Phillips v. Postmaster General, United States Postal Service

NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
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No. 10-3222
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SUZANNE PHILLIPS,
Appellant
v.
POSTMASTER GENERAL,
UNITED STATES POSTAL SERVICE
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On Appeal from the United States District Court
for the Western District of Pennsylvania
(D.C. No. 07-815)
District Judge: Hon. Donetta W. Ambrose
Argued May 10, 2011
Before: SMITH, CHAGARES, and VANASKIE, Circuit Judges.
(Filed: June 2, 2011)
Christian Bagin (Argued)
Wienand & Bagin
100 First Avenue, Suite 1010
Pittsburgh, PA 15222
Gregory G. Paul
Morgan & Paul, PLLC
409 Broad Street, Suite 270
Sewickley, PA 15143
Counsel for Appellant
Alice L.A. Covington (Argued)
United States Postal Service
Commercial and Appellate Litigation
475 L’Efant Plaza, S.W.
Washington, D.C. 20260-1127
Counsel for Appellees
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OPINION
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CHAGARES, Circuit Judge.
Suzanne Phillips appeals the District Court’s denial of compensatory damages on
her contract claim following a jury’s finding that the United States Postal Service
(“Postal Service”) breached a settlement agreement with Phillips. Phillips also appeals
the District Court’s denial of spoliation sanctions against the Postal Service in light of its
failure to implement a litigation hold on the destruction of documents. For the following
reasons, we will affirm the District Court’s denial of compensatory damages on Phillips’
contract claim and dismiss her appeal with regard to spoliation sanctions.
I.
We write for the parties’ benefit and recite only the facts essential to our
disposition. Suzanne Phillips is a mail processing clerk who began her career at the
Postal Services in 1989. In 1998, Phillips sued the Postmaster General for sexual
discrimination and retaliation under Title VII stemming from the conduct of Postal
Service manager, Thomas Arneson. In 1999, Phillips and the Postal Service settled the
dispute. As part of the settlement agreement, Phillips was protected from any further
retaliation relating to her suit: “Defendant, the Postmaster General, agree[s] that neither
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he nor his employees will use against Plaintiff Phillips, any of her actions taken to protect
her rights under federal law, in terms of promotion, transfer, the grant of benefits or
salary raises, or any other term or condition of her employment with the defendant.”
Joint Appendix (“JA”) 471.
Phillips alleges that beginning in 2006, she was retaliated against by Arneson
through his intimidating behavior, threats of discipline, denial of vacation leave, and
assignment of more physically demanding and less desirous work tasks. Following a
final agency decision on her complaint in March 2007, Phillips filed suit against the
Postal Service in June 2007 under the retaliation provisions of Title VII and based on the
Postal Service’s breach of contract of the non-retaliation provision in the settlement
agreement.
In February 2008, Phillips requested during discovery a broad range of documents
including all documents and electronically stored information with Phillips’ name. In
October 2008, Phillips filed a motion for sanctions claiming that the Postal Service
committed spoliation of discovery materials by (1) shredding documents and (2) deleting
stored emails. Despite the Postal Service’s admission that it failed to impose a timely
litigation hold for the retention of documents, the District Court denied the motion for
spoliation sanctions, finding that Phillips’ allegations that relevant documents were
destroyed was pure speculation and that there was no evidence that the Postal Service
acted with bad or malicious intentions by destroying documents.
The case was tried before a jury beginning on March 2, 2010. The District Court
proposed its own jury instructions to the parties on March 4. At a hearing, the Court
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raised concerns as to whether the jury could award damages based on the contract claim
and whether the verdict form to be submitted to the jury needed to differentiate the
damages between Phillips’ claims. Phillips’ counsel maintained: “[T]here aren’t any
monetary damages under the contract, itself. I think if there is a finding of liability,
which is coextensive, to the extent we were looking for anything under the contract, we
would come back to the Court for injunctive relief or otherwise to make her whole.” JA
590. Phillips’ counsel argued that a finding of liability on the breach of contract claim
was sufficient to allow Phillips to seek injunctive relief with the Court, and that damages
stemming from the contract claim did not need to be presented to the jury. JA 594-95.
Phillips’ counsel reiterated that there were two separate claims, for breach of contract and
retaliation, but that no instructions were necessary for damages stemming from the
breach of contract claim. JA 592, 594, 595.
The District Court provided the jury with the following instruction on liability and
damages: “Here, because plaintiff’s breach of contract claim is based on a non-retaliation
provision in the settlement agreement, the damages for plaintiff’s breach of contract and
retaliation claims are coextensive.” JA 605. Additionally, the District Court removed
any breach of settlement agreement language from the damage section of the verdict
form. During deliberations, the jury submitted a question to the District Court regarding
whether it was allowed to provide damages to Phillips based only on her breach of
contract claim. The District Court recognized that its jury instructions noted that the Title
VII and breach of contract damages were coextensive, but that the verdict form was
unclear whether the jury could provide for a damage amount if it found that the Postal
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Service only breached the agreement. During discussions with the parties on how to fix
this problem, Phillips’ counsel maintained that the contract and retaliation claims were
coextensive and not actually two separate claims, and then requested an instruction for
emotional damages for breach of contract, although this had never been raised prior to
this time. JA 633-38.
The District Court determined that it was too late for Phillips to change the theory
of the case:
But, you can’t now change in midstream. You got up and you said, clearly
and unequivocally, that you were looking for specific performance. You
can’t now, after you have tried the entire case with that theory, switch gears
and ask for emotional damages for a breach of contract which were never
requested and never part of this case.
JA 634. The District Court determined that the contract and Title VII claims were not
coextensive and that the jury could have reasons to find that the Postal Service breached
the contract provisions without finding a Title VII violation. The District Court,
therefore, amended the jury instructions by removing the language that the liability for
both claims was coextensive. Additionally, the District Court revised the verdict form,
removing the issue of damages for breach of contract from the jury’s consideration.
On March 9, 2010, the jury found that the Postal Service had breached its
settlement agreement with Phillips, but that it had not retaliated against Phillips under
Title VII. On March 22, 2010, the District Court entered final judgment against Phillips
on her Title VII claim and granted specific performance on her breach of contract claim.
On May 10, 2010, Phillips filed a motion for entry of judgment for contract damages and
a renewed motion for judgment as a matter of law and a motion to alter judgment. On
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June 30, 2010, the District Court denied the motion, finding that Phillips had never
sought damages for breach of contract and was therefore barred from such an award.
Phillips filed a timely appeal. 1
II.
Phillips raises two issues on appeal. First, she contends that the District Court
erred by denying her compensatory damages on her contract claim because she was
entitled to such damages as a matter of law and never waived her right to compensatory
damages. After a thorough review of the record, we conclude that Phillips waived her
right to compensatory damages on her contract claim repeatedly throughout the course of
the trial. JA 588-95, 604, 617, 633-35. Phillips made clear to the District Court all the
way through the second day of jury deliberations that she was only seeking specific
performance on her contract claim and she litigated her theory fully on the merits. See
Alexander v. Riga, 208 F.3d 419, 429 (3d Cir. 2000) (noting that it is incumbent on the
plaintiff to bring its request for damages to the trial judge prior to the time the jury retires
to consider the verdict).
Second, Phillips maintains that the District Court abused its discretion by denying
her spoliation sanctions. We, however, cannot reach the merits of this issue as we do not
have jurisdiction under 28 U.S.C. § 1331 to review the District Court’s denial of Phillips’
spoliation motion. According to Fed. R. App. P. 3(c)(1)(B), a party is required to specify
the “judgment, order, or part thereof being appealed.” We have recognized that notices
1
The District Court had jurisdiction under 28 U.S.C. §§ 1331, 1367, 42 U.S.C. § 2000e-
16(c), and 39 U.S.C. § 409(a), and we have jurisdiction under 28 U.S.C. § 1291.
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of appeal are generally liberally construed as it is “almost axiomatic that decisions on the
merits are not to be avoided on grounds of technical violations of procedural rules.”
Polonski v. Trump Taj Mahal Assocs., 137 F.3d 139, 144 (3d Cir. 1998). Hence,
appellate jurisdiction is permissible over orders that are not specified in the notice of
appeal where: “(1) there is a connection between the specified and unspecified orders; (2)
the intention to appeal the unspecified order is apparent; and (3) the opposing party is not
prejudiced and has a full opportunity to brief the issues.” Polonski, 137 F.3d at 144; see,
e.g., Satterfield v. Johnson, 434 F.3d 185, 190 (3d Cir. 2006) (exercising jurisdiction over
the appeal because the district court’s order adopting a magistrate judge’s
recommendation regarding statutory tolling was related to the claim of ineffective
assistance of counsel because such a claim could not be reached without disposing of the
issue of timeliness); Polonski, 137 F.3d at 144 (finding that an appeal from an order
adopting a magistrate judge’s recommendation to reduce attorney’s fees was sufficient to
confer jurisdiction over an appeal of the earlier order granting attorney’s fees);
Drinkwater v. Union Carbide Corp., 904 F.2d 853, 858 (3d Cir. 1990) (exercising
jurisdiction because notice of appeal designating portions of summary judgment order on
a discrimination claim were “inextricably meshed” with prior order dismissing a
retaliation claim).
Phillips’ notice of appeal only referenced the District Court’s June 30 order
addressing the damages relating to the contract claim. Even applying Rule 3 liberally,
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Phillips has failed to satisfy the test for appellate jurisdiction. 2 Phillips has not provided
any connection between the June 30 order and the earlier spoliation order. In fact,
Phillips never even challenged the jury’s findings of liability on the Title VII or contract
claim post-verdict or on appeal, thus possibly implicating evidentiary issues and her
motion for spoliation. Additionally, there is no indication in the notice of appeal that
Phillips intended to appeal the spoliation motion or any evidentiary-related issue.
Therefore, even considering the liberal application of Rule 3, we conclude that there is no
appellate jurisdiction to review the District Court’s denial of Phillips’ spoliation motion
as Phillips did not provide a proper notice of appeal on this issue.
III.
For the foregoing reasons, we will affirm District Court’s denial of Phillips’
request for compensatory damages on her contract claim and dismiss her appeal with
regard to spoliation sanctions.
2
Phillips argues that her brief served as the “functional equivalent” of notice to warrant
appellate jurisdiction in accordance with Smith v. Barry, 502 U.S. 244 (1992). The
Supreme Court in Smith recognized that the Federal Rules of Appellate Procedure do
“not preclude an appellate court from treating a filing styled as a brief as a notice of
appeal [], if the filing is timely under Fed. R. App. P. 4, and conveys the information
required by Fed. R. App. P. 3(c).” Id. at 249. Accordingly, key to allowing a brief to
serve as the functional equivalent of a notice of appeal is that the non-appealing party is
given notice within the time period for filing the notice of appeal. Id. at 248. Phillips,
however, did not file her appellate brief within the time period for filing her notice of
appeal. Therefore, Phillips’ argument that her brief can serve as the functional equivalent
of a notice of appeal is rejected.
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