those positions.
CPI argues that Passantino's damage estimates cannot
apply because they are based on the harm she suffered from
discrimination, not retaliation. However, the fact that she gave
those estimates in the context of a claim of discrimination is
irrelevant. Even if the jury did not find that Passantino was
denied promotions prior to her complaints, it obviously did
find that CPI punished her in retaliation for those complaints.
After she complained, Passantino went from being the most
highly rated performer in her division to being not promot-
able. Thus, the most plausible reading of the record in light
of the jury's verdict is that the jurors believed Passantino was
denied promotions because she complained. The change in
her status regarding her promotability after the complaints
strongly supports this finding. We cannot say that this conclu-
sion is contrary to the clear weight of the evidence.
B. Front Pay
CPI also argues that the jury's front pay award was exces-
sive and speculative. Under Washington law,
This court will not willingly assume that the jury did
not fairly and objectively consider the evidence and
the contentions of the parties relative to the issues
before it. The inferences to be drawn from the evi-
dence are for the jury and not for this court. The
credibility of witnesses and the weight to be given to
the evidence are matters within the province of the
jury and even if convinced that a wrong verdict has
been rendered, the reviewing court will not substitute
its judgment for that of the jury, so long as there was
evidence which, if believed, would support the ver-
dict rendered.
Herring v. Dept. of Social and Health Services , 914 P.2d 67,
77 (Wash. Ct. App. 1996) (internal citations omitted) (holding
that $500,000 award was within "the range" of the evidence).16
Here, we find that the award of $2,000,000 was supported by
the evidence.
At the time of the trial, Passantino was 43 years old, with
an expected working life of 22 years to her normal retirement
age of 65. She had 18 years experience at CPI and her annual
salary in her Level 3 position with CPI at that time was
$71,500. Evidence showed that if Passantino left CPI, her
annual salary with a new employer would likely be $50-
60,000. On the other hand, if her career had not been cut short
by CPI's violations of Title VII, the jury could easily have
concluded that she was on the path to upper executive man-
agement at Level 4 or above. Evidence presented at trial indi-
cated that the compensation packages available to Level 4
managers included base salaries of $94,000, potential cash
bonuses, stock bonuses of 4-7% of salary, and stock options
worth 200-300% of salary.
As an example, Passantino testified that she was qualified
for a position held by John Wernicki (a job that was falsely
described to her as a lateral). Wernicki earned $140,000 in
base salary -- double Passantino's pay, plus bonuses, stock
options, and other perks. The difference between what Pas-
santino earned at the time she was discriminated against
(which is more than she would have earned had she left the
company and sought another job) and what Wernicki earned
over the 22 years of her expected remaining work life adds up
to a total of $1.54 million. That calculation does not include
the cash bonuses, stock bonuses, or stock options worth two
to three times her salary. Adding in those amounts would
obviously result in a total loss of income in excess of the
jury's $2 million award.
CPI also argues, in the alternative, that we should disallow
the jury's front pay award as a matter of law because Passan-
tino had not quit her job as of the time of trial and thus had
not been constructively discharged. This argument is waived,
as it should have been raised when the jury was instructed on
front pay. See EEOC v. Pape Lift, Inc., 115 F.3d 676, 683 (9th
Cir. 1997) (holding that the failure to request a jury instruc-
tion constitutes waiver on appeal). CPI objected to approxi-
mately sixteen different jury instructions at trial, but at no
time did it make the argument it now advances. In fact, CPI's
own proposed jury instruction on damages includes an
instruction on front pay. In addition, at trial Passantino was
asked to estimate her future losses based upon lost promo-
tional opportunities and the complaint she had filed. CPI ini-
tially objected on foundation/opinion grounds, but allowed the
answer in without further objection after a foundation was
laid. Had it objected to Passantino's submission of front pay
to the jury, CPI could have made its objection known either
when her testimony was elicited or when the jury was
instructed on the issue. See, e.g., Saman v. Robbins, 170 F.3d
1150, 1155 (9th Cir. 1999) (finding waiver where party failed
to object at trial). In addition, the closing arguments make
clear that CPI was on notice that front pay and constructive
discharge were significant issues at trial. CPI argued in clos-
ing that Passantino did not have to quit, and that her supervi-
sors had continued to treat her well after the complaint was
filed. Thus, it is clear that CPI knew that Passantino sought
front pay, but it nonetheless failed to raise the argument it
now makes for the first time. Accordingly, we need not
address it.
Even were we to consider CPI's argument regarding front
pay, there is ample basis on which to support the jury's
award. Under Washington law the jury has substantial auton-
omy when awarding front pay. See Lords v. Northern Auto-
motive Corp., 881 P.2d 256, 266 (Wash. Ct. App. 1994)
(striking down trial court decision limiting front pay to five
years after termination). Front pay may be awarded whenever
the antagonism between the plaintiff and her employer is such
that it would be inappropriate to expect her to return to work.
See Pannell v. Food Services of America, 810 P.2d 952, 966
(Wash. Ct. App. 1991) (holding that front pay issue is not too
speculative to go to jury, and endorsing it as substitute for
reinstatement, citing Ninth Circuit's decision in Cassino);
Hayes v. Trulock, 755 P.2d 830, 834 (Wash. Ct. App. 1988)
(describing front pay as substitute for reinstatement); Cassino
v. Reichhold Chemicals, Inc., 817 F.2d 1338, 1347 (9th Cir.
1987) (upholding front pay award based on "some hostility"
in spite of testimony that plaintiff and defendant were still
friends); Thorne v. City of El Segundo, 802 F.2d 1131, 1137
(9th Cir. 1986). Front pay may also be awarded when the
antagonism precludes the plaintiff from remaining at work
following the trial, even if she has not yet quit at the time it
is being conducted.
Here, there was ample evidence to support a finding that
substantial hostility existed between Passantino and her
employer, such that a front pay award was appropriate. While
Passantino had not resigned at the time of the trial, she testi-
fied that she had been unable to resign because of financial
constraints, as she was the primary breadwinner for her fam-
ily. Nonetheless, she made it clear that she could not remain
in her job much longer. Thus, the evidence also permitted the
jury to find that, as a result of the hostile atmosphere, Passan-
tino would be forced to actually terminate her employment.
Accordingly, the jury could properly award front pay on the
ground that Passantino was entitled to compensation for the
difference between what she would have earned had she been
promoted (in the absence of retaliation) and what she is able
to earn at a new job. See Gotthardt v. National Railroad Pas-
senger Corporation, 191 F.3d 1148, 1156-57 (9th Cir. 1999)
(upholding district court's award of front pay calculated by
reference to what plaintiff would have made had she been
promoted). The district court did not err in upholding the
jury's front pay award.
C. Compensatory Damages
CPI also challenges the district court's decision upholding
the jury's compensatory damage award. CPI claims that the
evidence of emotional damage arising from lost promotional
opportunities can only be attributed to Passantino's gender
discrimination claims. This argument is misguided. The jury
could have found that Passantino suffered substantial emo-
tional damage because of CPI's retaliation against her. Her
"promotability" status within the company plummeted after
she complained. She testified, and her husband and sister cor-
roborated, that she experienced substantial anxiety as a result
of her sense that she could no longer advance within the com-
pany. The jury could have attributed this anxiety, as well as
her rashes, stomach problems, and other symptoms, to CPI's
retaliatory action. While the jury could have believed, as CPI
argues, that these problems were caused by her unwarranted
perception that she suffered discrimination (or even some pre-
existing condition), we cannot reverse its findings merely
because our reading of the evidence might have been differ-
ent, especially where the district court concluded that the "ev-
idence at trial was sufficient to support the verdict[ ] on
emotional distress damages." Here, there is evidence which,
if believed, would support the verdict. See Herring, 914 P.2d
at 78.
CPI also appears to suggest that emotional damages awards
must be supported by some kind of "objective" evidence.
While objective evidence requirements may exist in other cir-
cuits, such a requirement is not imposed by case law in either
Washington, the Ninth Circuit, or the Supreme Court. See
Herring, 914 P.2d at 77-83 (upholding damage award in
excess of $1,000,000, including $550,000 for emotional dam-
ages, in disability discrimination and retaliation case based on
testimonial evidence of emotional harm); Chalmers v. City of
Los Angeles, 762 F.2d 753, 761 (9th Cir. 1985) (upholding
emotional damages based solely on testimony); Johnson v.
Hale, 13 F.3d 1351, 1352 (9th Cir. 1994) (noting that emo-
tional damages may be awarded based on testimony alone or
appropriate inference from circumstances); Carey v. Piphus,
435 U.S. 247, 264 n.20 (1978) (noting that emotional distress
damages are "essentially subjective" and may be proven by
reference to injured party's conduct and observations by oth-
ers). See also Merriweather v. Family Dollar Store, 103 F.3d
576, 580 (7th Cir. 1996) (noting that plaintiff's testimony can
be enough to support emotional damages). Most important,
Washington law contains no severity requirement as a precon-
dition to awarding compensatory damages; thus, Passantino's
testimony corroborated by that of her husband and sister is
adequate to support the jury's verdict. Herring , 914 P.2d at
81.
CPI also argues that the Fourth Circuit ruled against sub-
stantial compensatory damages in a case extremely similar to
this one, citing Hetzel v. County of Prince William, 89 F.3d
169, 171 (4th Cir. 1996). First, Hetzel is distinguishable. In
Hetzel the plaintiff offered no corroborating evidence for her
emotional damages, and she sought no counseling from any-
one. Here, in contrast, Passantino's claims were corroborated
by her husband and sister, and she sought help from her pas-
tor. Second, the Fourth Circuit's holding does not bind us,
even when we are applying federal law, let alone when it is
Washington law that guides us. We find no basis under Wash-
ington law for reversing the district court's decision.
D. Punitive Damages
CPI argues that the district court erred in upholding the
punitive damages award, because no federal compensatory or
nominal damages were awarded and therefore the punitive
damages cannot stand under federal law. In addition, it argues
that allowing the jury to consider punitive damages was error
because there was insufficient evidence to submit the issue to
the jury. Passantino argues, on cross-appeal, that the applica-
tion of Title VII's $300,000 damages cap violates the Seventh
Amendment. CPI responds that the cap is constitutional, and
that in any event the punitive damages award is excessive
under BMW of North America v. Gore, 517 U.S. 559 (1996).17
[9] Although we conclude that the evidence was unques-
tionably sufficient and that the form of the jury's verdict prop-
erly supported a punitive damages award, we remand so that
the district court may apply the Supreme Court's decision in
Kolstad v. American Dental Association, 119 S.Ct. 2118
(1999) -- specifically so that the district court may determine
whether CPI is entitled to present the vicarious liability
defense outlined in Kolstad, and if so, for a new trial on puni-
tive damages. For this reason, we need not reach either cross-
appeal issue, as both of them concern the amount of the puni-
tive damages award.18 Because we do not reach the issue,
although raised to us on appeal, Passantino is not foreclosed
from seeking reconsideration before the district court or on
further appeal to this court if it becomes appropriate to do so.
1. The Award of Federal Compensatory Damages
CPI argues that because the non-punitive damages were all
allocated to the state claim, the punitive damages award under
Title VII should not have been upheld. In support of its argu-
ment, it cites the jury instructions, which stated that under
Title VII a plaintiff may not recover punitive damages with-
out establishing liability for either compensatory or nominal
damages.
[10] We have held in S 1983 cases that punitive damages
may be awarded in the absence of compensatory or nominal
damages, as long as the plaintiff has shown that the defendant
violated a federally protected right. Gill v. Manuel, 488 F.2d
799, 802 (9th Cir. 1973); Bise v. Int'l Brotherhood of Electri-
cal Workers, 618 F.2d 1299, 1305-06 (9th Cir. 1979). Other
circuits have adopted the same rule. See, e.g. , King v. Macri,
993 F.2d 294, 297-98 (2d Cir. 1993); Basista v. Weir, 340
F.2d 74, 88 (3rd Cir. 1965).19
[11] Here, we need not decide if punitive damages may be
awarded under Title VII in the absence of a compensatory or
nominal damage award, because the jury did award compen-
satory damages. As we explained in our discussion of the dis-
trict court's allocation decision, supra, Passantino did
establish liability for compensatory damages on her federal
claim, and the jury actually awarded her compensatory dam-
ages under federal law. It did so in the form of a general com-
pensatory damages award that applied to both the federal and
state claims. Because the standards for liability under state
and federal law were similar, the damage awards were fungi-
ble and, barring some statutory or other reason (see p. 4573
supra), could be allocated, by the court, to either the state or
federal claims, in whole or in part. Although the district court
acted properly in allocating the compensatory part of the
jury's damage award to Passantino's state law claim, the fact
remains that the jury awarded compensatory damages under
both federal and state law retaliation claims. That is all that
is required to permit an award of punitive damages in cases
in which predicate damages are necessary. A court's subse-
quent allocation of compensatory or nominal damages among
various claims does not change that rule. Moreover, in the
present case, it is clear that the jury thought it was, inter alia,
awarding federal damages, because it was told that it could
not award punitive damages without awarding federal dam-
ages, and it did award punitive damages. Accordingly, the
compensatory damages are adequate to sustain the award of
punitive damages, if such predicate damages are required.
2. Sufficiency of the Evidence
[12] The standard for determining when evidence is suffi-
cient to present the punitive damages issue to the jury is now
governed by Kolstad v. American Dental Asociation, 119
S.Ct. 2118 (1999). In that case, the Supreme Court rejected
the District of Columbia Circuit's interpretation of Title VII,
which would have required "egregious" conduct by an
employer before punitive damages could be available. Id. at
2124. Instead, the Court stated that an employer may be liable
for punitive damages in any case where it "discriminate[s] in
the face of a perceived risk that its actions will violate federal
law." Id. at 2125. The court made clear that although egre-
gious conduct could be evidence of intent to break the law,
such conduct was not required to establish punitive damages
liability. Id. at 2126 (holding that egregious behavior provides
"one means" of satisfying plaintiff's burden of proof for puni-
tive damages). Thus, in general, intentional discrimination is
enough to establish punitive damages liability.
However, the Court also acknowledged that there could be
some instances in which intentional discrimination did not
give rise to punitive damages liability. The Court set forth
three areas in which the factfinder could find intentional dis-
crimination but the defendant would nonetheless not be liable
for punitive damages. First, if the theory of discrimination
advanced by the plaintiff was sufficiently novel or poorly rec-
ognized, the employer could reasonably believe that its action
was legal even though discriminatory. Second, the employer
could believe it had a valid BFOQ defense to its discrimina-
tory conduct. Third, in some (presumably rare) situations, the
employer could actually be unaware of Title VII's prohibition
against discrimination. Id. at 2125. Common to all of these
exceptions is that they occur when the employer is aware of
the specific discriminatory conduct at issue, but nonetheless
reasonably believes that conduct is lawful. Under such cir-
cumstances, an employer may not be liable for punitive dam-
ages.
[13] An application of Kolstad's intentional discrimination
requirement to the facts here leaves no doubt that punitive
damages were available. The jury had substantial evidence
based upon which it could find malice or reckless indifference
to Passantino's federally protected rights. The jury could have
found that CPI downgraded Passantino's promotability status
and offered her demotions in retaliation for her complaints.
The jury also could have found that defense witnesses lied
(both to Passantino and at trial) about their actions, as part of
a continuing effort to cover up their campaign against her,
including giving her false or misleading information about
potential jobs as well as about salaries, and that CPI's actions
against Upshaw suggested a pattern of similar action. These
actions are sufficient to permit a jury to conclude that CPI
could not have reasonably believed that its conduct was law-
ful. As the exceptions outlined in Kolstad are not applicable
here, there was sufficient evidence to submit the claim for
punitive damages to the jury.
3. Vicarious Liability
In addition to clarifying the standard for intentional dis-
crimination claims under Title VII, Kolstad also expanded the
availability of the Burlington defense to punitive damage
claims. Defendants may now establish an affirmative defense
to punitive damages liability when they have a bona fide pol-
icy against discrimination, regardless of whether or not the
prohibited activity engaged in by their managerial employees
involved a tangible employment action. While Burlington had
created a similar affirmative defense for hostile work environ-
ment claims, Kolstad extends the doctrine by allowing defen-
dants to assert it in response to punitive damages claims, even
in cases involving tangible employment action. Kolstad, 119
S.Ct. at 2129-30.
[14] In light of the facts before us, we considered undertak-
ing the task of determining whether Kolstad applies. How-
ever, the parties had no reason to litigate the issues involved
in a Burlington defense, leaving the record unclear to us in at
least two material respects. First, while the actors here were
clearly managerial, it is not apparent to us exactly how senior
they were. We are not aware of any evidence that establishes
how high up in CPI's corporate structure Williams, the super-
visor of a "National Account Manager," and Hogan, a "Vice
President of Sales" actually were. A determination regarding
the status of the principal actors is crucial to the outcome, for
while Kolstad established that, under some circumstances,
corporations may not be subject to punitive damages for
actions taken by their "managerial" employees, it did nothing
to eliminate the rule established in earlier cases that an indi-
vidual sufficiently senior in the corporation must be treated as
the corporation's proxy for purposes of liability. See, e.g.,
Faragher v. City of Boca Raton, 118 S.Ct. 2275, 2284 (1998)
(citing Harris v. Forklift Systems, 510 U.S. 17, 19 (1993)).
In fact, Kolstad makes it clear that the proxy doctrine con-
stitutes a bar to the successful invocation of the Burlington
defense as to punitive damages. In Kolstad, the plaintiff, Car-
ole Kolstad, was denied a promotion within the American
Dental Association because of her sex. The people primarily
responsible for her failure to receive the promotion were Wil-
liam Allen, who was the acting executive director of the
Association, and Leonard Wheat, who was the acting head of
the Washington office where Kolstad worked. 119 S.Ct. at
2122.
After announcing that the standard governing the availabil-
ity of punitive damages in Title VII cases requires proof of
"malice or reckless indifference" to the rights guaranteed by
Title VII, the Court discussed how the district court should
apply the standard on remand. For Allen, the Court stated that
because he held the highest position within the Association,
the only question for the district court would be whether or
not he acted with malice or reckless indifference. For Wheat,
the Court noted that the district court would have to determine
whether or not Wheat served in a "managerial capacity" and
whether or not he behaved with "malice or reckless indiffer-
ence." Id. at 2130.
[15] Thus, the Burlington defense remains inapplicable as
a defense to punitive damages when the corporate officers
who engage in illegal conduct are sufficiently senior to be
considered proxies for the company. If Hogan and Williams
hold positions sufficiently high up within CPI, they would be
CPI's proxies, which would bar CPI from asserting a vicari-
ous liability defense to punitive damages. This is one of the
matters for the district court to examine upon remand.
[16] Second, the record does not contain enough informa-
tion about CPI's anti-discrimination policy to allow us to
determine whether it was implemented in good faith. As Kol-
stad makes clear, even if the defendant shows that the rele-
vant actors were merely managerial, it can escape punitive
damages only if it has undertaken sufficient "good faith
efforts at Title VII compliance." Kolstad, 119 S.Ct. at 2129.20
Although the purpose of Title VII is served by rewarding
employers who adopt anti-discrimination policies, see id., it
would be undermined if those policies were not implemented,
and were allowed instead to serve only as a device to allow
employers to escape punitive damages for the discriminatory
activities of their managerial employees. Thus, to avail itself
of a Burlington defense, an employer must show not only that
it has adopted an anti-discrimination policy, but that it has
implemented that policy in good faith.
[17] While the record reflects that CPI had promulgated a
policy against workplace discrimination and a complaint
mechanism to which Passantino turned, CPI did not, under-
standably (given the then-current state of the case law) intro-
duce the requisite evidence establishing that the policy was
fairly and adequately enforced. To the contrary, Passantino
testified that the policy and mechanism were not enforced and
were used to discourage her from asserting her rights. Unless
the district court is able to determine from the record that one
of the individuals responsible for the acts of retaliation is a
proxy for CPI, the proxy issue and the issue of whether CPI's
anti-discrimination policy and mechanism meet the good faith
standard will be subject to resolution only following the intro-
duction of further evidence on remand.21
Because we remand for consideration of whether punitive
damages are available under the circumstances of this case,
we do not reach the question of the constitutionality of Title
VII's damage cap. See Ashwander v. Tennessee Valley
Authority, 297 U.S. 288, 347 (1936) (Brandeis, J., concur-
ring). Because we do not reach the issue, although raised to
us on appeal, Passantino is not foreclosed from seeking recon-
sideration before the district court or on further appeal to this
court if it becomes appropriate to do so.
IX. ATTORNEYS' FEES
CPI argues that Passantino's counsel's fees should be
reduced because Passantino did not prevail on some of her
claims. We review a fees award for abuse of discretion, and
review the legal analysis involved in the award de novo.
Cabrales v. County of Los Angeles, 935 F.2d 1050, 1052 (9th
Cir. 1991). The prevailing party is entitled to reasonable attor-
neys' fees if she succeeds on "any significant issue in litiga-
tion which achieves some of the benefit" of her suit. Hensley
v. Eckerhart, 461 U.S. 424, 433 (1983). The district court did
not abuse its discretion.
Although Passantino did not prevail on her discrimination
claims or her claim for injunctive relief, she prevailed on her
retaliation claims, which were inextricably intertwined with
her discrimination claims. In fact, in order to prevail on her
retaliation claims, she had to prove that she reasonably
believed that CPI was engaged in discriminatory activity.
Moyo v. Gomez, 32 F.3d 1382, 1384-85 (9th Cir. 1994). Thus,
the time spent on her discrimination claims contributed to the
success of her retaliation claims. Cabrales, 935 F.2d at 1052.
Her multi-million dollar verdict represented success on a sig-
nificant issue which achieved a substantial portion of the ben-
efit sought from the suit. Given the broad discretion to which
attorneys' fees determinations are entitled on appellate
review, Hensley, 461 U.S. at 437, we decline to second-guess
the district court's decision.
X. CONCLUSION
For the foregoing reasons, we affirm the district court's
judgment and jury's award of compensatory damages, front
pay, and back pay to Passantino. We vacate the punitive dam-
ages award against CPI and remand for the district court to
apply the Supreme Court's decision in Kolstad . If necessary,
the district court should conduct a trial on the punitive dam-
ages issue.
AFFIRMED IN PART; VACATED AND REMANDED
IN PART.
_________________________________________________________________
THOMAS, Circuit Judge, concurring in part and dissenting in
part:
I would affirm the district court judgment in its entirety. In
my view, the evidence was sufficient to support a punitive
damage award even under Kolstad v. American Dental Ass'n,
119 S. Ct. 2118 (1999). I would also hold that the Title VII
limitation on damage awards does not violate the Seventh
Amendment. Thus, I do not believe any remand is required.
In all other respects, I concur in the majority opinion.
_______________________________________________________________
FOOTNOTES
1 Williams testified at trial that although he believed the men complained
of bore equal responsibility for the problems between them and Passan-
tino, he did not give them a reduced performance rating for relationship
with peers.
2 In contrast, the male colleagues Passantino and Upshaw complained
about were promoted.
3 Upshaw also had a "follow-up " meeting with Hogan at which she was
told that her male colleagues were better paid than she was. In fact,
Upshaw was informed by Hogan that her pay was not even within the
appropriate range for her position even though she had been in that posi-
tion for five years.
4 At her performance review held in 1996, Passantino asked Hogan
about a position that in fact would have been a promotion, Director of
Trade Marketing. The company's failure to promote Passantino to this
position was one of the allegations of discrimination in her EEOC com-
plaint. Hogan characterized it as a lateral, telling Passantino that it was at
the "same level" she currently held, Level 3, and that it was "not a promo-
tion from where you're at today." Corporate records showed that the job
was actually Level 4. This meeting was tape recorded by both Passantino
and Hogan, but CPI's tape was apparently inaudible. Passantino produced
her copy of the tape during discovery. During his direct examination,
Hogan testified accurately that the position would have been a promotion.
After an unsuccessful attempt by CPI's counsel to prevent the jury from
hearing the tape, Hogan was impeached with it; it showed him misrepre-
senting the nature of the position to Passantino and telling her it was at the
"same level." Hogan was thus forced to admit on the stand that his state-
ment to Passantino was false. The district court stated that Hogan and Wil-
liams "were probably viewed by the jury as being caught in lies, having
demeanors of untruthfulness, lacking credibility."5 Title VII limits compensatory and punitive damages based on the size
of the defendant corporation. For a plaintiff suing CPI, a company with
more than 500 employees, damages are capped at $300,000. 42 U.S.C.
S 1981a(b)(3). Backpay does not constitute damages for purposes of the
cap. 42 U.S.C. S 1981a(2).
6 We note that venue is based on the allegations set forth in the com-
plaint, not solely on the counts on which a plaintiff prevails. Passantino
alleged a variety of acts, both of discrimination and retaliation, in addition
to the actual failure to promote. For purposes of venue, we can consider
any of those actions. However, because she worked out of a home office,
it is likely that none of the decisions to engage in unlawful actions against
her occurred in Washington.
7 Only the first of the possible bases for venue is at issue here.
8 Although we recognize that the issues involved in personal jurisdiction
disputes are different from the issues involved in venue disputes, it is clear
that if exercising personal jurisdiction over a particular defendant would
comport with due process, this fact provides support for reading an other-
wise ambiguous venue statute in harmony with the jurisdictional rule.
9 For example, CPI's reference to decreased inventory obviously does
not provide a sufficient explanation for all of Passantino's information
problems. While there was testimony that information problems occurred
throughout the division, that testimony was from Hogan, who was
severely discredited at trial. Williams' explanations are problematic for the
same reason.
10 We need not consider whether or not Burlington's defense could ever
be available in retaliation cases, even in those cases which do not involve
tangible employment actions.
11 While an employer is always liable for tangible employment actions
taken in its name, it does not follow that employers are always subject to
punitive damages for tangible employment actions by their employees,
because there may be reasons to limit damages when companies engage
in good faith efforts to comply with Title VII, even if they ultimately fail
to prevent discriminatory conduct by their managerial employees. We dis-
cuss this issue in detail in the punitive damages section of this opinion,
which considers the effect of Kolstad v. American Dental Association, 119
S.Ct. 2118 (1999). See section VIII D., infra.
12 We note that CPI did not argue below that the District Court's deci-
sion was inconsistent with Monessen.
13 This is also the rule in the Ninth Circuit. See Alma v. Manufacturers
Hanover Trust Co., 684 F.2d 622, 626 (9th Cir. 1982).
14 Wholly aside from the allocation issue, CPI's argument that the front
pay award is subject to the cap is erroneous. Front pay is not part of the
compensatory award for purposes of Title VII's damage cap. Gotthardt v.
National Railroad Passenger Corp., 191 F.3d 1148, 1155 (9th Cir. 1999).
Backpay is also excluded. See 42 U.S.C.S 1981a(b)(3). Thus, those parts
of the award are not subject to the cap, whether or not the allocation was
appropriate.
15 Judgment as a matter of law is only appropriate if the evidence,
viewed in the light most favorable to the nonmovant, permits only onedecision, which is contrary to that reached by the jury. Forrett v. Richard-
son, 112 F.3d 416, 419 (9th Cir. 1997). A district court's refusal to grant
a new trial should be reversed only if it constitutes an abuse of discretion.
Wharf v. Burlington Northern R.R. Co., 60 F.3d 631, 637 (9th Cir. 1995).
The trial court may grant a new trial only if the verdict is contrary to the
clear weight of the evidence, is based upon false or perjurious evidence,
or to prevent a miscarriage of justice. Ace v. Aetna Life Ins. Co., 139 F.3d
1241, 1248 (9th Cir.), cert. denied, 119 S.Ct. 338 (1998).
16 Similarly, Ninth Circuit law provides for "substantial deference" to a
jury's findings as to the appropriate amount of damages. Del Monte v.
Monterey, 95 F.3d 1422, 1435 (9th Cir. 1996). A jury's award of damages
should not be disturbed unless it is clearly unsupported by the evidence.
Chalmers v. City of Los Angeles, 762 F.2d 753, 760 (9th Cir. 1985).
17 To the extent that CPI's argument can be read to challenge the capped
punitive damage award of $300,000 as excessive, we reject its argument.
As we uphold the compensatory award of $1,000,000, there is no doubt
that the capped punitive damages are not excessive.
18 The cap was applied only to Passantino's punitive damages award.
19 The First Circuit held, however, in a case in which it did not discuss
any of the cases noted above, that compensatory or nominal damages were
required in a Title VII case. Kerr-Selgas v. American Airlines, 69 F.3d
1205, 1214 (1st Cir. 1995) (requiring compensatory or nominal damages
for award of punitive damages).
20 For this reason, the Court stated that the Association's good faith
efforts "may" be relevant to determining liability for Wheat's actions,
while it did not mention those efforts when discussing the possibility of
liability for Allen's actions. As Allen was without doubt a proxy for the
Association, it could not escape punitive damages liability for its proxy's
actions by relying on its anti-discrimination policy. Kolstad, 119 S.Ct. at
2130.
21 It is, of course, never necessary to reach the "good faith" compliance
with Title VII issue if it is determined that the discriminatory action was
committed by a "proxy." Kolstad, 119 S.Ct. at 2129-30.
|
|
|
LEGAL NEWS:
Top Headlines ·
Supreme Court ·
Commentary ·
Crime ·
Cyberspace ·
International US FEDERAL LAW: Constitution · Codes · Supreme Court Opinions · Circuit Opinions US STATE LAW: State Constitutions · State Codes · Case Law RESEARCH: Dictionary · Forms · LawCrawler · Library · Summaries of Law LEGAL SUBJECTS: Constitutional · Intellectual Property · Criminal · Labor · more... GOVERNMENT RESOURCES: US Federal · US State · Directories · more... INTERNATIONAL RESOURCES: Country Guides · Trade · World Constitutions · more... COMMUNITY: Message Boards · Newsletters · Greedy Associates Boards TOOLS: Office · Calendar · CLE · Email · FAX · West WorkSpace · FirmSite |
| Advertising Info · Add URL · Help · Comments | Jobs@FindLaw · Site Map |
|
|
| Company | Privacy Policy | Disclaimer | Copyright © 1994-2003 FindLaw |