Roseann Thorne v. Welk Investment

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
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No. 98-3928
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Roseann Thorne, *
*
Plaintiff - Appellee, *
*
v. * Appeal from the United
* States District Court
Welk Investment, Inc.; William * for the Western District
Welk; Marcia Paul, * of Missouri
*
Defendants - Appellants, *
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Choice Hotel International, Inc. *
*
Defendant. *
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No. 98-4048
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Roseann Thorne, *
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Plaintiff - Appellant, *
*
v. *
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Welk Investment, Inc.; William *
Welk; Marcia Paul; Choice Hotel *
International, Inc., *
*
Defendants - Appellees. *
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Submitted: September 16, 1999
Filed: November 22, 1999
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Before FAGG, BEAM, Circuit Judges, and BOGUE,1 District Judge.
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BOGUE, District Judge.
Roseann Thorne worked as a desk clerk and manager of a Comfort Inn hotel in
Nevada, Missouri. The hotel is owned by Welk Investment, Inc., which in turn is a
franchisee of Choice Hotel International, Inc. Believing that she was a victim of sexual
harassment on the job, Thorne brought this case against the Defendants under Title VII,
42 U.S.C. § 2000e et seq. and the Missouri Human Rights Act (MHRA). Mo. Rev.
Stat. ch. 213. The district court2 dismissed franchisor Choice Hotel because it found
that Choice Hotel was not Thorne’s employer, and dismissed Thorne’s state law tort
claims on the ground that they were preempted by Missouri Workers’ Compensation
Law. Following a trial, the jury returned a verdict in favor of Thorne. Acting on post-
trial motions, the court reduced the jury’s award in several respects and made an award
of attorneys’ fees to the Plaintiff. Both sides appeal.
I. BACKGROUND
We recount the facts of this case by presenting the evidence submitted at trial in
a light most favorable to the judgment. Delph v. Dr. Pepper Bottling Co. of Paragould,
1
The Honorable Andrew W. Bogue, United States Senior District Judge for the
District of South Dakota, sitting by designation.
2
The Honorable Gary A. Fenner, United States District Judge for the Western
District of Missouri.
2
Inc., 130 F.3d 349, 351 (8th Cir. 1997). Thorne was hired as a desk clerk at a Nevada,
Missouri Comfort Inn in May 1995. Within three months, William Welk, the hotel’s
owner, invited Thorne to dinner to discuss a promotion to manager. Welk also offered
her a car and payment of her mortgage. Thorne declined these offers, but accepted the
job of manager, though it was obvious to her that Welk’s interest in her was more than
strictly professional.
Through the end of 1995 and into 1996, Thorne’s suspicions were confirmed by
a number of sexually suggestive comments and actions initiated by Welk. A
representative sample will suffice: Welk tried to kiss Thorne; Welk called her on his
car phone to ask if she was “horny;” Welk asked her to “get naked” in a jacuzzi; Welk
grabbed her breasts in his hotel room; and when Welk confronted Thorne about
maintenance issues at the Comfort Inn, he told her that she could have it “easy” like his
girlfriend and sometime employee Marcia Paul, or she could have it “the hard way.”
William Welk and Marcia Paul had a long-standing relationship which was at the
same time professional and intimate. In November 1995, Thorne had an uncomfortable
dinner with Paul and Welk where references were made about Welk’s sexual
relationships with some of his employees. A few days later, Paul told Thorne that there
were three ways her employment could be terminated – stealing, lying, and “f—ing Bill
Welk.”
Around the same time, Becky Watkins visited the Nevada Comfort Inn and met
Thorne. Watkins was one of Welk’s employees from Arkansas. Watkins had been
told by Jeannie Phillips, a Welk manager, that Thorne and Welk had an ongoing sexual
relationship. Paul told Watkins that she would fire Thorne if this were true. When
Watkins reminded Paul that employees could not be terminated for this reason, Paul
responded that she would use the “dirty motel” excuse to justify her actions.
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In January 1996, Choice Hotel performed a review of its Nevada Comfort Inn
franchisee. The reviewer, Greg Scott, noted Thorne’s helpfulness and gave the hotel
a good housekeeping score. Thorne reported that she was being sexually harassed on
the job. Scott told her to contact the EEOC or William Welk. The following month,
Thorne filed her charge of discrimination with the EEOC.
When Paul learned of Thorne’s EEOC filing, she begged Thorne to remove her
name from the charge. Paul explained that she could fire Thorne if she had three
performance write-ups. In March, Paul called Thorne and told her that she could either
accept a demotion to desk clerk or be terminated. At a meeting the next day, Paul
presented Thorne with three performance write-ups. Paul told her that she wanted to
tape record her voluntarily agreeing to a demotion. Distraught, Thorne acquiesced.
On April 1, 1996, Thorne telephoned Paul and told her that she was ill and
would not be in to work. Thorne’s psychologist provided a work release. As her two
week medical leave was about to expire, Thorne inquired as to when she would be
placed back on the work schedule. Thorne soon learned that she no longer worked at
the hotel. Paul had hired a replacement within a week of April 1.
II. DISCUSSION
A. Admissibility Issues
The Defendants challenge the admissibility of four separate items: the existence
of an Arkansas defamation suit brought by Welk against Becky Watkins and Sandra
Bullock; the testimony of Becky Watkins relating to this lawsuit; testimony regarding
Welk’s sexual relationships with other women; and reputation testimony regarding
Welk’s propensity for truthfulness. We have reviewed each item and find no reversible
error in the court’s rulings.
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In a similar vein, the Defendants contend that the jury’s verdict was based on
passion and prejudice, and that the trial court therefore abused its discretion when it
denied their motion for a new trial. Defendants claim that the improper jury verdict is
evidenced by the excessive damage awards. It was the trial court’s admission of the
above discussed “inflammatory” evidence which created the “incendiary” environment
in which the jury’s verdict was rendered, they argue.
When a punitive damage award is the result of passion and prejudice, a new trial
is usually required and remittitur is an inappropriate remedy. Hale v. Firestone Tire &
Rubber Co., 820 F.2d 928, 936 (8th Cir. 1987). Remittitur is often inadequate in this
situation because the passion and prejudice may have affected the jury’s decision on
the question of liability, as well as damages. 11 Charles A. Wright, et al., Federal
Practice & Procedure § 2815 (2nd ed. 1995). This is the exception to the general rule,
however, that “[t]he final determination of whether a new trial or remittitur is
appropriate . . . is committed to the sound discretion of the trial court.” Id. Our review
of the trial transcripts leads us to reject, as the district court did, Defendants’ assertion
that improper evidence and questioning “poisoned” the verdict.
Defendants also cite Triple R Indus., Inc. v. Century Lubricating Oils, Inc., 912
F.2d 234, 239 (8th Cir. 1990) for the proposition that a plaintiff’s consent is required
before a court will authorize remittitur. See also Hale, 820 F.2d at 936; Everett v. S.H.
Parks & Associates, Inc., 697 F.2d 250, 253 (8th Cir. 1983). In this case, the trial judge
ordered remittitur without Plaintiff’s waiver of her right to a new trial. That fact does
not entitle Defendants to a new trial, however. Nonconsensual remittitur implicates the
Plaintiff’s Seventh Amendment jury right, not the Defendants’ who lack standing to
raise the issue. See Morgan v. Woessner, 997 F.2d 1244, 1258 (9th Cir. 1993), cert.
dismissed, 510 U.S. 1033 (1993). We consider Plaintiff’s arguments concerning the
trial court’s order of remittitur separately below.
B. Welk’s and Choice Hotel’s Status as an Employer
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Next, Defendants argue that the trial court erred in concluding that Welk was
personally Plaintiff’s employer. Instead, Defendants claim, Thorne was actually
employed by Welk Investment, Inc. In a related issue, the trial court granted summary
judgment in Choice Hotel’s favor on the ground that Choice Hotel, as franchisor, was
not Thorne’s employer. The Plaintiff appeals this determination. We, however, see no
error of law or fact in either conclusion.
C. Retaliation
To establish a prima facie case of retaliation, a plaintiff must show participation
in a protected activity, subsequent adverse action by the employer, and a causal
connection between the two. 42 U.S.C. §2000e-3(a); Evans v. Kansas City, Mo. Sch.
Dist., 65 F.3d 98, 100 (8th Cir. 1995). Defendants claim that no reasonable jury could
have concluded that a causal link was established between Thorne’s demotion and
termination and her filing the EEOC charge of sexual discrimination. Instead,
Defendants point to evidence of Thorne’s poor performance and work related
misconduct as the cause of her demotion and ultimate termination. Defendants’ claim
of error is that the district court should have granted their motion for judgment as a
matter of law on this claim.
For a court to grant judgment as a matter of law, “[t]he evidence must point
unswervingly to only one reasonable conclusion.” Gardner v. Buerger, 82 F.3d 248,
251 (8th Cir. 1996), citing Johnson v. Cowell Steel Structures, Inc., 991 F.2d 474, 478
(8th Cir. 1993). Where, as here, a jury has been presented with conflicting testimony,
we will not ordinarily disturb the verdict on appeal. See Kim v. Nash Finch Co., 123
F.3d 1046, 1061 (8th Cir. 1997). “The evidence in this case presented inconsistent
inferences to the jury, and the resolution of this conflicting evidence was a matter for
the jury to resolve.” Id. at 1061-62. Accordingly, there was no error in the district
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court’s order denying Defendants’ motion for judgment as a matter of law on Plaintiff’s
claim of retaliation.
D. Damages
The jury awarded Thorne $220,000 in actual damages, $200,000 of which was
designated for pain and suffering, and $725,000 in punitive damages on her Title VII
and MHRA claims. The court reduced the jury’s award and entered a judgment for
$135,000 in compensatory damages and $135,000 in punitive damages. The district
court also ordered that the Missouri service letter punitive damage award should be
reduced from $50,000 to $10,000. Two separate issues are presented within the
question of the district court’s order of remittitur. First, we examine the amount of
remittitur ordered. Next, we must determine whether the court was authorized to order
remittitur in this case.
The court ordered the jury award of punitive damages for Defendants’ violations
of Title VII and the MHRA reduced from $725,000 to $135,000. The court also
remitted the jury’s award of compensatory damages from $220,000 to $135,000. In
so doing, the court considered “the degree of malice, the financial worth of the parties,
the injury suffered and all the relevant facts and circumstances.” The court also noted
the Plaintiff’s sporadic work history and the fact that she was re-employed shortly after
her termination from the hotel.
Next, the court reduced the jury’s $50,000 award of punitive damages for the
Defendants’ violation of the Missouri Service Letter Statute3 to $10,000. The evidence
3
That statute provides that when an employee requests a service letter from a
former employer, the employer shall within forty-five days issue a letter “setting forth
the nature and character of the service rendered by such employee to such corporation
and the duration thereof, and truly stating for what cause, if any, such employee was
discharged or voluntarily quit such service.” Mo. Rev. Stat. § 290.140.1. Employers
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introduced at trial established that Thorne had sent two identical service letter requests
on June 3, 1996, one in a certified envelope, as required by the statute, and one in a
first class envelope on which she deliberately did not write a return address. She
received both letters back in the mail and never obtained a service letter.
The court found that an award of $50,000 was “far more than necessary to deter and
punish” and noted that there was no evidence that Thorne suffered any tangible
detriment because of the failure to provide a service letter.
We review the reduction of damages by a district court for an abuse of
discretion. Kimzey v. Wal-Mart Stores, Inc., 107 F.3d 568, 576 (8th Cir. 1997); see
also Delph, 130 F.3d at 351. A verdict is not excessive unless the result is “monstrous”
or “shocking.” Jenkins v. McLean Hotels, Inc., 859 F.2d 598, 600 (8th Cir. 1988),
quoting Stafford v. Neurological Medicine, Inc., 811 F.2d 470, 475 (8th Cir. 1987).
Thorne claimed to have suffered considerable emotional distress but we agree, after
carefully reviewing the evidence, that a compensatory award of $135,000 is not
excessive, though an award of $220,000 was excessive as a matter of law. See Kim,
123 F.3d at 1067, citing Turic v. Holland Hospitality, Inc., 85 F.3d 1211, 1215-16 (6th
Cir. 1996) (citing cases where emotional distress damages ranged from $40,000 to
$150,000). Therefore we will not disturb the amount remitted on Thorne’s
compensatory damages. Insofar as the remittitur of punitive damages, it appears that
the district court considered the factors relevant to the reasonableness of a punitive
damages award, including the degree of reprehensibility of the defendant’s conduct,
and the ratio between the actual harm inflicted on the plaintiff and the punitive damages
award. Id. (citations omitted). We see no abuse of discretion with regard to the
remittited amount of punitive damages.
may be liable for nominal and punitive damages if the evidence establishes that a letter
was not issued. Mo. Rev. Stat. § 290.140.2.
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Having determined that the dollar figures remitted by the district court were
within the court’s discretion, we next turn to the question of whether the court was
authorized to order remittitur in the absence of the Plaintiff’s consent. The decision to
order remittitur is circumscribed by the Seventh Amendment. Bonura v. Sea Land
Serv., Inc., 505 F.2d 665, 669 (5th Cir. 1974). Here, the district court could have
ordered the remittitur in the amounts stated by conditioning the denial of a new trial on
Plaintiff’s consent to the remittitur. Yost v. Sauter, 420 F.2d 79, 81 n.2 (D.C. App.
1969), citing Dimick v. Schiedt, 293 U.S. 474, 482, 55 S. Ct. 296, 299, 79 L. Ed. 2d 603
(1935). Instead, the district court simply ordered remittitur without the Plaintiff’s
consent. This was in error. But cf. Parsons v. First Investors Corp., 122 F.3d 525, 529
(8th Cir. 1997) (noting “unique circumstances” where remittitur may be ordered
unconditionally). Ordinarily, we would remand in order to allow the Plaintiff to elect
between the judgment as remitted and a new trial. In this case, however, the Plaintiff
has represented through her attorneys that she will waive her right to a new trial if given
the choice. See Appellee/Cross-Appellant’s Opening Brief at 53 n.10 (“Should the
Eighth Circuit, however, simply decide to uphold the district court’s remittitur and
remand to give Plaintiff a choice, Plaintiff represents [she] would accept the remitted
amount.”). We acknowledge and hereby accept Plaintiff’s waiver of her right to a new
trial. Therefore we will affirm the district court’s judgment as remitted.
E. Workers’ Compensation Exclusivity Defenses
The jury found against Marcia Paul and William Welk on Thorne’s state law tort
claims of intentional and negligent infliction of emotional distress. The district court
granted post-trial motions for judgment as a matter of law on these claims, reasoning
that under Missouri law, Welk and Paul were entitled to workers’ compensation
immunity. See Nichols v. American Nat’l Ins. Co., 945 F. Supp. 1242, 1248 (E.D. Mo.
1996). Thorne has appealed these rulings which we review de novo. Swanson v.
White Consol. Indus., Inc., 30 F.3d 971, 973 (8th Cir. 1994).
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Missouri’s Workers’ Compensation Law provides for the liability of employers
for accidental injury of employees. Mo. Rev. Stat. § 287.120(1). The term “accident”
includes, but is not limited to “injury or death of the employee caused by the
unprovoked violence or assault against the employee by any person.” Id. The Act
provides an exclusive remedy and therefore preempts all other common law rights and
remedies on account of such accidents. Mo. Rev. Stat. § 287.120(2). The Act thereby
supplants and supersedes common law rights whenever the injury is “accidental” as
that term is used within the statute. Jones v. Jay Truck Driver Training Ctr., Inc., 709
S.W.2d 114, 115 (Mo. 1986) (en banc).
It is well settled that it is the exclusive jurisdiction of the Missouri Labor and
Industrial Relations Commission to determine whether an employee’s injuries were the
product of an “accident” for purposes of Workers’ Compensation preemption.
Goodrum v. Asplundh Tree Expert Co., 824 S.W.2d 6, 8 (Mo. 1991) (en banc); Killian
v. J&J Installers, Inc., 802 S.W.2d 158, 161 (Mo. 1991) (en banc); Jones, 709 S.W.2d
at 115. The Commission made no such determination of the Plaintiff’s claims.
Because Missouri law deprives courts of the jurisdiction to decide the “accidental”
quality of common law state law tort claims, the district court was correct in granting
judgment as a matter of law. Accordingly, this aspect of the district court’s judgment
will be affirmed.
F. Attorneys’ Fees
Pursuant to Rule 54(d), Thorne moved for an award of attorneys’ fees and
related non-taxable expenses in the amount of $388,266.42. See Fed. R. Civ. P. 54(d);
42 U.S.C. §2000e-5(k). The district court awarded her $267,100.00. Both sides
appeal this determination; the Plaintiff claiming that the fees were improperly reduced,
the Defendants arguing that the fees awarded were excessive.
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The Plaintiff provided the court with over eighty pages of itemized billing which
reflected twenty-three individuals who worked on the case. She claimed 2,448.80
billable hours and $35,000 in expenses. In trimming this fee request by roughly
$121,000, the court expressed its opinion that Plaintiff’s counsel had taken “an
overbroad approach” to “a fairly straight forward claim of sexual harassment and
retaliation and not the myriad of other claims and charges that served to drive the
excessive time and expense of this litigation.” The court also believed that the hourly
rates for Plaintiff’s trial attorneys were unreasonable given their lack of objectivity and
duplicative efforts.
We review a district court’s award of attorneys’ fees under the abuse of
discretion standard. St. Louis Fire Fighters Ass’n v. St. Louis, Mo., 96 F.3d 323, 331
(8th Cir. 1996). There are a number of factors district courts should consider in
determining a reasonable fee award. Id. at 332 n.10. Although courts are to consider
the results obtained which, in this case the Plaintiff describes as “excellent,”
counterweights in this case were the time required, the novelty and difficulty of the
issues, and the requisite skills to perform the legal service properly, all of which the
court felt the Plaintiff had overstated. See id. The district court determined that these
factors did not warrant the fee request submitted and reduced the award accordingly.
One critical factor the district court should have also considered in a case like
this is the attorneys’ fees awards in similar cases. See, e.g., Delph, 130 F.3d at 358
(attorneys’ fees of $88,800 in a racially hostile work environment case); Shrader v.
OMC Aluminum Boat Group, Inc., 128 F.3d 1218, 1220 (8th Cir. 1997) (attorneys’ fees
of $44,137.50 in an ADA case); cf. Migis v. Pearle Vision, Inc., 135 F.3d 1041, 1048
(5th Cir. 1998) ($81,000 in attorneys’ fees too high considering results obtained in Title
VII case); but see Bridges v. Eastman Kodak Co., 102 F.3d 56, 58 (2nd Cir. 1996), cert.
denied, 520 U.S. 1274, 117 S. Ct. 2453, 138 L. Ed. 2d 211 (1997) (affirming Title VII
attorneys’ fees of $753,202.99). It appears that the court neglected to include this
factor in its calculations and as a result reached an attorneys’ fees award amount which
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was too high under the circumstances. When, as here, the amount sought by the
prevailing party is far more than one would expect for a case of its complexity and
novelty, the court should reference awards in similar cases. While we are not imposing
an absolute pay scale for Title VII cases, we do believe that it was an abuse of
discretion for the court to overlook this factor. Therefore, we will remand with
instructions for the court to reconsider its award of attorneys’ fees with attention to this
neglected factor.
G. Bifurcation
Finally, the Defendants claim error in the district court’s refusal to bifurcate the
punitive damages aspect of the case. See Fed. R. Civ. P. 42(b). Even if accepted, this
assertion, standing alone, will not typically warrant reversal. E.g., EEOC v. HBE
Corp., 135 F.3d 543, 551 (8th Cir. 1998). This the Defendants acknowledge, yet claim
that the court’s decision not to bifurcate constituted an abuse of discretion if considered
cumulatively with the other asserted evidentiary errors. We disagree. The decision
of whether to isolate the punitive damages phase of the trial is within the sound
discretion of the trial court. We can discern no abuse of that discretion in the record
before us.
III. CONCLUSION
For the foregoing reasons, we conclude that the case should be affirmed in part
and reversed in part. With respect to the attorneys’ fees, we reverse and remand for
reconsideration by the trial court as hereinbefore discussed. Upon reconsideration of
this award, the trial court shall enter an order reflecting its decision as to this issue. In
all other respects, the decision of the district court is affirmed. For further proceedings
consistent with this opinion, the case is remanded.
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A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.
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