Metropolitan News-Enterprise


Friday, April 12, 2002


Page 3


Ninth Circuit Upholds Federal Law Capping Damage Awards in Bias Cases


By KENNETH OFGANG, Staff Writer/Appellate Courts


Federal law limiting non-economic damages in employment discrimination cases doesn’t violate the Seventh Amendment right to trial by jury or the separation of powers, the Ninth U.S. Circuit Court of Appeals ruled yesterday.

“Congress has significant power to define and circumscribe self-created causes of action,” Judge Harry Pregerson wrote for the court. “...Title VII epitomizes such a congressionally created right; as such, its remedies—including type and quantity of damages—may be legislatively determined without violating separation of powers.”

That holding was a relatively minor defeat, however, for two Spokane, Wash. women who sued their employer, a regional grocery chain, and will keep over $3 million in damages under the appellate court’s ruling.

The plaintiffs, Connie Hemmings and Patty Lamphiear, rose through the management ranks at Tidyman’s, Inc., Hemmings to the position of controller and Lamphiear to that of Customer Prepaid Inventory department manager.

Both claimed that they had been passed over for promotion in favor of less-qualified men, were underpaid for the work they were doing, were threatened and intimidated by male managers, were retaliated against for complaining about discrimination against themselves and other women, and were otherwise subjected to a male-dominated corporate culture that held down opportunities for advancement by women.

Hemmings was awarded $120,000 in lost wages and benefits, $1.58 million for future wage loss, $230,000 in general damages, and $1 million in punitive damages. Lamphiear was awarded $596,500 in lost wages and benefits, $1.024 million for future wage loss, $650,000 in general damages, and $1 million in punitive damages.

Chief U.S. District Judge Wm. Fremming Nielsen of the Eastern District of Washington threw out the punitive damage awards as unsupported by the evidence.

But he denied the remainder of the defendant’s post-trial motions, holding that Lamphiear’s general damage award was not subject to the $300,000 cap set forth in the 1991 civil rights law because damages were awarded under state as well as federal law,  and that the jury had properly awarded twice her actual past due wage loss under a state statute that automatically doubles awards for intentional withholding of wages.

The Ninth Circuit ruling yesterday reinstated the punitive damage award, but limited it to the $300,000 cap; and cut Lamphiear’s award for past-due wages in half, holding that the state wage law doesn’t apply where wages are underpaid as a result of discrimination, as opposed to being withheld entirely.

The panel upheld the balance of the judgment, with each of the three panelists writing a separate opinion. 

In the lead opinion, Judge Harry Pregerson rejected Tidyman’s arguments that the district judge erred in admitting prejudicial statistical testimony, that the general damage awards were subject to the federal cap, and that Nielsen committed plain error by not declaring a mistrial or issuing an immediate cautionary instruction after the plaintiff’s lawyer referred in closing argument to a prior bias suit he had handled against the company.

The statistical evidence that the defendant objected to was an analysis breaking down the company’s management according to the number of men and women in certain job categories. The plaintiffs’ expert testified that male and female managers were segregated into certain roles, with a substantial pay disparity, and that this segregation could not be accounted for by gender-neutral factors.

The evidence met the standard for expert testimony under Rule 702 of the Federal Rules of Evidence, Pregerson said.

The analysis was appropriate, the judge said, given the company’s practice of promotion from within. The law, he said, “does not require the near-impossible standard of eliminating all possible nondiscriminatory factors.”

Counsel’s reference to the prior suit, Pregerson went on to say, was improper but does not require reversal under the plain error standard, which applies because defense counsel made no objection at the time.

Pregerson acknowledged past cases holding that a judge committed plain error by allowing reference to prior suits against the same defendant. But those circumstances were different, he insisted.

“Here, the misconduct was an isolated, short comment during a closing statement that covered 66 pages when transcribed,” he said. The lack of objection, he added, may have been a strategic decision by defense counsel “to gamble on the verdict” rather than seek a mistrial.

Besides, Pregerson said, the strength of the plaintiff’s case suggests that the comment made no difference.

Pregerson was joined by Judge Sidney Thomas.

 Judge Ronald Gould dissented in part, arguing that Nielsen committed plain error by allowing counsel to comment on the prior suit.

“[T]he unadmitted evidence slipped in during closing argument implied that the plaintiffs’ claim in the prior suit was similar to the plaintiffs’ claim here, involved the very same allegedly discriminatory policies, and was resolved favorably to the plaintiffs,” he reasoned. The size of the verdict, he argued, suggests “that the jury took counsel’s improper and unsubstantiated admonishments to heart.”

In a footnote, Gould said he understood the majority’s reluctance to order a lengthy new trial “over a mistake in argument of a few seconds in closing.” That would be the proper result, however, he insisted, because “the length of the improper argument is not the measure of its power to work injustice.”

Thomas, in a separate opinion for himself and Gould, said the trial judge erred in applying the double-damage statute. Pregerson dissented on that issue, noting that the Washington Supreme Court has held that the law must be “liberally construed to advance the Legislature’s intent to protect employee wages and advance payment.”

The case is Hemmings v. Tidyman’s Inc., 99-35932.


Copyright 2002, Metropolitan News Company