Gomez v. Great Lakes Steel Div., Nat. Steel Corp.

• Decision Date: 10 October 1986
• Docket Number: Nos. 84-1651,84-1827 and 84-1853,s. 84-1651
• Citation: 803 F.2d 250
• Parties: 41 Fair Empl.Prac.Cas. 1864, 41 Empl. Prac. Dec. P 36,620, 55 USLW 2287, 21 Fed. R. Evid. Serv. 1227 Octavio P. GOMEZ, Plaintiff-Appellee (84-1651/1827) Cross-Appellant (84-1853), v. GREAT LAKES STEEL DIVISION NATIONAL STEEL CORPORATION, Defendant-Appellant (84- 1651/1827) Cross-Appellee (84-1853).
• Court: U.S. Court of Appeals — Sixth Circuit

Page 250

803 F.2d 250

41 Fair Empl.Prac.Cas. 1864,

41 Empl. Prac. Dec. P 36,620, 55 USLW 2287,

21 Fed. R. Evid. Serv. 1227

Octavio P. GOMEZ, Plaintiff-Appellee (84-1651/1827) Cross-Appellant (84-1853), v. GREAT LAKES STEEL DIVISION NATIONAL STEEL CORPORATION Defendant-Appellant (84- 1651/1827) Cross-Appellee (84-1853).

Nos. 84-1651, 84-1827 and 84-1853.

United States Court of Appeals Sixth Circuit.

Argued March 7, 1986.

Decided Oct. 10, 1986.

D. James Barton, Grosse Ile, Mich., Carl Hellerstedt (argued), for defendant-appellant cross-appellee.

Mayer Morganroth (argued), Southfield, Mich., Daniel J. Wright, Detroit, Mich., for plaintiff-appellee cross-appellant.

Before MERRITT and WELLFORD, Circuit Judges, and PECK, Senior Circuit Judge.

JOHN W. PECK, Senior Circuit Judge.

Defendant Great Lakes Steel Division, National Steel Corporation ("Great Lakes") appeals from the final judgment entered October 30, 1984, by the district court on a jury verdict in favor of plaintiff Octavio Gomez, and Gomez appeals from an order of remittitur. Gomez alleged that Great Lakes discriminated against him because of his Mexican-American heritage by failing to promote him, designating him for layoff, and constructively discharging him in violation of 42 U.S.C. Sec. 1981 and the Michigan Elliott-Larsen Civil Rights Act, Mich.Comp.Laws Sec. 37.2101 et seq. For reasons stated herein, we vacate the judgment of the district court and remand this case for a new trial.

I.

In 1948 Great Lakes, a steel production facility, hired Gomez as an hourly employee in its open hearth and mold yards. In 1958 Gomez received a promotion to turn foreman in the No. 2 basic oxygen process (BOP) mold yard. "Turn foreman" is a first level management position which involves supervision of hourly employees who work rotating work shifts or turns. At trial Gomez testified that he thought Great Lakes also promoted him in December 1977 to general mold yard foreman for No. 2 BOP. Gomez believed that the job was a promotion, because it was not represented as temporary and because it was a vacancy created by the transfer of the general mold yard foreman to another area. However, Gomez alleged that he learned he was mistaken two months later when the assistant superintendent, Mr. Spuwell, said, "Good morning. How is my acting general mold yard foreman doing?" Gomez testified that he replied, "What do you mean 'acting'? Isn't this a permanent job?" Spuwell allegedly said, "No, not yet," and Adams, the supervisor, later said that Great Lakes was not sure what it was going to do with the job.

Gomez continued in this position until June 1980 when Mr. Wessells informed Gomez that he was being returned to turn foreman as part of a personnel reassignment necessitated by the closing of No. 1 BOP. Ron Crosby, the caucasian general mold yard foreman from No. 1 BOP, replaced Gomez. Gomez testified that he had tried previously to "bump" from No. 2 BOP to No. 1 BOP, but that he was told it was not allowed. Gomez testified that when he asked Wessells why Crosby was permitted to "bump" when he was not, Wessells replied, "Well, that's the way it is." Gomez also testified that he believed his replacement by Crosby was discriminatory because Crosby had fewer years of service with Great Lakes and Crosby's 1979 performance appraisal was no better than that given Gomez.

On August 19, 1980, Crosby, who was Gomez's supervisor by virtue of the reassignment, told Gomez that it was his turn to be laid off as part of a rotational layoff due to economic conditions. When Gomez protested that men with less seniority than he were not laid off, Crosby responded that the company did not recognize supervisory seniority. Gomez testified that it suddenly came to him that he was a victim of discrimination. As a result, Gomez chose that same day to take early retirement to be effective August 21, 1980, and filed this action on July 6, 1981.

Gomez also presented evidence at trial that over the entire course of his career he was invited to attend only two one-hour training classes given by Great Lakes whereas other similarly situated employees were selected to attend many more classes. Gomez testified that supervisors never adequately answered his questions about not being selected for the classes which were unposted and by invitation only. Similarly, Gomez alleged that beginning in 1960 he started asking various supervisors for promotions and why he was not promoted. Gomez testified that over the years supervisors only generally answered that they were glad he was interested and that they would get back to him, but never did. Gomez identified four positions in particular for which he believed he was qualified: three openings that occurred in the mid-1960's for assistant general foreman and general foreman, which were filled by caucasians, and in 1977 a general foreman position in the continuous caster division which was filled by a caucasian employee, John Deuve. It was Deuve's transfer to this job which created the vacancy for No. 2 BOP general foreman which Gomez filled on an acting basis until replaced by Crosby in 1980.

Great Lakes conceded that it lacked objective guidelines or policies for determining promotions, job assignments, and training class assignments. However, it denied that its actions toward Gomez were motivated by discrimination. With regard to promotions Great Lakes presented testimony that length of service was not a significant factor, that many caucasian hourly employees with more years of service than Gomez were never promoted, and that many caucasian turn foremen were not promoted further. As to the layoff Great Lakes presented evidence that ten caucasian turn foremen had been placed on layoff before Gomez and that length of service was not a relevant factor in designating layoffs. Great Lakes further explained that it had designated Gomez as "acting" general foreman instead of promoting him to general foreman because activity at No. 2 BOP had decreased due to newer caster processes, No. 2 BOP was being phased out, and because Crosby retained responsibility for overall planning and purchases for both No. 1 and 2 BOP. Great Lakes presented testimony that Gomez should have known at the onset that the position was not a promotion because the job was not affirmatively represented as a promotion and Gomez did not receive a pay increase. Finally, with regard to the training courses Great Lakes introduced testimony that many courses were not available until 1979 when it established a training department and that some courses were designed for new supervisors, not experienced supervisors like Gomez.

Great Lakes moved for a directed verdict with regard to the claims of discrimination which occurred prior to July 6, 1978, on the basis that the applicable three-year statute of limitations barred them. The district court denied the motion finding that there was sufficient evidence to permit the jury to consider whether Great Lakes fraudulently concealed Gomez's cause of action which under Mich.Comp.Laws Sec. 600.5855 would toll the statute of limitations.

The jury awarded Gomez $300,000.00 in economic loss, $500,000.00 in compensatory damages for mental anguish, and $1,500,000.00 in punitive damages plus prejudgment interest of $963,000.00 for a total of $3,263,000.00. In awarding damages which covered virtually Gomez's entire career the jury clearly found fraudulent concealment and did not limit its consideration to events occurring after July 6, 1978. Great Lakes moved for judgment notwithstanding the verdict alleging that insufficient evidence existed from which the jury could have found fraudulent concealment. Great Lakes also moved for a new trial or remittitur on the basis that the damages awarded were excessive and the result of prejudice. The district court denied the motion for judgment NOV, but granted remittitur to the extent of reducing compensatory damages to $150,000.00, reducing punitive damages to $300,000.00, and reducing the amount of prejudgment interest included in the award.

On appeal Great Lakes claims that the evidence was insufficient to support either the verdict of discrimination or the findings of fraudulent concealment and constructive discharge. Great Lakes also asserts that admission of Gomez's economic damage exhibit constituted reversible error, and that the punitive and compensatory damages were excessive and unsupported by substantial evidence. Gomez cross-appeals, arguing that the district court abused its discretion in granting remittitur in light of the evidence introduced at trial.

II.

Although both parties have extensively argued the sufficiency or insufficiency of the evidence to sustain the verdict of national origin discrimination, our review of this issue is rendered unnecessary, and indeed would be meaningless, in light of several critical flaws in the trial which render the verdict unreliable and necessitate a remand for a new trial.

We turn first to the issue of sufficiency of evidence to support a finding of fraudulent concealment. Pursuant to Mich.Comp.Laws Sec. 600.5805(8) a three-year statute of limitations ordinarily applies to claims under the Elliott-Larsen Act, Mair v. Consumers Power Co., 419 Mich. 74, 77-78, 348 N.W.2d 256, 257-58 (1984), as well as to Sec. 1981 civil rights actions, Marlowe v. Fisher Body, 489 F.2d 1057, 1063 (6th Cir.1973). In this case Gomez's claims of discrimination which occurred prior to July 6, 1978, would thus be barred. However, Gomez alleged that the three-year limitations period was tolled due to Great Lakes' fraudulent concealment of his claim. According to Mich.Comp.Laws Sec. 600.5855:

If a person who is or may be liable for any claim fraudulently conceals the existence of the claim or the identity of any person who is liable for the claim from the knowledge of the person entitled to sue on the claim, the action may be commenced at any time within 2 years after the person who is...