Karnes v. SCI Colorado Funeral Services, Inc., 96-1478

• Decision Date: 17 December 1998
• Docket Number: No. 96-1478,96-1478
• Citation: 162 F.3d 1077
• Parties: 78 Fair Empl.Prac.Cas. (BNA) 1143, 74 Empl. Prac. Dec. P 45,683, 98 CJ C.A.R. 6422 Dorothy S. KARNES, Plaintiff--Appellee, v. SCI COLORADO FUNERAL SERVICES, INC., d/b/a T.G. McCarthy Funeral Home, Defendant--Appellant.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 1077

162 F.3d 1077

78 Fair Empl.Prac.Cas. (BNA) 1143,

74 Empl. Prac. Dec. P 45,683, 98 CJ C.A.R. 6422

Dorothy S. KARNES, Plaintiff--Appellee, v. SCI COLORADO FUNERAL SERVICES, INC., d/b/a T.G. McCarthy Funeral Home, Defendant--Appellant.

No. 96-1478.

United States Court of Appeals Tenth Circuit.

Dec. 17, 1998.

Daniel R. Satriana Jr., Alan Epstein with him on the briefs, of Hall & Evans, L.L.C., Denver, CO, for Defendant--Appellant

Charlotte Noelle Sweeney, Richard C. LaFond with her on the brief, of LaFond & Clausen, Denver, CO, for Plaintiff--Appellee and Cross-Appellant.

Before ANDERSON, KELLY, and HENRY, Circuit Judges.

HENRY, Circuit Judge.

SCI Colorado Funeral Services, Inc. (SCI) appeals the district court's judgment awarding compensatory and punitive damages to Dorothy Karnes and ordering reinstatement on her retaliatory discharge claim under Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e-2000e17. ¹ SCI argues that the district court should have applied state rather than federal law regarding the standard for proving punitive damages. It maintains that the district court erred in refusing to apply the Colorado statute, Colo.Rev.Stat. § 13-25-127, which requires plaintiffs to prove claims for punitive damages "beyond a reasonable doubt." We conclude that the burden of proof for recovering punitive damages in Title VII actions is governed by federal rather than state law. Therefore, we affirm the judgment of the district court.

I. BACKGROUND

Ms. Karnes filed this wrongful discharge suit against SCI asserting claims under the Age Discrimination in Employment Act (ADEA), 29 U.S.C. §§ 621-34, Title VII, and state law. The district court granted summary judgment to SCI on several of Ms. Karnes's claims, but the ADEA and Title VII claims proceeded to trial. Although it returned a verdict in favor of SCI on Ms. Karnes's ADEA claim, the jury found for Ms. Karnes on her Title VII claim, awarding $52,000 in lost wages and benefits, $20,000 in emotional damages, and $110,000 in punitive damages. Following the jury's verdict, the district court ordered SCI to reinstate Ms. Karnes to her former position.

The district court instructed the jury that, in order to prevail on her claims, Ms. Karnes was required to prove each of the elements by a preponderance of the evidence. See SCI's App. at 42, 44. SCI requested a separate instruction stating that, in order to be entitled to punitive damages, Ms. Karnes would have to establish beyond a reasonable doubt that [SCI] "engaged in a discriminatory practice or practices with malice or reckless indifference to the rights of [Ms.] Karnes to be free from such intentional discrimination in employment." Id. at 53. In support of this proposed instruction, SCI invoked Colo.Rev.Stat. § 13-25-127, which provides that "[e]xemplary damages against the party against whom the claim is asserted shall only be awarded in a civil action when the party asserting the claim proves beyond a reasonable doubt the commission of a wrong under the circumstances set forth in section 13-21-102." (emphasis supplied). ² The district court refused to give SCI's proposed punitive damages instruction. In instructing the jury on punitive damages, the court did not specify a burden of proof, and SCI objected to that part of the instruction.

II. DISCUSSION

On appeal, SCI argues that the district court erred in refusing to instruct the jury that Ms. Karnes was required to prove her entitlement to punitive damages beyond a reasonable doubt, the standard set forth in § 13-25-127. Because SCI's objection to the district court's jury instructions raises a legal question, we review de novo the district court's refusal to apply Colorado's beyond a reasonable doubt standard. ³ See City of Wichita v. United States Gypsum Co., 72 F.3d 1491, 1494-95 (10th Cir.1996). Although we may reverse the district court's judgment only if an erroneous instruction is prejudicial in light of the record as a whole, Mason v. Texaco, Inc., 862 F.2d 242, 246 (10th Cir.1988), we note that "[j]ury instructions outlining the appropriate burdens of proof are almost always crucial to the outcome of the trial," Stevison by Collins v. Enid Health Sys., Inc., 920 F.2d 710, 714 (10th Cir.1990).

A. 42 U.S.C. § 1988

In arguing that the district court erred in refusing to apply the beyond a reasonable doubt standard established by the Colorado statute, SCI invokes 42 U.S.C. § 1988(a), which dictates when federal courts adjudicating federal civil rights laws should apply state law:

The jurisdiction in civil and criminal matters conferred on the district courts by the provisions of titles 13, 24, and 70 of the Revised Statutes for the protection of all persons in the United States in their civil rights, and for their vindication, shall be exercised and enforced in conformity with the laws of the United States, so far as such laws are suitable to carry the same into effect; but in all cases where they are not adapted to the object, or are deficient in the provisions necessary to furnish suitable remedies and punish offenses against the law, the common law, as modified and changed by the constitution and statutes of the State wherein the court having jurisdiction of such civil or criminal cause is held, so far as the same is not inconsistent with the Constitution and laws of the United States, shall be extended to and govern the said courts in the trial and disposition of the cause, and, if it is of a criminal nature, in the infliction of punishment on the party found guilty.

Id. (emphasis added).

Section 1988 directs courts to follow a three-step process in determining whether to apply state law. Burnett v. Grattan, 468 U.S. 42, 47, 104 S.Ct. 2924, 82 L.Ed.2d 36 (1984); Blake v. Dickason, 997 F.2d 749, 750 (10th Cir.1993). First, the court must determine whether federal law establishes a suitable rule to apply. See Burnett, 468 U.S. at 47-48, 104 S.Ct. 2924. If no suitable federal rule exists, the court must then determine whether the state law supplies one. See id. at 48, 104 S.Ct. 2924. Finally, the court must consider whether the state rule, if it exists, is consistent with federal law. Id. On several occasions, the Supreme Court has concluded that state laws should be applied under § 1988, see, e.g., id. at 48-49, 104 S.Ct. 2924 (concluding that the forum state's personal injury statute of limitations should be applied to § 1983 claims); Robertson v. Wegmann, 436 U.S. 584, 98 S.Ct. 1991, 56 L.Ed.2d 554 (1978) (applying a state's survivorship statute to a § 1983 action). SCI urges us to follow those decisions here.

In analyzing SCI's argument, we begin by considering whether federal law regarding the burden of proof for punitive damages claims under Title VII is "deficient." See 42 U.S.C. § 1988(a). Then we consider whether the Colorado's statute is consistent with federal law.

B. The Alleged Deficiency in Federal Law

We are not convinced that federal law regarding the burden of proving punitive damages in Title VII actions is "deficient" under § 1988(a). The applicable federal statute, 42 U.S.C. § 1981a(b)(1), provides that plaintiffs in Title VII actions may recover punitive damages against a private defendant if that defendant "engaged in a discriminatory practice or discriminatory practices with malice or with reckless indifference to the federally protected rights of an aggrieved individual." This punitive damages provision is part of the Civil Rights Act of 1991 (CRA), 42 U.S.C. § 1981a, legislation enacted "to further Title VII's 'central statutory purposes of eradicating discrimination throughout the economy and making persons whole for injuries suffered through past discrimination.' " Landgraf v. USI Film Prods., 511 U.S. 244, 254, 114 S.Ct. 1483, 128 L.Ed.2d 229 (1994) (quoting Albemarle Paper Co. v. Moody, 422 U.S. 405, 421, 95 S.Ct. 2362, 45 L.Ed.2d 280 (1975)). As the Supreme Court has explained, the CRA "effects a major expansion in the relief available to victims of employment discrimination." Id. It allows plaintiffs in Title VII actions to obtain the same kinds of monetary relief (particularly punitive damages and certain kinds of compensatory damages) that have been available to plaintiffs bringing actions under other civil rights laws, such as 42 U.S.C. §§ 1981 and 1983. See Luciano v. Olsten Corp., 110 F.3d 210, 219-21 (10th Cir.1997) (discussing the legislative history of the Act). The CRA also authorizes jury trials if a Title VII plaintiff seeks compensatory or punitive damages. See 42 U.S.C. § 1981a(c); Landgraf, 511 U.S. at 254, 114 S.Ct. 1483.

Section 1981a(b) does not specify the burden of proof that a plaintiff must meet in order to recover punitive damages. However, in our view, the absence of a particular burden of proof in the statute does not establish that the federal law on the question is "deficient" under § 1988. See Brown v. United States, 742 F.2d 1498, 1507 n. 5 (D.C.Cir.1984) (en banc) (criticizing the view that "the simple absence of any provision of state law from federal law automatically implies a deficiency from federal law, regardless of whether or not such a provision is in any way necessary or helpful to or even consistent with the execution of the federal law in question."). Here, there are several sources of federal law suggesting that the determination of punitive damages should be governed by the preponderance of the evidence standard.

In particular, in Price Waterhouse v. Hopkins, 490 U.S. 228, 109 S.Ct. 1775, 104 L.Ed.2d 268 (1989), a plurality of the Supreme Court concluded that an employer that has allowed a discriminatory motive to play a part in an employment decision has an affirmative defense to a Title VII claim if it establishes by a preponderance of the evidence that it would have made the same decision in the absence of discrimination. In rejecting the more stringent clear and convincing evidence standard, the plurality noted that "[c]...