Kentucky Dept. of Corrections v. McCullough, 2000-SC-0727-DG.

• Decision Date: 21 August 2003
• Docket Number: No. 2000-SC-0727-DG.,No. 2001-SC-0146-DG.,2000-SC-0727-DG.,2001-SC-0146-DG.
• Citation: 123 S.W.3d 130
• Parties: KENTUCKY DEPARTMENT OF CORRECTIONS and Dewey Sowders, Appellants/Cross-Appellees, v. Patricia McCULLOUGH, Appellee/Cross-Appellant.
• Court: United States State Supreme Court — District of Kentucky

123 S.W.3d 130

KENTUCKY DEPARTMENT OF CORRECTIONS and Dewey Sowders, Appellants/Cross-Appellees, v. Patricia McCULLOUGH, Appellee/Cross-Appellant.

No. 2000-SC-0727-DG.

No. 2001-SC-0146-DG.

Supreme Court of Kentucky.

August 21, 2003.

As Modified on Denial of Rehearing and Grant of Modification January 22, 2004.

Stephen P. Durham, Department of Corrections, Office of General Counsel, Mark A. Sipek, Personnel Board, Frankfort, Counsel for Appellants/Cross-Appellees.

William R. Erwin, Helton, Erwin and Sanders, Danville, Counsel for Appellee/Cross-Appellant.

Deborah T. Eversole, General Counsel, Public Service Commission, Karen Quinn, Deputy General Counsel, Justice Cabinet, Frankfort, Counsel for Amicus Curiae, Governor's Executive Cabinet.

Opinion of the Court by Justice JOHNSTONE.

Appellee and Cross-Appellant, Patricia McCullough, brought suit against Appellants and Cross-Appellees, the Kentucky Department of Corrections and Warden Dewey Sowders, alleging gender discrimination and unlawful retaliation in violation of the Kentucky Civil Rights Act ("KCRA"). The jury found for Appellants on McCullough's gender-discrimination claim and found for McCullough on her unlawful-retaliation claim. Appellants appealed and McCullough cross-appealed. The Court of Appeals affirmed in part, vacated in part and remanded with instructions. On discretionary review, both sides raise a number of interesting and important issues, including whether McCullough established a prima facie case of retaliation and whether punitive damages are available under the KCRA. For the reasons set forth below, we affirm in part and reverse in part.

I. Facts and Procedural History

McCullough is employed as a correctional officer at the Northpoint Training Center (Northpoint). On January 29, 1987, she filed an Equal Employment Opportunity ("EEO") complaint with the Department of Corrections. In the complaint, she alleged that she had been sexually harassed by Lt. W.W. Gribbins, who was her superior officer at the time. McCullough alleged that after she volunteered to work in a dormitory unit, Lt. Gribbins told her that women were not allowed to work in dormitory units and then made inappropriate comments of a sexual nature. As a result of the complaint, Lt. Gribbins made a formal, written apology and was voluntarily demoted to the rank of sergeant. Further, prison policy was changed to permit women to work in dormitory units. McCullough was the first person to benefit from this policy change when she was allowed to take on the work assignment for which she had volunteered.

Between filing the EEO complaint in January 1987 and filing the underlying lawsuit against Appellants in August 1995, McCullough applied for promotion to the rank of sergeant twenty-four times and applied for promotion to the rank of unit administrator twice. She was passed over for promotion all twenty-six times. After withdrawing her name from consideration for promotion for the twenty-seventh time, she filed suit alleging gender discrimination and unlawful retaliation in violation of the KCRA.

McCullough's case proceeded to trial. The jury found against her on the gender-discrimination claim, for her on the retaliation claim and awarded her $120,000.00 in compensatory damages and $120,000.00 in punitive damages. In response to post-trial motions by both parties, the trial court set aside the punitive damages award, awarded McCullough $50,000.00 in attorneys' fees, and ordered Appellants to pay her court costs and interest on the judgment as provided by law. Additionally, the trial court granted McCullough's request for injunctive relief by ordering Appellants to promote her to the rank of sergeant.

Appellants appealed and McCullough cross-appealed. The Court of Appeals affirmed the award for compensatory damages and costs, vacated the award for interest and attorneys' fees, and vacated that portion of the trial court's order setting aside the punitive damages award. Additionally, the Court of Appeals vacated the trial court's order denying McCullough an instruction on punitive damages against Warden Dewey Sowders and remanded the case to the trial court to reconsider attorneys' fees and to allow McCullough to pursue her claim for punitive damages against Sowders.

We accepted discretionary review in part to address the question of whether KRS 344.450 provides for an award of punitive damages. Additional arguments concern whether the trial court erred in denying Appellants' motion for a directed verdict, whether the trial court erred in ordering post-judgment interest and whether McCullough was entitled to a missing evidence instruction. Upon careful review, we affirm the Court of Appeals' holding that Appellants were not entitled to a directed verdict and affirm its holding that post-judgment interest cannot be assessed against the Commonwealth under the KCRA. We reverse its holding that punitive damages are available under the KCRA. Finally, we dismiss as moot its holding that McCullough was not entitled to a missing evidence instruction.

II. Discussion

A. Directed Verdict: Retaliation

KRS 344.280(1) makes it unlawful for a person:

To retaliate or discriminate in any manner against a person because he has opposed a practice declared unlawful by this chapter, or because he has made a charge, filed a complaint, testified, assisted, or participated in any manner in any investigation, proceeding or hearing under this chapter.

A claim for unlawful retaliation requires the plaintiff to first establish a prima facie case of retaliation, which consists of showing that "(1) she engaged in a protected activity, (2) she was disadvantaged by an act of her employer, and (3) there was a causal connection between the activity engaged in and the [defendant] employer's act." Kentucky Center for the Arts v. Handley, Ky.App., 827 S.W.2d 697, 701 (1991), citing De Anda v. St. Joseph Hospital, 671 F.2d 850, 856 (1982). In a case where there is no direct evidence of retaliation, as is the case here, the burden of production and persuasion follows the familiar McDonnell Douglas framework. Under this framework, after the plaintiff establishes a prima facie case of retaliation, the burden of production shifts to the defendant to show a non-retaliatory reason for the adverse employment decision that disadvantaged the plaintiff. Id. After the defendant has met this burden, "the McDonnell Douglas framework is no longer relevant." St. Mary's Honor Center v. Hicks, 509 U.S. 502, 510, 113 S.Ct. 2742, 2748, 125 L.Ed.2d 407, 418 (1993). This is because "the McDonnell Douglas presumption is a procedural device, designed only to establish an order of proof and production." Id. at 521, 113 S.Ct. at 2755, 125 L.Ed.2d. at 425 (emphasis in original). At this point, the case then proceeds with the plaintiff having to meet her initial burden of persuading the trier of fact by a preponderance of the evidence that the defendant unlawfully retaliated against her. Reeves v. Sanderson Plumbing Products, Inc., 530 U.S. 133, 143, 120 S.Ct. 2097, 2106, 147 L.Ed.2d 105, 117 (2000).

To meet her burden of persuasion, the plaintiff "must be afforded the opportunity to prove by a preponderance of the evidence that the legitimate reasons offered by the defendant were not its true reasons, but were a pretext for [retaliation]." Reeves, 530 U.S. at 143, 120 S.Ct. at 2106, 147 L.Ed.2d. at 117. Proof that the defendant's non-retaliatory reasons are "unworthy of credence is simply one form of circumstantial evidence that is probative of intentional discrimination, and it may be quite persuasive." Id. at 147, 120 S.Ct. at 2108, 147 L.Ed.2d at 119-20. Consequently, "a plaintiff's prima facie case, combined with sufficient evidence to find that the defendant's asserted justification is false, may permit the trier of fact to conclude that the employer unlawfully [retaliated against the plaintiff]." Id. at 148, 120 S.Ct. at 2109, 147 L.Ed.2d at 120. In other words, a plaintiff's prima facie case plus proof of a pretext may constitute sufficient evidence to survive a motion for a directed verdict.

On appellate review, when determining whether the trial court erred in denying a motion for directed verdict, the non-moving party's evidence is taken as true and the non-moving party is entitled to all reasonable inferences that may be made from the evidence. Lewis v. Bledsoe Surface Mining, Ky., 798 S.W.2d 459, 461 (1990). When viewed in this light, McCullough's prima facie case of retaliation plus her proof of pretext were sufficient to survive Appellants' motion for a directed verdict.

Prima Facie Case

The Court of Appeals held that McCullough met her burden of proving a prima facie case of retaliation by showing that (1) she engaged in a protected activity by filing an EEO complaint, (2) she was subjected to adverse treatment when she was denied promotion, and (3) she was denied promotion because she filed an EEO complaint. The first two elements are relatively easy to establish. Filing an EEO complaint is a protected activity. Clark County School District v. Breeden, 532 U.S. 268, 273, 121 S.Ct. 1508, 1511, 149 L.Ed.2d 509, 515 (2001). Next, failure to be promoted can be adverse treatment. Hale v. Cuyahoga County Welfare Department, 891 F.2d 604, 606 (6th Cir.1989). In order to establish adverse treatment based on failure to promote in a retaliation case, the plaintiff must demonstrate that (1) she applied for promotion after engaging in a protected activity and was qualified for the promotion, (2) she was considered for and denied the promotion, and (3) other employees of similar or lesser qualifications received promotions at the time the plaintiff's request for promotion was denied. Cf. Brown v. Tennessee, 693 F.2d 600, 603 (6th Cir.1982) (setting forth the elements of failure to promote in the context of a prima facie case of racial discrimination). But the issue of whether McCullough established a causal...