Opinion
CIVIL ACTION No. 02-2291-KHV
February 11, 2004
MEMORANDUM AND ORDER
James Hardman filed suit against his former employer, AutoZone, Inc., for racial harassment, discrimination and retaliation in violation of Title VII, 42 U.S.C. § 2000e et seq. On September 5, 2003, the Court sustained defendant's motion for summary judgment on plaintiff's disparate treatment discrimination claim. See Memorandum And Order (Doc. #40). On October 27, 2003, a jury found defendant liable for racial harassment but not retaliation. For racial harassment, the jury awarded $1.00 for emotional distress, $1.00 for lost wages and benefits and $87,500.00 in punitive damages. This matter comes before the Court on Defendant AutoZone's Motion For Judgment As A Matter Of Law, Or Alternatively For A New Trial Or Remittitur (Doc. #79) filed November 10, 2003. For reasons stated below, the Court sustains defendant's motion in part.
Factual Background
In its Memorandum And Order (Doc. #40) of September 5, 2003, the Court set forth pertinent factual background, which is incorporated by reference. The following is a brief summary of the evidence presented at trial.
On a motion for judgment as a matter of law, the Court must view the evidence in the light most favorable to the prevailing party.See Harolds Stores, Inc. v. Dillard Dep't Stores, Inc., 82 F.3d 1533, 1546 (10th Cir.), cert. denied, 519 U.S. 928 (1996).
On a motion for new trial, the Court determines whether the verdict was "clearly, decidedly, or overwhelmingly" against the weight of the evidence. Anaeme v. Diagnostek, Inc., 164 F.3d 1275, 1284 (10th Cir.), cert. denied, 528 U.S. 814 (1999).
Plaintiff, a black male, started work as a parts sales manager ("PSM") at an AutoZone store in Lawrence, Kansas on May 5, 2000. Plaintiff worked with store manager Ralph Ray, assistant store manager Troy Raber, PSM Mike Miller, and counter salespeople Chris Bates and Mike Wilson. Plaintiff, who was the only black employee at the store, worked about 40 hours a week at AutoZone. He also worked 30 to 40 hours a week at other jobs, and he was a full-time student at Baker University.
As assistant store manager, Raber was plaintiff's direct supervisor. In late May of 2000, Raber began calling plaintiff "nigger," "boy" and other derogatory names. Beginning in May of 2000, plaintiff complained to both Raber and store manager Ray. Raber continued the racially derogatory names, however, and Ray ignored plaintiff's comments and told him to stop complaining.
Raber and Miller called plaintiff "nigger" and made other racially derogatory comments about him, blacks, Hispanics and other ethnic groups.
In June of 2000, in an effort to scare plaintiff, Miller jumped out from behind an aisle with a bag over his head, pretending to be part of the Ku Klux Klan. As Miller jumped out, he said "hey nigger." Ray, Raber and a commercial manager saw the incident, but took no corrective action. Approximately three days later, plaintiff reported the incident to Mark Shaffer, the AutoZone district manager. Shaffer did not investigate the incident until late September of 2000.
Several times in July of 2000, Raber took his dog to the store and threatened to have it attack plaintiff. Plaintiff reported the incidents to Ray and Shaffer.
On several occasions in August of 2000, Raber called plaintiff at the store and at home and made racial comments and threatened plaintiff and his family. Plaintiff reported the threats to Ray and the police.
In late August or early September of 2000, plaintiff found a hangman's noose near his mailbox, with a picture of a man hanging from a rope. Plaintiff reported the incident to Ray, who again told plaintiff to stop complaining. Plaintiff later reported the incident to district manager Shaffer, along with a regional manager in Kansas City and a manager in Memphis.
On several occasions, Raber, Miller and Wilson told plaintiff that they did not want "nigger music" in the store. In September of 2000, Raber removed the store stereo because plaintiff continued to play such music. Plaintiff reported the incident to Ray and Shaffer.
Plaintiff did not welcome the racial comments. He did not incite the comments and he did not participate in the joking.
In early September of 2000, plaintiff discovered that $300 was missing from Raber's safe and register, and informed Shaffer of the missing money. Shaffer responded that Raber was one of his best employees. After this conversation, someone replaced the money and AutoZone did not investigate.
On October 5, 2000, Shaffer and a human resources manager visited the store and asked plaintiff to provide a written statement regarding his allegations of discrimination. Based on plaintiff's statement and further investigation, AutoZone determined that approximately three months earlier, Wilson had called plaintiff a nigger. Within two weeks, AutoZone terminated Wilson's employment because of the incident. Plaintiff and Raber received Corrective Action Reviews for arguing with each other in front of customers and other employees. In addition, Miller received a Corrective Action Review for (1) the bag incident and (2) failing to report a racially derogatory comment by another employee.
The record does not reflect which complaint prompted the investigation.
On October 15, 2000, AutoZone transferred Wayne Porter from a Topeka store, to replace Ray as store manager. Ray remained at the Lawrence store but no longer served as store manager.
Sometime in November of 2000, for reasons unrelated to plaintiff's complaints, AutoZone transferred Raber to another store.
In October of 2000, an employee accused plaintiff of talking to a customer about purchasing a gun. AutoZone asked plaintiff to provide a written statement about the incident. Plaintiff did so and denied the accusation. AutoZone did not discipline plaintiff regarding the incident. On December 2, 2000, plaintiff resigned from AutoZone because managers had reprimanded him over little things and he felt that they were setting him up to be terminated.
Procedural History
On June 26, 2002, plaintiff filed suit against AutoZone, alleging that (1) AutoZone maintained a racially hostile work environment; (2) because of his race, AutoZone did not promote him to store manager and discriminated in the terms and conditions of his employment, (3) after plaintiff complained of race discrimination, AutoZone retaliated by disciplining him and allowing harassment to continue.
On September 5, 2003, the Court sustained defendant's motion for summary judgment on plaintiff's disparate treatment claim. See Memorandum And Order (Doc. #40). On October 27, 2003, a jury found defendant liable for racial harassment but not retaliation. For harassment, it awarded $1.00 for emotional distress, $1.00 for lost wages and benefits and $87,500.00 in punitive damages.
Defendant argues that the liability verdict for racial harassment is against the weight of the evidence, and that it is therefore entitled to judgment or a new trial. As to punitive damages, defendant argues that (1) it is entitled to judgment because the uncontested evidence established that any harassment was contrary to its good faith efforts to comply with Title VII; (2) it is entitled to a new trial because the Court's instruction on punitive damages did not include the good faith defense as outlined in Kolstad v. Am. Dental Ass'n, 527 U.S. 526 (1999); and (3) it is entitled to remittitur because the $87,500 punitive damage award was excessive.
Judgment As A Matter Of Law Standards
Judgment as a matter of law under Rule 50(b) of the Federal Rules of Civil Procedure "should be cautiously and sparingly granted." Zuchel v. City County of Denver, 997 F.2d 730, 734 (10th Cir. 1993). Judgment as a matter of law is appropriate "only if the evidence, viewed in the light most favorable to the nonmoving party, points but one way and is susceptible to no reasonable inferences supporting the nonmovingparty." Riggs v. Scrivner, Inc., 927 F.2d 1146, 1149 (10th Cir.), cert. denied, 502 U.S. 867 (1991). Such judgment is proper only when "the evidence so strongly supports an issue that reasonable minds could not differ." Ryder v. City of Topeka, 814 F.2d 1412, 1418 (10th Cir. 1987). In determining whether judgment as a matter of law is proper, the Court may not weigh the evidence, consider the credibility of witnesses or substitute its judgment for that of the jury. See Lucas v. Dover Corp., 857 F.2d 1397, 1400 (10th Cir. 1988). Nevertheless, the Court must find more than a mere scintilla of evidence favoring the nonmovant; the Court must find that "evidence was before the jury upon which it could properly find against the movant."Cooper v. Asplundh Tree Expert Co., 836 F.2d 1544, 1547 (10th Cir. 1988).
New Trial Standards
The decision to grant a motion for new trial is committed to the trial court's sound discretion. See Unit Drilling Co. v. Enron Oil Gas Co., 108 F.3d 1186, 1194 (10th Cir. 1997). "[T]he party seeking to set aside a jury verdict must demonstrate trial errors which constitute prejudicial error or that the verdict is not based on substantial evidence." White v. Conoco, Inc., 710 F.2d 1442, 1443 (10th Cir. 1983). The Court should ignore errors that did not affect the essential fairness of the trial. McDonough Power Equip., Inc. v. Greenwood, 464 U.S. 548, 553 (1984) (quotations and citations omitted). "Where anew trial motion asserts that the jury verdict is not supported by the evidence, the verdict must stand unless it is clearly, decidedly, or overwhelmingly against the weight of the evidence."Anaeme, 164 F.3d at 1284 (quotation omitted): see May v. Interstate Moving Storage Co., 739 F.2d 521, 525 (10th Cir. 1984).
Jury Instruction Standards
The decision whether to give a particular jury instruction is within the sound discretion of the Court. The instructions as a whole must pro vide correct statements of the governing law and provide the jury with an ample understanding of the issues and applicable legal standards.Allen v. Minnstar, 97 F.3d 1365, 1368 (10th Cir. 1996). The question is not "whether the charge was faultless in every particular, but whether the jury was misled in any way and whether it had understanding of the issues and its duties to determine these issues."Mason v. Okla. Tpk. Auth., 115 F.3d 1442, 1454 (10th Cir. 1997) (quotations and citations omitted); see Brown v. Wal-Mart Stores, Inc., 11 F.3d 1559, 1564 (10th Cir. 1993) ("An error in jury instructions will mandate reversal of a [civil] judgment only if the error is determined to have been prejudicial after reviewing the record as a whole.").
Analysis
I. Liability On Plaintiff's Racial Harassment ClaimDefendant argues that the liability verdict on plaintiff's racial harassment claim is against the weight of the evidence, and that it is therefore entitled to judgment as a matter of law or a new trial. In particular, defendant argues that (1) plaintiff did not present sufficient evidence of a racially hostile work environment and (2) defendant satisfied both prongs of its affirmative defense underFaragher v. City of Boca Raton, 524 U.S. 775 (1998).
Both arguments are contrary to defendant's admission, in the summary judgment context, that triable issues of fact remained on plaintiff's racial harassment claim and defendant's affirmative defense under Faragher. See defendant's Opposition To Plaintiff's Motion For Partial Summary Judgment (Doc. #34) filed May 22, 2003, at 1 ("Recognizing that issues of fact clearly existed with regard to Plaintiff's hostile work environment claim and Defendant's establishment of the second prong of the Faragher affirmative defense, Defendant filed a Motion for Partial Summary Judgment [only] on Plaintiff's retaliation, promotion, and differential treatment claims");id. at 21 ("[u]nquestionably, genuine issues of material fact exist with respect to Plaintiff's hostile work environment claim. . . . Defendant [also] recognizes the factual dispute with respect to" the second prong under Faragher).
Although defendant did not seek summary judgment on plaintiff's racial harassment claim, plaintiff did so. The Court overruled plaintiff's motion on a record that was not materially different from the evidence at trial.
A. Racially Hostile Work Environment
As explained above, judgment as a matter of law is appropriate "only if the evidence, viewed in the light most favorable to the nonmoving party, points but one way and is susceptible to no reasonable inferences supporting the nonmoving party." Riggs, 927 F.2d at 1149. In addition, a new trial is not warranted unless the verdictwas "clearly, decidedly, or overwhelmingly" against the weight of the evidence.Anaeme, 164 F.3d at 1284. Defendant has not satisfied the high standards for judgment as a matter of law or a new trial based on the weight of the evidence. Although defendant has stated a version of the facts under which it could have prevailed, the jury found otherwise. Based on the evidence at trial, the jury reasonably could have found for either party on plaintiff's racial harassment claim. The Court must therefore defer to its credibility determinations and its ultimate finding of liability.
B. Faragher Defense
AutoZone argues that (1) as soon as plaintiff learned that Ray was ignoring his complaints, Faragher required him to complain to others and (2) as a matter of law, plaintiff's failure to do so constituted an unreasonable failure to report offensive conduct to management. See Memorandum In Support Of Defendant's Motion For Judgment As A Matter Of Law, Or Alternatively For A New Trial Or Remittitur (Doc. #80) filed November 10, 2003, at 18.
At trial, the jury instructions submitted alternative theories of liability for racial harassment: (1) that supervisory or management employees other than Raber knew or should have known of the harassment byRaber and/or other employees, but did not take prompt, appropriate remedial action (direct liability); and (2) that Raber created a racially hostile work environment for plaintiff (vicarious liability). See Jury Instructions (Doc. #66). Nos. 14-15: see also Deters v. Equifax Credit Info. Servs., Inc., 202 F.3d 1262, 1270 n. 3 (10th Cir. 2000) (explaining distinction between direct and vicarious liability). The Faragher defense applies only to vicarious liability. See Faragher, 524 U.S. at 807-08 (defense to vicarious liability); Harrison v. Eddy Potash, Inc., 248 F.3d 1014, 1024 (10th Cir. 2001) (Faragher defense applies to harassment by supervisor). Indeed, the Court did not instruct thatFaragher provided a defense to plaintiff's theory of direct liability and AutoZone did not object to the Court's failure to do so.See Jury Instructions (Doc. #66), No. 14. Because the jury could have found AutoZone liable under a direct theory of liability, the Court must overrule AutoZone's motion for judgment as a matter of law or a new trial as to plaintiff's racial harassment claim.
Plaintiff also presented sufficient evidence to defeat defendant's Faragher defense on his theory of vicarious liability. To prevail on a defense under Faragher, defendant must show that "(1) the harassment did not rise to the level of a tangible employment action; (2) it took reasonable care, as evidenced by its antiharassment policy, to prevent and correct promptly any [racially] harassing behavior; and (3) [p]laintiff unreasonably failed to utilize the antiharassment policy." Mallinson-Montague v. Pocrnick, 224 F.3d 1224, 1228 (10th Cir. 2000).
Defendant argues that plaintiff did not present sufficient evidence that he reasonably utilized AutoZone's anti-harassment policy. Though plaintiff's evidence on this point was limited, a reasonable jury could have found in his favor. Plaintiff testified that he complained about race discrimination to Ray on a daily basis. Beginning in May or June of 2000, he also complained to district manager Shaffer, human resources director Scott Anderson and the voice mail of the 1-800 number at the AutoZone office in Memphis. See also EEOC Questionnaire, Exhibit 560 at 7 (beginning in May 2000, plaintiff complained to Ray, Shaffer and Anderson about schedule and "racial remarks"). Although plaintiff did not specify the dates when he complained to individuals other than Ray about each and every incident, a reasonable jury could find that he reasonably attempted to follow the AutoZone handbook — which did not specifically explain what to do if his manager did not respond to complaints. For example, plaintiff testified that on approximately June 3, 2000, in the presence of Ray and Raber, Mike Miller said "hey nigger" to plaintiff with a bag over his head. Approximately three days later, plaintiff reported the incident to Shaffer, the district manager. Plaintiff testified that in July or August of2000, he complained to Rayand Shaffer about Raber bringing his dog to the store to frighten him In late August or early September of 2000, after plaintiff found a noose and a picture of a man hanging from a rope in his mailbox, he reported the incident to Ray, Shaffer and Anderson. In sum, plaintiff presented sufficient evidence for a jury to find in his favor on defendant's Faragher defense.
II. Punitive Damages
As noted, the jury awarded $87,500.00 in punitive damages on plaintiff's racial harassment claim. As to punitive damages, defendant argues that (1) it is entitled to judgment because the uncontested evidence established that any harassment was contrary to its good faith effort to comply with Title VII; (2) it is entitled to a new trial because the jury instruction on punitive damages did not include its good faith defense under Kolstad; and (3) it is entitled to remittitur because the punitive damage award was excessive.
A. Motion For Judgment As A Matter Of Law
Defendant argues that it is entitled to judgment as a matter of law on plaintiff's punitive damage claim because the uncontested evidence established that any harassment by plaintiff's co-workers and supervisors was contrary to its good faith effort to comply with Title VII. To be eligible for punitive damages, plaintiff must show that defendant discriminated with malice or reckless indifference to federally protected rights. Deters, 202 F.3d at 1269; see 42 U.S.C. § 1981a(b)(1). In this context, "malice" and "reckless indifference" refer not to the egregiousness of the employer's conduct, but to its knowledge that it may be violating federal law. Deters, 202 F.3d at 1269; see Kolstad, 527 U.S. at 535. More specifically, "recklessness and malice are to be inferred when a manager responsible for setting or enforcing policy in the area of discrimination does not respond to complaints, despite knowledge of serious harassment." Deters, 202 F.3d at 1269; see Kolstad, 527 U.S. at 546 (defense requires good faith effort to enforce anti-discrimination policy):Cadena v. Pacesetter Corp., 224 F.3d 1203, 1210 (10th Cir. 2000); Baty v. Willamette Indus., Inc., 172 F.3d 1232, 1244-45(10th Cir. 1999). An employer may therefore be liable for punitive damages if it did not adequately address Title VII violations of which it was aware. Cadena, 224 F.3d at 1210.
The Tenth Circuit has explained the purpose of the good faith defense under Kolstad:
in the context of punitive damages, an employer may not be liable for the discriminatory employment decisions of management-level employees where these acts are contrary to good-faith efforts on the part of the employer to comply with Title VII. See Kolstad, 119 S.Ct. at 2129. This principle is meant to advance the purposes of Title VII by encouraging the remediation and prevention that lie at the heart of the statute's goals. Id. It would defeat these purposes to hold an employer strictly liable for the acts of rogue managers when it has made every effort to comply with Title VII's requirements.Deters, 202 F.3d at 1271. The Tenth Circuit has emphasized, however, that the Kolstad defense applies only incases of vicarious liability. See Dodoo v. Seagate Tech., Inc., 235 F.3d 522, 531 (10th Cir. 2000); Deters, 202 F.3d at 1271.
As explained above, the jury instructions submitted alternative theories of liability for racial harassment: (1) that supervisory or management employees other than Raber knew or should have known of the harassment by Raber and/or other employees, but did not take prompt, appropriate remedial action (direct liability) and (2) that Raber created a racially hostile work environment for plaintiff (vicarious liability).
Kolstad does not apply to plaintiff's direct theory of liability and ample evidence supported punitive damages under that theory. Viewing the evidence in the light most favorable to plaintiff, he complained to Ray about racial issues on a daily basis throughout his employment. Ray did not respond and actually told plaintiff to stop complaining. AutoZone insists that Ray "was not responsible for developing or implementing Auto Zone's policies, conducting investigations under those policies, or determining appropriate remedial conduct." Memorandum In Support Of Defendant's Motion For Judgment As A Matter Of Law, Or Alternatively For A New Trial Or Remittitur (Doc. #80) filed November 10, 2003, at 7. As explained above, however, the relevant question is whether Ray was responsible for "setting or enforcing policy in the area of discrimination." Deters, 202 F.3d at 1269 (emphasis added). Under the AutoZone handbook, Ray was charged with enforcement of anti-harassment policy. See Trial Exhibit 602 at 3 8-39 (employee should immediately report harassment to his manager). If AutoZone did not want store managers to enforce anti-harassment policy, its handbook should not have designated them to receive employee complaints of harassment. See Swinton v. Potomac Corp., 270 F.3d 794, 810-11 (9th Cir. 2001) (Kolstad does not apply where supervisor designated as proper recipient of harassment complaints failed to act on them), cert. denied, 535 U.S. 1018 (2002); Deters, 202 F.3d at 1270-71 (employee designated to process complaints and act as final company representative at particular branchis managerial agent on punitive damages issue). In addition, in the performance appraisals of store managers, AutoZone specifically evaluated "diversity" and each store manager's ability to teach "the importance of treating all AutoZoners and customers with respect." Trial Exhibit 585 at 2.
Finally, plaintiff complained to Shaffer on several occasions and to Anderson on one occasion. Neither individual investigated the incidents until late September of 2000 — approximately four weeks after plaintiff complained about the noose in his mailbox and the picture of the man hanging from a rope. In sum, the jury reasonably could have concluded that defendant acted with malice or reckless indifference to plaintiff's federally protected rights to be free from racial harassment under a theory of direct liability.
In addition, under a theory of vicarious liability, plaintiff presented sufficient evidence to defeat defendant's Kolstad defense. In particular, based on the conduct of Ray and Shaffer, the jury could have concluded that defendant did not make a good faith effort to comply with Title VII. See supra note 4.
For these reasons, the Court overrules defendant's motion for judgment as a matter of law on the issue of punitive damages.
B. Jury Instruction
Defendant argues that it is entitled to a new trial because the jury instruction on punitive damages did not include its defense underKolstad. The Court instructed the jury as follows:
If you find from a preponderance of the evidence that plaintiff is entitled to actual damages, you may, but are not required to, award punitive damages in addition to the other compensatory damages mentioned in other instructions. Punitive damages may be imposed in order to punish the wrongdoer for extraordinary misconduct, and to serve as an example or warning to others not to engage in such conduct.
If you find by a preponderance of the evidence that defendant acted with malice or with reckless indifference to the federally protected rights of plaintiff to be free from racial harassment and retaliation, you may award punitive damages.
"Malice" is a state of mind characterized by an intent to do a harmful act without a reasonable justification or excuse. An act is "maliciously" done if prompted or accompanied by ill will, or spite, or grudge toward the injured person. An act is done with "reckless indifference" if it is done in reckless or callous disregard of, or indifference to, the rights of the injured person.
Whether to make an award of punitive damages in addition to actual damages is a matter exclusively within the province of the jury. You may not award punitive damages unless you award actual damages.
If you do award punitive damages in this case, then in assessing the amount of such damages, you should consider the following:
(1) the impact or severity of defendant's conduct;
(2) the amount of time defendant conducted itself in this manner;
(3) the amount of compensatory damages;
(4) the attitudes and actions of defendant's top management after the misconduct was discovered; and
(5) the effect of the damage award on defendant's financial condition.
Any award of punitive damages must be iked with calm discretion and sound reason, and must never be awarded, or fixed in amount, because of any sympathy, or bias, or prejudice with respect to any party to the case.Jury Instructions (Doc. #66), No. 21.
At the instruction conference, defendant objected that the proposed instruction did not instruct that defendant could not be liable for punitive damages if it had an anti-discrimination policy and acted in good faith. The Court overruled defendant's request because, by requiring malice or reckless indifference, the instruction required the jury to find a lack of good faith. More problematically, the instruction allowed the jury to award punitive damages on plaintiff's theory of vicarious liability based on the conduct of all agents and employees of AutoZone. It did not adequately explain that as to vicarious liability, any conduct by defendant's supervisor that was inconsistent with its good faith policy to comply with Title VII should not be considered to constitute conduct of the corporation. Under Kolstad, to the extent the jury found defendant vicariously liable based on Raber's conduct, defendant was entitled to an instruction that for purposes of punitive damages, the jury could not consider malicious or reckless conduct by Raber which was inconsistent with defendant's good faith efforts to comply with Title VII. See Kolstad, 527 U.S. at 545-46. In the punitive damages instruction, the Court did not attempt to distinguish plaintiff's two alternative theories of liability. In addition, the Court did not propound a special interrogatory which required the jury to state the theory under which it found defendant liable.
Although defendant erroneously attempted to assertKolstad as a defense to both theories of liability and did not submit a proper Kolstad instruction under the facts of the case, defendant adequately preserved its objectionby stating at the formal instruction conference that the Court's instruction onpunitive damages was inconsistent with Kolstad. As explained above, defendant's objection is well taken as to plaintiff's theory of vicarious liability.
The Tenth Circuit has noted that an erroneous jury instruction requires reversal only if the error is determined to have been prejudicial, based on a review of the record as a whole. See Bangert Bros. Const. Co., Inc. v. Kiewit W. Co., 310 F.3d 1278, 1290 (10th Cir. 2002). The Tenth Circuit has not defined precisely what likelihood of prejudice will require a new trial, see Morrison Knudsen Corp. v. Fireman's Fund Ins. Co., 175 F.3d 1221, 1236-37 (10th Cir. 1999), but it most often applies a standard which requires reversal if an erroneous instruction may have misled the jury — even if that chance is `Very unlikely."Wankier v. Crown Equip. Corp., 353 F.3d 862, 867 (10th Cir. 2003); Adams-Arapahoe Jt. Sch. Dist. No. 28-J v. Cont'l Ins. Co., 891 F.2d 772, 780 (10th Cir. 1989); Farrell v. Klein Tools, Inc., 866 F.2d 1294, 1301 (10th Cir. 1989): see Townsend v. Lumbermens Mut. Cas. Co., 294 F.3d 1232, 1242 (10th Cir. 2002) (court must reverse if jury "might" have based verdict on erroneous instruction); Coleman v. B-G Maint. Mgmt. of Colo., Inc., 108 F.3d 1199, 1202 (10th Cir. 1997) (same); City of Wichita v. U.S. Gypsum Co., 72 F.3d 1491, 1495 (10th Cir. 1996) (same). But see U.S. Indus., Inc. v. Touche Ross Co., 854 F.2d 1223, 1253 n. 39 (10th Cir. 1988) (new trial required only if more than 50 per cent chance that an error was prejudicial; preponderance of evidence standard).
In this case, ample evidence supported an award of punitive damages based on a theory of direct liability and the jury was properly instructed on that theory, both as to liability and punitive damages. The Court, however, cannot rule out the possibility that the jury awarded punitive damages — at least in part — on a theory of vicarious liability. Although sufficient evidence supported an award of punitive damages under that theory as well, the Court cannot be sure that the jury did not consider Raber's conduct in assessing punitive damages. At a minimum, the jury's consideration of Raber's conduct may have impacted the amount of punitive damages awarded. Because the jury might have imposed punitive damages or increased the amount of punitive damages on the theory of vicarious liability, and the Court did not properly instruct the jury on that theory, AutoZone may have been prejudiced. Accordingly, the Court grants defendant's motion for a new trial. See Wankier, 353 F.3d at 867.
The jury could have properly considered Raber's conduct if it had also found that AutoZone did not make a good faith effort to comply with Title VII, but absent a proper jury instruction or special interrogatory, the Court cannot be certain of the jury's conclusion on that issue.
Because the Court sustains defendant's motion for new trial based on the erroneous jury instruction, it need not address defendant's argument as to the excessiveness of punitive damages.
III. Scope Of New Trial
For reasons explained above, the Court grants defendant's motion for new trial on the issue of punitive damages, but overrules defendant's motion on the issue of liability. In these circumstances, the Court must determine the scope of the new trial. A full retrial is required only if (1) an error or insupportable damage award calls into question the propriety of the original jury's finding of liability, e.g., a compromise verdict, or (2) the issue to be retried is "inextricably intertwined" with one of the original jury's findings, such that a limited retrial would cause confusion and uncertainty and thus an unfair retrial. Morrison, 175 F.3d at 1255-56: see Mason v. Texaco, Inc., 948 F.2d 1546, 1552 (10th Cir. 1991) (court may limit retrial where issue to be retried is so distinct and separate from others that trial of it alone maybe without injustice), cert. denied, 504 U.S. 910 (1992). In this case, the issue of punitive damages is inextricably intertwined with the jury's finding of liability. In determining punitive damages, the jury considers the impact or severity of defendant's conduct and the amount of time defendant conducted itself in this manner. See Jury Instructions (Doc. #366), No. 21. Because alternative theories of liability were submitted to the jury, the Court and a second jury could only speculate as to what AutoZone conduct formed the basis of the first jury's verdict of liability and award of nominal damages. A new trial on the limited issue of punitive damages would likely confuse the jury and result in an unfair trial for both parties. Accordingly, the Court orders a new trial on plaintiff's racial harassment claim as to liability, damages and punitive damages.
IT IS THEREFORE ORDERED that Defendant AutoZone's Motion For Judgment As A Matter Of Law, Or Alternatively For A New Trial Or Remittitur (Doc. #79) filed November 10, 2003 be and hereby is SUSTAINED in part. Defendant's motion for new trial is sustained as to plaintiff's racial harassment claim. Defendant's motion is otherwise overruled.
IT IS FURTHER ORDERED that Plaintiff's Amended Motion For Attorney's Fees And Costs (Doc. #78) filed November 5, 2003 be and hereby is OVERRULED as moot.
IT IS FURTHER ORDERED that Plaintiff's Motion For Leave To Conduct Discovery For Preparation Of Plaintiff's Motion For Statutory Attorney Fees And Expenses Pursuant To 42 U.S.C. § 2000e-5(k) (Doc. #88) filed December 16, 2003 be and hereby is OVERRULED as moot.
IT IS FURTHER ORDERED that a new trial on plaintiff's racial harassment claim is scheduled for May 18, 2004 at 9:30 a.m.