Court Opinion

ID: 2759325
Source: CourtListenerOpinion
Date Created: 2014-12-10 19:00:59.096127+00
Date Added: 2024-06-11T10:37:14.074924
License: Public Domain

FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

STATE OF ARIZONA; TERRY L.                No. 11-17484
GODDARD, Attorney General for the
State of Arizona; ARIZONA                    D.C. No.
DEPARTMENT OF LAW, Civil Rights           4:08-cv-00441-
Division,                                     MWB
                 Plaintiffs-Appellees,

ANGELA AGUILAR,                             OPINION
     Intervenor-Plaintiff–Appellee,

                  v.

ASARCO LLC,
           Defendant-Appellant.

      Appeal from the United States District Court
               for the District of Arizona
      Mark W. Bennett, District Judge, Presiding

            Argued and Submitted En Banc
          June 18, 2014—Seattle, Washington

                Filed December 10, 2014

  Before: Sidney R. Thomas, Chief Judge, and Stephen
Reinhardt, Alex Kozinski, Barry G. Silverman, Ronald M.
 Gould, Marsha S. Berzon, Richard R. Clifton, N. Randy
2               STATE OF ARIZONA V. ASARCO

Smith, Mary H. Murguia, Morgan Christen, and Jacqueline
               H. Nguyen, Circuit Judges.

                Opinion by Chief Judge Thomas

                           SUMMARY*

                 Title VII / Punitive Damages

    Affirming the district court’s judgment, the en banc court
held that a $300,000 punitive damages verdict, in a Title VII
sexual harassment case in which only nominal damages were
awarded, comported with due process.

    The en banc court concluded that punitive damages
awards conferred under 42 U.S.C. § 1981a, which imposes a
$300,000 cap on compensatory and punitive damages,
comport with due process because the statute’s provisions
meet the constitutional concerns underlying BMW of N. Am.,
Inc. v. Gore, 517 U.S. 559 (1996). The en banc court stated
that the statute provides specific notice of proscribed conduct.
It specifies the maximum amount of damages that can be
awarded, and incorporates both specified compensatory and
punitive damages within the cap. The $300,000 dollar
amount of the cap provides an extremely limited potential for
recovery, and has not been changed, nor been adjusted for
inflation, since its adoption in 1991. As a result, and due to
the circumstances of this case, including the fact that the jury
awarded only nominal, and not compensatory damages, the

  *
    This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
              STATE OF ARIZONA V. ASARCO                       3

en banc court declined to rigidly apply Gore’s three
guideposts to the award in this case. The en banc court
affirmed the district court’s conclusion that the punitive
award was made in conformance with the statute and was not
otherwise in violation of due process.

    The en banc court held that the district court did not abuse
its discretion in admitting evidence of sexually explicit
graffiti.

     The en banc court held that the district court did not abuse
its discretion in awarding attorneys’ fees to the plaintiff.

                         COUNSEL

David T. Barton (argued), Eric B. Johnson, and Brian A.
Howie, Quarles & Brady LLP, Phoenix, Arizona, for
Defendant-Appellant.

Thomas C. Horne, Ann Hobart, and Leslie Ross, Assistant
Attorneys General, State of Arizona Department of Law,
Civil Rights Division, Phoenix, Arizona, for Plaintiff-
Appellee State of Arizona.

Eric Schnapper (argued), University of Washington Law
School; Jenne S. Forbes, Waterfall, Economidis, Caldwell,
Hanshaw & Villamana, P.C., Tucson, Arizona, for
Intervenor-Plaintiff Appellee.

Julie L. Gantz (argued), Attorney, P. David Lopez, General
Counsel, Lorraine C. Davis, Acting Associate General
Counsel, Jennifer S. Goldstein, Acting Assistant General
Counsel, Equal Employment Opportunity Commission,
4             STATE OF ARIZONA V. ASARCO

Washington, D.C., for Amicus Curiae United States Equal
Employment Opportunity Commission.

                         OPINION

THOMAS, Chief Judge:

    This appeal presents the question of whether a $300,000
punitive damages verdict, in a Title VII sexual harassment
case in which only nominal damages were awarded, comports
with due process. Given the statutory scheme that governs
punitive damages in Title VII cases and the circumstances of
this case, we conclude that the award does not violate due
process. We affirm the judgment of the district court.

                              I

    ASARCO, LLC (“ASARCO”) operates the Mission Mine
complex in Sahuarita, Arizona, near Tucson. Mission Mine
includes a copper mine from which copper ore is extracted
and a mill facility in which the ore is crushed, filtered, and
refined. Angela Aguilar worked at the Mission Mine
complex from December 2005 through November 2006. She
started as a mill laborer and became a car loader operator in
March 2006. A month later, she then became a filter operator
in the filter plant and two months later, a rod and ball mill
person. Aguilar alleges that during her time at ASARCO, she
was subjected to sexual harassment, retaliation, intentional
infliction of emotional distress, and was constructively
discharged from her employment.

    The State of Arizona filed suit against ASARCO under
the Arizona Civil Rights Act in Pima County Superior Court,
              STATE OF ARIZONA V. ASARCO                     5

alleging harassment, disparate treatment, and retaliation
against Aguilar. Aguilar subsequently filed her own lawsuit
against ASARCO, alleging harassment, constructive
discharge, and retaliation under Title VII. The proceedings
were consolidated and removed to the United States District
Court for the District of Arizona.

    After an eight-day trial, the jury found ASARCO liable on
Aguilar’s sexual harassment claims, in violation of 42 U.S.C.
§ 2000e-2, but not on her constructive discharge or retaliation
claims. The jury awarded no compensatory damages, but
awarded $1 in nominal and $868,750 in punitive damages.
The jury was instructed on the standard for granting punitive
damages found in 42 U.S.C. § 1981a(b).           Following the
judgment, ASARCO filed a renewed motion for judgment as
a matter of law, contending, in part, that the punitive damages
award was unconstitutionally excessive. In the alternative, it
urged the court to grant a new trial because of evidentiary
errors.

    The district court rejected the motion for judgment as a
matter of law. Applying the due process analysis in BMW of
North America, Inc. v. Gore, 517 U.S. 559 (1996), it
concluded the punitive damages award was not
unconstitutional but, given the $300,000 cap on
compensatory and punitive damages found in
§ 1981a(b)(3)(D), reduced the award to $300,000. The court
also rejected ASARCO’s new trial motion, and granted
Aguilar’s request for injunctive relief, directing ASARCO to
update its harassment policies. Finally, the court granted
Aguilar’s motion for attorneys’ fees and costs, in the total
amount of $350,902.75.
6             STATE OF ARIZONA V. ASARCO

    ASARCO timely appealed, arguing that the district court
erred by refusing to reduce the punitive damages award
further, by admitting evidence of other employees who
witnessed pornographic graffiti, and by awarding Aguilar
attorneys’ fees. A three-judge panel of this court affirmed the
district court as to the evidence and attorneys’ fees, but
vacated the $300,000 punitive damages award. Applying the
three factors found in Gore, the panel majority concluded that
while ASARCO’s conduct was reprehensible, the ratio of
300,000 to 1 between the punitive and nominal damages
awards was excessive. Arizona v. ASARCO LLC, 733 F.3d
882, 885–92 (9th Cir. 2013). Citing to the highest ratio it
could locate among discrimination cases, 125,000 to 1 in
Abner v. Kansas City S. R.R. Co., 513 F.3d 154, 164 (5th Cir.
2008), the majority reduced the award to $125,000.
ASARCO, 733 F.3d at 891–92. Dissenting in part, Judge
Hurwitz stated that he would affirm the entire $300,000
judgment in light of the applicable statutory cap, which
provides employers with notice of the penalties they could
face for Title VII violations. Id. at 892–93 (Hurwitz, J.,
concurring in part and dissenting in part).

    Upon the majority vote of the active, non-recused judges
of the court, we agreed to rehear this case en banc. Arizona
v. ASARCO LLC, 755 F.3d 1044 (9th Cir. Feb. 28, 2014). We
have jurisdiction under 28 U.S.C. § 1291. We apply “a de
novo standard of review when passing on district courts’
determinations of the constitutionality of punitive damages
awards.” Cooper Indus. v. Leatherman Tool Grp., Inc.,
532 U.S. 424, 436 (2001). Even when a defendant makes a
constitutional challenge to a punitive damages award,
however, we defer to the district court’s “findings of fact
unless they are clearly erroneous.” Id. at 440 n.14.
              STATE OF ARIZONA V. ASARCO                    7

                              II

     Applying Gore, ASARCO argues that the district court
erred in upholding the jury’s punitive damages award, which
the court then reduced to $300,000 because of the statutory
cap on damages contained in § 1981a. At oral argument,
ASARCO argued the award should be reduced far below the
$125,000 awarded by the three-judge panel, an amount which
it contends is still constitutionally excessive. ASARCO also
argues the award should be reduced below the $2500 per
offense punitive damages amount awarded in Mendez v.
County of San Bernardino, 540 F.3d 1109, 1120–23 (9th Cir.
2008).

                              A

    In Gore, the Supreme Court altered the legal punitive
damages landscape, applying the Due Process Clause of the
Fourteenth Amendment to a state court’s $2 million punitive
damages award (accompanying a $4000 compensatory
damages award) arising from state common law claims, and
concluding that the punitive damages amount was “grossly
excessive” and therefore unconstitutional. 517 U.S. at
565–67, 574–75. To assess the constitutionality of a state
common law punitive damages award, the Court in Gore
employed three guideposts, which it later summarized in
State Farm Mutual Automobile Insurance Co. v. Campbell,
538 U.S. 408, 418 (2003), as follows: “(1) the degree of
reprehensibility of the defendant’s misconduct; (2) the
disparity between the actual or potential harm suffered by the
plaintiff and the punitive damages award; and (3) the
difference between the punitive damages awarded by the jury
and the civil penalties authorized or imposed in comparable
cases.” Id. (citing Gore, 517 U.S. at 575).
8             STATE OF ARIZONA V. ASARCO

    Under Gore and State Farm, the most important
guidepost is reprehensibility. State Farm articulated several
factors courts could consider in assessing the egregiousness
of a defendant’s conduct:

        the harm caused was physical as opposed to
        economic; the tortious conduct evinced an
        indifference to or a reckless disregard of the
        health or safety of others; the target of the
        conduct had financial vulnerability; the
        conduct involved repeated actions or was an
        isolated incident; and the harm was the result
        of intentional malice, trickery, or deceit, or
        mere accident.

Id. at 419.

    As for the second factor–the disparity between the harm
suffered by the plaintiff and the punitive damages award–the
Court has repeatedly eschewed the adoption of a “bright-line
ratio which a punitive damages award cannot exceed.” Id. at
425. Nevertheless, the Court has noted that, “in practice, few
awards exceeding a single-digit ratio between punitive and
compensatory damages, to a significant degree, will satisfy
due process.” Id. The Court also cautioned, however, that a
higher ratio may be appropriate where the conduct is
especially egregious, but results in minimal economic
damages. Id. (citing Gore, 517 U.S. at 582, for the
proposition that economic awards may be small because the
injury is hard to quantify or detect).

    Gore is undeniably of some relevance in this context.
See, e.g., Cooper Indus., 532 U.S. at 441–43 (applying Gore
to a due process challenge to punitive damages awarded in a
              STATE OF ARIZONA V. ASARCO                     9

federal Lanham Act suit); Payne v. Jones, 711 F.3d 85,
96–106 (2d Cir. 2013) (assessing a non-constitutional claim
that a punitive damages award was excessive by, in part,
looking to the Gore factors). Indeed, it is conceivable that
even awards conferred under a carefully crafted statutory
scheme governing punitive damages could fail to comport
with due process.

    Still, this case presents a different question than the
Supreme Court considered in Gore. Here, Aguilar has
asserted a claim under a statute, Title VII, which includes a
carefully crafted provision, § 1981, that imposes a cap on
punitive damages. The landscape of our review is different
when we consider a punitive damages award arising from a
statute that rigidly dictates the standard a jury must apply in
awarding punitive damages and narrowly caps hard-to-
quantify compensatory damages and punitive damages. See
Abner, 513 F.3d at 16 (noting that, through § 1981a,
“Congress has effectively set the tolerable proportion” in
Title VII cases and that, because the statutory cap does not
offend due process, “the three-factor Gore analysis” is
irrelevant); see generally Joseph A. Seiner, Punitive
Damages, Due Process, and Employment Discrimination,
97 Iowa L. Rev. 473, 490–94 (2012) (arguing that, after
Exxon Shipping Co. v. Baker, 554 U.S. 471 (2008), and in
light of § 1981a, courts need not reach “the due process issues
raised in Gore and State Farm when addressing employment
discrimination claims brought under Title VII”).

                              B

    In resolving ASARCO’s due process challenge in the
Title VII context, we start with the constitutional concerns
underlying the Court’s due process analysis in Gore and State
10            STATE OF ARIZONA V. ASARCO

Farm. First and foremost, the Court developed the Gore
doctrine out of a concern that a defendant “receive fair notice
not only of the conduct that will subject him to punishment,
but also the severity of the penalty” that may be imposed.
Gore, 517 U.S. at 574. The Court was also interested in
avoiding arbitrary, biased, or ill-informed deprivation of
property of defendants by juries when the statute or common
law did not provide sufficient safeguards. State Farm,
538 U.S. at 416–18. The Court sought to uphold the
deterrence function of punitive damages awards, while
policing awards that exceed an amount necessary to deter
future wrongdoing. Gore, 517 U.S. at 584.

     In Gore, the Court also discussed the reasoning
underlying each of its three guideposts. The Court noted that
its reprehensibility guidepost attempts to align the punitive
damages award with the severity of the wrongful act. Id. at
575–77. As for the ratio guidepost, the Court declined to
apply a bright line rule, while acknowledging the general goal
of making punitive damages proportional to the actual injury
suffered. Id. at 582. The Court noted that the ratio could be
higher if “the injury is hard to detect or the monetary value of
noneconomic harm might [be] difficult to determine,” and
that the general aim of the ratio guidepost is
“reasonableness.” Id. at 582–83 (internal quotation marks
omitted); see also State Farm, 538 U.S. at 425 (“[R]atios
greater than those we have previously upheld may comport
with due process where ‘a particularly egregious act has
resulted in only a small amount of economic damages.’”
(quoting Gore, 517 U.S. at 582)). Finally, in articulating its
third guidepost, directing courts to take into account
analogous civil or criminal penalties for comparable
misconduct, the Court highlighted the importance of
according “substantial deference to legislative judgments
              STATE OF ARIZONA V. ASARCO                    11

concerning appropriate sanctions for the conduct at issue.”
Gore, 517 U.S. at 583 (internal quotation marks omitted).

    An exacting Gore review, applying the three guideposts
rigorously, may be appropriate when reviewing a common
law punitive damages award. However, when a punitive
damages award arises from a robust statutory regime, the
rigid application of the Gore guideposts is less necessary or
appropriate. Thus, the more relevant first consideration is the
statute itself, through which the legislature has spoken
explicitly on the proper scope of punitive damages.

     In some instances, a statute may leave gaps, or room, for
the common law to shape the scope of punitive damages
awards, within the boundaries of due process. See, e.g.,
Exxon, 554 U.S. at 514–15 (adopting, in the area of federal
maritime law, a 1 to 1 ratio between compensatory and
punitive damages). But here, the statutory scheme leaves
little to the imagination. Cf. id. at 516–17 (Stevens, J.,
concurring in part and dissenting in part) (arguing that, since
federal maritime law is largely statutory, Congress’s decision
“not to restrict the availability of a particular remedy favors
adherence to a policy of judicial restraint,” and implicitly
stating that the role of the court is equally, if not more,
limited when Congress has reined in a remedy explicitly).

    When we examine § 1981a, it becomes readily apparent
why awards under the statute comport with due process.
First, the statute clearly sets forth the type of conduct, and
mind-set, a defendant must have to be found liable for
punitive damages. 42 U.S.C. § 1981a(b)(1) (“A complaining
party may recover punitive damages under this section
against a respondent . . . if the complaining party
demonstrates that the respondent engaged in a discriminatory
12            STATE OF ARIZONA V. ASARCO

practice or discriminatory practices with malice or with
reckless indifference to the federally protected rights of an
aggrieved individual.”).

    Second, the statute sets a cap on certain types of
compensatory damages, combined with punitive damages.
42 U.S.C. § 1981a(b)(3) (capping the “sum of the amount of
compensatory damages awarded under this section for
pecuniary losses, emotional pain, suffering, inconvenience,
mental anguish, loss of enjoyment of life, and other
nonpecuniary losses,” along with punitive damages). The cap
tops out at $300,000 for employers having more than 500
employees, like ASARCO. Id. § 1981a(b)(3)(D). The cap
drops down to as low as $50,000 for employers with more
than 14, but fewer than 101, employees.                  Id.
§ 1981a(b)(3)(A).

    These two aspects of the statute address Gore’s concern
that defendants be on notice of what conduct might make
them liable for punitive damages and the extent to which they
might be held liable. The punitive damages provision
codified at § 1981a was enacted in 1991. Since that time,
employers have been on notice regarding the type of conduct
that could subject them to liability, the level of mental
culpability or intentionality required, and the dollar amount
to which they could be subjected, if they violate the law.
Seiner, supra, at 492 (noting that “the [punitive damages
award] amendments to Title VII have been in place for two
decades” and that “[e]mployers are on notice, then, that if
they intentionally discriminate . . . they can be subjected to
the punitive penalties set forth in” § 1981a).

   Moreover, the statute dramatically reduces the chance of
random, arbitrary awards, because the statute articulates the
              STATE OF ARIZONA V. ASARCO                    13

degree of culpability that a defendant must have before being
subject to liability and restricts damages awards to a range
between $0 and $300,000. Cush-Crawford v. Adchem Corp.,
271 F.3d 352, 359 (2d Cir. 2001) (“To the extent that courts
worried about unleashing juries to award limitless punitive
damages in cases where no harm had occurred, this concern
is eliminated by the imposition of the statutory caps.”).
Similarly, the odds of over-deterrence are low, given the
statute’s narrow circumscription of punitive damages awards.
In sum, the general constitutional concerns underlying Gore
are addressed by the provisions of § 1981a.

    The same is true of Gore’s guidelines. Section 1981a
satisfies Gore’s concern that conduct must be reprehensible
by imposing an intent requirement that ensures jurors
understand that only certain negative conduct should be
penalized. In addition, the statutory scheme provides that
conduct in violation of the statute, which subjects the
employer to compensatory damages, does not necessarily
compel a punitive damages award. 42 U.S.C. § 1981a(b)(1)
(establishing an explicit requirement that punitive damages be
awarded only if the defendant acted “with malice or with
reckless indifference to the federally protected rights of an
aggrieved individual”).

    Gore’s ratio analysis has little applicability in the Title
VII context because § 1981a governs punitive damages.
When a statute narrowly describes the type of conduct subject
to punitive liability, and reasonably caps that liability, it
makes little sense to formalistically apply a ratio analysis
devised for unrestricted state common law damages awards.
That logic applies with special force here because the statute
provides a consolidated cap on both compensatory and
punitive damages. See id. § 1981a(b)(3) (applying the cap to
14              STATE OF ARIZONA V. ASARCO

the sum of punitive damages and certain compensatory
damages). Under a Gore ratio analysis, the amount
constitutionally available for a punitive damages award
increases proportionately to the harm. But § 1981a(b)(3)
produces the opposite result: as the award for specified
compensatory damages increases, the amount available for a
punitive damages award decreases—the greater the harm, the
less the punitive damages award. By establishing a
consolidated damages cap that includes both specified
compensatory and punitive damages, Congress supplanted
traditional ratio theory and effectively obviated the need for
a Gore ratio examination.

    In addition, as the Fifth Circuit noted in Abner, 513 F.3d
at 163, Title VII violations often result in injuries that are
“difficult to quantify in physical terms.” When only nominal
damages are awarded, application of a Gore ratio analysis is
not appropriate. Id. at 164 (concluding that in punitive
damages cases where quantifiable compensatory damages are
so impossible to calculate that only nominal damages are
awarded, “a ratio-based inquiry becomes irrelevant”).

    “Nominal damages are not intended to compensate a
plaintiff for injuries, nor to act as a measure of the severity of
a defendant’s wrongful conduct.” Cummings v. Connell,
402 F.3d 936, 945 (9th Cir. 2005). Because nominal damages
measure neither damage nor severity of conduct, it is not
appropriate to examine the ratio of a nominal damages award
to a punitive damages award.1 Saunders v. Branch Banking

 1
  In Mendez, we applied the ratio analysis despite the jury awarding only
nominal and punitive damages, and no compensatory relief. 540 F.3d at
1117, 1120–23 (mentioning the difficulty of applying the Gore ratio
analysis when only nominal damages were awarded). The suit in Mendez
                STATE OF ARIZONA V. ASARCO                            15

& Trust Co. of Va., 526 F.3d 142, 154 (4th Cir. 2008) (noting
that “when a jury only awards nominal damages . . . a
punitive damages award may exceed the normal single digit
ratio because a smaller amount would utterly fail to serve the
traditional purposes” of punitive damages awards and stating
that, in this case, the court would “not rely upon the
challenged ratio” but instead compare this award “to other
cases involving similar claims” (internal quotation marks
omitted)); Williams v. Kaufman Cnty., 352 F.3d 994, 1016 &
n.76 (5th Cir. 2003) (stating that “any punitive damages-to-
compensatory damages ‘ratio analysis’ cannot be applied
effectively in cases where only nominal damages have been
awarded”); Romanski v. Detroit Entm’t, LLC, 428 F.3d 629,
645 (6th Cir. 2005) (noting that in a § 1983 unlawful arrest
case, the “plaintiff’s economic injury was so minimal as to be
essentially nominal” and that in such a case, the Supreme
Court’s precedent “on the ratio component of the
excessiveness inquiry—which involved substantial
compensatory damages awards for economic and measurable
noneconomic harm—are therefore of limited relevance”
(footnote omitted)).

   Further, in this case, the nominal damages were capped.
The jury was instructed that it could not award more than $1
in nominal damages. When compensatory or nominal
damages are subject to a cap, there is no meaningful way to
apply a Gore ratio analysis because the true harm is not
measured.

arose under a different statutory scheme, however, since the case involved
a 42 U.S.C. § 1983 suit. Id. at 1117. To the extent Mendez conflicts with
this decision, we overrule it.
16            STATE OF ARIZONA V. ASARCO

    Gore’s third guidepost bolsters our conclusion that
punitive damages awards conferred under the statutory
scheme in this case do not violate due process. The purpose
of the third guidepost is deference to reasoned legislative
judgments. Gore, 517 U.S. at 583. Here, Congress has made
a reasoned judgment not simply as to analogous criminal or
civil penalties, but as to punitive damages awarded in cases
like the one at hand. We need not search outside the statutory
scheme Congress enacted for legislative guidance in other
contexts.

     Finally, we see no reversible error in the district court’s
conclusion that the record evidence justified a punitive
damages award under the statute. As the Fifth Circuit noted
in Abner, just because damages awards conferred under a
certain statutory scheme comport with due process and Gore
does not mean our constitutional analysis is at an end. We
still must assess whether the district court was correct in
concluding that the award met the requirements of the
statutory scheme. Abner, 513 F.3d at 164 (concluding, in a
Title VII hostile work environment case, that the statutory
scheme in § 1981a comports with due process and that the
court need not apply Gore’s guideposts, but also stating that,
“[a]ccepting this analysis makes the sufficiency of the
evidence to support the statutory threshold a determinant of
constitutional validity”).

     In its post-trial motions, ASARCO argued there was
insufficient evidence presented at trial to support a punitive
damages award under § 1981a. ASARCO claimed that even
if it was properly liable under Title VII, it still did not act
with the malice or recklessness required to award punitive
damages under § 1981a(b). The district court rejected this
argument below but ASARCO focused its appeal instead on
              STATE OF ARIZONA V. ASARCO                      17

the district court’s rejection of its Gore due process challenge
to the amount of the punitive damages.

    Even if we assume, given ASARCO’s presentation of the
facts and its argument regarding the reprehensibility of its
own conduct, that ASARCO did not waive any challenge to
the sufficiency of the evidence supporting an award of
punitive damages, we still conclude that the district court did
not err in granting $300,000 in punitive damages. In its
decision, the district court noted that ASARCO did have an
anti-discrimination policy in force. But it also recounted
particular evidence in the record, specifically that ASARCO’s
management “did not provide prompt and effective remedial
action” when made aware of Aguilar’s complaints. Instead,
the court pointed to evidence that ASARCO “treated
Aguilar’s claims dismissively, did nothing to investigate
Aguilar’s claims, or took steps that were not reasonably
calculated to and did not stop the harassment.” The court
noted that, based on its evaluation of the evidence, ASARCO
repeatedly, over the course of months, failed to adequately
respond to discrete instances of harassment against Aguilar.
Moreover, the court reasoned, because the evidence
demonstrated that ASARCO “is a serial violator of
antidiscrimination laws” (as evidenced by the sexually
explicit graffiti targeting other employees), the deterrence
aim of punitive damages awards warranted a significant
award that would discourage future misconduct by ASARCO.

     Our review of the record confirms that the district court
did not clearly err in its assessment of the facts. Indeed, there
is significant and compelling evidence that management was
aware of, and did little to resolve, lewd, inappropriate, and
sexually aggressive behavior directed to Aguilar; sexually
explicit, targeted pictures of Aguilar on the walls of the
18            STATE OF ARIZONA V. ASARCO

bathroom rented specifically for her use; and overly
aggressive management and criticism of Aguilar by
supervisors. Aguilar complained to management multiple
times. The sexually explicit graffiti in the bathroom was not
removed while she was working in the filter plant. As the
district court correctly noted, to the extent ASARCO did have
an antidiscrimination or harassment policy, the existence of
such a policy alone is not enough to save it. See Bains LLC
v. Arco Prods. Co., 405 F.3d 764, 774 (9th Cir. 2005) (“A
written antidiscrimination policy does not insulate a company
from liability [under, in Bains, 42 U.S.C. § 1981, for punitive
damages] if it does not enforce the antidiscrimination policy
and, by its actions, supports discrimination.”). Further, the
award is consistent with, and in some cases smaller than,
punitive damages awards in other Title VII and 42 U.S.C.
§ 1981 cases we have considered. See, e.g., Zhang v. Am.
Gem Seafoods, Inc., 339 F.3d 1020, 1045 (9th Cir. 2003)
(upholding a $2.6 million punitive damages award in
response in a § 1981 racial discrimination case); Swinton v.
Potomac Corp., 270 F.3d 794, 817–20 (9th Cir. 2001)
(upholding $1 million discrimination award).

    In sum, we conclude that punitive damages awards
conferred under § 1981a comport with due process. The
statute provides specific notice of proscribed conduct. It
specifies the maximum amount of damages that can be
awarded, and incorporates both specified compensatory and
punitive damages within the cap. The $300,000 dollar
amount of the cap provides an extremely limited potential for
recovery, and has not changed, nor been adjusted for
inflation, since its adoption in 1991. There is nothing in our
consideration of the Gore factors that would alter that
conclusion. The record supports the district court’s
conclusion that the punitive award was made in conformance
              STATE OF ARIZONA V. ASARCO                      19

with the statute and was not otherwise in violation of due
process.

                               III

                               A

    ASARCO also challenges the district court’s admission
of evidence of other sexually explicit graffiti in bathrooms
that was similar to the sexually explicit graffiti directed to
Aguilar.

    We review “for abuse of discretion a district court’s
decision to admit evidence,” reversing only if we are
“convinced firmly that the reviewed decision lies beyond the
pale of reasonable justification under the circumstances.”
McCollough v. Johnson, Rodenburg & Lauinger, LLC,
637 F.3d 939, 953 (9th Cir. 2011) (internal quotation marks
omitted). To obtain reversal of an evidentiary ruling,
ASARCO “must show that the error was prejudicial, and that
the verdict was more probably than not affected as a result.”
Id. (internal quotation marks omitted). ASARCO argues
evidence that sexually explicit graffiti was also targeted at the
other employees was too factually dissimilar and temporally
remote from Aguilar’s experience and that, as a result, the
evidence was more prejudicial than probative under Federal
Rule of Evidence 403.

    We disagree. Any prejudice to ASARCO was limited by
the circumscribed nature of the evidence and the limiting
instruction given by the district court. The evidence had
probative value in helping the jury assess whether Aguilar
had proved the elements of harassment. Moreover, contrary
20             STATE OF ARIZONA V. ASARCO

to ASARCO’s assertion, this evidence formed only a small
part of the evidence presented by Aguilar.

    Thus, under our deferential standard of review, we
conclude that the district court did not abuse its discretion in
narrowly admitting this evidence. Tennison v. Circus Circus
Enters., Inc., 244 F.3d 684, 689–90 (9th Cir. 2001) (noting
that a district court “enjoys considerable discretion” in
determining whether harassment of employees other than the
victim is more prejudicial than probative).

                                B

     Finally, ASARCO challenges the court’s decision to grant
Aguilar’s motion for $350,902.75 in attorneys’ fees and costs.
“Awards of attorney’s fees are generally reviewed for abuse
of discretion.” Thomas v. City of Tacoma, 410 F.3d 644, 647
(9th Cir. 2005). Discretionary review, however, is only
applied if the court is “satisfied that the correct legal standard
was applied and that none of the district court’s findings of
fact were clearly erroneous.” Id. Citing Farrar v. Hobby,
506 U.S. 103 (1992), ASARCO argues Aguilar is not eligible
for attorneys’ fees because she achieved little to no success
before the district court. ASARCO points out that Aguilar
only succeeded on one of her claims and that she received
nominal, but not compensatory, damages, arguing she won
little more than “the moral satisfaction of knowing that a
federal court concluded that [her] rights had been violated.”
Farrar, 506 U.S. at 114 (internal quotation marks omitted).

    We conclude that the district court did not abuse its
discretion in granting the attorneys’ fees motion. First, given
the overlap between Aguilar’s harassment claim and her other
claims, ASARCO’s argument that she prevailed on merely
              STATE OF ARIZONA V. ASARCO                    21

one claim is incorrect. Passantino v. Johnson & Johnson
Consumer Prods., 212 F.3d 493, 517–18 (9th Cir. 2000)
(“Although Passantino did not prevail on her discrimination
claims or her claim for injunctive relief, she prevailed on her
retaliation claims, which were inextricably intertwined with
her discrimination claims.”). More importantly, even if
Aguilar was only awarded nominal, and not compensatory,
damages, any analogy to Farrar disappears because, unlike
in that case, Aguilar was awarded almost $900,000 in
punitive damages from the jury, and was ultimately granted
$300,000 in punitive damages from the district court.
Compare Farrar, 506 U.S. at 107 (noting that the jury
awarded the plaintiffs nothing). We affirm the district court’s
grant of attorneys’ fees.

                              IV

    Because its provisions meet the constitutional concerns
underlying Gore, we conclude that § 1981a’s punitive
damages regime comports with due process. As a result, and
due to the circumstances of this case, including the fact that
the jury awarded only nominal, and not compensatory
damages, we also decline to rigidly apply Gore’s three
guideposts to the award in this case. Because the governing
statute comports with due process, the district court did not
err in concluding sufficient evidence supported a punitive
damages award of any amount in this case, and the award
here complies with the strictures of the statute, we affirm the
district court’s conclusion that the $300,000 award does not
violate due process. In addition, exercising our supervisory
power, we also conclude the award was not excessive and the
district court did not abuse its discretion in allowing it.
Finally, we affirm the district court as to the admission of
22            STATE OF ARIZONA V. ASARCO

other evidence of sexually explicit graffiti and as to the award
of attorneys’ fees.

     AFFIRMED.