Opinion ID: 202018
Heading Depth: 3
Heading Rank: 1

Heading: Adequacy of Evidence to Support Punitive Damages

Text: 82 After the award of punitive damages, Wal-Mart asked that the verdict of punitive damages be set aside, altered, or amended under Fed.R.Civ.P. 59(e). 8 The court denied the motion, saying that it had given the proper instruction under Kolstad v. American Dental Ass'n, 527 U.S. 526, 538, 545, 119 S.Ct. 2118, 144 L.Ed.2d 494 (1999) (holding under Title VII that punitive damages are available only upon a showing that the employer acted with reckless indifference or malice and that an employer may not be vicariously liable for the discriminatory employment decisions of managerial agents where these decisions are contrary to the employer's good-faith efforts to comply with Title VII (internal quotation marks omitted)). The court reasoned that it was up to the jury to weigh each side's characterization of Wal-Mart's open door policy. The jury chose to believe Arrieta. 83 Our review of the denial of the motion to alter or amend the judgment under Rule 59(e) is for abuse of discretion. McCord v. Horace Mann Ins. Co., 390 F.3d 138, 144 (1st Cir.2004). If the district court committed an error of law, such as an improper instruction harmful to the outcome of the case, that would be an abuse of discretion. Even if an instruction was erroneous, we ask whether we can say with fair assurance that the jury verdict was likely unaffected. See Putnam Res. v. Pateman, 958 F.2d 448, 471 (1st Cir.1992). 84 As to punitive damages, the district court instructed: 85 In order to find punitive damages, you must find that the acts of the Defendant which proximately caused actual damages to the Plaintiff were maliciously or wantonly done. 86 If you so find, you may add to the award of actual damages such amount as you shall agree to be proper as punitive damages. 87 An act or failure to act is maliciously done if prompted or accompanied by ill-will, spite or grudge, either toward the injured person individually or towards all persons in one or more groups or categories of which the injured person is a member. An act or failure to act is wantonly done if done in reckless or callous disregard of, or indifference to the rights of one or more persons, including the injured person. 88 While this is not a precise Kolstad instruction, it is close. As this court said in Romano v. U-Haul Int'l, 233 F.3d 655 (1st Cir.2000), in Kolstad the Supreme Court held: 89 [A]n employer may be liable for punitive damages under Title VII in four instances: (1) when the agent has been authorized by the principal to commit the misconduct in question; (2) when the principal recklessly employed the unfit agent; (3) when the agent, acting in a managerial capacity, committed the misconduct within the scope of the employment; or (4) when the agent's bad act was subsequently approved by the principal. The Court limited the reach of the third situation by absolving an employer from liability for punitive damages if a good-faith effort to comply with the requirements of Title VII is made. 90 Id. at 669 (citations omitted). 91 Wal-Mart's objection to the instruction, both before the district court and on appeal, is unclear. Wal-Mart does not argue that the district court's instruction was erroneous because it did not mention the good-faith aspect of Kolstad. Rather, Wal-Mart argues that because it had provided ample evidence of its open door policy, Arrieta's supervisors' misconduct could not be imputed to Wal-Mart and the instructions to the jury should not have been given. In sum, Wal-Mart's position appears to be that, as a matter of law, punitive damages are unavailable if there is any evidence of good-faith efforts by the employer to comply with the law. Wal-Mart's position is wrong and would allow companies to pay lip service to the law while blatantly violating it. 92 The difficulty for Wal-Mart is that the Supreme Court did not adopt a test that any evidence of a good-faith effort could shield it from liability; rather, it required a finding of a good-faith effort to comply with the law. On these facts, a jury could easily conclude that the open door policy was a sham designed to give the appearance, but not the reality, of an effort to comply with the law, and that Wal-Mart acted with reckless disregard of Arrieta's rights. Goya, 304 F.3d at 30; Romano, 233 F.3d at 670. 93 That leaves Wal-Mart's argument that there was insufficient evidence for a jury to award punitive damages. Wal-Mart argues that any conscious wrongdoing by supervisors could not be imputed to Wal-Mart because there was a lack of evidence that the managers who taunted Arrieta and ignored his complaints were acting within the scope of their employment. We reject this argument; we agree with the district court that, on these facts, a reasonable jury could have found that the supervisors were acting in the scope of their employment. We agree with the district court that a reasonable jury could award punitive damages.