Equal Emp't Opportunity Comm'n v. Autozone, Inc.

• Decision Date: 02 May 2013
• Docket Number: No. 12–1017.,12–1017.
• Citation: 707 F.3d 824
• Parties: EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff–Appellee, v. AUTOZONE, INCORPORATED, Defendant–Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

707 F.3d 824

EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff–Appellee,

v.AUTOZONE, INCORPORATED, Defendant–Appellant.

No. 12–1017.

United States Court of Appeals,

Seventh Circuit.

Argued Sept. 13, 2012.

Decided Feb. 15, 2013.

Rehearing En Banc Denied May 2, 2013.

Eric A. Harrington (argued), Attorney, Equal Employment Opportunity Commission, Washington, DC, Justin Mulaire, Attorney, Equal Employment Opportunity Commission, Chicago, IL, for Plaintiff–Appellee.

Garrett L. Boehm, Jr. (argued), Joseph F. Spitzzeri, Attorneys, Johnson & Bell, Ltd., Chicago, IL, for Defendant–Appellant.

Before MANION, SYKES, and HAMILTON, Circuit Judges.

MANION, Circuit Judge.

The Equal Employment Opportunity Commission filed this employment discrimination case on behalf of John Shepherd, a former employee of AutoZone, and alleged that AutoZone had violated the Americans with Disabilities Act. Shepherd had a back injury that was aggravated by mopping floors, and he claimed that AutoZone required him to mop the store floors despite his requests for relief. Among other claims, the EEOC alleged that AutoZone had failed to accommodate Shepherd's disability. The magistrate judge hearing this case initially ruled for AutoZone on summary judgment on this accommodation claim, but we reversed that ruling on appeal. On remand, a jury returned a verdict in Shepherd's favor. The magistrate judge then approved $100,000 in compensatory damages, $200,000 in punitive damages, $115,000 in back pay, an injunction on AutoZone's anti-discrimination practices, and the EEOC's motion to vacate a prior award of costs to AutoZone from the first trial. AutoZone appeals the verdict and remedies. We affirm on all issues except for a provision in the injunction, which we remand for further proceedings.

I. Facts

Shepherd started working for AutoZone, Inc. (“AutoZone”) in 1998. He initially worked as a sales clerk—a non-supervisory position—but was promoted to parts sales manager a year later. Shepherd's store manager called him a good salesman who could “sell ice cubes to an Eskimo,” and noted that customers would specifically ask for Shepherd's assistance. As a result, Shepherd averaged the highest sales per customer among the employees at his store in 2003. Although Shepherd received several reprimands at work, he won the AutoZone Extra Miler award, which AutoZone characterized as a “prestigious honor,” and AutoZone even asked Shepherd to train new employees.

But Shepherd suffered from a chronic back injury. In 1996, Shepherd had been permanently injured while working for a different employer, and he sought help from his neurologist, Dr. Marc Katchen. Dr. Katchen determined that Shepherd had impairments to his trapezius and rhomboid muscles of the upper-left side of his back, a degenerative-disc disease of the cervical vertebrae, and a herniated disc of the cervical vertebrae. As a result, Shepherd could rotate his torso, but repetitive twisting aggravated his condition and caused “flare-ups,” which brought on severe pain in his neck and back.

About 80% of Shepherd's work at AutoZone was devoted to sales and customer service, and these activities did not affect his health. However, soon after starting work at AutoZone, Shepherd began to experience severe flare-ups that caused his back and neck to swell, and would cause pain with the slightest of movements. He had to use hot baths, ice, and a TENS (Transcutaneous Electrical Nerve Stimulation) unit that sent electrical currents through his skin to control the pain. Dr. Katchen determined that these flare-ups were caused by the repetitive motions involved in mopping AutoZone's floors, which was one of Shepherd's job requirements.

Shepherd asked his store manager, Larry Gray, if he could be released from mopping, and Gray informally allowed Shepherd to perform other tasks instead. But when the district manager, Steven Smith, found out that Shepherd was no longer mopping the floors, he directed Gray to have Shepherd resume mopping. Gray complied.

After Shepherd transferred to another AutoZone store in Smith's district, he again sought to avoid mopping the floors. The store manager, Terry Wilmot, was willing to accommodate Shepherd's back injury, but when one of Shepherd's coworkers complained about Shepherd's special treatment, Smith again insisted that Shepherd should mop the floors. Although Wilmot allowed Shepherd to avoid mopping duties when Smith was not around, Smith demoted Wilmot in July 2002, and replaced him with a new store manager, Steven Thompson.

The testimony at trial revealed two distinct versions of Shepherd's job requirements while he worked for Thompson. Thompson and Smith testified that they were willing to accommodate Shepherd's condition. They stated that whenever Shepherd was scheduled to mop the floors, he was allowed to delegate the mopping task to other AutoZone employees because he was a parts sales manager. Shepherd, however, testified that Thompson and Smith still required him to mop the floors. He stated that he had sent a myriad of health and medical forms—some produced in conjunction with Dr. Katchen—to AutoZone officials, but he never received an accommodation.

In March 2003, Shepherd took a medical leave of absence because his mopping duties had caused his condition to worsen. He returned to work in April, and although Thompson and Smith testified that Shepherd had been free to delegate his mopping duties, Shepherd testified that he was still compelled to mop the floors. As a result, he suffered from flare-ups four or five times a week and was unable to perform basic tasks of his daily routine. Shepherd's wife, Susan, had to help Shepherd get dressed, wash his body, and engage in other activities around the house. Shepherd began to suffer from depression and Dr. Katchen prescribed an antidepressant.

Shepherd continued to seek an accommodation that would allow him to stop mopping the floors. Shepherd contacted a number of corporate officials at AutoZone and was quite insistent that he needed an accommodation. Among other corporate officials, Shepherd frequently contacted Jackie Moore, the lead disability coordinator who worked at AutoZone's corporate benefits department in Memphis, Tennessee.

On September 12, 2003, Shepherd was wringing out a mop when he felt a sharp pain. He tried to continue his work, but the pain persisted, and he suffered a disabling flare-up that left him unable to return to work for the rest of the year. Three days after this flare-up, Smith sent Shepherd a written letter that relieved Shepherd of his mopping duties because of his back condition. Over the next few months, Shepherd received extensive treatments from Dr. Katchen, including heat treatment, physical therapy, medications, deep tissue massage, ultrasound, antidepressants, and sleep inducers. When Shepherd tried to return to work in January 2004, he learned that AutoZone would not allow him to return. Instead, AutoZone kept Shepherd on involuntary medical leave until February 2005, when it terminated his employment with AutoZone.

Throughout this process, Shepherd had filed multiple charges of discrimination with the Equal Employment Opportunity Commission (“EEOC”), and in June 2007, the EEOC brought an action against AutoZone under the Americans with Disabilities Act (“ADA”). The EEOC's complaint alleged that AutoZone had failed to accommodate Shepherd's disability during his employment from March to September 2003. Additionally, it alleged that AutoZone had retaliated against Shepherd and had failed to accommodate his disability when it refused to allow Shepherd to returnto work in January 2004 and later terminated his employment. The EEOC and AutoZone agreed to submit to the jurisdiction of a magistrate judge, and AutoZone moved for summary judgment on all claims.

The magistrate judge granted summary judgment for AutoZone on the March to September 2003 accommodation claim, but allowed the involuntary-leave and termination claims to go to trial. A jury found that Shepherd had not been qualified to perform his job in January 2004 and therefore ruled in AutoZone's favor on these claims. The EEOC appealed the magistrate judge's grant of summary judgment on the accommodation claim, but not the jury's verdict. On appeal, we reversed the magistrate judge's grant of summary judgment and remanded for further proceedings. EEOC v. AutoZone, Inc., 630 F.3d 635, 644–45 (7th Cir.2010).

In preparation for the second trial, AutoZone moved to exclude Dr. Katchen's testimony because he had not produced a written report, but the magistrate judge denied this motion. The magistrate judge then presided over a jury trial on the accommodation claim, and the jury returned a verdict in favor of the EEOC. The jury ruled that Shepherd had been qualified to perform his job between March and September 2003, and awarded $115,000 in back pay, $100,000 in compensatory damages, and $500,000 in punitive damages. After trial, the magistrate judge remitted the punitive damages to $200,000 to bring the compensatory and punitive damages within the ADA's $300,000 statutory cap. The magistrate judge also granted a motion from the EEOC to impose an injunction on AutoZone and granted a motion from the EEOC to vacate an award of costs to AutoZone from the first trial.

II. Discussion

AutoZone appeals the magistrate judge's decision on three grounds. First, AutoZone argues that the first trial precluded the second jury from reaching its verdict against AutoZone. Second, if we find that the second jury was not precluded from reaching its verdict, AutoZone argues for a new trial because it contends that the EEOC had Dr. Katchen testify without submitting a written report. Third, if we uphold the verdict of the second trial, AutoZone argues that we should alter the remedies resulting from it. Specifically, AutoZone challenges the compensatory damages, the punitive damages, the injunction, and the award of costs. We address...