Smith v. Diffee Ford-Lincoln-Mercury, Inc.

• Decision Date: 29 July 2002
• Docket Number: No. 00-6363.,No. 00-6362.,00-6362.,00-6363.
• Citation: 298 F.3d 955
• Parties: Diantha SMITH Plaintiff-Appellee and Cross-Appellant, v. DIFFEE FORD-LINCOLN-MERCURY, INC., Defendant-Appellant and Cross-Appellee.
• Court: U.S. Court of Appeals — Tenth Circuit

298 F.3d 955

Diantha SMITH Plaintiff-Appellee and Cross-Appellant, v. DIFFEE FORD-LINCOLN-MERCURY, INC., Defendant-Appellant and Cross-Appellee.

No. 00-6362.

No. 00-6363.

United States Court of Appeals, Tenth Circuit.

July 29, 2002.

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Maurice G. Woods, II (Michael McAtee with him on the briefs), of McAtee & Woods, P.C., Oklahoma City, OK, for Defendant-Appellant and Cross-Appellee.

Mark Hammons of Hammons & Associates, Oklahoma City, OK, for Plaintiff-Appellee and Cross-Appellant.

Before BRISCOE, HOLLOWAY and McWILLIAMS, Circuit Judges.

HOLLOWAY, Circuit Judge.

I

Diantha Smith ("Smith") was employed by Diffee Ford-Lincoln-Mercury, Inc. ("Diffee") of El Reno, Oklahoma. Smith's job title was "booker" or "warranty clerk," and her position required that she figure and prepare all warranty, internal, and customer pay repair orders for payment. Smith was a senior employee and apparently did her job well in most respects.

Smith's supervisor, Warren Blackketter ("Blackketter"), became disappointed, however, that Smith had not been training several junior employees in how to perform the Ford warranty claims submission process. As early as 1993 or 1994, he had asked her to begin this training and, in December, 1996, after Smith's return from vacation, formally reprimanded her for not training the junior employees. No deadline seems to have been set for this training to be completed, which was to last only about two weeks, and no documentation was required. Smith agrees that she did not train them fully as requested, but indicates that it was not listed as an official duty and that she was not well-suited to teaching.

Smith was diagnosed with breast cancer on April 29, 1997 and required medical leave from April 30 through June of 1997 for treatment. She told Diffee on leaving that she would be able to return to work June 16, 1997, which was within 12 weeks as the Family and Medical Leave Act (FMLA) required. During Smith's absence, Diffee says it became apparent to Blackketter that Smith had not adequately trained a junior employee, Martha DeHart, to do her job and that the warranty claims submission process began to back up. Warranty work accounted for the majority of Diffee's revenues, and Diffee says it was losing money as a result of the backup. DeHart had been working at Diffee since January of that year. Both parties agree that Smith had partially but not fully trained DeHart, though they disagree as to the adequacy of the partial training. On June 3, 1997, Diffee terminated Smith.

The FMLA, 29 U.S.C. §§ 2601-2654, provides that eligible employees of certain employers have the right to take unpaid medical leave for a period of up to twelve work weeks in any twelve month period for a serious health condition as defined by the Act. It was established that Smith was an eligible employee, that Diffee was an employer covered by the Act, that Smith was on medical leave for treatment of a covered medical condition at the time of her dismissal, and that she would have been able to return to work before using her 12 weeks of leave had she not been terminated. Smith testified that she expected to work for Diffee until she retired.

II

Smith brought suit against Diffee under the FMLA, the Americans with Disabilities Act (ADA), and Title VII, though she abandoned her Title VII claim at trial. She requested back pay, prejudgment interest, and front pay, as well as liquidated damages (under the FMLA), punitive damages (under the ADA), costs, and attorney's fees.

The district court granted summary judgment for Diffee as to the ADA claim of failing to reasonably accommodate her disability. The jury found that Smith was entitled to $58,000 back pay from the date of termination to the trial, to which $4,785 in interest was added. Relying on 29 U.S.C. § 2617(a)(1)(A)(iii), and on the fact that the jury had necessarily rejected Diffee's defense that it would have discharged Smith regardless of her taking FMLA leave, the judge found that he was required to award $62,785 in liquidated damages (equal to the sum of back pay of $58,000 and interest in the amount of $4,785) and did so. As is explained below, such liquidated damages are in addition to the like amount of back pay and interest, effectively doubling the damages.

The judge, who determines front pay as an equitable issue, found the evidence persuasive that Diffee "was dissatisfied with [Smith's] job performance and would have discharged her within the next few months, even if she had not been absent for medical reasons," and declined to award front pay. III Aplt.App. 640. The court also awarded some but not all of the attorney's fees and costs Smith requested.

Both parties now appeal the denial of judgment as a matter of law in their favor on the FMLA claim. Diffee appeals the FMLA judgment based on the verdict, on the ground that the court improperly instructed the jury that Diffee bore the burden of proof on the FMLA claim. Diffee also appeals the award of liquidated damages. Smith appeals the district judge's grant of summary judgment for Diffee on the ADA claim, the judge's denial of FMLA front pay, and his refusal to award full costs and attorney's fees. We address each of these issues in turn.

III

A Judgment as a Matter of Law on the FMLA Claim

Diffee appeals the denial of its motion for judgment as a matter of law on Smith's FMLA claim. "We review de novo a district court's disposition of a motion for judgment as a matter of law, applying the same standard as the district court." Baty v. Willamette Indus., Inc., 172 F.3d 1232, 1241 (10th Cir.1999) (quotation marks and citation omitted).

Employees are authorized under 29 U.S.C. § 2617(a) to bring an action to recover damages for violations of § 2615. Courts have recognized two theories for recovery on FMLA claims under § 2615, the retaliation or discrimination theory and the entitlement or interference theory. The retaliation or discrimination theory arises from § 2615(a)(2), which provides that "[i]t shall be unlawful for any employer to discharge or in any other manner discriminate against any individual for opposing any practice made unlawful by this subchapter." The entitlement or interference theory arises from § 2615(a)(1): "[i]t shall be unlawful for any employer to interfere with, restrain, or deny the exercise of or the attempt to exercise, any right provided in this subchapter."

We have addressed claims brought under both § 2615(a)(1) and (2). Compare Morgan v. Hilti, 108 F.3d 1319, 1325 (10th Cir.1997) (affirming grant of summary judgment on FMLA retaliation/discrimination claim), with Renaud v. Wyoming Dep't of Family Servs., 203 F.3d 723, 732 (10th Cir.2000) (examining the sufficiency of evidence for a jury's determination that an employer did not interfere with its employee's entitlement to FMLA leave when he was fired while on leave), and Tate v. Farmland Indus., 268 F.3d 989, 997 (10th Cir.2001) (holding that an employee could maintain a cause of action where the employee had FMLA rights and the employer's actions were alleged to have interfered with those rights). We recently recognized the interference theory by name. McBride v. Citgo Petroleum Corp., 281 F.3d 1099, 1108 (10th Cir.2002) (characterizing claims in Renaud and Gunnell v. Utah Valley State College, 152 F.3d 1253 (10th Cir.1998), as brought under the interference theory).

The interference or entitlement theory is derived from the FMLA's creation of substantive rights. If an employer interferes with the FMLA-created right to medical leave or to reinstatement following the leave, a deprivation of this right is a violation regardless of the employer's intent. King v. Preferred Technical Group, 166 F.3d 887, 891 (7th Cir.1999). In such a case, "the employee must demonstrate by a preponderance of the evidence only entitlement to the disputed leave.... [T]he intent of the employer is immaterial." Id. However, we are also mindful that "[u]nder FMLA, an employee who requests leave or is on leave has no greater rights than an employee who remains at work." Gunnell, 152 F.3d at 1262 (citing 29 C.F.R. § 825.216(a)). We have further explained that "an employee who requests FMLA leave would have no greater protection against his or her employment being terminated for reasons not related to his or her FMLA request than he or she did before submitting the request." Id. (citing 29 C.F.R. § 825.216(a) and cases). Gunnell makes clear that an employee may be dismissed, preventing her from exercising her statutory right to FMLA leave — but only if the dismissal would have occurred regardless of the employee's request for or taking of FMLA leave. Id.

We have not explored the entire range of reasons for dismissal that would support recovery under the interference/entitlement theory. The fact that the interference/entitlement theory and the retaliation/discrimination theory are recognized as separate theories makes it evident, however, that retaliation is not the only impermissible reason for dismissal. A plaintiff can prevail under an entitlement theory if she was denied her substantive rights under the FMLA for a reason connected with her FMLA leave. Such a reason need not be retaliation. Smith's decision not to pursue her claim under the retaliation theory is thus not fatal to her case.

On the other hand, a reason for dismissal insufficiently related to FMLA leave will not support recovery under an interference theory. In McBride, we affirmed a grant of summary judgment to a defendant employer where an employee argued that the same illness that led to her taking FMLA leave also caused performance problems for which she was dismissed. McBride, 281 F.3d at 1108. We reasoned that the FMLA did not extend to employees such additional protections as a ban on dismissal for poor performance caused by illness or the right to demonstrate improved performance when not ill. Id. We considered the...