Caudle v. Bristow Optical Co.

CourtUnited States Courts of Appeals. United States Court of Appeals (9th Circuit)
Citation224 F.3d 1014
Docket NumberNos. 98-15760,No. 98-15537,98-15676,98-15760,98-15537,s. 98-15760
Parties(9th Cir. 2000) REBECCA ANN CAUDLE, a single woman, Plaintiff-Appellant/Cross-Appellee, v. BRISTOW OPTICAL COMPANY, INC., an Arizona corporation, Defendant-Appellee/Cross-Appellant. REBECCA ANN CAUDLE, a single woman, Plaintiff-Appellant, v. BRISTOW OPTICAL COMPANY, INC., an Arizona corporation; JANICE MILETICH, a single woman, Defendants-Appellees
Decision Date06 December 1999

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[Copyrighted Material Omitted] COUNSEL: John Gabroy (argued), Richard A. Brown, Gabroy, Rollman & Bosse, P.C., Tucson, Arizona, for the plaintiff-appellant.

David A. Selden (argued), John K. Ausdemore, Quarles & Brady, Phoenix, Arizona, for the defendant-appellee.

Appeals from the United States District Court for the District of Arizona William D. Browning, District Judge, Presiding D.C. No. CV-95-00421-WDB

Before: Diarmuid F. O'Scannlain, Susan P. Graber,* and William A. Fletcher, Circuit Judges.

OPINION

O'SCANNLAIN, Circuit Judge:

In this pregnancy discrimination case, we must consider various issues raised under federal employment antidiscrimination law and state contract and tort law.

I

Rebecca Ann Caudle sued her erstwhile employer, Bristow Optical Company, Inc. ("Bristow"), and her supervisor, Janice Miletich, after Bristow terminated Caudle's employment in the eighth month of her pregnancy. Caudle had joined Bristow as a salesperson on April 22, 1993; she was unmarried at the time. In August 1994, she realized that she was pregnant. On August 25, Caudle informed Miletich about her pregnancy and indicated that she intended to stay on the job.

Caudle and Miletich had experienced some tension before Caudle reported her pregnancy. According to Caudle, qualitycontrol problems in one of Bristow's laboratories had rendered her job extraordinarily difficult from the outset, and she discussed the difficulties with Miletich "very frequently." By November of 1994, the relationship between Caudle and Miletich had worsened. Miletich accused Caudle of lying about the situation underlying Bristow's quality-control problems. In December of 1994, citing Caudle's underperformance in increasing sales, Miletich suspended Caudle's base salary, thereby reducing Caudle's compensation to a commission. Miletich ultimately terminated Caudle's employment with Bristow on March 8, 1995, when Caudle was eight months pregnant.

After giving birth to her child in April 1995, Caudle began seeking substitute employment without success. In September of 1995, Caudle and her fiance "tentatively decided that it would be in the best interests of [their child ] for [Caudle] to stay at home with him for a certain period of time."

Meanwhile, Caudle had filed the complaint giving rise to this appeal in state court. In addition to claims not relevant here, Caudle asserted causes of action against Miletich for improper interference with contractual relations and against both Miletich and Bristow for pregnancy discrimination in violation of Title VII of the Civil Rights Act of 1964 ("Title VII"), 42 U.S.C. S 2000e(k), and wrongful termination under Arizona law. Bristow removed the case to federal district court, where the parties made cross-motions for summary judgment. Because it was undisputed that Caudle voluntarily left the workforce in September 1995, the court granted defendants' motion for summary judgment on Caudle's failure to mitigate damages after that date. Shortly before the trial on Caudle's surviving claims was to begin, the court winnowed the case further by granting Miletich's motion for a "directed verdict"1 on Caudle's claim of tortious interference with contractual relations. Caudle's remaining claims of pregnancy discrimination under federal law and wrongful termination under Arizona law went to a jury, which returned verdicts for Caudle in the amount of $15,000 compensatory damages on her state law claim and in the amounts of $10,000 back pay and $55,000 punitive damages on her federal claim.

Bristow and Miletich moved the court for a new trial or judgment as a matter of law and to set aside the jury's punitive damages award. The court denied the defendants' motions but did limit punitive damages to $50,000 in order to bring them under the cap on total damages for employers with fewer than 101 employees pursuant to 42 U.S.C. S 1981a(b) (3)(A). In doing so, the court denied Caudle's motion to treat Bristow and Heard Optical Co. ("Heard"), Bristow's corporate affiliate, as a "single employer" for the purpose of raising the applicable cap on damages. The court also held that the $10,000 award under Title VII and the $15,000 award on the state wrongful termination claim were redundant and, therefore, reduced the award on the state claim to $5,000, the amount by which it exceeded the jury's back pay award on the federal claim.

At the conclusion of the proceedings on the merits, Caudle, Bristow, and Miletich filed for attorneys' fees. The court concluded that Caudle was the prevailing party and that all of her claims were related and awarded her $20,000 of the approximately $76,000 that she requested. The court denied Bristow's and Miletich's motions for attorneys' fees.

Caudle and Bristow timely filed their respective appeal and cross-appeal.

II

We first consider Caudle's appeal of those claims upon which she did not prevail. The district court's judgment for Caudle on her Title VII claim included a $10,000 award of back pay for the period extending from March 1995, when her employment at Bristow was terminated, to September 1995, when she elected to stay at home with her child for a period that she originally anticipated would last approximately three years. The district court did not, however, permit Caudle to offer evidence to the jury on damages that she allegedly incurred after September 1995, because her voluntary withdrawal from the workforce at that time undisputedly dispelled any reasonable expectation of continuing employment with Bristow (and would have done so even if she had never been terminated) and also constituted a failure to mitigate damages. Caudle appeals the court's ruling on this score. She argues that she should have been permitted to prove and to recover the amount by which the income that she would have received as a Bristow employee exceeded her actual income for the period after she re-entered the workforce in 1997.

A

Title VII of the Civil Rights Act of 1964 permits courts to grant equitable remedies to employees who have been impermissibly discriminated against by employers with fifteen or more employees. See 42 U.S.C. S 2000e-5(g) (1994). The relevant remedies include reinstatement and awards of back pay and front pay. An award of back pay is appropriate to advance "Congress' intent to make `persons whole for injuries suffered through past discrimination.' " Loeffler v. Frank, 486 U.S. 549, 558 (1988) (quoting Albemarle Paper Co. v. Moody, 422 U.S. 405, 421 (1975)). Indeed, there is a presumption in favor of back pay awards. See Albemarle Paper, 422 U.S. at 421. "Front pay is the term used to describe damages paid as [prospective] compensation for training or relocating to another position. An award of front pay is made in lieu of reinstatement when the antagonism between employer and employee is so great that reinstatement is not appropriate." Fadhl v. City and County of San Francisco, 741 F.2d 1163, 1167 (9th Cir. 1984), overruled on other grounds by Price Waterhouse v. Hopkins, 490 U.S. 228 (1989); see also Thorne v. City of El Segundo, 802 F.2d 1131, 1137 (9th Cir. 1986). In relation to front pay, "reinstatement, when it is feasible, is the `preferred remedy' in a discrimination suit." Gotthardt v. National R.R. Passenger Corp., 191 F.3d 1148, 1156 (9th Cir. 1999).

Section 2000e-5 imposes upon plaintiffs seeking back pay a duty to mitigate damages by seeking alternative employment with "reasonable diligence." See 42 U.S.C. S 2000e-5(g)(1) (1994). The same requirement has been used to constrain awards of front pay. See Gotthardt , 191 F.3d at 1157 ("A court awarding front pay should consider a plaintiff's ability to mitigate her damages by finding other employment in the future . . . . `Because of the potential for windfall, [front pay's] use must be tempered.' " (quoting Duke v. Uniroyal, Inc., 928 F.2d 1413, 1424 (4th Cir. 1991)).

B

The district court ruled that Caudle's withdrawal from the workforce in September 1995 barred her recovery under Title VII as of that date because the withdrawal was voluntary. The court apparently found Caudle's decision to withdraw from the workforce not only uncompelled by her situation but also unaffected by the defendant's discriminatory behavior. In holding that the voluntariness of Caudle's withdrawal precluded her recovery for lost pay during the ensuing period, the district court correctly focused on the general objective underlying Title VII remedies and the plaintiff's duty to mitigate damages generally: ensuring that the plaintiff is made whole. See Albemarle Paper, 422 U.S. at 421.

Caudle never alleged (and there is no reason otherwise to believe) that her decision to withdraw from the workforce in September 1995 was in any way affected by Bristow's discriminatory termination of her employment.2 She therefore failed to show that her diminished income after that date was not "voluntary" and was thus an injury for which she would need to be "made whole" by Bristow. Absent any injury, an award of back pay or front pay is plainly unwarranted under 42 U.S.C. S 2000e-5(g)(1). See Ford Motor Co. v. EEOC, 458 U.S. 219, 230 (1982) (noting that the purpose of equitable relief under Title VII is " `to make the victims of unlawful discrimination whole' by restoring them, `so far as possible . ....

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