Landals v. George A. Rolfes Co.

• Decision Date: 18 April 1990
• Docket Number: No. 88-1638,88-1638
• Parties: 57 Fair Empl.Prac.Cas. (BNA) 1699, 54 Empl. Prac. Dec. P 40,098 Bernard LANDALS, Appellee, v. GEORGE A. ROLFES CO., Appellant.
• Court: Iowa Supreme Court

Page 891

454 N.W.2d 891

57 Fair Empl.Prac.Cas. (BNA) 1699,

54 Empl. Prac. Dec. P 40,098

Bernard LANDALS, Appellee, v. GEORGE A. ROLFES CO., Appellant.

No. 88-1638.

Supreme Court of Iowa.

April 18, 1990.

Leon R. Shearer, Dean C. Mohr, and Kristin H. Johnson, of Shearer, Templer & Pingel, P.C., West Des Moines, for appellant.

Victoria L. Herring, West Des Moines, for appellee.

Considered by McGIVERIN, C.J., and HARRIS, SCHULTZ, NEUMAN and ANDREASEN, JJ.

ANDREASEN, Justice.

Bernard Landals (Landals) was discharged from his job with George A. Rolfes Co. (employer) in July 1983 at age fifty-two. He filed a complaint with the Iowa Civil Rights Commission under the Iowa Civil Rights Act, Iowa Code chapter 601A (1983), alleging age and disability discrimination. He obtained an administrative release and then filed suit in district court. After Landals presented his case to a jury, the court granted the employer's motion for directed verdict on the disability discrimination claim, but denied its motion on the age discrimination claim. The jury returned a special verdict for Landals on the age discrimination claim, awarding him $72,100 for past loss of income and benefits. The employer filed motions for new trial and judgment notwithstanding the verdict, which the court denied.

On appeal, the employer challenges the sufficiency of the evidence to support a prima facie case of age discrimination and urges Landals failed to establish that the employer's reason for discharge was a pretext. The employer also urges the jury failed to follow the court's instruction when it awarded damages beyond the date Landals secured employment and stopped looking for another job. On cross-appeal, Landals challenges the method used by the district court in allowing interest on the judgment. We have consolidated with this appeal another appeal and cross-appeal challenging an award of attorney fees entered after the first appeal was taken.

I. Scope of Review.

Our scope of review is to correct errors of law when an appeal is taken from the actions of the civil rights commission in a chapter 601A proceeding. Peoples Memorial Hosp. v. Iowa Civil Rights Comm'n, 322 N.W.2d 87, 90, 91 (Iowa 1982). When a chapter 601A suit is tried to the district court as an equitable action, our review is de novo. Frank v. American Systems, Inc., 398 N.W.2d 797, 799 (Iowa 1987). If tried to the district court as a law action, as in this case, our review is on errors of law. Trobaugh v. Hy-Vee Food Stores, Inc., 392 N.W.2d 154, 156 (Iowa 1986); Iowa R.App.P. 4.

If the findings of the jury are supported by substantial evidence, we are bound by them. Nadler v. City of Mason City, 387 N.W.2d 587, 591 (Iowa 1986); Iowa R.App.P. 14(f)(1). Evidence is substantial if a reasonable mind would accept it as adequate to reach a conclusion. Trobaugh, 392 N.W.2d at 156.

II. Proof of Age Discrimination.

A person may prove age discrimination by either of two methods. One method is to present direct or circumstantial evidence that age was a determining factor in the employer's employment decision. The other method of proof is to utilize the indirect, burden-shifting method of proof as established in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973). See Oxman v. WLS-TV, 846 F.2d 448, 452 (7th Cir.1988). See also United States Postal Serv. Bd. of Governors v. Aikens, 460 U.S. 711, 717-18, 103 S.Ct. 1478, 1483, 75 L.Ed.2d 403, 412 (1983) (Blackmun, J., concurring).

In the past, we have applied the McDonnell Douglas principles and analytical framework as refined in Texas Dep't of Community Affairs v. Burdine, 450 U.S. 248, 101 S.Ct. 1089, 67 L.Ed.2d 207 (1981), in our civil rights cases. See, e.g., Hulme v. Barrett, 449 N.W.2d 629, 632 (Iowa 1989); King v. Iowa Civil Rights Comm'n, 334 N.W.2d 598, 601-03 (Iowa 1983); Linn Coop. Oil Co. v. Quigley, 305 N.W.2d 729, 733 (Iowa 1981).

However, the McDonnell Douglas framework is not well suited as a detailed instruction to the jury. Grebin v. Sioux Falls Indep. School Dist., 779 F.2d 18, 20 (8th Cir.1985). It "add[s] little to the juror's understanding of the case and, even worse, may lead jurors to abandon their own judgment and to seize upon poorly understood legalisms to decide the ultimate question of discrimination." Id. at 20-21 (quoting Loeb v. Textron, 600 F.2d 1003, 1016 (1st Cir.1979)). Furthermore, a uniform instruction is of little value because application of the McDonnell Douglas framework will vary in different fact situations. See Hildebrand v. M-Tron Indus., Inc., 827 F.2d 363, 368 (8th Cir.1987).

Although the three-stage order of proof and the presumptions described in McDonnell Douglas are useful to the court in structuring proof while the trial is in progress, once the jury finds discrimination, and the resulting judgment is being evaluated on appeal, these presumptions fade away and the appellate court should simply study the record to determine whether the evidence is sufficient to support the verdict and judgment. Barber v. American Airlines, Inc., 791 F.2d 658, 659-660 (8th Cir.), cert. denied, 479 U.S. 885, 107 S.Ct. 278, 93 L.Ed.2d 254 (1986).

Once an employer offers reasons for discharging the plaintiff, the presumption of discrimination recognized in the first stage of McDonnell Douglas loses its significance in the case. See Aikens, 460 U.S. at 714-15, 103 S.Ct. at 1481-82, 75 L.Ed.2d at 409-10. The inference of discrimination, however, does not drop from the case. The jury also may rationally draw an inference of discrimination from proof that the reasons given by the employer for discharging the plaintiff were not the true reasons. Barber, 791 F.2d at 660.

The ultimate question, however, is whether the employer intentionally discriminated against the plaintiff. See Aikens, 460 U.S. at 714-15, 103 S.Ct. at 1481-82, 75 L.Ed.2d at 409-10. When a case is fully tried on the merits, "we focus our attention on the ultimate question presented and not on the adequacy of a party's showing at any particular stage of the analysis." Smith v. Goodyear Tire & Rubber Co., 895 F.2d 467, 471 (8th Cir.1990).

Under the McDonnell Douglas framework, the burden of proving the ultimate question remains on the plaintiff. The McDonnell Douglas framework cannot be applied where the plaintiff uses the direct method of proof of discrimination. See Trans World Airlines, Inc. v. Thurston, 469 U.S. 111, 121, 105 S.Ct. 613, 621-22, 83 L.Ed.2d 523, 533 (1985). Where direct evidence is presented and the employer suggests other factors influenced the decision, the employer has the burden of proving by a preponderance of the evidence that it would have made the same decision even if it had not considered the improper factor. Price Waterhouse v. Hopkins, 490 U.S. 228, 109 S.Ct. 1775, 1795, 104 L.Ed.2d 268, 293 (1989).

III. Instructions.

Here the district court drafted its instructions to the jury using the framework of McDonnell Douglas. Instruction number nine provided:

Before Landals can recover on his claim for age discrimination, he must prove all of the propositions described in this instruction. He must first prove all of the following three propositions:

1. In July of 1983, Landals was qualified for the job at Rolfes from which he was discharged.

2. Despite being qualified, Landals was laid off from his job at Rolfes and not recalled for employment.

3. When Landals was laid off and not recalled, Rolfes retained persons to do Landals' job who were younger than Landals and who had comparable or lesser qualifications for the job.

If Landals has failed to prove one or more of the above three propositions, he cannot recover on his claim of age discrimination. If, however, he has proved all of the above three propositions, you will then consider Rolfes' claim that its decision to lay off and not recall Landals was based upon reasons other than age. More specifically, Rolfes alleges that it laid off and failed to recall Landals because a large decrease in company sales and profits during 1983 required large layoffs, including that of Landals', and the consolidation or elimination of several job positions, including that of Landals'. Rolfes does not have to prove these reasons for laying off and not recalling Landals. Rather, Rolfes is only required to present enough evidence to create a genuine issue of fact in your mind.

If Rolfes has presented evidence raising an issue in your mind about the reason for Landals' layoff, Landals is then required to prove at least one of the following propositions:

(a) Landals' age more likely motivated Rolfes to lay him off than did any of the reasons given by Rolfes; or

(b) The reasons given by Rolfes for laying off Landals are not worthy of belief.

If Landals has failed to prove at least one of these propositions, he cannot recover on his claim for age discrimination. If, however, he has proved at least one of these propositions and also proved the three propositions shown above, he is entitled to recover on his claim for age discrimination and you will proceed to consider the amount of his damages, as explained further in Instruction No. 10.

The employer's only objection to this instruction was that it should have listed Landals' lack of qualification as a third reason for his layoff.

IV. Substantial Evidence of Age Discrimination.

The ultimate issue in this case is whether Landals has shown that age was a determining factor in the employer's decision to discharge him or lay him off. We view the evidence in the light most favorable to Landals and give him the benefit of all reasonable inferences that may be drawn from the evidence. Winter v. Honeggers' & Co., 215 N.W.2d 316, 321 (Iowa 1974).

Viewing the evidence in this light, Landals presented substantial evidence he was qualified for the position he held. He had been employed by Rolfes since 1958. After working in the shipping and receiving department for approximately two years, he was...