Duke v. Uniroyal Inc.

• Citation: 928 F.2d 1413
• Decision Date: 03 June 1991
• Docket Number: 89-1834,Nos. 89-1830,90-1750 and 90-1757,s. 89-1830
• Parties: 55 Fair Empl.Prac.Cas. 816, 56 Empl. Prac. Dec. P 40,676, 59 USLW 2663, 19 Fed.R.Serv.3d 259 Jesse T. DUKE; Sidney W. Fox, Plaintiffs-Appellees, v. UNIROYAL INCORPORATED; Uniroyal Chemical Company, Incorporated, Defendants-Appellants, and Norman R. Barden; Joseph R. Bishop, Defendants. (Two Cases) Sidney W. FOX, Plaintiff-Appellant, Jesse T. Duke, Plaintiff, v. UNIROYAL INCORPORATED; Uniroyal Chemical Company, Incorporated, Defendants-Appellees, and Norman R. Barden; Joseph R. Bishop, Defendants. Jesse T. DUKE; Sidney W. Fox, Plaintiffs-Appellants, v. UNIROYAL INCORPORATED; Uniroyal Chemical Company, Incorporated, Defendants-Appellees, and Norman R. Barden; Joseph R. Bishop, Defendants.
• Court: United States Courts of Appeals. United States Court of Appeals (4th Circuit)

Page 1413

928 F.2d 1413

55 Fair Empl.Prac.Cas. 816,

56 Empl. Prac. Dec. P 40,676, 59 USLW 2663,

19 Fed.R.Serv.3d 259

Jesse T. DUKE; Sidney W. Fox, Plaintiffs-Appellees, v. UNIROYAL INCORPORATED; Uniroyal Chemical Company, Incorporated, Defendants-Appellants, and Norman R. Barden; Joseph R. Bishop, Defendants. (Two Cases)

Sidney W. FOX, Plaintiff-Appellant, Jesse T. Duke, Plaintiff, v. UNIROYAL INCORPORATED; Uniroyal Chemical Company, Incorporated, Defendants-Appellees, and Norman R. Barden; Joseph R. Bishop, Defendants.

Jesse T. DUKE; Sidney W. Fox, Plaintiffs-Appellants, v. UNIROYAL INCORPORATED; Uniroyal Chemical Company, Incorporated, Defendants-Appellees, and Norman R. Barden; Joseph R. Bishop, Defendants.

Nos. 89-1830, 89-1834, 90-1750 and 90-1757.

United States Court of Appeals Fourth Circuit.

Argued Dec. 5, 1990.

Decided April 1, 1991.

As Amended June 3, 1991.

James Gunter Billings, Kimberly Jo Korando, Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan, Raleigh, N.C., for defendants-appellants.

Lynn Fontana, argued (Joyce L. Davis, Crisp, Davis, Schwenter, Page & Currin, Raleigh, N.C., on brief), for plaintiffs-appellees.

Before SPROUSE and NIEMEYER, Circuit Judges, and MICHAEL, District Judge for the Western District of Virginia, sitting by designation.

NIEMEYER, Circuit Judge:

Jesse T. Duke and Sidney W. Fox were discharged from employment with Uniroyal Chemical Company, Inc. on August 15, 1985, as part of a reduction in force. They filed suit, contending that age was a determining factor in the decision to terminate them and that Uniroyal violated the Age Discrimination in Employment Act (ADEA), 29 U.S.C. Secs. 621-634 (1988). Following a two and one-half week jury trial, the jury returned a verdict and found in favor of Duke in the amount of $181,115 for loss of back pay and $387,216 for loss of future income, often referred to as "front pay." The jury also found in favor of Fox in the amount of $18,480 for back pay and $38,055 for front pay. Finally, the jury found that the violations were not willful and no liquidated damages were awarded. See 29 U.S.C. Sec. 626(b). Following the verdict, the district judge denied Fox's motion for reinstatement and entered an award of attorneys' fees and costs in the amount of $298,130.81. 743 F.Supp. 1218.

Uniroyal charges error in virtually every aspect of trial. The numerous issues that it briefed on appeal may be grouped within the following more generalized contentions: (1) the jury verdict was unsupported by substantial evidence of age discrimination; (2) various rulings of the district court on the evidence were improper; (3) the district court abused its discretion in refusing to sever plaintiffs' claims for trial; (4) the instructions to the jury failed to accommodate adequately the particular facts in evidence; (5) front pay should not have been submitted to the jury; and (6) the district court abused its discretion in its award of attorneys' fees. Fox filed a cross appeal, contending that he was improperly denied reinstatement.

For the reasons that follow, we reject all challenges to the fairness of the jury trial and affirm the verdict of the jury except insofar as it awards front pay. We vacate the awards of front pay and the order denying reinstatement, with instructions to the district court to conduct an equity trial to determine what, if any, equitable relief is appropriate. We affirm the award of attorneys' fees.

I

Duke and Fox were employed with the Crop Protection Division of Uniroyal, Duke as a sales representative of Agri Chemicals in Region 13, and Fox as a sales development representative in Region 13/16. Both were terminated on August 15, 1985, as part of a reduction in force. At the time Duke was 51, having worked with Uniroyal for 16 years, and Fox was 50, having worked for 17 years. At about the same time when Duke and Fox were terminated, Joseph Bishop, 54, was also terminated and Norman R. Barden, 59, elected to take early retirement under a company sponsored program. Although both Bishop and Barden were also plaintiffs in the case below, their claims have since been settled.

Duke, Barden and Bishop were the oldest and longest tenured sales representatives in Region 13, and Fox, who was the only development representative to be terminated, was the oldest and longest tenured development representative in Region 13/16. Six months after Fox was terminated, Uniroyal retained him as an independent consultant, a position that he retained as of trial.

In early 1985, Uniroyal, Inc. was the subject of a hostile takeover attempt that threatened its chemical business. This prompted a leveraged buy out (the LBO) which resulted in the formation of Uniroyal Chemical Company, Inc. The LBO and weakening market conditions caused Uniroyal to restructure and reduce its work force. In selecting those to be terminated, Uniroyal applied employee performance criteria, focusing on the employee's ability to assume greater technical responsibility, demonstrated initiative in increasing sales of small volume products, and past performance ratings. Uniroyal contends that its particular decision to terminate Duke was based on the fact that Duke's territory was eliminated and his customers were assigned to other territories. He was not reassigned because of his performance against the stated criteria. Similarly, Uniroyal claims that Fox was selected for termination because of his weakness in knowledge of herbicides and pesticides, which Uniroyal had decided to promote, and his inability to promote them.

At trial plaintiffs contended that the articulated reasons given by Uniroyal for their terminations were a pretext for age discrimination. They attempted to prove their case by indirect evidence under the procedure established for Title VII cases in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973). It is unclear whether Uniroyal challenges the sufficiency of plaintiffs' evidence in establishing a prima facie case, but it adamantly contends that no evidence was presented to prove that its articulated reasons were a pretext. It urges that we reverse the district court's denial of its motion for a directed verdict and motion for judgment notwithstanding the verdict.

When determining whether the evidence is sufficient to support the jury's verdict, the evidence must be reviewed in the light most favorable to plaintiffs, giving them the benefit of all inferences. If, with that evidence, a reasonable jury could return a verdict in favor of plaintiffs, the court must defer to the judgment of the jury, even if the court's judgment on the evidence differs. See Herold v. Hajoca Corp., 864 F.2d 317, 319 (4th Cir.1988), cert. denied, 490 U.S. 1107, 109 S.Ct. 3159, 104 L.Ed.2d 1022 (1989); Gill v. Rollins Protective Services Co., 773 F.2d 592, 594 (4th Cir.1985).

In the context of the ADEA, a plaintiff must prove, with reasonable probability, that but for the age of the plaintiff, the employment decision adverse to the plaintiff would not have been made. Age must have been a determining factor. See Lovelace v. Sherwin-Williams Co., 681 F.2d 230, 239 (4th Cir.1982). That burden may be satisfied, as with any other case, by direct or circumstantial evidence.

Under the method of proof by circumstantial evidence established by McDonnell Douglas, when the plaintiff proves a prima facie case of age discrimination, the burden of going forward shifts to the defendant. If the defendant articulates a legitimate nondiscriminatory reason for the employment action, the plaintiff must then prove that the reason given was a mere pretext for discrimination and that age was a more likely reason for the employment action. Hajoca, 864 F.2d at 319; EEOC v. Western Elec. Co., 713 F.2d 1011, 1014 (4th Cir.1983).

In Hajoca and Western Electric, we adapted the elements for establishing a prima facie case to a reduction-in-force case brought under the ADEA and stated that the plaintiff must show:

(1) [T]hat he is in the protected age group, (2) that he was discharged, (3) that at the time of the discharge, he was performing his job at a level that met his employer's legitimate expectations, and (4) that persons outside the protected age class were retained in the same position or that there was some other evidence that the employer did not treat age neutrally in deciding to dismiss the plaintiff.

Hajoca, 864 F.2d at 319 (citing Western Elec., 713 F.2d at 1014-15).

That precise formulation, however, need not be rigidly applied, and differing factual circumstances may require adaptation. The first two elements--that a person was in the protected class and suffered an adverse employment action as a result of the reduction in force--are basic to every ADEA case. The third element, that the employee was performing to his employer's reasonable expectations, however, is an element that may often become irrelevant. When a reduction in force occurs, the terminated employees may well be performing to expectation, and the discharge of a specified group is driven by economic reasons. In selecting those employees who are to be discharged, employers have applied criteria unrelated to performance, such as by seniority or by department or division, or in response to future expected needs of the company, or by combinations of them. When the selection process is based on performance, the criterion is more a question of relevant performance than one of not meeting employer expectations.

The fourth element outlined in Hajoca, that persons not protected by the ADEA were retained or that there was evidence that the employer did not treat age neutrally, often proves difficult to apply. A reduction in force decision may result not only in the elimination of personnel, but also in the elimination of positions by the consolidation of functions, departments and territories. Moreover, such restructuring often causes employee transfers, in lieu of terminations. In...