Booker v. Taylor Milk Company ( 1995 )

Opinions of the United
1995 Decisions States Court of Appeals
for the Third Circuit
8-31-1995
Booker v Taylor Milk Company
Precedential or Non-Precedential:
Docket 94-3503
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"Booker v Taylor Milk Company" (1995). 1995 Decisions. Paper 240.
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1
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
Nos. 94-3503 & 94-3525
LEATCH BOOKER, III,
v.
TAYLOR MILK COMPANY, INC.; RUSSELL MORGAN;
TIMOTHY M. GARCIA; DIANE PETCASH;
JOSEPH S. TAYLOR; PHIL F. RICHARDSON;
DICK RICHARDSON; RICHARDSON & ASSOCIATES
Leatch Booker, III,
Appellant in No. 94-3503 and
Cross-appellee in No. 94-3525
Taylor Milk Company, Inc.,
Appellant in No. 94-3525 and
Cross-appellee in No. 94-3503
Appeal from the United States District Court
for the Western District of Pennsylvania
(D.C. Civ No. 91-cv-02021)
Argued June 13, 1995
Before: STAPLETON, MCKEE and SEITZ, Circuit Judges.
Filed: August 31, 1995
Vaughn A. Booker, Esquire (Argued)
28 Douglass Road
Suite A-1
Woodbrook Circle
Lansdale, Pennsylvania 19446
2
Attorney for Appellant
3
John A. McCreary, Jr., Esquire (Argued)
Henry L. Clement, III, Esquire
Volk, Robertson & Hellerstedt
Three Gateway Center
15th Floor East
Pittsburgh, Pennsylvania 15222
Attorneys for Appellee
OPINION OF THE COURT
SEITZ, Circuit Judge.
Leatch Booker, III ("Plaintiff") was unlawfully
terminated by Taylor Milk Company, Inc. ("Defendant"). As a
result of this discharge, Plaintiff was awarded, inter alia, back
pay; however, his request for prejudgment interest on the award
was denied. First, both Plaintiff, on appeal, and Defendant, in
its cross-appeal, challenge the district court's order awarding
back pay. Second, Plaintiff appeals from the order of the
district court denying his request for prejudgment interest. The
finding of unlawful termination is not challenged on appeal. The
district court had jurisdiction under 28 U.S.C. § 1331, and we
have jurisdiction pursuant to 28 U.S.C. § 1291.
I. FACTS
Plaintiff, an African American, was employed as a
probationary laborer and dock handler by Defendant. Prior to the
end of his period of probation, Plaintiff was terminated.
Thereafter, he instituted this action against Defendant, and a
number of other individuals (not involved in this appeal),
alleging that his discharge was racially motivated. After a
bench trial, the district court entered judgment for Plaintiff
4
finding that his discharge was racially motivated and violative
of Title VII of the Civil Rights Act of 1964, see 42 U.S.C.
§§ 2000e to 2000e-17.
In its judgment, the district court concluded that
Plaintiff was entitled to, inter alia, back pay. Although it
awarded back pay, it reduced that sum by the amount it found
Plaintiff could reasonably have earned elsewhere during the
layoff period.1 Thereafter, Plaintiff made a motion for
prejudgment interest on this back pay award, which was denied by
the district court.
Plaintiff filed a timely appeal and Defendant a timely
cross-appeal from the district court's orders.
II. DISCUSSION
Plaintiff argues on appeal that the district court
erred in finding that he essentially failed to mitigate damages
after his discharge and in calculating the amount of the back pay
award. In addition, Plaintiff argues that the district court
abused its discretion in denying his motion for prejudgment
interest. In its cross-appeal, Defendant contends that because
the court concluded that Plaintiff failed to fully mitigate
damages as required by the statute, he is not entitled to any
back pay. We turn first to the district court's order awarding
Plaintiff certain back pay.
A. The Back Pay Award
1
In addition, the district court subtracted "interim earnings,"
which Plaintiff had earned in the various "odd jobs" he held over
a four-year period between the wrongful discharge and his
reinstatement with Defendant.
5
If a district court finds that an employer has engaged
in an unlawful employment practice, Title VII authorizes, inter
alia, a back pay award. See 42 U.S.C. § 2000e-5(g)(1); see also
Loeffler v. Frank, 486 U.S. 549, 558 (1988). As explained
by the Loeffler court, the back pay award authorized by Title VII
"is a manifestation of Congress' intent to make ``persons whole
for injuries suffered through past discrimination.'" Id. (quoting
Albemarle Paper Co. v. Moody, 422 U.S. 405, 421 (1975)); see
Squires v. Bonser, 54 F.3d 168, 172 (3d Cir. 1995). Despite a
presumption in favor of a back pay award, see Albemarle Paper
Co., 422 U.S. at 421, successful Title VII claimants have a
statutory duty to mitigate damages. See Robinson v. SEPTA, Red
Arrow, 982 F.2d 892, 897 (3d Cir. 1993).
1. Plaintiff's Duty to Mitigate Damages
A successful claimant's duty to mitigate damages is
found in Title VII: "Interim earnings or amounts earnable with
reasonable diligence by the person or persons discriminated
against shall operate to reduce the back pay otherwise
allowable." 42 U.S.C. § 2000e-5(g)(1); see Ellis v. Ringgold Sch.
Dist., 832 F.2d 27, 29 (3d Cir. 1987), cert. denied, 494 U.S.
1005 (1990). Although the statutory duty to mitigate damages is
placed on a Title VII plaintiff, the employer has the burden of
proving a failure to mitigate. See Robinson, 982 F.2d at 897;
Anastasio v. Schering Corp., 838 F.2d 701, 707-08 (3d Cir. 1988).
To meet its burden, an employer must demonstrate that
1) substantially equivalent work was available, and 2) the Title
6
VII claimant did not exercise reasonable diligence to obtain the
employment. See id. at 708.
Whether or not a claimant has met his duty to mitigate
damages is a determination of fact, which is subject to the
clearly erroneous standard of review. See Robinson, 982 F.2d at
897; Ellis, 832 F.2d at 29. In this case, the district court
found that Defendant had established Plaintiff's failure to
mitigate damages by a preponderance of the evidence and reduced
the back pay award by the amount it found Plaintiff could
reasonably have earned during the relevant period.
In support of its finding, the district court stated
that "Defendant's Exhibit 14 and other evidence establishes [sic]
that minimum wage jobs were available in the relevant job market
for which Plaintiff was qualified. Plaintiff did not apply and
would have been hired if he did." Appendix at 91a. Defendant's
Exhibit 14 covers thirty-three months of the Beaver County Times'
("Times") Sunday help-wanted section following Plaintiff's
discharge. The court did not specifically indicate what "other
evidence" supported its conclusion. Although the record is
somewhat sparse, it is clear that the district court found from
the record that 1) Plaintiff was not reasonably diligent in an
effort to secure employment, and 2) there were substantially
equivalent positions available. We address these findings.
a) Reasonable Diligence
The reasonableness of a Title VII claimant's diligence
should be evaluated in light of the individual characteristics of
the claimant and the job market. See Tubari Ltd., Inc. v. NLRB,
7
959 F.2d 451, 454 (3d Cir. 1992). Generally, a plaintiff may
satisfy the "reasonable diligence" requirement by demonstrating a
continuing commitment to be a member of the work force and by
remaining ready, willing, and available to accept employment. See
Hutchison v. Amateur Elec. Supply, Inc., 42 F.3d 1037, 1044 (7th
Cir. 1994); Ford v. Nicks, 866 F.2d 865, 873 (6th Cir. 1989).
Plaintiff testified that he read the help-wanted ads in
the Times every Sunday and "constantly and continuously searched
for employment." Appendix at 23a-2 to 23a-3, 25a. In addition,
following his discharge, Plaintiff did earn approximately $2,000
a year doing "odd jobs." Id. at 23a-1 ("handyman, painting,
putting up fences, whatever"). Plaintiff also pointed out that
he remained active with the Beaver Falls Job Service ("Job
Service"), a local employment agency. However, Plaintiff
testified that in the three and one-half years following his
discharge, he had failed to submit any employment applications in
response to the Times ads and had only one job interview. See id.
at 23a-2, 27a-28a. Plaintiff has attempted, both during trial
and on appeal, to explain his efforts.
First, Plaintiff stated that most companies will not
accept job applications unless they are sent through the Job
Service. However, there is no evidence in the record to support
Plaintiff's statement. Furthermore, Defendant produced a number
of help-wanted ads, which seem to be soliciting applications
directly without reference to the Job Service.
In addition, Plaintiff argues that "[a]n examination of
the grouping of advertisements [in Exhibit 14] reveals that the
8
vast majority of the listings are those of employment agencies
and temporary agencies." Plaintiff's Br. at 10. Because a number
of agencies may list the same job and some list jobs so as to
establish a file of available personnel, he maintains, merely
counting the listings may serve to count the same job more than
once. Although some of the listings are from agencies, Plaintiff
did not point to any ads which posted the same position or which
listed a position that was, in actuality, not available. Further,
Plaintiff did not support his statements concerning the temporary
agencies' policies. In fact, Plaintiff testified that in the
past, he obtained employment through a temporary agency.
Although a plaintiff's efforts need not be successful,
he must exercise good faith in attempting to secure a position.
See Reilly v. Cisneros, 835 F. Supp. 96, 99-100 (W.D.N.Y. 1993).
Here, it appears that Plaintiff did little more than register
with the Job Service and look through the help-wanted ads. See
EEOC v. Service News Co., 898 F.2d 958, 963 (4th Cir. 1990)
("Looking through want ads for an unskilled position, without
more, is insufficient to show mitigation, and the back pay award
should accordingly be reduced."); Truskoski v. ESPN, Inc., 823
F. Supp. 1007, 1015 (D. Conn. 1993) ("A ritualistic compliance
with the unemployment administrator's work search requirement
does not necessarily constitute a reasonably diligent search for
suitable employment."). Under the circumstances, Plaintiff's
conduct following the unlawful discharge does not appear to
demonstrate his continuing commitment to be a member of the work
force. Cf. Odima v. Westin Tucson Hotel, 53 F.3d 1484, 1497 (9th
9
Cir. 1995); Sellers v. Delgado College, 902 F.2d 1189, 1195 (5th
Cir. 1990); Gallo v. John Powell Chevrolet, Inc., 779 F. Supp.
804, 814 (M.D. Pa. 1991). Thus, the district court's conclusion
that Plaintiff failed to exercise reasonable diligence does not
appear to be clearly erroneous.
However, Plaintiff maintains that the Times help-wanted
listings include postings for laborers, assembly workers, and
factory workers, which are not "substantially equivalent" to his
former position. He argues that because they are not
"substantially equivalent" he was under no duty to apply for
these positions, and therefore, they should not be considered
sufficient proof of his failure to mitigate damages. We address
that argument.
b) Substantially Equivalent Employment
The duty of a successful Title VII claimant to mitigate
damages is not met by using reasonable diligence to obtain any
employment. Rather, the claimant must use reasonable diligence
to obtain substantially equivalent employment. See Ford Motor Co.
v. EEOC, 458 U.S. 219, 231-32 (1982); Anastasio, 838 F.2d at 708.
"Substantially equivalent employment is that employment which
affords virtually identical promotional opportunities,
compensation, job responsibilities, and status as the position
from which the Title VII claimant has been discriminatorily
terminated." Sellers, 902 F.2d at 1193; see Mitchell v. Humana
Hospital-Shoals, 942 F.2d 1581, 1583 n.2 (11th Cir. 1991); Ford,
866 F.2d at 873.
10
The record demonstrates that Defendant employed
Plaintiff as a "laborer" and "dock handler." In those positions,
he was essentially an unskilled worker who loaded and unloaded
trucks and coolers. Defendant's Exhibit 14 includes numerous
postings for laborers, general laborers, light labor positions,
and movers. Although most of the postings do not include
information about specific job responsibilities, benefits, and
promotional opportunities, but see, e.g., Appendix at 36a, 43a,
65a, it is clear that on the whole, the positions would not
require Plaintiff to "go into another line of work, accept a
demotion, or take a demeaning position." Ford Motor Co., 458 U.S.
at 231. But see Tubari Ltd., Inc., 959 F.2d at 458-59 (stating
that it is reasonable for an unskilled worker to have accepted a
wide range of work); id. at 456-57 (explaining that as time wears
on, plaintiff may be required to lower his sights). Furthermore,
to the extent it is indicated, the compensation for the positions
is substantially similar to Plaintiff's previous pay. Cf. Ellis,
832 F.2d at 30.
The listings in Exhibit 14 appear to be substantially
similar to Plaintiff's previous positions with Defendant.
Therefore, the district court did not err in considering the
exhibit as evidence of Plaintiff's failure to mitigate damages.
We are bound to accept the findings of the district
court unless we are left with a definite and firm conviction that
a mistake has been committed. See In re Cohn, 54 F.3d 1108, 1113
(3d Cir. 1995). After reviewing the record, we conclude that the
district court's finding that Defendant had proven Plaintiff's
11
failure to mitigate damages by a preponderance of the evidence is
not clearly erroneous.
In its cross-appeal, Defendant argues that because
Plaintiff failed to mitigate damages, he is not entitled to any
back pay. We turn now to that issue.
2. Defendant's Cross-appeal
Defendant argues that because Plaintiff failed to
mitigate damages to some extent, he wholly forfeits the right to
back pay under Title VII. The district court rejected
Defendant's "no mitigation-no backpay" argument. Because this
issue involves the interpretation of section 2000e-5, our review
is plenary. See Johnson & Johnson-Merck v. Rhone-Poulenc Rorer,
19 F.3d 125, 127 (3d Cir. 1994).
The plain language of section 2000e-5 shows that
amounts that could have been earned with reasonable diligence
should be used to reduce or decrease a back pay award, not to
wholly cut off the right to any back pay. See 42 U.S.C. § 2000e-
5(g)(1); see also Tubari Ltd., Inc., 959 F.2d at 453-54;
Anastasio, 838 F.2d at 708-09; 2 DAN B. DOBBS, LAW OF REMEDIES
§ 6.10(4), at 221-22 (2d ed. 1993). Furthermore, Defendant's
"no-mitigation-no back pay" argument is inconsistent with the
"make whole" purpose underlying Title VII.
As explained supra, back pay is designed to restore a
victim of discrimination to the economic position he would have
enjoyed absent the unlawful discrimination. The Supreme Court
has instructed that "given a finding of unlawful discrimination,
backpay should be denied only for reasons which, if applied
12
generally, would not frustrate the central statutory purposes of
[Title VII]." See Albemarle Paper Co., 422 U.S. at 421. Here,
the district court found that even had Plaintiff successfully
mitigated his damages, he would still not have been made "whole"
absent the award of some back pay. Based on the evidence before
it, the district court concluded that the amount Plaintiff could
have earned in a substantially equivalent position would have
been less than what he would have earned in Defendant's employ.
Thus, a denial of all back pay under the circumstances would
frustrate the make-whole purpose underlying Title VII.
Defendant's reliance on the Supreme Court's decision in
Ford Motor Co. is misplaced. In that case, the Court was
addressing the following issue: "[W]hether an employer charged
with discrimination in hiring can toll the continuing accrual of
backpay liability under . . . Title VII simply by unconditionally
offering the claimant the job previously denied, or whether the
employer also must offer seniority retroactive to the date of the
alleged discrimination." See Ford Motor Co., 458 U.S. at 220
(footnote omitted). Under that situation, a plaintiff can
entirely, or nearly, mitigate any loss by accepting the job once
denied, and, further, that rule satisfies Title VII's second
goal─to end unlawful discrimination. In the present case, there
was no "Ford offer," and, as the district court found, even with
reasonable diligence, Plaintiff could not have wholly mitigated
damages. This fact distinguishes his case from others where
plaintiffs failed to seek jobs that would have compensated them
completely for their losses and elected to remain unemployed. See
13
Hopkins v. Price Waterhouse, 920 F.2d 967, 981-82 (D.C. Cir.
1990); Cowan v. Prudential Ins. Co. of America, 852 F.2d 688, 690
(2d Cir. 1988).2
We conclude that the district court was correct as a
matter of law in rejecting Defendant's "no mitigation-no backpay"
argument and in awarding Plaintiff back pay where it was
necessary to make him whole. Although Plaintiff was granted back
pay, he argues that the district court abused its discretion in
calculating the amount of the award.
3. Calculation of Back Pay
As stated, the district court reduced Plaintiff's back
pay award by the amount he could have earned with reasonable
diligence. In calculating this amount, the district court turned
to Defendant's Exhibit 14 -- the Times help-wanted ads. The
district court found that substantially equivalent positions were
2
Defendant's reliance on Phelps Dodge Corp. v. NLRB, 313 U.S. 177
(1941) and its progeny is also misplaced. In Phelps the Court
stated, "Since only actual losses should be made good, it seems
fair that deductions should be made not only for actual earnings
by the worker but also for losses which he willfully incurred."
Id. at 198 (emphasis added). Reading on, we think that by
"losses willfully incurred," the Court was referring to "wages
that might have been earned." See id. Therefore, Phelps could
fairly be read as holding that a deduction from back pay awards
should be made for those earnings which could have been earned
with reasonable diligence.
In addition, we are unpersuaded by Defendant's citation
to our decision in Carden v. Westinghouse Elec. Corp., 850 F.2d
996 (3d Cir. 1988). First, the Carden court cites Ford Motor Co.
in support of its holding. As we have explained in the text,
Ford Motor Co. does not support Defendant's "no mitigation-no
backpay" argument. Second, as we read Carden, it seems to
support the position that a plaintiff's failure to mitigate
damages, as with a plaintiff who has "interim earnings," results
in a reduction in the back pay award. See id. at 1006.
 14
available and paid between $5.00 and $12.00 per hour. It set
$8.50 per hour as an average and used it to calculate the set
off. In addition, the court included overtime hours in its
calculation. We review the district court's back pay calculation
for an abuse of discretion. See Shore v. Federal Express Corp.,
42 F.3d 373, 377-78 (6th Cir. 1994); Robinson, 982 F.2d at 898.
Plaintiff argues that the district court abused its
discretion in computing his back pay award. He maintains that
the back pay order is contrary to its Findings of Fact and
Conclusions of Law. In its findings, the court stated,
"Defendant's Exhibit 14 and other evidence establishes that
minimum wage jobs were available . . . ." Appendix at 91A.
(emphasis added). Plaintiff contends that the court was bound to
use the minimum wage, and not the higher wage actually used, in
reducing his back pay award.
The evidence indicates that a number of substantially
similar positions were available, and those positions paid more
than minimum wage. Although the district court stated that
"minimum wage" positions were available, the record supports its
decision to use a higher wage. We conclude that the district
court did not abuse its discretion in calculating Plaintiff's
back pay and the set off.
Finally, Plaintiff argues that the district court erred
in not awarding prejudgment interest on this award. We turn now
to that issue.
B. Prejudgment Interest
15
The determination of whether to award prejudgment
interest in a Title VII case is committed to the sound discretion
of the district court. See Robinson v. SEPTA, Red Arrow, 982 F.2d
892, 897 (3d Cir. 1993). Generally, a court of appeals will not
overturn the district court's determination of the
appropriateness of a prejudgment interest award absent an abuse
of discretion. See Gelof v. Papineau, 829 F.2d 452, 456 (3d Cir.
1987); see also Hadley v. VAM P T S, 44 F.3d 372, 376 (5th Cir.
1995). The district court is deemed to have abused its
discretion only when the reviewing court is firmly convinced that
a mistake has been made. See Shore v. Federal Express Corp., 42
F.3d 373, 380 (6th Cir. 1994).
Here, the district court denied Plaintiff's motion for
prejudgment interest. In its order the district court recited in
relevant part:
IT IS ORDERED that the motion be and hereby is
denied for the following reasons:
. . . .
2. Interest on the back-pay and damage
calculations is not appropriate in this case due to the
conduct of plaintiff following [Defendant's] illegal
employment decision . . . ;
3. The conduct of plaintiff contributed to an
inflated claim for back-pay and therefore the equities
do not weigh in favor of awarding pre-judgment interest
on the damage award;
4. Plaintiff did not suffer from the loss of the
use of funds during the relevant period; and
5. The award of back-pay and the damage
calculations are fair, reasonable and appropriate under
the circumstances, without more.
Plaintiff's Br. at 28-29. Although the district court is not
specific, the parties agree that the "conduct" referred to by the
16
district court is Plaintiff's failure to mitigate damages. See
id. at 19; Defendant's Br. at 15.
Title VII authorizes prejudgment interest as part of
the back pay remedy in actions against private employers. See
Loeffler v. Frank, 486 U.S. 549, 557 (1988). As with the back
pay award, prejudgment interest helps to make victims of
discrimination whole. See Green v. USX Corp., 843 F.2d 1511, 1530
(3d Cir. 1988). The award of prejudgment interest is
compensatory in nature; it serves to compensate a plaintiff for
the loss of the use of money that the plaintiff otherwise would
have earned had he not been unjustly discharged. See Chandler v.
Bombardier Capital, Inc., 44 F.3d 80, 83 (2d Cir. 1994); Berndt
v. Kaiser Aluminum & Chemical Sales, Inc., 789 F.2d 253, 259 (3d
Cir. 1986).
This court has stated, "To fulfill this [make-whole]
purpose, prejudgment interest should be ``given in response to
considerations of fairness [and] denied when its exaction would
be inequitable.'" Green, 843 F.2d at 1531 n.16 (quoting Board of
Comm'rs of Jackson County v. United States, 308 U.S. 343, 352
(1939)) (second alteration in original). This language has been
interpreted as supporting a strong presumption in favor of
awarding prejudgment interest, except where the award would
result in "unusual inequities." See id.; Brock v. Richardson, 812
F.2d 121, 127 (3d Cir. 1987); see also Barbour v. Merrill, 48
F.3d 1270, 1279 (D.C. Cir. 1995). Accordingly, a district court
may exercise its discretion to depart from this presumption only
17
when it provides a justification that reasonably supports the
departure.
In the present case, the district court found that the
award of back pay alone wholly compensated Plaintiff, and that,
because Plaintiff's conduct contributed to an inflated back pay
claim, the equities weighed against prejudgment interest.
Furthermore, it concluded that Plaintiff did not suffer the loss
of the use of funds following the unlawful discharge.
We agree with those courts that have held that a
plaintiff's failure to mitigate damages, alone, is insufficient
to overcome the presumption in favor of a prejudgment interest
award. See, e.g., Hutchison v. Amateur Elec. Supply, Inc., 42
F.3d 1037, 1047-48 (7th Cir. 1994); Donnelly v. Yellow Freight
Sys., Inc., 874 F.2d 402, 411 (7th Cir. 1989). First,
Plaintiff's reduced back pay award reflects his failure to
mitigate damages. Second, even had Plaintiff met his duty to
mitigate losses, he would not be made whole absent an award of
some back pay. Because Plaintiff was entitled to some back pay
as a result of his unlawful termination, under the present
circumstances he is entitled to prejudgment interest for the loss
of the use of the amount included in the back pay award.
We find, therefore, that the district court's
conclusion was not consistent with a sound exercise of
discretion.
III. CONCLUSION
For the foregoing reasons, we will affirm the August 8,
1994 order of the district court awarding Plaintiff certain back
18
pay. We will reverse the August 22, 1994 order of the district
court denying Plaintiff's request for prejudgment interest on the
back pay award and direct the entry of an appropriate amount.