Knox v. John Varvatos Enters. Inc.

• Decision Date: 12 January 2021
• Docket Number: 17 Civ. 772 (GWG)
• Citation: 512 F.Supp.3d 470
• Parties: Tessa KNOX, Plaintiff, v. JOHN VARVATOS ENTERPRISES INC., Defendant.
• Court: U.S. District Court — Southern District of New York

512 F.Supp.3d 470

Tessa KNOX, Plaintiff,

v.JOHN VARVATOS ENTERPRISES INC., Defendant.

17 Civ. 772 (GWG)

United States District Court, S.D. New York.

Signed January 12, 2021

William Irvin Dunnegan, Laura Jean Scileppi, Richard Weiss, Dunnegan & Scileppi LLC, New York, NY, for Plaintiff.

Ned Henry Bassen, Amina Hassan, Hughes Hubbard & Reed LLP, Joanne Liu, New York, NY, for Defendant.

OPINION AND ORDER

GABRIEL W. GORENSTEIN, UNITED STATES MAGISTRATE JUDGE

Plaintiff Tessa Knox, on behalf of a class of female "sales professionals" employed by clothing retailer John Varvatos Enterprises, Inc. ("Varvatos"), brought this action alleging that Varvatos's clothing allowance policy, which included giving free clothing to male sales professionals but not female sales professionals, violated various federal and state anti-discrimination laws. A jury trial was held in February and March 2020, and the jury returned a verdict in favor of plaintiffs on all claims. Judgment was entered in accordance with that verdict. Varvatos now moves for judgment as a matter of law and/or a new trial or remittitur on various issues relating to liability and damages.¹ See Fed. R. Civ. P. 50(a), 59(e). For the reasons set forth below, Varvatos's motions are denied, except that the Court orders a new trial or remittitur on the issues of compensatory and punitive damages.

I. BACKGROUND

Plaintiffs are a class of 72 current or former female "sales professionals" at Varvatos (see List of Plaintiffs, annexed as Exhibit 15 to Hassan Decl. (Trial Exhibit 45)), a menswear brand. (See, e.g., Tr. 10).² Plaintiffs brought claims under the federal Equal Pay Act, 29 U.S.C. § 206(d) ("EPA"); the New York Equal Pay Act, N.Y. Lab. L. § 194 ("NY EPA"); Title VII of the Civil Rights Act, 42 U.S.C. § 2000e-5 ("Title VII"); and the New York Human Rights Law, N.Y. Exec. L. § 296 ("NYHRL") alleging that male sales professionals were given a Clothing Allowance and that female sales professionals were not given equivalent compensation.

As background, the Varvatos dress code required the male sales professionals to wear at least three articles of specified Varvatos-branded clothing while on the sales floor. See Appearance and Dress Standards at 1, annexed as Exhibit 1 to Hassan Decl. ("Dress Code Policy") (Trial Exhibit A). It required female sales professionals to wear outfits that were "appropriate for the work environment and representative of the brand." Id. To assist the males in complying with the dress code, Varvatos's Clothing Allowance allowed male sales professionals to select and keep Varvatos clothing worth $3000 at retail prices four times per year — once for each season.³ The selections were known as "pulls." (See Tr. 46-47). Female sales professionals were not provided any free clothing. (Tr. 47:17-19). Instead, female sales professionals (and not the males) received a 50 percent discount on women's clothes at "AllSaints," a sister brand of Varvatos. (Tr. 49:14-16).

A trial was held from February 24, 2020 to March 2, 2020. On February 28, 2020, the jury delivered a verdict in favor of plaintiffs as to liability on all counts, awarded the compensatory damages sought by plaintiffs ($3000 per quarterly pull), and found Varvatos was liable for liquidated damages and punitive damages. See Verdict Sheet, filed Feb. 28, 2020 (Docket # 334) ("Jury Verdict Sheet # 1"). Following the presentation of additional evidence, the jury fixed the award of liquidated damages at $2500 per quarter and punitive damages at $2500 per quarter. See Verdict Sheet, filed March 2, 2020 (Docket # 335) ("Jury Verdict Sheet # 2"). On March 23, 2020, a judgment was entered in keeping with the jury's verdict awarding plaintiffs a total judgment of $3,516,051.23. Docket # 362.

Varvatos now moves for judgment as a matter of law on a number of issues pursuant to Fed. R. Civ. P. 50 and also moves for a new trial on certain issues, or a remittitur on damages, pursuant to Fed. R. Civ. P. 59(a).

II. APPLICABLE LEGAL PRINCIPLES

A. Fed. R. Civ. P. 50

Federal Rule of Civil Procedure 50(a) provides:

If a party has been fully heard on an issue during a jury trial and the court finds that a reasonable jury would not have a legally sufficient evidentiary basis to find for the party on that issue, the court may:

(A) resolve the issue against the party; and

(B) grant a motion for judgment as a matter of law against the party on a claim or defense that, under the controlling law, can be maintained or defeated only with a favorable finding on that issue.

Under Fed. R. Civ. P. 50(b), "[i]f the court does not grant a motion for judgment as a matter of law made under Rule 50(a), the court is considered to have submitted the action to the jury subject to the court's later deciding the legal questions raised by the motion." Fed. R. Civ. P. 50(b). In considering a motion under Rule 50, courts have an obligation to "consider the evidence in the light most favorable to the party against whom the motion was made and to give that party the benefit of all reasonable inferences that the jury might have drawn in [its] favor from the evidence." Tolbert v. Queens Coll., 242 F.3d 58, 70 (2d Cir. 2001) (citation omitted). In performing this function, a court cannot "assess the weight of conflicting evidence, pass on the credibility of the witnesses, or substitute its judgment for that of the jury, and must disregard all evidence favorable to the moving party that the jury is not required to believe." Id. (citation omitted).

B. Fed. R. Civ. P. 59

Federal Rule of Civil Procedure 59(a)(1)(A) provides that a court may grant a new trial "after a jury trial, for any reason for which a new trial has heretofore been granted in an action at law in federal court." "The general grounds for a new trial are that (1) the verdict is against the clear weight of the evidence; (2) the trial court was not fair; (3) substantial errors occurred in the admission or rejection of evidence of the giving or refusal of instructions to the jury; or (4) damages are excessive." Welch v. United Parcel Service, Inc., 871 F. Supp. 2d 164, 174 (E.D.N.Y. 2012) (citation omitted).

"Unlike judgment as a matter of law, a new trial may be granted even if there is substantial evidence supporting the jury's verdict." DLC Management Corp. v. Town of Hyde Park, 163 F.3d 124, 134 (2d Cir. 1998). Moreover, "[o]n new trial motions, the trial judge may weigh the evidence and the credibility of witnesses and need not view the evidence in the light most favorable to the verdict winner." Raedle v. Credit Agricole Indosuez, 670 F.3d 411, 418 (2d Cir. 2012) (citation omitted). However,

trial judges must exercise their ability to weigh credibility with caution and great restraint, as a judge should rarely disturb a jury's evaluation of a witness's credibility, and may not freely substitute his or her assessment of the credibility of witnesses for that of the jury simply because the judge disagrees with the jury.

Id. (citation and quotation marks omitted). Furthermore, when "a verdict is predicated almost entirely on the jury's assessments of credibility, such a verdict generally should not be disturbed except in an egregious case, to correct a seriously erroneous result, or to prevent a miscarriage of justice." Id. at 418-19. Also, "a trial court should be most reluctant to set aside that which it has previously decided ...." LiButti v. United States, 178 F.3d 114, 118 (2d Cir. 1999).

III. DISCUSSION

A. Elements of Federal and New York EPA Claims

To prove their EPA claims, the plaintiffs had to "demonstrate that (1) the employer pays different wages to employees of the opposite sex; (2) the employees perform equal work on jobs requiring equal skill, effort, and responsibility; and (3) the jobs are performed under similar working conditions." E.E.O.C. v. Port Auth. of N.Y. & N.J., 768 F.3d 247, 254-55 (2d Cir. 2014) (alterations omitted) (quoting Belfi v. Prendergast, 191 F.3d 129, 135 (2d Cir. 1999) ). The parties agreed that male sales professionals and female sales professionals performed work under similar working conditions. (See Tr. 632:16-17). Thus, the questions presented to the jury were whether the jobs were substantially equal and whether female sales professionals were paid less than their male counterparts. Id. at 19-20; see also Jury Verdict Sheet # 1, questions 1-3.

1. Finding that the Jobs Were Substantially Equal

As to whether the males and females performed jobs requiring equal skill, effort, and responsibility, the parties agreed that the jobs of female sales professional and male sales professional required the same skill. (Tr. 634:2-4). Varvatos argues, however, that the jury could not have found that the jobs involved substantially equal effort and responsibility. Equal effort is the "measurement of the physical or mental exertion needed for the performance of a job." 29 C.F.R. § 1620.16(a) ; accord Port Auth. of N.Y. & N.J., 768 F.3d at 255. Equal responsibility is defined as "the degree of accountability required in the performance of the job, with emphasis on the importance of the job obligation." 29 C.F.R. § 1620.17(a) ; accord Port Auth. of N.Y. & N.J., 768 F.3d at 255.

The only evidence that the jobs of male and female sales professionals differed in any way related to the Varvatos dress code. There was ample evidence, however, from which the jury could find that the jobs of female and male sales professional otherwise involved "substantially" equal effort and responsibility notwithstanding any difference in dress or responsibilities occasioned by the dress code. There was a single job description for the job of sales professional. (Chang: Tr. 98:5-7). Varvatos's own head of human resources (Chang: Tr. 67:22, 68:3-5) admitted that "both men sales professionals and women sales professionals have to perform all those job responsibilities which are listed under heading job responsibilities" in the job description. (Chang: Tr. 98:16). Two sales...