Court Opinion

ID: 3022547
Source: CourtListenerOpinion
Date Created: 2015-10-13 22:27:10.822253+00
Date Added: 2024-06-11T11:47:34.414672
License: Public Domain

United States Court of Appeals
                             FOR THE EIGHTH CIRCUIT
                                ________________

                                   No. 98-1832
                                ________________

Vernon E. Spencer,                        *
                                          *
             Appellee,                    *
                                          *      Appeal from the United States
      v.                                  *      District Court for the
                                          *      Western District of Missouri.
Stuart Hall Company, Inc., a              *
Missouri corporation; Newell              *
Company, a Delaware corporation,          *
                                          *
             Appellants.                  *

                                ________________

                           Submitted: November 18, 1998
                               Filed: April 12, 1999
                                ________________

Before McMILLIAN, WOLLMAN, and HANSEN, Circuit Judges.
                       ______________

HANSEN, Circuit Judge.

       Vernon Spencer received a favorable jury verdict on the age discrimination
claim he brought against Stuart Hall Company, Inc., and Newell Company
(collectively Stuart Hall) after he was terminated during a reduction in force (RIF).
Stuart Hall appeals from the district court’s1 denial of its motion for judgment as a
matter of law (JAML). We affirm.

                                           I.

       Because this is an appeal from the denial of a motion for JAML, we consider
the facts in the light most favorable to the winning party, construing any ambiguities
and making any reasonable inferences in favor of the verdict. See Ballard v. River
Fleets, Inc.,149 F.3d 829, 831 (8th Cir. 1998). Viewed in this light, the relevant facts
are as follows.

       Spencer worked for Stuart Hall2 for 25 years, most recently as a production
supervisor. In May 1995, Wal-Mart canceled a large order, costing Stuart Hall 40
percent of its sales. Within a month, Stuart Hall shut down its third shift, laying off
100 of 325 production workers and 3 of 10 production supervisors. Gordon Kirsch,
Vice-President of Manufacturing, was responsible for the final layoff decision
regarding the supervisors, with input from Ed Schweikhardt and Ernie Mautino, two
plant managers. In addition to the three supervisors originally laid off, Stuart Hall
terminated a fourth supervisor, Jim Wallace, a week after the layoff. Stuart Hall laid
off one supervisor from each of the three production lines, though it claims that it laid
off supervisors by comparing all ten and laying off the four worst performers (Stuart
Hall contends that Wallace was part of the RIF). Spencer, age 54 at the time of the
layoff, was on the envelope line. The envelope line supervisors who were not laid off
were Don Ponak, age 38, and Brett Broadaway, age 33.

      1
       The Honorable Scott O. Wright, United States District Judge for the Western
District of Missouri.
      2
     Stuart Hall manufactures paper products such as school and office supplies.
Newell Company bought Stuart Hall in 1992.
                                           2
       Stuart Hall claimed that it based its layoff decision on each supervisor's two
most recent performance evaluations. Spencer had two "provisional" ratings;3
according to Stuart Hall, no other supervisor had ratings as low as Spencer did.
Though Stuart Hall claimed that Ponak had only one provisional rating, there was
evidence that he actually had two provisional ratings and that Stuart Hall failed to
produce the evaluation from that rating, using a less recent rating of "good" in its
place. Two of the three supervisors who were laid off were over age 40 and were the
oldest of all the supervisors; the third laid off supervisor was age 29.

        Spencer brought this age discrimination claim under the Age Discrimination
in Employment Act (ADEA), 29 U.S.C. §§ 621-634 (1994). The district court
initially granted Stuart Hall's motion in limine and excluded evidence of statements
allegedly made by prior managers indicating age bias. However, the district court
reversed its ruling during trial and admitted the evidence. The jury returned a verdict
in favor of Spencer, finding that Stuart Hall's actions were willful. The district court
awarded Spencer back pay of $39,573, front pay of $12,499, liquidated damages of
$39,573, and attorney's fees and costs of $57,607. Stuart Hall moved for JAML, or
in the alternative, for a new trial. The district court denied Stuart Hall’s motion and
Stuart Hall now appeals.

                                          II.

       We review de novo the denial of a motion for JAML, applying the same
standards applied by the district court. See Ballard, 149 F.3d at 831. In so doing, we
must "(1) resolve direct factual conflicts in favor of [Spencer]; (2) assume as true all
facts supporting [Spencer] which the evidence tended to prove; (3) give [Spencer] the
benefit of all reasonable inferences; and (4) affirm the denial of the motion if the

      3
       Stuart Hall evaluated its employees on a six-level rating system: exceptional,
outstanding, good, competent, provisional, and unsatisfactory.
                                           3
evidence so viewed would allow reasonable jurors to differ as to the conclusions that
could be drawn.” Id. (citation and internal quotations omitted).

A.    Violation of the ADEA

       An ADEA claim can arise either as a pretext claim, as a mixed motives claim,
or as a RIF claim. Each type of ADEA claim has slightly different elements. Cf.
Bevan v. Honeywell, Inc., 118 F.3d 603, 609 n.1 (8th Cir. 1997). To prove his RIF
claim, Spencer must show that: (1) he was within the protected class (over age 40);
(2) his performance met his employer's legitimate expectations; (3) he was
discharged; and (4) there was an additional showing of age as a factor in the
discharge decision. See Cramer v. McDonnell Douglas Corp., 120 F.3d 874, 876 (8th
Cir. 1997). Our focus in an appeal from the denial of a JAML motion following a
jury verdict is whether Spencer met his ultimate burden of showing intentional age
discrimination, which requires more than merely discrediting Stuart Hall’s proffered
reason for the adverse employment decision. Spencer must also prove that the
proffered reason was a pretext for age discrimination. See Nelson v. Boatmen's
Bancshares, Inc., 26 F.3d 796, 801 (8th Cir. 1994).

       The evidence at trial presented two possible scenarios regarding the RIF
decisional process. Stuart Hall claims that it laid off the four worst performing
supervisors. There was also evidence, however, that only three supervisors were laid
off as part of the RIF, one from each of the three production lines. Kirsch, Mautino,
and Schweikhardt all changed their testimony at trial from the testimony they gave
during depositions and through affidavits. Kirsch testified during his deposition that
he first ranked the ten supervisors according to their two most recent performance
evaluations (Spencer was ranked worst) and that he then discussed each supervisor's
performance with Mautino and Schweikhardt to confirm that Spencer was in fact the
worst of the ten. Mautino and Schweikhardt corroborated this testimony in their
summary judgment affidavits. At trial, however, all three changed their stories to say

                                          4
that they first met to discuss and rank the managers based on their experiences with
the supervisors and then, after determining that Spencer was the worst, reviewed the
performance evaluations to confirm their initial inclinations. Where conflicting
evidence is presented at trial, it is the jury rather than this court which assesses the
credibility of the witnesses and decides which version to believe. See Curtis v.
Electronics & Space Corp., 113 F.3d 1498, 1502 (8th Cir. 1997). Based on these
inconsistencies, which were brought out during trial, the jury could have discredited
the Stuart Hall managers' testimony and the basis they gave for laying off Spencer.

       While we deem it a close call, we conclude that the evidence in this case was
sufficient to support the jury verdict. From all of the evidence, the jury reasonably
could have found that Stuart Hall laid off one supervisor from each of the three
production lines, rather than basing the decision on the overall performance of all ten
supervisors. Spencer was the oldest supervisor in his department with significantly
greater experience and seniority than either Ponak or Broadaway, the other two
supervisors in Spencer's department. Of the three supervisors initially laid off, two
were the oldest of all the supervisors. There was evidence that younger employees
received preferential shift assignments and were not written up for disciplinary
problems similar to those for which Spencer was written up. However, there was also
evidence that older workers were given favorable shift assignments while younger
workers were given unfavorable assignments. We cannot say the evidence points all
one way.

      In addition to this circumstantial evidence of age discrimination, Stuart Hall’s
layoff policy required employees of equal qualifications to be laid off based on
seniority. The performance evaluations used in the layoff decision for Ponak, who
had less seniority than Spencer, were from January 1992 (good) and January 1994
(provisional). Though no evaluation from early 1995 was ever produced for Ponak,
payroll records reflected that Ponak did not receive a raise in February 1995 because

                                           5
of a provisional rating. This evidence, which we must read in the light most favorable
to the verdict, supports a jury finding that Ponak had received two provisional ratings,
as had Spencer, but that Stuart Hall ignored Ponak's most recent provisional rating
to avoid following its seniority based tie breaker layoff policy in order to lay off the
older Spencer.4 We hold that reasonable jurors could differ as to the conclusions to
be drawn from all of the evidence and agree with the district court that the evidence
supports the jury's verdict finding Stuart Hall liable for age discrimination under the
ADEA.

B.    Liquidated Damages Under the ADEA

       An improperly dismissed employee is entitled to a double recovery, called
liquidated damages, if he proves that his employer willfully violated the ADEA. See
29 U.S.C. § 626(b). The standard for proving willfulness "is simply whether 'the
employer either knew or showed reckless disregard for the matter of whether its
conduct was prohibited by the statute.'" See Brown v. Stites Concrete, Inc., 994 F.2d
553, 559 (8th Cir. 1993) (en banc) (quoting Hazen Paper Co. v. Biggins, 507 U.S.
604, 617 (1993)). This showing does not require any heightened quantum or quality
of evidence beyond that already established as long as all the evidence satisfies the
distinct standard for willfulness. Id. at 560. "A violation of the ADEA does not
require any particular mental state, but the award of liquidated damages under the

      4
        Stuart Hall argues that even if Ponak and Spencer both had two provisional
ratings, Spencer still would have been laid off because he would still have been one
of the four worst performers. This argument ignores the evidence that Stuart Hall
actually laid off one supervisor from each production line. If the jury believed this
scenario, then Ponak, who was on the same production line as Spencer, would have
been laid off and Spencer would have been retained under Stuart Hall's layoff policy.
The jury is free to choose which story it believes. We will not reweigh or reevaluate
the credibility of the evidence. See Ballard, 149 F.3d at 831.
                                           6
ADEA does." Glover v. McDonnell Douglas Corp., 12 F.3d 845, 849 (8th Cir.), cert.
denied, 511 U.S. 1070 (1994).

       The ADEA contains two tiers of liability. It awards compensatory damages
when an employer violates the statute and liquidated damages when that violation is
willful. Although the statute was meant to create this two-tiered liability scheme,
Biggins makes clear that our focus is not on ensuring that a heightened evidentiary
requirement keeps the two-tiered scheme intact. Rather, we are only to determine
whether the employer willfully violated the ADEA, thereby exposing the employer
to additional damages. Biggins, 507 U.S. at 616 ("The ADEA does not provide for
liquidated damages 'where consistent with the principle of a two-tiered liability
scheme.' It provides for liquidated damages where the violation was 'willful.'"); see
also Brown, 994 F.2d at 560. For example, liquidated damages are inappropriate
where "an employer incorrectly but in good faith and nonrecklessly believes that the
statute permits a particular age-based decision." Biggins, 507 U.S. at 616. See also
Maschka v. Genuine Parts Co., 122 F.3d 566, 572 (8th Cir. 1997) (finding liquidated
damages appropriate where the employer "presented no evidence that it made its
decision under the erroneous belief that it was entitled to an exception" under the
ADEA); Curtis, 113 F.3d at 1503 (same).

       This case is one of those situations where the same evidence--although thin--
that supports liability under the ADEA also supports an award of liquidated damages
for its willful violation. Reading the evidence in the light most favorable to the
verdict, the jury could have found that Stuart Hall decisionmakers ignored Ponak's
second provisional rating in order to justify laying off Spencer, who was older and
had more seniority than Ponak. Though a showing of equal competence followed by
preference for a younger employee does not meet the showing required to establish
an intent to discriminate, see Lewis v. Aerospace Comm. Credit Union, 114 F.3d 745,
749 (8th Cir. 1997), cert. denied, 118 S. Ct. 1392 (1998), Stuart Hall's policy
required that the company make layoff decisions based on seniority with respect to

                                         7
equally qualified employees. Additionally, Kirsch discussed whether Spencer's age
would create an Equal Employment Opportunity problem with the Vice President of
Human Resources. It was for the jury to determine whether this evidence weighed
in favor of or against the employer. Compare Nelson, 26 F.3d at 803 ("[T]here was
evidence that Boatmen's was more than merely aware of the ADEA statute. Its
human resources director had both experience with and training in the statute.") with
Glover, 12 F.3d at 849 (rejecting the argument that "because Barbeau had been
briefed about the basic requirements and prohibitions of the ADEA, . . . he must have
committed his violation recklessly."). From this evidence, and the jury's credibility
assessments, the jury was free to find that Stuart Hall took steps to hide its true intent,
knowing, or at least recklessly disregarding, that its actions violated the ADEA. Cf.
Newhouse v. McCormick & Co., Inc., 110 F.3d 635, 640 (8th Cir. 1997) (concluding
that liquidated damages were supported by evidence that an employer acted in such
a way that it would appear that the employer was complying with the ADEA). We
cannot say as a matter of law that no reasonable juror could have returned a verdict
for Spencer on the issue of liquidated damages.

C.    Admission of Stray Remarks

       Stuart Hall argues that the district court erred in admitting evidence of alleged
"stray remarks" by two former employees. We review a district court's admission of
evidence for a clear abuse of discretion. See Paul v. Farmland Indus., Inc., 37 F.3d
1274, 1277 (8th Cir. 1994), cert. denied, 514 U.S. 1017 (1995). We will only disturb
a jury's verdict if the evidence is so prejudicial that its exclusion would likely produce
a different result in a new trial. Id.

       The "stray remarks" were two different statements allegedly made by John
Rogers and Rick Arentson to Spencer in 1993, to the effect that an older supervisor
was moved to third shift to make room for younger workers coming up. The district
court originally precluded the evidence upon Stuart Hall's motion in limine. During

                                            8
trial, however, Stuart Hall's counsel cross-examined Spencer about his theory that
Stuart Hall managers had conspired to fire him because of his age two years before
he was actually laid off. (See Trial Tr. at 140-42.) Spencer's counsel requested a
bench conference, during which the court agreed that Stuart Hall had opened the door
to Rogers' and Arentson's alleged statements and that Spencer's counsel would be
permitted to address the issue on redirect. (See id. at 143-45.) Because the judge was
going to allow the evidence on redirect, Stuart Hall's counsel elicited it during the
resumed cross-examination. Upon receiving Spencer's answer about the younger
employees' remarks, Stuart Hall's counsel introduced evidence that neither Arentson
nor Rogers were involved in the layoff decision because neither was employed by
Stuart Hall at the time of the layoff. Arentson and Rogers both later testified that they
did not make the alleged remarks, that Rogers was not even employed at the time of
his alleged remark, and that neither was employed at the time of the layoff.

       Remarks tending to show age animus that are remote in time and made by
nondecisionmakers are insufficient to establish the "additional showing" of
intentional age discrimination needed to support an age discrimination claim in the
context of a reduction in force. See Walton v. McDonnell Douglas Corp., 167 F.3d
423, 427-28 (8th Cir. 1999). The lack of probativeness will generally support
exclusion of the evidence because it also tends to be highly prejudicial. See Slathar
v. Sather Trucking Corp., 78 F.3d 415, 420 (8th Cir.) (affirming district court's
exclusion of stray remarks by nondecisionmakers that would be quite prejudicial but
provide no evidence of age discrimination), cert. denied, 117 S. Ct. 179 (1996).
However, we do not think that the district court abused its discretion in admitting the
testimony in this case.

      Stuart Hall's counsel repeatedly challenged Spencer's conspiracy theory,
indicating defense counsel's doubt that Spencer's theory was believable. Defense
counsel questioned Spencer's credibility by grilling him about his basis for believing
a conspiracy existed to get rid of him because of his age two years before he was laid

                                           9
off. (See Trial Tr. at 142.) Spencer was unable to provide a complete and coherent
answer without referring to Rogers' and Arentson's alleged statements, which he was
under strict orders not to discuss based on the court's in limine ruling. We agree that
Stuart Hall opened the door to the admission of these statements and the district court
acted within its broad discretion by admitting the evidence within the scope of
redirect. See United States v. Bilzerian, 926 F.2d 1285, 1296 (2d Cir.) (evidence
otherwise inadmissable as too prejudicial under Rule 403 may be "admissible to rebut
testimony elicited on cross examination that created a false impression"), cert. denied,
502 U.S. 813 (1991); United States v. Womochil, 778 F.2d 1311, 1317 (8th Cir.
1985) (finding no abuse of district court's discretion in allowing "otherwise
inadmissible evidence on redirect to clarify the issue" when opposing counsel had left
a false impression after cross-examination). The admission of the stray remarks
allegedly made by Rogers and Arentson does not warrant a new trial.

                                          III.

     For the foregoing reasons, we affirm the district court's denial of Stuart Hall's
motion for judgment as a matter of law.

      A true copy.

             Attest:

                     CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT

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