Smith v. Norwest Financial Acceptance, Inc.

• Decision Date: 03 December 1997
• Docket Number: 96-8111,Nos. 96-8103,s. 96-8103
• Citation: 129 F.3d 1408
• Parties: 75 Fair Empl.Prac.Cas. (BNA) 1274, 72 Empl. Prac. Dec. P 45,096, 97 CJ C.A.R. 3067 Debbie L. SMITH, Plaintiff-Appellee/ Cross-Appellant, v. NORTHWEST FINANCIAL ACCEPTANCE, INC., an Iowa corporation; Curtis Mangus; Norwest Financial Wyoming, Inc., a Wyoming corporation; and Norwest Financial, Inc., an Iowa corporation, Defendants-Appellants/ Cross-Appellees. Tenth Circuit
• Court: U.S. Court of Appeals — Tenth Circuit

Page 1408

129 F.3d 1408

75 Fair Empl.Prac.Cas. (BNA) 1274,

72 Empl. Prac. Dec. P 45,096, 97 CJ C.A.R. 3067

Debbie L. SMITH, Plaintiff-Appellee/ Cross-Appellant, v. NORTHWEST FINANCIAL ACCEPTANCE, INC., an Iowa corporation Curtis Mangus; Norwest Financial Wyoming, Inc., a Wyoming corporation; and Norwest Financial, Inc., an Iowa corporation, Defendants-Appellants/ Cross-Appellees.

Nos. 96-8103, 96-8111.

United States Court of Appeals,Tenth Circuit.

Dec. 3, 1997.

Dirk W. deRoos (Jo Frances Walsh with him on the briefs) of Faegre & Benson LLP, Denver, CO, for Defendants-Appellants/Cross-Appellees.

Les Bowron (Frank R. Chapman with him on the brief) of Beech Street Law Offices, Casper, WY, for Plaintiff-Appellee/Cross-Appellant.

Before BRORBY, BARRETT and McKAY, Circuit Judges.

McKAY, Circuit Judge.

Plaintiff Debbie Smith brought a sexual harassment hostile work environment claim pursuant to Title VII of the Civil Rights Act of 1994, 42 U.S.C. § 2000e, et seq., against Defendants Norwest Financial Wyoming, Inc., a Wyoming Corporation; Norwest Financial, Inc., an Iowa corporation; and Mr. Curtis Mangus, an individual (Defendants). The advisory jury returned a verdict for Plaintiff, and the district court entered a judgment for Plaintiff for $270,000 in compensatory damages for emotional distress and $89,000 in lost future fringe benefits, totaling $359,000. The district court then granted Defendants' Motion to Alter or Amend Judgment, reducing the compensatory damages award to $200,000, the statutory cap under 42 U.S.C. § 1981(a), and setting aside the advisory jury verdict for $89,000 in fringe benefits. The district court denied Defendants' Motion for Judgment as a Matter of Law, or in the Alternative, a New Trial, and their Motion for Remittitur, and awarded Plaintiff $93,507.31 in combined costs and attorney's fees pursuant to 42 U.S.C. § 2000e-5(k). Defendants appeal the denial of their post-trial motions and the district court's order for damages and attorney's fees and costs. Plaintiff cross-appeals the district court's denial of her Motion for Sanctions against Defendants' conduct at the pretrial settlement conference.

I.

This case arises out of the employment of Plaintiff by Norwest Financial Wyoming, Inc. and Norwest Financial, Inc. (Norwest) from February 1993 to January 1995. While at Norwest, Plaintiff worked as an accounts service representative under the supervision of Defendant Mr. Mangus. The Casper, Wyoming, office employed one part time female employee and only five full-time employees, namely Plaintiff, Mr. Mangus, and three other men. The employees shared a small open space without partitions or privacy. Plaintiff alleged that she was subjected to a hostile work environment based on offensive and sexually harassing comments made by Mr. Mangus during her employment. Plaintiff's claim rested primarily on six statements directed at her and frequently made within earshot of her co-workers. In October 1994, Plaintiff complained to her district manager about Mr. Mangus' harassing statements. Plaintiff resigned from Norwest in January 1995 and began work as a bookkeeper with a Casper furniture company. She filed this action after pursuing her claim with the Equal Employment Opportunity Commission.

II.

Defendants appeal the district court's denial of their Motion for Judgment as a Matter of Law on Plaintiff's hostile work environment claim. They argue that the statements made to Plaintiff over the course of her employment were neither sufficiently severe nor pervasive to create a hostile work environment. We review de novo the district court's legal conclusion that the conduct was sufficiently severe or pervasive to constitute a hostile work environment. Mason v. Oklahoma Turnpike Auth., 115 F.3d 1442, 1450 (10th Cir.), aff'd, 124 F.3d 217 (10th Cir.1997). Applying that standard, we must view the evidence most favorably to the nonmoving party and will reverse only "if 'there is no legally sufficient evidentiary basis ... with respect to a claim or defense ... under the controlling law.' " Id. (citing Harolds Stores, Inc. v. Dillard Dep't Stores, Inc., 82 F.3d 1533, 1546-47 (10th Cir.) (citations omitted), cert. denied, ___U.S.___, --- U.S. ----, 117 S.Ct. 297, 136 L.Ed.2d 216 (1996)).

Title VII prohibits an employer from discriminating against an employee on the basis of sex "with respect to [her] compensation, terms, conditions, or privileges of employment." 42 U.S.C. § 2000e-2(a)(1). This prohibition proscribes sexual harassment in the workplace. See Harrison v. Eddy Potash, Inc., 112 F.3d 1437, 1442 (10th Cir.1997), petition for cert. filed, 66 U.S.L.W. 3137 (U.S. Aug. 6, 1997) (No. 97-232); Hirschfeld v. New Mexico Corrections Dep't, 916 F.2d 572, 575 (10th Cir.1990). Hostile work environment harassment occurs when unwelcome sexual conduct " 'unreasonably interfer[es] with an individual's work performance or creat[es] an intimidating, hostile, or offensive working environment.' " Meritor Sav. Bank, FSB v. Vinson, 477 U.S. 57, 65, 106 S.Ct. 2399, 2404, 91 L.Ed.2d 49 (1986) (quoting 29 C.F.R. § 1604.11(a)(3)). Meritor states that "[f]or sexual harassment to be actionable, it must be sufficiently severe or pervasive 'to alter the conditions of [the victim's] employment and create an abusive working environment.' " Id. at 67, 106 S.Ct. at 2405 (citation omitted). The mere utterance of a statement which " 'engenders offensive feelings in an employee' would not affect the conditions of employment to [a] sufficiently significant degree to violate Title VII." Id. (quoting Rogers v. EEOC, 454 F.2d 234, 238 (5th Cir.1971), cert. denied, 406 U.S. 957, 92 S.Ct. 2058, 32 L.Ed.2d 343 (1972)).

Harris v. Forklift Systems, Inc., 510 U.S. 17, 114 S.Ct. 367, 126 L.Ed.2d 295

(1993), clarified the elements of a claim for gender discrimination resulting from a hostile work environment. The Supreme Court held that conduct within the purview of Title VII must be severe or pervasive enough to create both "an objectively hostile or abusive work environment--an environment that a reasonable person would find hostile"--and an environment the victim-employee subjectively perceives as abusive or hostile. Id. at 21-22, 114 S.Ct. at 370-71. We determine whether an environment is "hostile" or "abusive" by looking at the totality of circumstances, such as "the frequency of the discriminatory conduct; its severity; whether it is physically threatening or humiliating, or a mere offensive utterance; ... whether it unreasonably interferes with an employee's work performance"; and the context in which the conduct occurred. Id. at 23, 114 S.Ct. at 371. Additionally, the Court specifically noted that any relevant factor "may be taken into account, [but] no single factor is required." Id.

The Meritor test is a disjunctive one, requiring that the harassing conduct be sufficiently pervasive or sufficiently severe to alter the terms, conditions, or privileges of Plaintiff's employment. We address the severity of the harassing conduct in this case first. Plaintiff must demonstrate that the harassment is severe under both the subjective and objective requirements of Harris. See id. at 21-22, 114 S.Ct. at 370-71. First, Plaintiff must subjectively believe that Mr. Mangus' conduct was so severe that it created an abusive or hostile environment. We review for clear error the court's factual finding that this subjective test was met. Trotter v. Todd, 719 F.2d 346, 348 (10th Cir.1983).

Plaintiff testified that she felt humiliated and upset by the hostile nature of her supervisor's statements. Although her claim of constructive discharge did not proceed past the stage of summary judgment, Plaintiff presented evidence that she left her job at Norwest because she found the working environment hostile and was unhappy and uncomfortable in that environment. Further, contrary to Defendants' assertion, Plaintiff is not required to prove that her tangible productivity or work performance declined or that her ability to do her job was impaired by Mr. Mangus' behavior. See Harris, 510 U.S. at 23, 114 S.Ct. at 371 (stating that no single factor is required as long as the environment is hostile or abusive); Dey v. Colt Constr. & Dev. Co., 28 F.3d 1446, 1454-55 (7th Cir.1994); Davis v. Monsanto Chem. Co., 858 F.2d 345, 349 (6th Cir.1988), cert. denied, 490 U.S. 1110, 109 S.Ct. 3166, 104 L.Ed.2d 1028 (1989). It is sufficient that Plaintiff's testimony reflects that Mr. Mangus' comments were intolerable, publicly made, and caused humiliation and a loss of self-respect. In Plaintiff's mind, Mr. Mangus' conduct created a hostile work environment and altered the conditions or privileges of her employment. Our review of the record indicates that the district court did not err; the subjective component was established.

Second, the harassing conduct must be sufficiently severe that a reasonable person would find the work environment hostile or abusive. We review this objective test, a legal conclusion, de novo. E.E.O.C. v. Wiltel, Inc., 81 F.3d 1508, 1513 (10th Cir.1996). We conclude that the record evidence supports this element. Two of Plaintiff's male co-workers testified that Mr. Mangus' conduct was "sexually inappropriate," "offensive," and "intimidating." Appellants' App., Vol. I at 271; Vol. II at 414. One witness also testified that Mr. Mangus' conduct had an impact on the office, and that when Mr. Mangus would make one of his remarks, "[i]t was obvious in [Plaintiff's] work. Her numbers would drop off and that type of thing." Id., Vol. I at 258. This evidence supports the court's conclusion that a reasonable person would find the sexual harassment severe and the work environment therefore hostile or abusive.

Additionally, we can aggregate evidence of racial hostility with evidence of sexual hostility to establish a hostile work environment. See Hicks v. Gates Rubber Co., 833 F.2d 1406, 1416-17 (10th Cir.1987) [Hicks I ]. At least three...