Opinion ID: 2994631
Heading Depth: 2
Heading Rank: 1

Heading: Appeal of Booth and East Chicago

Text: Our review of the district court’s denial of the defendants’ motions for judgment as a matter of law under Rule 50 is de novo. See Deimer v. Cincinnati Sub-Zero Products, supra, 58 F.3d at 343-44. In addition, it is particularly important here to acknowledge that we apply the law as it now is, including the Supreme Court’s intervening decisions in Ellerth and Faragher. See Harper v. Virginia Dept. of Taxation, 509 U.S. 86, 97 (1993).
Although Booth’s brief contains some references to Title VII, we reiterate for the sake of completeness the fact that the district court’s instructions clearly indicated that it was not permitting Molnar to pursue a Title VII claim against Booth. This was correct, because an individual supervisor does not fall within the definition of the term employer for Title VII purposes. See, e.g., Bryson v. Chicago State Univ., 96 F.3d 912, 917 (7th Cir. 1996); Williams v. Banning, 72 F.3d 552, 555 (7th Cir. 1995). Thus, the jury was never invited to impose liability on Booth under Title VII, it never did so, and Booth has no grounds for complaining about any ruling of the district court on a Rule 50 motion that addressed his liability under that theory. East Chicago, in contrast, was Molnar’s employer and it was therefore potentially liable to her for a violation of that statute. The district court also denied East Chicago’s Rule 50 motion seeking to keep from the jury Molnar’s claim of sexual harassment. Viewing the evidence in the light most favorable to Molnar, and keeping in mind the Supreme Court’s guidance in Ellerth and Faragher for these claims, we find no error in the court’s decision. In Ellerth and Faragher, the Supreme Court established the standards that govern the liability of an employer for sexually harassing behavior of a supervisor toward a subordinate employee. The Court abandoned the prior distinction, for vicarious liability purposes, between so-called quid pro quo harassment and hostile environment harassment, in favor of a test that distinguished between cases in which the supervisor takes a tangible employment action against the subordinate and those in which he does not. Ellerth, 524 U.S. at 760-65; Faragher, 524 U.S. at 807. The employer’s liability in all kinds of cases is determined under agency principles, as the Supreme Court has developed them. In general, employers bear vicarious liability for the harassment committed by a supervisor, in accordance with the following rules as summarized in Faragher: An employer is subject to vicarious liability to a victimized employee for an actionable hostile environment created by a supervisor with immediate (or successively higher) authority over the employee. When no tangible employment action is taken, a defending employer may raise an affirmative defense to liability or damages, subject to proof by a preponderance of the evidence. . . . No affirmative defense is available, however, when the supervisor’s harassment culminates in a tangible employment action, such as discharge, demotion, or undesirable reassignment. 524 U.S. at 807-08. Regardless of the vocabulary then in use, Molnar therefore had to have evidence in the record that, if believed by the jury, would have shown that she was suffering from sexual harassment. In addition, the question whether the harassment led to a tangible employment action was critical. If so, East Chicago was liable without more; if not, East Chicago was entitled in principle to the opportunity to show (1) that it exercised reasonable care to prevent and correct promptly any sexually harassing behavior, and (2) that Molnar unreasonably failed to take advantage of any preventive or corrective opportunities provided by her employer or to avoid harm otherwise. Ellerth, 524 U.S. at 765; Faragher, 524 U.S. at 807. Though we consider it a close call, we conclude that Molnar did show a tangible employment action, as the Court signaled that term should be understood in Ellerth. Citing with approval the concept of tangible employment action used in this court’s decision in Crady v. Liberty Nat. Bank & Trust Co. of Ind., 993 F.2d 132, 136 (7th Cir. 1993), the Court highlighted indicia such as termination of employment, a demotion evidenced by a decrease in wage or salary, a less distinguished title, a material loss of benefits, significantly diminished material responsibilities, or other indices that might be unique to a particular situation. Ellerth, 524 U.S. at 761. We reaffirmed the Crady test in our post-Ellerth/Faragher decision in Ribando v. United Airlines, Inc., 200 F.3d 507, 511 (7th Cir. 1999). To similar effect, in Savino v. C.P. Hall Co., 199 F.3d 925 (7th Cir. 1999), we said that [a] tangible employment action has to cause a substantial detriment to the plaintiff’s employment relationship. Id. at 932 n.8. The clearest tangible employment action shown in Molnar’s evidence was Booth’s confiscation of the art supplies he had given her--supplies the jury could have believed were necessary for her to be able to perform her assigned job. (Indeed, as we discuss below, the jury was specifically told in Instruction 6 that it had to find that Molnar’s reaction to Booth’s advances affected tangible aspects of her employment. Its verdict for Molnar indicates that it did so find.) This deprivation was not something the School Board ever fixed. At least as a temporary matter, the negative evaluation Booth gave Molnar was also a tangible employment action; the jury could have believed that it spelled the end of a career for an intern. The mere fact that the evaluation was reversed more than six months later and Molnar’s career put back on track does not diminish its importance during the time it lasted. To hold otherwise would mean that harassing supervisors could demote employees who rejected their advances with impunity, as long as they later reversed the demotion and restored the employees to their former positions. The short duration is naturally relevant to the degree of damage Molnar suffered from the evaluation, but the jury’s verdict of $500 on this claim indicates strongly that the jury was aware of that fact too. If, in the alternative, one were to dismiss the confiscation of supplies as insufficiently grave to amount to a tangible employment action, and one were to recharacterize the evaluation as a threat of a tangible action instead of a present detriment, we would turn to the other half of the Ellerth/Faragher test. Ordinarily, that would require a remand so that East Chicago could have the chance to prove its affirmative defense by a preponderance of the evidence. Remand is not necessary in all cases, however, as Faragher itself illustrates. In Faragher, after outlining its new affirmative defense, the Court concluded that [w]hile the City would have an opportunity to raise an affirmative defense if there were any serious prospect of its presenting one, it appears from the record that any such avenue is closed. 524 U.S. at 808. That was so because the district court had found that the City had entirely failed to disseminate its policy against sexual harassment to its beach employees, its officials made no effort to monitor the conduct of its supervisors, and the policy had no provision for bypassing the problematic supervisors when someone wanted to register a complaint. Id. The Court thus held as a matter of law that the City could not establish the affirmative defense. On the alternate hypothesis that Molnar did not show a tangible employment action, we find the same to be true in the present record. East Chicago does not dispute Molnar’s assertion that it had no policy specifically aimed at sexual harassment. The only relevant policy East Chicago puts forward as a potential basis for an affirmative defense is the general policy it had barring discrimination on the basis of race, color, or sex. That policy was not a sexual harassment policy: it did not provide any guidance as to what employees should do in the face of sexual harassment--it did not even mention or define sexual harassment. (It is not surprising, then, that Booth, various other East Chicago employees, and union officials offered uncontroverted testimony that they had no idea (or were extremely confused about) what sexual harassment was, and what they should do about it.) Like the City in Faragher, East Chicago thus could never show that it had exercised reasonable care to prevent and correct promptly any harassing behavior. It could not show that Molnar unreasonably failed to take advantage of corrective opportunities it provided, because it provided none. It did not investigate Molnar’s grievance; it set a hearing for three weeks later, which was over twice the normal time limit, and then it did not conduct one. There was therefore enough evidence for Molnar to prevail on this view of the facts as well. There is a certain amount of forcing a square peg into a round hole when we evaluate evidence and jury instructions that were organized and drafted under an earlier view of the law according to a later Supreme Court decision. Nonetheless, this is the task the Court has given us in Harper. In addition, since Rule 50 motions are reviewed de novo in any event, we are free to see if any rational jury could find in the non- moving party’s favor. Here we have no trouble saying that the answer is yes, under the now- governing legal standards, and thus we find no error in the district court’s decision to submit the case to the jury. Our review of the jury instructions on the Title VII claim, Instructions 4 and 5, is similarly influenced by later changes. Once again, the standard of review is a liberal one: we look at jury instructions only to determine if taken as a whole they were sufficient correctly to inform the jury of the applicable law. Maltby v. Winston, 36 F.3d 548, 560 (7th Cir. 1994). Even if the instruction contains errors or misguides the jury, the error is reversible only if a litigant is prejudiced. Taken together with Instruction 6, we think that the jury instructions were adequate. After reciting the pertinent part of Title VII, Instruction 4 told the jury that [a] plaintiff may establish a violation of Title VII by proving that she was threatened with or suffered adverse employment decisions for refusing unwelcome sexual advances. This type of claim under Title VII is called a claim of quid pro quo sexual harassment or sexual discrimination. So far, so good: Ellerth and Faragher permit both threats and actual adverse actions to be actionable (distinguishing between them only for purposes of the affirmative defense), and it has been clear since Meritor Sav. Bank F.S.B. v. Vinson, 477 U.S. 57 (1986), and Harris v. Forklift Systems, Inc., 510 U.S. 17 (1993), that sexual harassment is encompassed within Title VII’s prohibition against sex discrimination. Instruction 5 told the jury that it had to find for the plaintiff on each of four listed elements:
class.
advances, requests for sexual favors or other verbal or physical conduct of a sexual nature.

materially adverse change in the terms or conditions of her employment as the result of her refusal to comply with the sexual requests and advances. Again, even though these would in all likelihood not be the instructions that would be drafted today, given Ellerth and Faragher, they communicate the most important points to the jury. It is the final paragraph of Instruction 6, however, that led us earlier to resolve our doubts in favor of concluding that the jury found an actual tangible employment action. That instruction was a classic quid pro quo instruction, which told them that the employer (i.e. East Chicago) was strictly liable for quid pro quo harassment, which occurs when a supervisor uses his supervisory authority either by making submission to requests for sexual favors a term or condition of the individual’s employment, or by making submission or rejection the basis for decisions affecting the individual. The instruction concluded as follows: Defendant School Corporation, the employer, is thus responsible or liable for the action of plaintiff’s supervisor in plaintiff’s claim of quid pro quo sexual harassment if plaintiff Molnar proves, by a preponderance of the evidence, that her reaction to Booth’s advance affected tangible aspects of her employment. In our view, these instructions did not so signficantly misstate the law as to require vacation of this verdict and remand for a new trial. In fact, in emphasizing that the action had to be based on sex, the district court anticipated the Supreme Court’s later decision in Oncale v. Sundowner Offshore Servs., Inc., 523 U.S. 75, 80 (1998).
East Chicago purports to challenge the jury instructions on both Title VII and sec. 1983, but its brief makes it clear that the only instructions it is attacking are 4, 5, and 6, which pertained only to Title VII and which we have already discussed. It also challenges the district court’s denial of its Rule 50 motion on the sec. 1983 claim, arguing that the evidence did not show the kind of intentional discrimination that is necessary for a claim under the equal protection clause. Based on the evidence, however, we believe this was properly a question for the jury. For example, the lack of any policy addressed to sexual harassment was East Chicago’s responsibility, not Booth’s. Furthermore, East Chicago offers little in the way of argument in support of its claim other than analogies to Title VII. Thus, even if there were points unique to sec. 1983 that it might have developed, it did not do so, and we will not undertake that task. As far as Booth is concerned, we have already noted his error in assuming that because he is not a proper defendant for Title VII, he cannot be held individually liable under sec. 1983. That mistaken premise forms the basis for most of the rest of his arguments, which point out various alleged errors in the Title VII jury instructions. Once again, there was evidence in the record on which the jury was entitled to rely, and we see no reversible error in the district court’s decision to submit the case to them.
As we noted earlier, Christine Kolavo testified at trial on Molnar’s behalf. Kolavo was a former employee whom Booth had supervised. She recounted an incident in which Booth had followed her out to her car and asked for her telephone number. Kolavo refused to give it to him and then reported the come on to Assistant Principal Vega. Vega then offered to supervise Kolavo directly. Kolavo did not make any report to the general school administration. The defendants argued that Kolavo’s testimony was irrelevant and prejudicial; Molnar responded that it tended to show either Booth’s retaliatory intent or his discriminatory motive, that it impeached Booth’s testimony that he had never asked out a person under his supervision and would not do so, and that it gave East Chicago notice of Booth’s conduct. The district court, whose decision here we review only for abuse of discretion, admitted it, and did not give an instruction telling the jury it could be considered only for impeachment. We are not impressed with the argument that this evidence gave East Chicago notice about Booth’s behavior, especially because Kolavo herself did not alert the administration to the incident. Nor does it show anything about retaliatory intent, either with respect to Kolavo herself or with respect to Molnar. Discriminatory motive, or more accurately modus operandi, comes closer to the mark. Rule 404(b) allows the admission of evidence of other acts if it tends to prove facts like intent, preparation, and absence of mistake. Booth’s effort to establish a sexual relationship with Kolavo (which was the way she saw it) suggests that he intended to do the same with Molnar and that he was not accidentally engaged in behavior that could be misconstrued. This was not the entirety of what Molnar needed to prove, but the request for sexual favors was a piece of the evidentiary puzzle, and as such, evidence tending to make the existence of that fact more probable was admissible. See also Fed. R. Evid. 401. In addition, and perhaps even more clearly, the evidence was admissible for impeachment purposes. The fact that no limiting instruction to that effect was given was the defendants’ own fault, as they never requested one. Finally, even if the Kolavo evidence would have been better left out (that is, even if the district court’s decision to allow it was an abuse of discretion), we find that the error was harmless. See Fed. R. Evid. 103; 28 U.S.C. sec. 2111. Both defendants took advantage of ample opportunities at trial to argue that Booth’s actions toward Kolavo were not discriminatory and that East Chicago did not derive any notice from them. Furthermore, the evidence did not report shocking behavior; it was about a simple social request that the listener found inappropriate and that was rebuffed. The jury was thus able to place this one piece of evidence in its proper perspective.
Booth claims that the jury’s award of $25,000 against him was excessive, because there was insufficient evidence for it to find that he had the requisite scienter to support punitive damages. Unfortunately, he has done little to preserve this point properly. He never moved for judgment as a matter of law on punitive damages, nor did he move for a new trial after the jury returned its verdict and the trial court entered its order. Never having asked the district judge to fix this problem, it is too late in the day to ask us to do so. At least in this procedural posture, we find nothing reversible here. Under Kolstad v. American Dental Ass’n, 527 U.S. 526 (1999), a defendant must behave with malice or reckless indifference in order for a court to impose punitive damages on him. Id. at 535. The terms malice and reckless indifference pertain to the employer’s knowledge that it may be acting in violation of federal law, not its awareness that it is engaging in discrimination. Id. The Court specifically rejected an additional egregious misconduct requirement that the court of appeals had engrafted onto the statute. The events here took place in 1994, long after the law of sexual harassment had become well established by the Supreme Court. The jury could have found that Booth (the relevant actor here, since we are considering only the sec. 1983 theory) acted with malice or reckless indifference toward Molnar, particularly after she rejected his advances. Booth also attacks the amount of the award, $25,000, as grossly excessive. We realize that this is a significant amount of money for an individual, but as a matter of law $25,000 is not so far out of line that it must be reduced. We upheld a similar punitive damages award in Merriweather v. Family Dollar Stores of Indiana, 103 F.3d 576, 581 (7th Cir. 1996), another sexual harassment case. Assuming as we must that the jury believed Molnar’s account and not Booth’s, this award is not monstrously excessive.