Parker v. General Extrusions ( 2007 )

RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit Rule 206
File Name: 07a0244p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
_________________
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Plaintiff-Appellant, -
NANCY PARKER,
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No. 06-3353
v.
,
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GENERAL EXTRUSIONS, INC., -
Defendant-Appellee. -
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Appeal from the United States District Court
for the Northern District of Ohio at Youngstown.
No. 05-00120—James Gwin, District Judge.
Argued: March 9, 2007
Decided and Filed: June 26, 2007
Before: DAUGHTREY and ROGERS, Circuit Judges; OBERDORFER, District Judge.*
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COUNSEL
ARGUED: Martin S. Hume, MARTIN S. HUME CO., L.P.A., Youngstown, Ohio, for Appellant.
Richard C. Haber, HABER POLK LLP, Cleveland, Ohio, for Appellee. ON BRIEF: Martin S.
Hume, MARTIN S. HUME CO., L.P.A., Youngstown, Ohio, for Appellant. Richard C. Haber,
HABER POLK LLP, Cleveland, Ohio, for Appellee.
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OPINION
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MARTHA CRAIG DAUGHTREY, Circuit Judge. The plaintiff, Nancy Parker, appeals the
district court’s order granting judgment as a matter of law under Rule 50(b) to the defendant,
General Extrusions, Inc., on the plaintiff’s claim for punitive damages in relation to her Title VII
gender discrimination suit, which she brought pursuant to 42 U.S.C. §§ 2000e-2000e-17. The jury
found for the plaintiff on her hostile working environment claim and, along with compensatory
damages, awarded Parker punitive damages. On motion of the defendant, however, the district court
struck down the punitive damages award, holding that punitive damages were not available pursuant
to 42 U.S.C. § 1981a(b)(1) because (1) only one of the employees who discriminated against Parker
was a “managerial agent” of the defendant, (2) this single employee did not act with the requisite
malice or reckless indifference to justify punitive damages, and (3) in any event, the defendant had
*
The Honorable Louis F. Oberdorfer, United States District Judge for the District of Columbia, sitting by
designation.
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made a good faith effort to comply with Title VII, thereby insulating itself from punitive damages
liability. The plaintiff appeals this ruling on all three grounds. For the reasons stated below, we
reverse.
FACTUAL AND PROCEDURAL BACKGROUND
From August 2000 until February 2004, Parker was employed by General Extrusions as a
shop worker on the night shift in the defendant’s fabrication department, which was responsible for
creating aluminum parts by extruding, cutting to size or punching such products out of metal. The
fabrication department was predominately male, with an average of five females employed in a
department of approximately 20 people. According to witnesses, a “loose” atmosphere pervaded
the night shift in the fabrication department: there was a “tremendous amount of horseplay”; the
workers as well as the management spoke freely in “shop talk” or “locker room talk,” meaning they
used profanity including crude and vulgar terms; and the male employees made sexual comments
about and to female employees.
The plaintiff established that while working within this environment, she was subjected to
pervasive sexual harassment from several co-workers. Although she reported a number of these
incidents of sexual harassment to her immediate supervisors, including foremen Rob Greenway,
John Alexander and Steve Kopkash, and, on occasion, to the human resources manager, Terry
Maloney, the record demonstrates that her complaints were not adequately addressed.
For example, one of Parker’s co-workers, Justin O’Hara, called Parker a “fucking whore”
and made vulgar comments about her sexual activities, implying that she was promiscuous. The
plaintiff reported this incident to her supervisor, foreman Steve Kopkash, who replied that the
comment “could be considered a compliment.” He did not report the incident to the Human
Resources manager, Terry Maloney, in violation of the company’s sexual harassment policy.
The most severe and pervasive harassment came from another co-worker, Eric Rendes, who
repeatedly referred to Parker in derogatory terms such as “whore,” “bitch,” “slut,” and “crybaby.”
These comments were at times made even in the presence of the foremen on duty, but Rendes was
not disciplined. On one occasion Rendes typed “fuck you” on Parker’s output card, and he
repeatedly used vulgar language to tell the plaintiff, or tell others while the plaintiff was in earshot,
about the sexual acts that he was going to perform on his girlfriend after work. On at least one
occasion Rendes made unsolicited comments to Parker regarding sexual acts Parker should perform
in order to “keep” her husband. When the plaintiff asked Rendes to stop this behavior, he told her
that he liked to harass women and that he had been fired from a previous job for harassing women.
Parker complained verbally to at least one foreman about Rendes’s behavior, specifically
about his vulgar language. Rendes was subsequently called into the foreman’s office, told that
Parker was complaining about his language, and informed that Parker was going to be reassigned
so that she no longer worked with him. Rendes did not, however, receive any discipline for his
actions, and none of the foremen reported the incident to the human resources manager, Terry
Maloney, again in violation of the company’s sexual harassment policy. In fact, Rendes testified that
the foremen generally “hushed it up” and tried to “keep it in house” when these kinds of complaints
were brought to their attention.
Even after she was reassigned, Parker continued to have problems with Rendes. He played
“tricks” on her, such as hiding her work equipment. At one point, Rendes purposefully blew metal
saw chips in her direction and, on another occasion, threw large pieces of metal that she had to
dodge in order to avoid being hit. One of the foremen, John Alexander, observed the saw-chips
incident but did not discipline Rendes for it. Instead, he laughed and walked away.
No. 06-3353 Parker v. General Extrusions Page 3
The plaintiff testified that because she had not received an adequate response following her
complaints to the foremen in her department, she went to Terry Maloney to discuss the situation.
According to the plaintiff, she started to describe Rendes’s reprehensible behavior toward her and
indicated what Rendes had told her about being fired from a previous job for harassing women.
Maloney allegedly cut her off, saying, “That’s hearsay and I don’t want to hear it.” As a result,
Parker felt that Maloney had taken Rendes’s side without hearing her out. She became upset, began
crying, and asked for a shift change. It is unclear from the record before this court whether her
request was honored.
At a later point, the plaintiff again had cause to complain about Rendes, who had used the
intercom system to make heavy breathing sounds obviously intended to be sexual in nature. The
plaintiff felt that this behavior was directed at her, and she made a written complaint about it to
Terry Maloney. As a result of this incident, Rendes was called into a meeting with Terry Maloney,
foremen Steve Kopkash and Rob Greenway, and a union representative. He was told that Parker
had accused him of sexual harassment and he replied that he “would rather jack off than touch her.”
Maloney reportedly “chuckled” at this comment, did not express disapproval of it, and then began
discussing what action to take in response to the intercom incident. The discussion led to Rendes
being given a verbal warning for “horseplay,” but he was not disciplined for sexual harassment.
When Rendes later testified about this meeting, he expressed his view that the company wanted to
get rid of both him and Parker: him because of his sexual harassment, and her because she
complained about things, including sexual harassment. He also testified that there was some
speculation during the meeting that Parker was complaining in an effort to extort money from the
company.
Parker testified that the result of this meeting was “humiliating” for her, explaining that
although she was led to believe that Maloney would keep her complaint as confidential as possible,
he loudly told her about the result of the meeting in a public work area where all her co-workers
could hear it. Moreover, soon after this incident, Parker was assigned to work on a deburring
machine, a job which was considered less desirable than most other jobs in the fabrication
department.
At this point, Parker also ran into trouble with another co-worker, Eli Rodriguez, who teased
her by unplugging a fan she was using. When Parker asked him to plug the fan back in, he screamed
various derogatory terms at her, calling her, for example, a “mother-fucking bitch.” Parker reported
this incident to foreman Kopkash and, because she was upset, apparently left work early. Kopkash
sent an e-mail to Terry Maloney indicating that Rodriguez and Parker had gotten into “a fight,” that
he thought Parker was just looking for a reason to go home early, and that he would make sure she
was disciplined for absenteeism. Rodriguez was not disciplined for the incident, even though he
admitted using the language at issue (he asserted that Parker used similar language, which she
denied). Meanwhile, Parker took sick leave necessitated by the stress created by the on-going
harassment. During this time, Maloney’s assistant attempted to contact Parker regarding the fan
incident, but the assistant was rude and demanding in the messages she left, and Parker did not reply
because she did not feel mentally and emotionally able to do so.
By July 2003, Parker had contacted an attorney, who wrote a letter to the chairman of the
board of General Extrusions, Herb Schuler Sr., outlining the harassment recounted above, as well
as a number of other incidents. In response to the letter, a meeting was held in which Parker, her
attorney, board chairman Schuler, and the company attorney were present. At the meeting Schuler
agreed that Parker could report any further sexual harassment to him. After the meeting, Terry
Maloney was instructed to and did investigate a number of the allegations made in the letter,
although the company attorney instructed him to forgo at least one claim (that a co-worker had put
a frozen water bottle between Parker’s legs). According to the defendant, other allegations were not
investigated because specific names were not given or because the individual named was no longer
No. 06-3353 Parker v. General Extrusions Page 4
employed at General Extrusions. Finally, the allegations concerning Maloney’s failure to take
Parker’s complaints seriously were never investigated, apparently because no one other than
Maloney was assigned to oversee the investigation.
The final incident of harassment occurred sometime after this meeting and after the plaintiff
returned from sick leave. While working on a machine that had a slow oil leak, Parker asked a co-
worker, Bob Montwori, to help her hang a cup on the machine to catch the oil. Montwori’s response
to the request was something to the effect of “You want me to hang it on my cock?” A few days
after this incident, Parker presented to the foreman on duty, Russell Green, a written complaint
detailing what had happened and asked him to sign it. Harvey Toy, a union representative, went
with Parker to present her written complaint to Green. Green told Parker that he did not know how
to deal with a sexual harassment claim, and Green, Parker and Toy went to find Maloney in his
office, but he had already left for the day. At some point later that night, Maloney became aware
of the complaint through another co-worker, phoned in to the office, and spoke with Green,
Montwori and Toy. Although Montwori denied making the comment, Toy told Maloney that
Montwori had already admitted to him privately that he had made the comment. Maloney instructed
Green to sign the complaint and said that he would return the next day, a Saturday, to investigate
further.
Parker reported to work next day, but as the day proceeded Maloney did not show up.
Eventually Green phoned Maloney to ask whether he was coming in, and Maloney told Green that
he had car trouble and could not make it in that day. Maloney later testified that he did not actually
have car trouble but, upon reflection, thought it best to discuss the situation with the company
attorney before proceeding further and therefore decided to wait until Monday to take any action.
When Parker learned that Maloney was not coming in to investigate she became distraught, ended
up going on sick leave again, and finally decided to quit when her sick leave was over.
Harvey Toy, the union representative who had helped Parker with the Montwori complaint,
testified on Parker’s behalf at trial that at various times he had assisted Parker in putting forward
other complaints of sexual harassment at work. He also testified that at some point he spoke with
Maloney about Parker’s complaints and that Maloney had said, “This is a mill-type environment.
If she doesn’t like it here, she can go get a job somewhere else.” Toy added that at least one
foreman had expressed a similar sentiment. He said that most of the time those to whom Parker
reported the harassment “thought it was a joke.” He also testified that his foreman (whom he did
not specifically name) had told him to “be careful” in what he said and did in relation to his
testimony in Parker’s case and threatened to fire him as the result of any cooperation with the
plaintiff’s litigation.
That litigation produced a jury verdict in the plaintiff’s favor, awarding $25,000 in
compensatory damages and $75,000 in punitive damages. Based on the defendant’s motion filed
pursuant to Federal Rule of Civil Procedure 50(b), the district court set aside the latter award,
holding: first, that the “Plaintiff’s allegations are insufficient to warrant an award of punitive
damages . . . [because] none of the employees who harassed Parker was a managerial agent”; second,
that the only managerial agent involved, Mahoney, may not have engaged in a “fully effective”
investigation of Parker’s complaints of harassment but that “he took harassment complaints
seriously” and “did not exhibit . . . malice or reckless indifference to the Plaintiff’s rights”; and,
finally, that the company “made a good faith effort to comply with Title VII.”
DISCUSSION
Without regard to the accuracy of the district court’s call on the first ground for overturning
punitive damages, we think the legal analysis on the second and third bases is simply not supported
by the evidence, as reflected in the jury’s verdict. It is for this reason that we have found it
No. 06-3353 Parker v. General Extrusions Page 5
necessary to set out the facts at some length, although the summary in this opinion does nothing
more than provide an idea of the abuse to which Parker was subjected on the job – many of the more
salacious allegations have been omitted from our narrative. It is sufficient to note that the
harassment was sufficiently continuous and serious enough to force Parker to take two separate
medical leaves of absence and, significantly, that it was still going on at the time she finally left the
company for good, despite what the district court described as the defendant’s “good faith effort to
comply with Title VII.” We conclude that this sorry state of affairs must be laid at the feet of Terry
Maloney, who was – without question – a managerial agent of General Extrusions.
In reaching this conclusion, we recognize that we review de novo the district court’s grant
of a Rule 50(b) motion for judgement as a matter of law. “In a federal question case, the standard
of review for a Rule 50 motion based on sufficiency of the evidence is identical to that used by the
district court. The evidence should not be weighed, and the credibility of the witnesses should not
be questioned. The judgment of this court should not be substituted for that of the jury; instead, the
evidence should be viewed in the light most favorable to the party against whom the motion is made,
and that party given the benefit of all reasonable inferences.” Tisdale v. Fed. Express Corp.,
415 F.3d 516, 531 (6th Cir. 2005). The Rule 50(b) motion should be granted only if “reasonable
minds could not come to a conclusion other than one favoring the movant.” Id.A Title VII claimant is entitled to recover punitive damages only when she can demonstrate
by a preponderance of the evidence that the employer “engaged in a discriminatory practice . . . with
malice or with reckless indifference to the federally protected rights of an aggrieved individual.”
42 U.S.C. § 1981a(b)(1). In Kolstad v. American Dental Association, 527 U.S. 526 (1999), the
Court laid out a three-part inquiry into determining whether punitive damages are proper under this
standard. First, the plaintiff must show that the individuals perpetrating the discrimination acted
with malice or reckless disregard as to whether the plaintiff’s federally protected rights were being
violated. Kolstad, 527 U.S. at 536. To meet this standard, those individuals must “at least
discriminate in the face of a perceived risk that its actions will violate federal law.” Id.Second, in order to impute liability to the employer, common law rules of agency apply. Most
relevant to the present case, the principal-employer is liable, only if “the agent was employed in a
managerial capacity and was acting in the scope of employment . . . .” Id. at 542-43 (citing
Restatement (Second) of Agency § 217C (1957)). “[N]o good definition of what constitutes a
‘managerial capacity’ has been found . . . and determining whether an employee meets this
description requires a fact-intensive inquiry.” Id. at 543 (internal quotation marks and citation
omitted). “In making this determination, the court should review the type of authority that the
employer has given to the employee, the amount of discretion that the employee has in what is done
and how it is accomplished.” Id. (internal quotation marks and citation omitted). “[A]n employee
must be important, but perhaps need not be the employer’s top management, officers, or directors to
be acting in a managerial capacity.” Id. (internal quotations and citation omitted). That employee
acts within the scope of employment if “the conduct is the kind the employee is employed to
perform,” it “occurs substantially within the authorized time and space limits” of his employment,
and it is “actuated, in least in part, by a purpose to serve the employer.” Id. at 543-44 (citing
Restatement (Second) of Agency, § 228(1), at 504) (internal quotations and alterations omitted).
Last, even if the plaintiff is successful in proving the first two inquiries, the defendant can
nonetheless avoid liability for punitive damages if it can show that it engaged in good faith efforts
to comply with Title VII. See id. at 544-46. This modification of the common law agency rules is
necessary in order to support and reward employers who are instituting one of the main goals of Title
VII: prevention of work-place discrimination. See id. at 545. With this in mind, courts interpreting
this criteria since Kolstad have focused both on whether the defendant employer had a written sexual
No. 06-3353 Parker v. General Extrusions Page 6
harassment policy and whether the employer effectively publicized and enforced its policy.1 See,
e.g., Bruso v. United Airlines, Inc., 239 F.3d 848, 858-59 & n.7 (7th Cir. 2001) (collecting cases).
We agree with the district court’s determination that Terry Maloney satisfies the Kolstad
“managerial agent” standard and, on appeal, the parties do not dispute this legal conclusion. Where
we part company with the district court is in its determination that Maloney’s conduct does not reflect
“malice or reckless disregard” for Parker’s right to be free from discrimination in the workplace. Nor
do we find any basis upon which to conclude that the company made a good-faith effort to enforce
its non-discrimination policy.
It is unnecessary to take issue with the district court’s conclusion that Maloney bore no malice
toward Parker, because a review of the record indicates quite clearly that Maloney was, at the very
least, recklessly indifferent to her plight. Significantly, after Maloney received the first complaint
from the plaintiff regarding the metal throwing incident with Rendes, Maloney immediately took
Rendes’s side without any investigation. When he finally did investigate, he simply spoke to Rendes
and, based on Rendes’s denial of any wrongdoing, took no disciplinary action whatever.
After Parker complained to Maloney again, this time about the intercom incident, Rendes was
initially told that he had been accused of sexual harassment. However, Rendes was not ultimately
punished for sexual harassment, but instead was written up for the relatively minor offense of
“horseplay.” Rendes testified that at the meeting about this incident, Maloney “chuckled” when
Rendes made a sexually offensive comment about Parker in Maloney’s presence. Importantly,
Rendes testified that after this meeting he got the impression that management was “looking for a
reason to get [Parker] out” because she “complained.” When asked to clarify whether he specifically
meant her complaints about sexual harassment, Rendes said that it related to Parker “trying to get me
on sexual harassment.” Parker testified that Maloney told her about the result of the meeting in a
public place, in front of other employees, in an effort to embarrass her.
In response to Kopkash’s e-mail to Maloney regarding the fan incident with Eli Rodriguez,
Maloney looked into the circumstances but did nothing to stop the foreman from punishing Parker
for absenteeism. Informed about the letter from Parker’s counsel, Maloney did undertake
investigation, but neither he nor higher-up management assigned the investigation to someone else,
despite the fact that Maloney himself was named as part of the basis for the complaint.
Without question, oversights such as these, whether intentional or merely reckless in the
extreme, could lead a jury to infer that the investigation was not taken seriously. Finally, although
Parker’s departure from the company hindered Maloney’s investigation into the final incident with
Malwori, Maloney admitted that he had told the foreman to tell Parker that he would investigate the
next day, but then did not come in the next day and, moreover, lied about his reason for doing so.
Additionally, Harvey Toy testified that in his role as Parker’s advocate, he questioned Maloney about
Parker’s complaints, and Maloney replied, “This is a mill-type environment. If she doesn’t like it
here, she can go get a job somewhere else.” The overt callousness of this response could only have
convinced the jury that Maloney did not take Parker’s complaints seriously.
Viewing all this evidence in its totality and drawing all reasonable inferences in favor of the
plaintiff, a rational fact-finder could plausibly choose to credit Rendes’s testimony that the company
was out to get Parker because of her continued complaints and, therefore, that any investigation into
those complaints was, at best, half-hearted and, at worst, a sham. Failure to engage in adequate
1
At least one circuit, the Tenth, has adopted a direct liability theory in cases in which management level
employees fail to rectify a hostile working environment and, therefore, has refused to consider any evidence of good faith
efforts to comply with Title VII. See McInnis v. Fairfield Communities, Inc., 458 F.3d 1129, 1138 & n.4 (10th Cir.
2006).
No. 06-3353 Parker v. General Extrusions Page 7
investigation – not once but on multiple occasions – coupled with conduct intended to embarrass and
ultimately drive the plaintiff out of the company, is legally sufficient to fulfill the “malice or reckless
disregard” standard. See, e.g., EEOC v. Harbert-Yeargin, Inc., 266 F.3d 498, 513-14 (6th Cir. 2001)
(recklessness found where managers did not adequately respond to employee’s complaints of
harassment); see also Deters v. Equifax Credit Info. Servs., Inc., 202 F.3d 1262, 1269 (10th Cir.
2000) (“[R]ecklessness 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.”).
We likewise find no legal merit to the defendant’s contention that it is insulated from liability
for punitive damages based on evidence of the company’s good-faith efforts to comply with Title VII.
In support of this argument, the defendant points to its written policy, which was modified once
during the plaintiff’s tenure in order to strengthen the employees’ protections; testimony from
various witnesses about sexual harassment training sessions both before and after the plaintiff’s case
became known to company management; and what the defendant characterizes as management’s
“prompt[] and reasonable respon[se]” to the defendant’s complaints.
Although this evidence might be somewhat persuasive if we were deciding the issue in the
first instance, the defendant’s argument in this regard ignores the standard to which it is now held.
In the present procedural posture, the plaintiff need only point to evidence on the record from which
any rational juror could find that the defendant was not making good faith efforts to comply with
Title VII. The plaintiff fulfills this obligation through the testimony of Harvey Toy, Justina Wade,
and Terry Maloney. Toy testified that in his ten years at the company, he did not remember receiving
any sexual harassment training until the plaintiff’s case became prominent, and Wade testified that
although she was aware of the sexual harassment policy, in her experience it was unenforced. The
jury was free to credit this testimony and conclude that the countervailing testimony regarding
training sessions and enforcement was exaggerated or even false. Moreover, we have in the record
Maloney’s testimony that in his 21 years as the human resources manager at General Extrusions, he
had never disciplined a foreman for not reporting an incident of sexual harassment. There is also
testimony regarding the foremen’s failure to report instances of sexual harassment against Parker in
violation of the sexual harassment policy, as well as Kopkash’s testimony that in his entire career at
the company, he never reported an instance of sexual harassment to Maloney. Obviously, a
reasonable juror could infer that the company was not making good faith efforts to ensure that its
policy was actually being enforced but was, instead, turning a blind eye to sexual harassment
occurring on the shop floor and simply letting the foremen handle it “in house.”
In the face of this record, the defendant nevertheless cites Bryant v. Aiken Regional Medical
Centers, Inc., 333 F.3d 536 (4th Cir. 2003), for the proposition that “courts do not hesitate to deny
punitive damages in cases, such as this one, where an employer has presented credible evidence that
it acted in good faith in attempting to comply with Title VII.” In Bryant, however, the Fourth Circuit
held that the defendant had presented evidence of “widespread anti-discrimination efforts, the
existence of which appellee [did] not dispute.” 333 F.3d at 549 (emphasis added). Here, the plaintiff
put on evidence disputing the extent of any sexual harassment training, as well as proof calling into
question not only the credibility but the very sincerity of enforcement efforts on the defendant’s part.
CONCLUSION
For the reasons set out above, we REVERSE the judgment of the district court insofar as it
sets aside the jury’s award of punitive damages and REMAND for entry of an order in the district
court reinstating and confirming that award.