Soto-LebrÓN v. Federal Express Corp.

Decision Date20 August 2008
Docket NumberNo. 06-2501.,No. 06-2519.,06-2501.,06-2519.
Citation538 F.3d 45
CourtU.S. Court of Appeals — First Circuit
PartiesLuis R. SOTO-LEBRÓN, Elizabeth Rosario Domenech, Conjugal Partnership Soto-Rosario, Plaintiffs, Appellees/Cross-Appellants, v. FEDERAL EXPRESS CORPORATION, Defendant, Appellant/Cross-Appellee.

Joseph D. Steinfield, with whom Laurie F. Rubin, Prince, Lobel, Glovsky & Tye, LLP, and Vilma Maria Dapena were on brief, for appellees.

Sandra C. Isom, with whom Carl Schuster, Mariela Rexach-Rexach, and Schuster Aguilo LLP were on brief, for appellants.

Before LIPEZ and HOWARD, Circuit Judges, and SMITH,* District Judge.

LIPEZ, Circuit Judge.

Plaintiffs Luis R. Soto-Lebron ("Soto") and his wife, Elizabeth Rosario Domenech ("Rosario"), sued Soto's former employer, Federal Express Corporation ("FedEx"), following Soto's termination by the company for a violation of company rules.1 The plaintiffs asserted emotional damages arising from libel, slander, and intentional infliction of emotional distress ("IIED").2 Soto also claimed statutory damages for wrongful termination pursuant to P.R. Laws Ann. tit. 29 §§ 185a-185m ("Act 80"). The jury returned a verdict in favor of the plaintiffs on all claims and awarded a total of $7,014,910.74 in damages. The district court then granted FedEx's motion for judgment as a matter of law on the slander claim and ordered a remittitur on the IIED and libel awards, reducing the total award to $4,014,910.74. FedEx appeals the sufficiency of the evidence to support the liability findings and the damage awards, except on the Act 80 claim. Soto cross-appeals the judgment as a matter of law on his slander claim.

As we shall explain more fully below, FedEx badly mishandled the termination of Soto. It conducted a sloppy investigation of his alleged misconduct before firing him. There are grounds for the indignation that the jury apparently felt about the performance of the company. Nevertheless, any such indignation cannot overwhelm the legal rules that courts must apply to the claims of liability and the award of damages in a case such as this. Therefore, after a careful review of the record, we have concluded that Soto did not introduce sufficient evidence to establish FedEx's liability for slander and IIED, and hence we must vacate those jury verdicts. There was sufficient evidence to support liability for libel, and hence we affirm the jury's liability finding on that claim. However, we have concluded that the admission of irrelevant evidence tainted the jury's damage calculation and that taint was not cured by the remittitur. Accordingly, we remand for a new trial on damages on the libel claim.

I.

Given the challenges to the sufficiency of the evidence, we recite the facts in the light most favorable to the jury verdict. Davignon v. Hodgson, 524 F.3d 91, 96 (1st Cir.2008).

On May 30, 2002, Soto, a fourteen-year employee of FedEx, shipped a package through FedEx to Kissimmee, Florida. Soto's wife, Rosario, a schoolteacher, had given it to him after packaging it in her classroom with fellow teacher Loyda Romero. Rosario asked Soto to send the box, which contained hair care products, to Iris Romero, Loyda's sister, in Florida. Soto shipped it using the FedEx employee discount policy, which permits employees and members of their immediate families to send packages at discounted rates.3

A. The Security Interview

When Soto arrived at work on June 6, 2002, he was told that security wanted to speak to him. He was taken to a conference room where Jose Pérez, a FedEx security specialist, was waiting for him.4 Pérez said: "Sit there. I am Jose Pérez from security." Throughout the interview Pérez remained seated, "leaning back on the chair." Pérez told Soto that he "had a problem." Pérez showed Soto the airway-bill for the package Soto had shipped to Florida and asked him if he recognized the bill. Soto said that he "had filled it out to send Iris Romero the package, the gift."

Pérez then told Soto that "there were problems with that package, that the package had been seized at the station where the package ended up." Soto asked what type of problem the package had, and Pérez responded that the package "had controlled substances, drugs" and that it "had been retained" by police. Soto told him "that is impossible." Pérez responded by stating that "they had evidence, that they had laboratory reports and police records that there were drugs there." Soto testified that Pérez "had some papers on top of the conference room table and during interrogation he pull[ed] out a document from the documents he had there that he said were evidence of the drugs and he said `I have a lab test' and throughout the interview would show the document like this. . . . [H]e waived [sic] the document to me and put it away." Pérez continued "asking [Soto] to tell the truth" and repeating that "they had evidence."

Pérez said he had been a police officer. He said that he had "left the police because he was not in agreement with the abuse of the police and to tell him the truth, that if [Soto] told him the truth, he would help [him]." Soto testified that Pérez's tone of voice and demeanor during the interview were "strong[,] . . . intimidating, with authority."

After "25 or 20 minutes" of interrogation by Pérez, Pedro Contreras, another FedEx security specialist, entered the conference room and Pérez left. Soto described Contreras as "more at ease, more peaceful than Pérez because Pérez was acting with authority." Soto explained that the substance of Contreras's questioning was the same as that of Pérez, but that Contreras's approach was "quieter" and "calmer." Soto continued to deny that drugs had been in the package. The questioning by Contreras lasted "about 20 minutes."

Then, Pérez and Rolando Medina, the station manager, came into the room, and Pérez said, "This guy has to be suspended because he sent drugs through the system." Medina left the room and returned with a letter of suspension, which Soto signed. The suspension letter indicated that an investigation would be conducted and advised Soto to contact his manager each morning. The letter also stated, "[Y]our [sic] are not to contact any FedEx location or customers without management approval." At the end of the interview, Soto also prepared and signed a statement indicating that he had shipped the package on behalf of Loyda Romero as a favor and that he did not know the contents of the package.

Following the security interview, Soto told the FedEx officials that he had to go back to his delivery truck to retrieve his belongings. Pérez said, "You can't do that. Just stop right there." Instead, Pérez and Contreras retrieved Soto's belongings. Then another FedEx employee escorted Soto outside to the security check point where he got into his personal vehicle. As Soto was being escorted outside, he passed by an area where he would be able to see clients or customers of FedEx. He reported seeing one person in that area. Medina told Soto as he was being escorted outside that he should "calm down, to be at ease, not do anything crazy."

Soto explained that after the interrogation he "was nervous, confused." He said: "I was shaking. I could not swallow. I was not well. I was like crazy. I was like I was crazy." When he left FedEx, he was scared. He explained, "I didn't know what I was going to do, where I was going to go and then thinking that I was going to be arrested because what I was told inside was that the package contained drugs." When he arrived home, he told his wife he had been suspended. He testified that "[s]he got hysterical. She started crying, yelling and I tried to be strong and to calm her down but I wasn't [able] to do so because we were both in the same condition."

B. FedEx Proceeds to Terminate Soto

Soon after Soto arrived home, he and Rosario called Iris Romero. Iris reported that she had received the package without incident. Soto and Rosario were relieved, concluding that there must have been a misunderstanding or a mistake. Soto immediately called Security Specialist Pérez to tell him that Iris had received the package. According to Soto's testimony, Pérez told him "that the package was at the Federal Express station. That there was a test made by Becton and Dickinson5 and that there was a police report."

Because he perceived that Pérez did not believe him, Soto then called Medina, the FedEx station manager, to explain the situation. He gave Medina the telephone number for Iris and asked him to call her, but Medina did not call. Medina repeated what Pérez had said: that a lab test had been conducted by Becton and Dickinson and that there was a police report. He told Soto that the police had the package.

Soto called in to FedEx every morning, as he had been instructed to do in his suspension letter. Each morning, he asked to speak to Medina and was instead transferred to Operations Manager Alberto Calero, Soto's immediate supervisor. Each morning, Calero responded that "they were dealing with the case." On June 11, Calero prepared and filed a report stating: "Investigation by Specialist Pérez revealed that on 5-30-02, Soto shipped [airwaybill number] for a friend of his wife, in violation of FedEx policy 7-35 [the employee reduced rate policy] as admitted by him during a taped recorded interview. Further investigation by the Orange County Sheriff Dept., Orlando, FL revealed that the package contained an undetermined amount of liquid cocaine. Soto was suspended and consequently terminated for the above violation."

On June 13, Soto was told to come into the station at three in the afternoon. Soto was brought into a conference room where Calero gave him a termination letter. Soto testified:

Calero signs my letter of dismissal, of termination and he hadn't done any investigation so I asked him, "Calero, why did you do this? You didn't do any investigation. Why are you doing this? What did you do with...

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