Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-96-07047/USCOURTS-caDC-96-07047-0/pdf.json

Parties Involved:
American Dental Association
Appellant
Equal Employment Opportunity Commission
Amicus Curiae
Carole Kolstad
Appellee

Document Text:

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued November 15, 1996 Decided March 21, 1997

No. 96-7030

CAROLE KOLSTAD,

APPELLANT/CROSS-APPELLEE

v.

AMERICAN DENTAL ASSOCIATION,

APPELLEE/CROSS-APPELLANT

Consolidated with

96-7047

Appeals from the United States District Court

for the District of Columbia

(No. 94cv01578)

Joseph A. Yablonski argued the cause and filed the briefs for appellant/cross-appellee.

Bruce S. Harrison argued the cause for appellee/cross-appellant. With him on the briefs was

Elizabeth Torphy-Donzella.

Before: WALD, WILLIAMS and TATEL, Circuit Judges.

Opinion for the Court filed by Circuit Judge TATEL.

Opinion concurring in part and dissenting in part filed by Circuit Judge WILLIAMS.

TATEL, Circuit Judge: A jury awarded Carole Kolstad back pay after finding that her

employer had violated her rights under Title VII of the 1964 Civil Rights Act by denying her a

promotion because she is a woman. The district court entered judgment against the employer in the

amount of the jury award, but denied Kolstad further relief. Because the jury could reasonably find

from the evidence that Kolstad's employer intentionally discriminated against her on the basis ofsex,

we hold that the district court properly denied the employer's motion for judgment as a matter oflaw,

but that it erred in refusing to instruct the jury on punitive damages. We thus remand the case for

trial on Kolstad's punitive damages claim and for reconsideration of her claims for further equitable

relief and attorney's fees.

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I

AChicago-based professional association, appellee and cross-appellant, the AmericanDental

Association (ADA), maintains an office in Washington, D.C. to represent its members' interests

before Congress and various federal agencies. In September 1992, Jack O'Donnell, the

second-highestranking employee inADA'sWashington office, announced his retirement at year's end.

O'Donnell held the dual-titled position of Director of Legislation and Legislative Policy and Director

of the Council on Government Affairs and Federal Dental Services. His responsibilities included

developing and communicating ADA's positions on federal legislation and regulations affecting its

membership, and managing tri-annual meetings of the Council on Governmental Affairs, a

policy-making body composed of ADA members.

Upon learning of O'Donnell's retirement, appellant Carole Kolstad, then serving as ADA's

Director of Federal Agency Relations, and Tom Spangler, then ADA's Legislative Counsel, each

expressed interest in O'Donnell's job. A lawyer, Kolstad had handled federal regulatory issues at

ADAforfour years, consistentlyreceiving "distinguished" performance evaluationsfromthe Director

of ADA's Washington office, a position held in 1992 by Leonard Wheat. Earlier in her career,

Kolstad had spent six years in the General Counsel's office of the Department of Defense, where she

drafted proposed legislation, prepared testimony for Congressional hearings, and represented the

Department's interests on Capitol Hill. Also a lawyer, Spangler had worked at ADA for twenty

months, focusing on legislative issues facing the organization. He too had received "distinguished"

performance evaluations from Wheat. Prior to joining ADA, Spangler had spent five years lobbying

Congress on behalf of the National Treasury Employees Union. Kolstad and Spangler each had

experience working with O'Donnell, with Spangler principally supporting his lobbying efforts and

Kolstad, his management of the Council.

Although Wheat had the authority to name O'Donnell's replacement, he asked Dr. William

Allen, ADA'sExecutive Director inChicago, to make the appointment. After consulting with Wheat,

Allen drafted a revised "Position Description Questionnaire" for O'Donnell's job that incorporated

verbatimmanyofthe job responsibilitiesrecorded on the Position Description Questionnaire that had

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been used to hire Spangler for the Legislative Counsel position in 1991. In October 1992, three

months before O'Donnell'sretirement, Wheat signed a performance evaluation of Spangler that listed

as one of Spangler's 1993 goals to "provide management and administrative support ... for the

Council on Government Affairs," work that O'Donnell was then performing.

Spanglerformallyapplied for O'Donnell's position once posted inmid-November 1992. After

writing Allen that Wheat had refused for several weeksto meet with her to discuss her interest in the

position, Kolstad also applied. Following interviews with both Spangler and Kolstad, Wheat

recommended Spangler for the job. Allen then offered Spangler the promotion, which he accepted.

Informing Kolstad ofthe decision, Allen explained that she lacked experience with health care reform

and was too valuable to ADA in her current position to take on O'Donnell's job.

After exhausting her administrative remedies before the Equal Employment Opportunity

Commission, Kolstad filed suit, charging ADAwith unlawful employment discrimination and seeking

equitable relief, 42 U.S.C. § 2000e-5(g)(1), and damages, 42 U.S.C. § 1981a (1994). In her

complaint, Kolstad demanded a jury trial on all claims. Prior to opening arguments at trial, Kolstad

informed the district court that the parties had agreed to try her claims for equitable relief to the

court, with the jury rendering an advisory verdict on back pay pursuant to Federal Rule of Civil

Procedure 39(c). The court agreed to try to the bench Kolstad's claim for the equitable remedy of

instatement, but declined to rule on whether the jury would render an advisory verdict on the back

pay claim. Kolstad proceeded to try her case to the jury, introducing evidence to support an award

of back pay. At the close of evidence, the district court denied ADA's motion for judgment as a

matter of law, but dismissed Kolstad's claims for compensatory and punitive damages, finding

insufficient evidence to support them. With respect to back pay, the court stated, "I am going to put

it to the jury and we can leave until after the fact whether it's advisory or binding."

Answering two special interrogatories, one on liability and the other on "damages," the jury

found that ADA had unlawfully discriminated against Kolstad on the basis of sex, awarding her

$52,718, precisely the amount she sought as back pay. Kolstad then moved for instatement into the

position occupied by Spangler and for attorney's fees. ADA renewed its motion for judgment as a

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matter of law. In a memorandum opinion, the district court denied both motions. Kolstad v.

American Dental Ass'n, 912 F. Supp. 13 (D.D.C. 1996). After concluding that the jury could

properly find unlawful discrimination from the evidence, and that the jury's award of back pay was

"conclusive" under Rule 39(c), the court held that Kolstad was not entitled to further equitable relief

or attorney's fees because she had failed to prove "to the Court's satisfaction" that she was a victim

of sex discrimination. Id. at 14 n.1, 15-16. The court entered judgment against ADA in the amount

of the jury award.

On appeal, Kolstad challenges the district court's refusal to allow the jury to consider an

award of punitive damages, as well as the court's denial of her claims for instatement into the

Director's job and attorney's fees. ADA cross-appeals the court's denial of its motion for judgment

as a matter of law and the court's ruling that the jury's verdict was binding.

II

We begin with ADA's challenge to the district court's denial of its motion for judgment as a

matter of law. Reviewing the district court's ruling de novo, we ask whether the evidence was

sufficient for a reasonable jury to have reached the challenged verdict. Mackey v. United States, 8

F.3d 826, 829 (D.C. Cir. 1993).

Title VII of the 1964 Civil Rights Act provides that:

It shall be an unlawful employment practice for an employer

(l) to fail or refuse to hire ... or otherwise to discriminate against any individual with

respect to ... compensation, terms, conditions, or privileges of employment, because

of such individual's ... sex....

42 U.S.C. § 2000e-2(a). In McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973), the Supreme

Court set forth the basic allocation of burdens and order of proof in Title VII cases alleging

discriminatory treatment, as the complaint does in this case. The plaintiff bears the initial burden of

proving a prima facie case of discrimination. Id. at 802. Where sex discrimination in promotion is

alleged, a plaintiff proves her prima facie case by showing that she is female, that she was refused a

position for which she applied and was qualified, and that the employer filled the position with a male.

See Valentino v. United States Postal Serv., 674 F.2d 56, 63 (D.C. Cir. 1982); Bundy v. Jackson,

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641 F.2d 934, 951 (D.C. Cir. 1981). If established, the prima facie case raises an inference of

discrimination that the employer may rebut with evidence of legitimate, nondiscriminatory reasons

for the plaintiff's rejection. McDonnell Douglas, 411 U.S. at 802. The plaintiff then bears the

ultimate burden of persuading the jury ofintentional discrimination, which she may satisfy by proving

that the defendant's proffered reasons were pretextsfor unlawful discrimination. Barbour v. Merrill,

48 F.3d 1270, 1277 (D.C. Cir. 1995), cert. granted, 116 S. Ct. 805, cert. dismissed, 116 S. Ct. 1037

(1996); see McDonnell Douglas, 411 U.S. at 802-805.

As in the district court, ADA concedes that Kolstad "met the paper qualifications for the

vacancy," Appellee/Cross-Appellant's Br. at 37, and that the jury could have reasonably found that,

despite her qualifications, "Kolstad never wasin the running" for the Director'sjob because Executive

Director Allen had decided, before the vacancy was posted, that Spangler was the best candidate to

replace O'Donnell. Appellee/Cross-Appellant's Reply Br. at 10. ADA argues, however, that even

assuming Spangler's preselection for the position, no reasonable jury could have concluded that

Kolstad was a victim of sex discrimination because the evidence overwhelmingly demonstrates

legitimate nondiscriminatory reasons for Kolstad's rejection. We disagree.

An employer's preselection of a job candidate, in violation ofits own proceduresrequiring fair

consideration of qualified applicants, is "undeniablyrelevant to the question of discriminatory intent,"

Krodel v. Young, 748 F.2d 701, 709 (D.C. Cir. 1984), and "operates to discredit the employer's

proffered explanation for its employment decision," Goostree v. State of Tenn., 796 F.2d 854, 861

(6th Cir. 1986); see also Krodel, 748 F.2d at 709 (improper selection procedures relevant to

determinationthat employer's nondiscriminatoryexplanationunworthyof belief). Here, evidence that

Allen "cut-and-paste" Spangler's job responsibilities into the Position Description Questionnaire for

O'Donnell's position, that Office Director Wheat agreed that Spangler's goals for 1993 included

performing portions of O'Donnell'sjob, and that Spangler began meeting extensively with O'Donnell

as soon as his retirement was announced permitted the jury to conclude that ADA had selected

Spangler to succeed O'Donnell before the posting of the position in November 1992. From evidence

that Allen did not review Kolstad's performance evaluations or resume, failed to interview Kolstad

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for the position, and gave Kolstad a different explanation for her rejection than the one subsequently

offered by ADA, the jury could also have reasonably found that ADA's claimed nondiscriminatory

reasons for choosing Spangler over Kolstadthat Kolstad lacked recent legislative experience and

strong writing skillswere after-the-fact rationalizations unworthy of belief.

We have held that a jury's "rejection of the employer's nondiscriminatory reasons, while not

sufficient to compel a finding of discrimination, nonetheless suffices to permit such a finding."

Barbour, 48 F.3d at 1277; see also St. Mary's Honor Ctr. v. Hicks, 509 U.S. 502, 511 (1993). As

the Supreme Court has observed, " "no additional proof of discrimination is required.' " Hicks, 509

U.S. at 510 (quoting Hicks v. St. Mary's Honor Ctr., 970 F.2d 487, 493 (8th Cir. 1992)). Thus, "a

plaintiff need only establish a prima facie case and introduce evidence sufficient to discredit the

defendant's proffered nondiscriminatory reasons; at that point, the fact finder, if so persuaded, may

infer discrimination." Barbour, 48 F.3d at 1277. Because Kolstad introduced sufficient evidence for

the jury to conclude both that she had proven a prima facie case of discrimination and that ADA's

proffered reasons were pretextual, the jury could have reasonably concluded that Kolstad proved

intentional sex discrimination.

As in Barbour, while we need not speculate about the jury'sreasoning, it could have inferred

that Kolstad's sexand not her qualificationsmotivated ADA's actions. That inference could

reasonably flow from Kolstad's prima facie case and the evidence of Spangler's preselection, as well

as from Kolstad's testimony, contested but not incredible, that Wheat ignored her efforts to discuss

the promotion, denied her other career-enhancing opportunities, told sexually offensive jokes at staff

meetings, and referred to several professional women as "bitches" or "battleaxes." Although Wheat

did not formally appoint O'Donnell'ssuccessor, he had the authority to do so, recommending to Allen

that Spangler and not Kolstad get the job. Consistent with our cases and the evidence at trial, the

district court properly denied ADA's motion for judgment as a matter of law.

III

Having decided that the jury could reasonably find that ADA intentionally discriminated

against Kolstad, we next address Kolstad's challenge to the district court's dismissal of her claim for

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punitive damages.

Finding that "additionalremedies under Federal law are needed to deter unlawful harassment

and intentional discrimination in the workplace," 42 U.S.C. § 1981 (note) (1994) (Congressional

Findings), Congress enacted the CivilRights Act of 1991,significantly expanding the monetary relief

potentially available to victims of unlawful discrimination. See 42 U.S.C. § 1981a; Landgraf v. USI

Film Products, 511 U.S. 244, 252-55 (1994). The Act provides that a plaintiff who proves

intentional discrimination in violation of Title VII may recover compensatory and punitive damages

in addition to equitable relief available under prior law. 42 U.S.C. § 1981a(a). Punitive damages may

be awarded "if the [plaintiff] demonstrates that the [defendant] 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). The Act caps punitive damages, along with compensatory

awards, at between $50,000 and $300,000, depending on the employer's size. 42 U.S.C. §

1981a(b)(3).

Relying on an excerpt from the Act's legislative history, ADA argues that Congressintended

Title VII plaintiffsto recover punitive damages only in "extraordinarily egregious cases," suggesting

that the quantum of proof necessary to sustain such an award is greater than courts have traditionally

required. See 137 Cong. Rec. S 15473 (Oct. 30, 1991) (Interp. Mem. of Sen. Dole et al.). In

response, Kolstad points to legislative history expressly contradicting this assertion: "Punitive

damages are available under [§ 1981a] to the same extent and under the same standardsthat they are

available to plaintiffs under 42 U.S.C. § 1981." See 137 Cong. Rec. H 9527 (Nov. 7, 1991) (Interp.

Mem. of Rep. Edwards). Decisive to us, however, is section 1981a's plain language, which tracks

the standard that courts had previously established for the proof required to sustain awards of

punitive damages under other federal civilrightsstatutes. See Smith v. Wade, 461 U.S. 30, 56 (1983)

(plaintiff must prove "evil motive or intent, or ... reckless or callous indifference to the federally

protected rights of others" for punitive award under § 1983); Williamson v. Handy Button Mach.

Co., 817 F.2d 1290, 1296 (7th Cir. 1987) (applying same standard under § 1981). That standard,

in turn, is rooted in the common law. See, e.g., Restatement (Second) of Torts § 908(2) (1979)

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("Punitive damages may be awarded for conduct that is outrageous, because of the defendant's evil

motive or his reckless indifference to the rights of others."); see also Wade, 461 U.S. at 38-49. We

think that if Congress had meant the courts to depart from well-established legalstandards, it would

have made that intention clear in the language of the Act. Because it did not do so, instead choosing

language already laden with meaning, and because we find no authoritative legislative history to

suggest otherwise, we hold that the standard of proof required to sustain awards of punitive damages

under 42 U.S.C. § 1981a is the same as that previously established for punitive awards under 42

U.S.C. §§ 1981 and 1983.

As both the Supreme Court and this court have explained, "evidence that sufficesto establish

an intentional violation of protected civilrights also may suffice to permit the jury to award punitive

damages, provided that the jury, in its "discretionary moral judgment,' finds that the conduct merits

a punitive award." Barbour, 48 F.3d at 1277 (emphasis added) (citations omitted) (quoting Wade,

461 U.S. at 52). In such cases, "[n]o additional evidence is required," id., because "the state of mind

necessary to trigger liability for the wrong is at least as culpable as that required to make punitive

damages applicable." Rowlett v. Anheuser-Busch, Inc., 832 F.2d 194, 205 (1st Cir. 1987). Having

concluded that the jury could reasonably find fromthe evidence that ADA intentionally discriminated

against Kolstad, the district court should have instructed the jury that upon the requisite

findingmalice or recklessindifference to Kolstad'srightsit could consider a punitive award. The

evidentiary threshold having been reached, discretion to award punitive damages, within the limits

set by statute, lay with a properly instructed jury, not the court.

Citing legislative history from the unadopted House version of the 1991 Act and case law

from other jurisdictions, our dissenting colleague argues that "something substantially more

blameworthy" than "garden-variety" intentionalrace or sex discrimination should be required before

a jury may consider a punitive award under § 1981a. Dissent at 1, 11. We note that the House

Report on which the dissent reliesstates clearly that the new law "setsthe same standard courts have

applied under § 1981," H.R. Rep. No. 40(I), 102d Cong., 1st Sess. at 74, and cites the First Circuit's

decision in Rowlett v. Anheuser-Busch, as well as Smith v. Wade, cases which support, in our view,

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this court's § 1981 jurisprudence. Consistent with our holding in Barbour and the Supreme Court's

reasoning that "society has an interest in deterring and punishing all intentional or recklessinvasions

of the rights of others," Wade, 461 U.S. at 54-55, we can conceive of no principled basis for

second-guessing the jury's "discretionary moral judgement," id., about which acts of intentional

discrimination are sufficiently "outrageous" or "egregious" to merit punitive awards. Nor, as the

dissent admits, do the cases from our sister circuits supply one, much less the smattering of state

court cases which the dissent implies have worked some change in the common law since Wade. If,

as the dissent suggests, something is missing from Kolstad's case as a matter of law, what is it? Or,

as the First Circuit put the question in a different context, "can it really be disputed that intentionally

discriminating against a black man on the basis of hisskin color is worthy ofsome outrage?" Rowlett,

832 F.2d at 206. Absent persuasive answers to these questions or further guidance from Congress,

we leave the decision to award punitive damages for intentional civil rights violations to the jury.

By our decision today, we do not suggest that evidence sufficient to establish liability under

Title VII for intentionaldiscriminationwillalwayssustainan award of punitive damages undersection

1981a. Not every employment practice violating Title VII is "obviously the kind of conduct that

society normally will not tolerate." Hernandez-Tirado v. Artau, 874 F.2d 866, 869 (1st Cir. 1989)

(setting aside punitive damages in § 1983 case of politically motivated demotion of public official).

Rather, it may be "conduct that sometimes is lawful and sometimes is not, depending on a complex

set of legalrules... that a particular [employer] might, or might not, actually understand." Id. at 869-

70. Thus, where an employer does not deny discrimination but defends on the ground that the

discrimination is not unlawful, evidence sufficient to support a finding of liability might not also

support a finding of malice or reckless disregard offederally protected rights. For example, evidence

that an employer erroneously used religion, sex, or national origin as a "bona fide occupational

qualification" for employment, see 42 U.S.C. § 2000e-2(e), may be insufficient to support an award

of punitive damages. Evidence that an employer overreached in its efforts lawfully to remedy the

effects of past discrimination likewise might be insufficient to establish that the employer acted

maliciously or recklessly. In such cases, although the challenged employment practice amounts to

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"intentional" discrimination, it may only be "negligent [as] to the existence of a federally protected

right," Hernandez-Tirado, 874 F.2d at 870. We also think that where intentional discrimination

occurs outside the scope of the agency relationship between employer and employeein a hostile

work environment case, for exampleevidence sufficient to support employer liability may not

establish that the employer maliciously or recklessly permitted the offending conduct. See, e.g.,

Farpella-Crosby v. Horizon Health Care, 97 F.3d 803, 809-10 (5th Cir. 1996); see generally Gary

v. Long, 59 F.3d 1391 (D.C. Cir. 1995) (discussing application of agency law to hostile work

environment claims). In each of these kinds of cases, the district court may need to assess separately

whether evidence sufficient to support a finding of intentional discrimination also suffices to instruct

the jury on punitive damages.

This case does not present these or analogous circumstances. ADA neither attempted to

justify the use of sex in its promotion decision nor disavowed the actions of its agents. Rather, it

flatly denied Kolstad's allegation of invidious sex discrimination, discrimination lying at the heart of

Title VII that society no longer tolerates. Having produced evidence sufficient to prove her charge,

Kolstad was entitled to have the jury consider whether ADA's conduct warranted a punitive award.

We thus remand the case to the district court for trial on Kolstad's punitive damages claim.

This brings us to Kolstad's argument that, in a trial of her claim for punitive damages, she

should be permitted to introduce in evidence a consent decree settling a prior discrimination suit

brought against ADA in which the association, although admitting no liability, conceded that

"preselection of a favored candidate" is contrary to its personnel policies. The district court ruled the

consent decree inadmissible at trial, finding its probative value as evidence of ADA's preselection of

Spanglersubstantiallyoutweighed byits possiblyprejudicial effect on the jury. See Fed. R. Evid. 403.

Although finding no abuse of discretion in the district court's ruling, see Joy v. Bell Helicopter

Textron, Inc, 999 F.2d 549, 554 (D.C. Cir. 1993) (Rule 403 determination reversed only for abuse

of discretion), we note the court's suggestion that it would reconsider the decree's admissibility to

impeach the testimony of ADA's witnesses. Because Kolstad did not offer the document for

impeachment purposes, we express no opinion on whether, or in what circumstances, the consent

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decree might now be admissible as evidence to support Kolstad's claim for punitive damages. See

Johnson v. WMATA, 883 F.2d 125, 130 (D.C. Cir. 1989) (inRule 403 balancing, court must consider

probative value in light of other evidence at trial).

IV.

We turnfinallyto the parties'respective challengesto the district court'streatment ofthe jury's

verdict. ADA argues that the district court erred by ruling that the jury's verdict was binding on the

court. Because the parties had agreed that the jury would sit only in an advisory capacity with respect

to back pay, and because back pay wasthe only claim for reliefto reach the jury, ADA contends that

the jury's verdict was advisory in its entirety, and that we should remand the case to the district court

for findings of fact and conclusions of law under Federal Rule of Civil Procedure 52. Kolstad

disagrees, arguing that because she was entitled to a jury trial on her claims for compensatory and

punitive damages, see 42 U.S.C. § 1981a(c), the district court was bound to accept the jury's verdict

notwithstanding the dismissal of those claims. She thus contends that the district court erred in

rejecting her claims for further equitable relief and attorney's fees based on the court's independent

view of the evidence. Although we agree that the district court erred in its treatment of the jury's

verdict, we conclude that the proper disposition of this case lies in between the parties' competing

positions.

To begin with, we agree with Kolstad that the jury's determination of liability must remain

undisturbed. But for the court's error in dismissing Kolstad's punitive damages claim, the jury's

verdict would have been conclusive, as a claim for punitive damages capable of withstanding

summary judgment entitled Kolstad to a jury trial. Furthermore, when the district court expressed

its view that the evidence was insufficient to support an award of either compensatory or punitive

damages, ADA neither moved to dismissthe jury nor expressly argued, asit does now, that the jury's

determinationofliabilitycould therefore onlybe advisory. Rather, ADA's counsel suggested that "the

issue for the jury, if the court were to have the jury provide an advisory verdict on damages, would

be whether Ms. Kolstad is entitled to back pay...." As a result, the district court framed this question,

"[A]re you agreed that if I allow the jury to deliberate on damages, it is an advisory verdict to the

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extent that it represents back pay? " Although the record is not entirely clear on this point, it seems

to us that both the parties and the court were operating on the assumption that the jury would

conclusivelydecide the question ofliability, regardless of whether the jury's determination ofthe back

pay award was only advisory.

As to the question of back pay, we agree with ADA that the district court was not bound by

the jury's verdict. Before voir dire, Kolstad represented to the district court that the parties had

agreed "to the jury resolving questions in an advisory capacity with respect to the equitable relief,"

including back pay, under Rule 39(c). Although that rule gives the district court discretion to try

equitable claims with an advisory jury, Rule 52(a) requires in such cases that the court enter its own

findings of fact and conclusions of law. Fed. R. Civ. P. 39(c), 52(a). Because the record does not

reflect that ADA consented to a binding jury determination of Kolstad's back pay award, the jury's

verdict was advisory on that score. On remand, the district court must therefore make its own

findings as to the amount of back pay, if any, Kolstad should receive.

Finally, the district court must also reconsider Kolstad's claimsfor further equitable relief and

attorney's fees. Consistent with the Seventh Amendment's command that "no fact tried by a jury[ ]

shall be otherwise re-examined in any Court of the United States," U.S. Const. amend. VII, "when

a case contains claims triable to a jury and claims triable to the court that involve common issues of

fact, the jury's resolution of those issues governs the entire case." Bouchet v. National Urban

League, Inc., 730 F.2d 799, 803 (D.C. Cir. 1984); see generally Dairy Queen v. Wood, 369 U.S.

469 (1962). As our sister circuits have uniformly held in cases involving allegations of intentional

discrimination, the district court must therefore follow the jury's factual findings with respect to a

plaintiff'slegal claims when later ruling on claimsfor equitable relief. See, e.g., Sorlucco v. NewYork

City Police Dept., 971 F.2d 864, 873-74 (2d Cir. 1992); Miller v. Fairchild Indus., Inc., 885 F.2d

498, 507 (9th Cir. 1989) (citing additional cases). Contrary to this principle, the district court here

denied Kolstad's claim for instatement, as well as her petition for attorney's fees, on the ground that

she had not proven her claim of intentionalsex discrimination "to the Court's satisfaction." Because

we agree with the district court that the jury's finding of intentional discrimination must be upheld,

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Kolstad is entitled to have her claims for equitable relief and attorney's fees properly considered by

the court in light of the jury's verdict.

Affirming the district court's denial of ADA's motion for judgment as a matter of law, we

remand the case to the district court for trialon punitive damages and for reconsideration of Kolstad's

claims for equitable relief and attorney's fees.

So ordered.

WILLIAMS, Circuit Judge, concurring in part and dissenting in part. I concur in much of the

decision, but not in the conclusion that in a Title VII suit the minimum standard of evidence for

punitive damages is, with narrow exceptions, no higher than the standard for liability. See Maj. Op.

at 8-12.

The 1991 Civil Rights Act authorizes punitive damage awards in Title VII cases where the

defendant engaged in the discriminatory act "with malice or with reckless indifference to the

[plaintiff's] federally protected rights." 42 U.S.C. § 1981a(b)(1) (1994). The majority concludes that

in the ordinary claim of sex discrimination, which must be intentional to be actionable (except for

"disparate impact" liability, for which the statute expressly precludes punitive damages), the jury is

automatically empowered to find malice or reckless indifference. Maj. Op. at 9-10. The ruling may

seem to manifest impeccable logic, as an intent to discriminate seems to encompass "reckless

indifference" to the rights of the discrimination victim. But the upshot of the majority's view is that

punitive damages are available ineverycase of garden-varietyTitle VII discrimination, excepting only

a few rather unusual ones such as claims dependent on an employer's miscalculation of the bona fide

occupational qualification exception. See Maj. Op. at 11-12. But if this were Congress's intent, why

would there be a separate provision purporting to describe a specialstandard for punitive damages?

Every circuit to address the question thus far has read § 1981a to demand proof of a more

culpable state of mind for punitive damagesthan the ordinary intent necessary for a violation of Title

VII. Emmel v. Coca-Cola Bottling, 95 F.3d 627, 636 (7th Cir. 1996) (characterizing standard for

punitive damages as a "higher hurdle" than that for proving the underlying discrimination); Turic v.

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1The majority dismisses the House Report as involving "the unadopted House version of the

1991 Act." Maj. Op. at 10. But the only conceivably material difference in wording is that the

House bill allowed punitive damages on a broader basis than the ultimate legislation, as it

permitted them where defendant engaged in discriminatory practices "with malice, or with

reckless or callous indifference to [plaintiff's] federally protected rights," House Report at 12

(emphasis added), the key difference being addition of the word "callous" in the alternative. 

Holland Hospitality, Inc., 85 F.3d 1211, 1216 (6th Cir. 1996) (despite sufficiency of evidence for

liability and "duplicitous" actions of defendant's employees, evidence insufficient for punitive

damages); Karcher v. Emerson Electric Co., 94 F.3d 502, 509 (8th Cir. 1996) (although jury could

properly infer intentionalsex discrimination from inconsistent nature of hiring process and failure to

select and train women, it could not find malice or deliberate indifference); Pandazides v. Virginia

Bd. of Educ., 13 F.3d 823, 830 n.9 (4th Cir. 1994) (stating in dictum that "[w]hile "intentional

discrimination' suffices to recover compensatory damages, Congress requires a heightened showing

of discriminatory action ... to recover punitive damages"); McKinnon v. Kwong Wah Restaurant, 83

F.3d 498, 507-09 (1st Cir. 1996) (endorsing concept of a higher standard for punitive damages;

rejecting district court's denial of punitive damages solely on basis of cultural factors, but

acknowledging that cultural factors would "likely have an impact on [a defendant's] consciousness

of wrongdoing"). None of these opinions, to be sure, offers much by way of explanation, although

McKinnon pointsto a comparativelyusefulpiece oflegislative history, the HouseReport on language

almost identical to that of the final bill:

Plaintiffs must first prove intentional discrimination, then must prove actual injury or

loss arising therefrom to recover compensatory damages, and must meet an even

higher standard (establishing that the employer acted with malice or reckless or

callous indifference to their rights) to recover punitive damages.

Id. at 507, quoting H.R. Rep. No. 40(I), 102d Cong., 1st Sess. at 72 (1991) (emphasis added)

("House Report").1 To justify creating a split with five sister circuits (particularly in light of this item

of legislative history), we ought to have a powerful reason. I don't see it.

* * *

I agree with the majority's general proposition that it is sensible to look to standards rooted

in the common law to understand what Congress meant when using the phrase "malice or reckless

indifference." But in what seems to me the relevant context, namely decisions relating to intentional

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torts and of roughly the vintage of the 1991 Act, the common law appears to require a state of mind

more extreme than what is required for the intentional tort on which the punitive claim is

piggybacked.

In Smith v. Wade, 461 U.S. 30 (1983), the Court addressed the right of plaintiffs to punitive

damagesin cases arising under 42 U.S.C. § 1983. The claim was that the defendant prison guard had

failed to protect the plaintiff inmate from harassment, beatings and sexual assault by fellow inmates.

The plaintiff had proved gross negligence on the part of the guard, and thus a violation of plaintiff's

Eighth Amendment right. Id. at 33. As § 1983 made no reference to punitive damages, the Court

looked to the common law for the appropriate standard. It rejected the proposition that "actual

maliciousintent"illwill,spite, or intent to injure'," id. at 37, wasrequired for punitive damages, and

held instead that they were allowable when the defendant's conduct was "motivated by evil motive

or intent, or when it involve[d] reckless or callous indifference to the federally protected rights of

others." Id. at 56. The Court reasoned that "the rule in a large majority of [states] was that punitive

damages ... could be awarded without a showing of actual ill will, spite, or intent to injure." Id. at

41. A dissent by Justice Rehnquist, joined by Chief Justice Burger and Justice Powell, read the

historic record differently, arguing that "at least some degree of bad faith or improper motive" was

required. Id. at 56. Justice O'Connor also dissented. Finding that the historical record provided no

real guidance on the intent of Congress at the time of enactment in 1871, she reasoned that the

majority's standard was inconsistent with the purposes of § 1983.

Obviously it is not our place to replay this argument. I make only a narrower point. In the

area ofintentionaltorts, the commonlaw analog ofintentionaldiscrimination, courts generallyrequire

an especially egregious intent, even when they are applying punitive damage standards phrased the

same as the one set forth in Smith v. Wade and echoed in § 1981a(b)(1). In doing so, they apply the

general principle that "[s]omething more than the mere commission of a tort is always required for

punitive damages." W. Page Keeton et al., Prosser & Keeton on the Law of Torts § 2, at 9 (5th ed.

1984); see also id. at 11 ("it is not so much the particular tort committed as the defendant's motives

and conduct in committing it"). To be sure, the Smith v. Wade majority's reading of the "rules of

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ordinary tort law" in substance rejected Prosser & Keeton's. 461 U.S. at 53. But in the realm of

intentional torts such a rejection has little support.

The Restatement (Second) of Torts, Section 908, for instance, asserts a generality similar to

the wording of Smith v. Wade and of § 1981a, saying that punitive damages are allowable "for

conduct that is outrageous, because of the defendant's evil motive or his reckless indifference to the

rights of others." One might expect that under this formula plaintiffs asserting any intentional tort

could automatically get to the jury on punitive damages. But the comments to the Restatement draw

such a claim in question. Comment b says that damages are only appropriate where there is "some

element of outrage similar to that usually found in crime." See also comment d (although award of

punitive damages left to jury discretion, "[i]t is error ... to award punitive damages if there has been

no bad motive or wanton indifference").

Some state courts have explicitlyinterpreted the Restatement to require some evidence of bad

motive in the intentional tort context. The Missouri Supreme Court in Burnett v. Griffith, 769

S.W.2d 780 (1989) (en banc), said that it "is not so much the commission of the intentional tort as

the conduct or motivesthe defendant's state of mindwhich prompted its commission that form

the basis for a punitive damage award." Id. at 787. "Plaintiff must prove that defendant's evil hand

was guided by an evil mind." Id. The court rejected a jury instruction stating that malice "does not

mean hatred, spite or ill will, as commonly understood, but means the doing of a wrongful act

intentionally without just cause or excuse," id. at 788, explaining that the language failed to explain

to jurorsthat "a bad motive or reckless disregard for the rights of others is required." Id. at 789; see

also Ryburn v. General Heating &Cooling, Co., 887 S.W.2d 604, 609 (Mo. App. 1994) (interpreting

Burnett as focusing "on the matter of moral culpability so that the jury would not impose punitive

sanction on a defendant for the mere commission of an intentional tort").

Similarly, the D.C. Court of Appeals has construed language at least as loose as that of §

1981a ("fraud, ill will, recklessness, wantonness, willful disregard of the plaintiff's rights, or other

circumstancestending to aggravate the injury") to require, for the tort ofintentional interference with

contract, something more than the intent necessary for the tort itself. Dyer v. William S. Bergman

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& Assocs., 657 A.2d 1132, 1139 n.10 (D.C. 1995). Given the "overlap" between the state of mind

needed for punitive damages and that needed for tortious interference with contract, the court said:

[T]rial judges must be alert to the need to frame their instructionsto the jury in a way

that makes it clear that proof of intentional interference [with contract] does not

automatically entitle the plaintiff to an award of punitive damages.

Arguably, where the tort alleged is an intentional one, inherently containing

elements of willfulness, an award of punitive damages must rest upon that tort being

committed in an outrageous way; in other words, the "outrageousness" cannot be

supplied by the conduct required to commit the tort itself.

Id. And Alaska, which at least nominally allows punitive damages for "reckless indifference" to

others' interests, Alyeska Pipeline Service Co. v. O'Kelley, 645 P.2d 767 (Ak. 1982), in fact denies

them where an intentional tort is not accompanied by evidence supporting an inference of "actual

malice or conduct sufficiently outrageous to be deemed equivalent to actual malice". Id. at 774.

Similarly, Vermont courts have used "reckless" language, but seem to require bad motive on

top of the intentional tort. Vermont limits "exemplary" or punitive damages to cases of "malice, ill

will, or wanton conduct," but includes within those terms action that is "reckless with regard to the

plaintiff'srights." Bruntaeger v. Zeller, 515 A.2d 123, 127 (Vt. 1986) (emphasis added). Yet, when

applying the same formulation in State Agency of Natural Resources v. Riendeau, 603 A.2d 360 (Vt.

1991), it held that under a statute imposing ordinaryliabilityfor "willful" violations, punitive damages

could be awarded only for "bad spirit and wrong intention," and that therefore plaintiff must show

"some ... bad motive [that makes the] knowing and intentional conduct malicious." Id. at 365; cf.

id. (distinguishing between the meaning of "willful" in civil cases, where it is "a synonym for

"intentional' " and in criminal cases, where it has a "different and darker shade of meaning").

Cases of an insurer's bad faith denial of insured's claims pose a related issue. The tort's label

suggests that it requires a more culpable state of mind than mere "intention," but courts in some

jurisdictions allow recovery where the insurer has acted in "reckless disregard" of its lack of a

reasonable basis for denial. McCullough v. Golden Rule Insurance Co., 789 P.2d 855, 860 (Wyo.

1990); Anderson v. Continental Insurance Co., 271 N.W.2d 368, 376 (Wisc. 1978). In any event,

courts appear to have reacted with the same impulse to reserve punitive damagesfor egregious cases.

When the Wyoming Supreme Court embraced the tort, it hastened to refute the suggestion that every

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such claim would entail a possibility of punitive damages, saying that plaintiff must also show

"wanton or willful misconduct," McCullough, 789 P.2d at 861, even though Wyoming nominally

allows punitive damagesfor "recklessindifference," id. at 860 n.11. The court quoted decisions from

other jurisdictions requiring not only intentional breach of the duty of good faith, but "oppression,

fraud, or malice." Id. at 861.

Wisconsin courts similarly demand an extra notch of evil:

[T]here is a distinction between the intent or malice necessary to maintain an action

for intentional tort (such as bad faith) and the intent which must be shown to recover

punitive damages.... [T]here must be a showing of an evil intent deserving of

punishment or something in the nature of special ill-will or wanton disregard of duty

or gross or outrageous conduct.

Anderson, 271 N.W.2d at 379; see also Mid-Continent Refrigerator Co. v. Straka, 178 N.W.2d 28,

32-33 (Wisc. 1970) (noting distinction between "the intent or malice necessary to maintain an action

for an intentional tort and that necessary to recover punitive damages" and stating that "something

must be shown over and above the mere breach of duty for which compensatory damages can be

given").

Some courts, to be sure, take the view that where the elements of an intentional tort entail

characteristicsjustifying punitive damagesin other contexts, they are freely available even though the

effect is to make punitive damages possible wherever liability is found. See, e.g., Ellerin v. Fairfax

Savings, F.S.B., 652 A.2d 1117, 1126 (Md. 1995) ("elements of the tort of [intentional] fraud or

deceit in Maryland ... include the type of deliberate wrongdoing and evil motive that hastraditionally

justified the award of punitive damages"); Owens v. Parker Drilling Co., 676 P.2d 162, 165 (Mont.

1984) ("where a statute is designed to protect the substantial interests of a person from a high degree

of risk, and the statute is violated either intentionally or recklessly, a jury question of punitive

damages is raised"); McMullin v. Murphy, 748 P.2d 171, 173 (Or. Ct. App. 1988) ("evidence

sufficient to establish intentional fraud is also necessarily sufficient to support the requisite findings

for the imposition of punitive damages, without additional or independent evidence pertaining to the

culpability of the defendant's conduct or state of mind").

Perhaps lining up citations on both sides of this question is just another "unilluminating,

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exegesis of the common law" similar to that in Smith v. Wade, which Justice O'Connor there

described as yielding only "inexact and contradictory language" unhelpful in interpreting a statute.

461 U.S. at 92-93 (O'Connor, J., dissenting). But that was the Court's approach in Smith v. Wade,

and in this search for analysis by state common law courts I find the weight of authority against the

idea that just because the governing formula allows punitives for "reckless" behavior it follows that

all intentional torts are eligible for punitive damages. In addition, to the extent that there appears to

be a split of authority on the question, the split is less close than it appears in view of other measures

taken to constrain the award of punitives.

The concern that punitive damages ought not be awarded in every case isreflected in a variety

of devices designed to reduce their incidence. See generally Restatement (Second) of Torts, § 908,

comment f; see also BMW of North America, Inc. v. Gore, 116 S. Ct. 1589, 1618 (1996) (Ginsburg,

J., dissenting)(appendix summarizing recentstate legislative activitydesigned to reduce the incidence

of punitive damages). More than half the states require that evidence supporting punitive damages

be "clear and convincing," most ofthemdoing so by statute but several by common law adjudication.

See Brian T. Beasley, "North Carolina's New Punitive Damages Statute: Who's Being Punished,

Anyway?" 74 N.C. L. Rev. 2174, 2201 (1996) (appendix providing survey of punitive damage

provisionsin all 50 states). Although the standard of proof is not at issue in this case, the reasons for

adoption of a clear and convincing standard suggest a widespread understanding that the award of

punitive damages should not be an everyday event. See, e.g., Masaki v. General Motors

Corporation, 780 P.2d 566, 574-75 (Haw. 1989) (more exacting standard because punitive damages

are stigmatizing punishment of a "quasi-criminal" type); Linthicum v. NationwideLife InsuranceCo.,

723 P.2d 675, 681 (Ariz. 1986) (en banc) (applying higher standard because punitive damages are

"only to be awarded in the most egregious of cases, where there is reprehensible conduct combined

with an evil mind over and above that required for commission of a tort"); Tuttle v. Raymond, 494

A.2d 1353, 1363 (Me. 1985) (adopting clear and convincing standard because of the risk posed by

punitive damages if they can be "loosely assessed").

In light of this common law background, it seems improbable that in adopting § 1981a

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2Section 1981 prohibits discrimination on the basis of race in the making and enforcement of

contracts. In the employment context, it overlaps substantially with Title VII, but the two differ

in important respects (e.g., § 1981 applies only to racial discrimination while Title VII covers sex

discrimination as well). Until 1991 one of the most important differences was the availability of

compensatory and punitive damages under § 1981 but not under Title VII, a difference that made

juries available for the former but not the latter. The Civil Rights Act of 1991 brings these two

discrimination statutes closer together, but they remain distinct. For example, punitive damage

claims under Title VII are capped, while those under § 1981 are not. 

Congress intended to adopt a punitive damage standard creating near-universal availability, despite

its use of "recklessness" in the statutory formulation.

* * *

Asthe majority opinion makes clear, the common law is not the onlysource for interpretation.

We can also look to how courts have interpreted a kindred provision, 42 U.S.C. § 1981.2 Here the

circuits are split, with three demanding more than mere intent to discriminate and three not doing so;

of the latter, the First and Seventh decline to extend the reasoning to § 1981a.

In Beauford v. Sisters of Mercy-Province of Detroit, 816 F.2d 1104 (6thCir. 1987), the court

cited language from Smith v. Wade but then stated that punitive damages in civil rights actions have

"generally been limited to cases involving egregious conduct or a showing of willfulness or malice

on the part of the defendant." Id. at 1109. Although finding enough evidence of intentional

discrimination, the court said there was no evidence of "the requisite malice or reckless or callous

indifference of an egregious character," so punitive damages could not be awarded. Id. The court

in Stephens v. So. Atlantic Canners, Inc., 848 F.2d 484 (4th Cir. 1988), followed Beauford,

observing that an award of punitive damages "is an extraordinary remedy and is designed to punish

and deter particularly egregious conduct." Id. at 489. Though the evidence was adequate for plaintiff

to get to the jury on intentional discrimination, and though noting that any form of discrimination

"constitutes reprehensible and abhorrent conduct," id., the court found the evidence inadequate for

punitive damages. And in Walters v. City of Atlanta, 803 F.2d 1135 (11th Cir. 1986), a § 1983

action based upon racialdiscrimination, after finding the evidence adequate on liability, the court held

that several of the defendants who had denied plaintiff employment had nonetheless not "acted with

either the requisite ill will or callous disregard" to justify punitive damages.

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In the opposite camp are this circuit, the First and the Seventh. In Barbour v. Merrill, 48

F.3d 1270 (D.C. Cir. 1995), cert. granted, 116 S. Ct. 805, cert. dismissed, 116 S. Ct. 1037 (1996)

(voluntary settlement by parties), we held that under § 1981 the jury's (sustainable) "finding of

intentional racial discrimination permitted it to find" the requisite ill will or reckless or callous

indifference for punitive damages. Id. at 1277. The First Circuit may have a similar rule. In Rowlett

v. Anheuser-Busch, Inc., 832 F.2d 194, 205-07 (1st Cir. 1987), it declined to adopt an aggravation

requirement for punitive damages under § 1981, leaving to the trier of fact "discretion to determine

whether punitive damages are necessary" where punitive damages are authorized for intentional

violations. Id. at 205. But in McKinnon v. Kwong Wah Restaurant the Circuit quoted and followed

the "higher standard" requirement set forth in the House Report, as noted above. See 83 F.3d at 507.

The Seventh Circuit is yet harder to characterize. In Yarbrough v. Tower Oldsmobile, Inc.,

789 F.2d 508 (7th Cir. 1986), the court upheld the verdict of intentional discrimination, finding the

case basically a "swearing contest," id. at 514, and then upheld the award of punitive damages, but

only after characterizing it as "a close case," id. Unless there was a higher standard for punitive

damages, it is hard to see why that case was "close" and the liability issue not. But in Williamson v.

Handy Button Machine Co., 817 F.2d 1290 (7th Cir. 1987), the court appeared to say that punitive

damages were available for racial discrimination under § 1981 so long as "the application of the law

to the facts at hand was so clear at the time of the act that reasonably competent people would have

agreed on its application." Id. at 1296. The position is not unlike that of the panel here, which

likewise makes limited allowance for a defendant's mistake on an obscure issue of law. It may be

more precise, however, to describe 7th Circuit law as in flux; as noted above, Emmel v. Coca-Cola

Bottling, 95 F.3d 627, 636 (7th Cir. 1996), says that an award of punitive damages under § 1981a

itself must surmount a "higher hurdle" than mere proof of intentional discrimination.

* * *

With this background in hand, I return to the legislative history of § 1981a. I have already

noted the language of the House Report asserting that § 1981a demands of plaintiff "an even higher

standard" than simple proof of intentional discrimination. See supra p. 2 above. The panel quotes

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what appear as contradictory glosses on § 1981a urged by a senator and a representative. While

Senator Dole said for himself and others that plaintiffs can recover for punitive damages only in

"extraordinarily egregious cases," see 137 Cong. Rec. S 15473 (Oct. 30, 1991) (Interp. Memo of

Sen. Dole et al.), Representative Edwardssaid that "[p]unitive damages are available under [§ 1981a]

to the same extent and under the same standards that they are available to plaintiffs under 42 U.S.C.

§ 1981." See 137 Cong. Rec. H 9527 (Nov. 7, 1991) (Interp. Memo of Rep. Edwards). Compare

Maj. Op. at 8-9.

It is not clear to me that these views are in conflict. In light of the circuit split, Representative

Edwards's comment isindeterminate. For those circuits that have required "egregious" discrimination

in the § 1981 context, the two observations fit handily. Of course Representative Edwards's remark

may be said to invite us to follow our own view of the law derived from § 1981. But that approach

seems unduly self-referential. We can reconcile the otherwise disparate items of legislative history

(the House Report and the Edwards and Dole statements) by following the courts that have, in

applying § 1981, followed the current common law trend that, as to intentional torts, demands for

punitive damagessomething substantially more blameworthy than the intention required for liability.

This approach would also avoid creating a split with all the circuits that have addressed the § 1981a

issue.

Because I agree with the panel that the parties agreed to have liability tried to the jury, id. at

13-14, I do not dissent from the view that the jury verdict was binding as to liability. But the remand

to the district court should not, in my view, include any direction to hold a trial on punitive damages.

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