Mccullough v. Bank

• Decision Date: 30 August 2011
• Docket Number: No. WD 71625.,WD 71625.
• Citation: 349 S.W.3d 389,112 Fair Empl.Prac.Cas. (BNA) 1786
• Parties: George McCULLOUGH and James Cranston, Appellants,v.COMMERCE BANK, Respondent.
• Court: Missouri Court of Appeals

349 S.W.3d 389
112 Fair Empl.Prac.Cas. (BNA) 1786

George McCULLOUGH and James Cranston, Appellants,
v.
COMMERCE BANK, Respondent.

No. WD 71625.

Missouri Court of Appeals, Western District.

July 26, 2011.As Modified Aug. 30, 2011.Motion for Rehearing and/or Transfer to

Supreme Court Denied Aug. 30, 2011. Application for Transfer Denied Oct. 25, 2011.

[349 S.W.3d 390]

Patrick G. Reavey, Kansas City, MO, for appellants.Kimberly A. Jones and Christi J. Hilker–Vaglio, Kansas City, MO, for respondent.Before Division Two: THOMAS H. NEWTON, Presiding Judge, CYNTHIA L. MARTIN, Judge and GARY D. WITT, Judge.CYNTHIA L. MARTIN, Judge.

George McCullough (“McCullough”) and James Cranston (“Cranston”) (collectively “Appellants”) appeal from the trial court's judgment denying their motion for new trial after a jury trial resulted in a verdict in favor of Commerce Bank on claims of employment discrimination. Appellants contend that the trial court erred in: (1) applying the wrong standard to claims raised in their motion for new trial addressing the purported withholding of information which should have been produced in response to discovery; and (2) refusing to give four non-MAI jury instructions

[349 S.W.3d 391]

addressing pretextual termination. We affirm.Factual and Procedural History¹

Appellants were employed by Commerce Bank in the Recovery Department. Once a Commerce Bank customer's account becomes delinquent, the account goes to Commerce Bank's Collections Department, where collectors attempt to make arrangements with the customers to pay off the account before the debt is “charged off” to the Recovery Department. Once the account is charged off to the Recovery Department, it is assigned to a Recovery Collector to attempt collection. The accounts are assigned based on the type of account and the alphabetical split of the customers' last names. The types of accounts that are charged off to the Recovery Department include bank card accounts, installment loans, and overdraft accounts. In addition to Recovery Collectors, Recovery Specialists repossess, recondition, and sell the collateral on secured installment loans.

In April 2006, McCullough, a 61–year old African–American, was employed as a Recovery Collector and had specific responsibility for collecting outstanding unsecured debt from Commerce Bank Card customers. Bank Card Collectors are assigned new accounts at the beginning of each month by an alphabetical split. McCullough's split was A–F.

In 2002, Ron Nesemeyer (“Nesemeyer”) was the Manager of the Recovery Department. Nesemeyer prohibited Recovery Collectors from making changes to the collector codes in the computer system. The collector codes identified who had been assigned responsibility for an account. Nesemeyer prohibited the reassignment of collector codes to prevent collectors from reassigning accounts for self-serving reasons, i.e., to secure credit toward monthly goals. According to Nesemeyer, any change in a collector code required management approval.

On April 4, 2006, McCullough collected monies on an account (the “Gatzke account”) which had been assigned to another employee, Bill Wright (“Wright”). McCullough claimed this was the result of a call he fielded from Mr. Gatzke's fiancé who wanted to pay the account by phone.

In order to receive credit for the monies collected, McCullough asked Cranston to change the collector code to move the account to McCullough's portfolio. Cranston changed the collector code. Cranston, a 35–year old Caucasian American, was employed as a Repossession Specialist. Cranston was responsible for repossessing, reconditioning, and selling collateral on secured loans. Cranston had no responsibility for collecting on Bank Card accounts. Cranston's change of the collector code at McCullough's request violated the policy put into place by Nesemeyer.

Wright complained to Deborah Turnbow (“Turnbow”), a Recovery Supervisor who supervised McCullough, who reported the complaint to Donna Dunn (“Dunn”), Cranston's direct supervisor. When confronted, Cranston admitted he changed the collector code to reflect McCullough's responsibility for the account, and added that he had done so with other accounts in the past. Dunn reported the unauthorized changes in the collector codes to Nesemeyer.

Appellants were terminated from employment following an investigation. The investigation revealed that Appellants had

[349 S.W.3d 392]

participated in four unauthorized account transfers.

Appellants were each issued a Right to Sue Letter from the Missouri Commission on Human Rights. In February 2007, Appellants filed their second amended petition against Commerce Bank alleging race and age discrimination in connection with their respective terminations from employment pursuant to the Missouri Human Rights Act (“MHRA”). Appellants contended that McCullough was terminated due to his race and age, and that Cranston was terminated to conceal the discrimination against McCullough. The matter went to a jury trial in June 2009. The jury found in favor of Commerce Bank. Appellants filed a motion for new trial which was denied following an evidentiary hearing.

Appellants filed this timely appeal.

Point I

For their first point, Appellants claim that the trial court erred in denying their motion for new trial because it erroneously applied the standard for determining whether newly discovered evidence warrants a new trial under Rule 78.01 instead of a standard Appellant's claim, for the first time on appeal, should apply to determine whether the withholding of evidence warrants vacation of a judgment under Rule 74.06(b)(2). We disagree and affirm.

Standard of Review

Our standard of review of a trial court's action disposing of a motion pursuant to either Rule 74.06 or 78.01 is the same. The trial court is vested with broad discretion when acting on a motion to vacate a judgment pursuant to Rule 74.06 and this Court will not interfere with that action unless the record convincingly demonstrates an abuse of discretion. Clark v. Clark, 926 S.W.2d 123, 126 (Mo.App. W.D.1996); Nandan v. Drummond, 5 S.W.3d 552, 555 (Mo.App. W.D.1999). Denial of a motion for new trial pursuant to Rule 78.01 is also reviewed for abuse of discretion. Kansas City v. Keene Corp., 855 S.W.2d 360, 372 (Mo. banc 1993).

Analysis

The opening paragraph of Appellants' motion for new trial asserts:

COME NOW Plaintiffs, by and through their counsel of record and pursuant to Supreme Court Rules 74.06(b) and 78.01, and move the Court for a new trial in the above-captioned matter because of misrepresentations and misconduct by Defendant and their counsel....

This opening paragraph was followed by the assertion of several claims of error warranting a new trial, only three of which are applicable to our discussion of Point One. First, Appellants claimed that Commerce Bank failed to reveal during discovery that Turnbow had a phone call with Mr. Gatzke's fiancé. Second, Appellants claimed that Commerce Bank failed to produce all records associated with the Gatzke account. Third, Appellants claimed that Commerce Bank failed to produce the personnel files for two terminated employees in response to discovery seeking the personnel files for all employees within the Recovery Department “terminated within the last five years.”

The trial court conducted an evidentiary hearing to address Appellants' claims. The trial court then denied Appellants' request for a new trial on the basis of the claims. As to the documents regarding an alleged conversation between Turnbow and Mr. Gatzke's fiancé, the trial court found, “Plaintiffs have not shown that this evidence came to their knowledge since trial. Plaintiffs admit that they learned of the alleged telephone call a few days before trial. The Court also finds that Plaintiffs

[349 S.W.3d 393]

have not shown that this evidence is so material it would probably produce a different result. Plaintiffs' first argument fails.”

As to the Gatzke account records, the trial court found, “Plaintiffs have failed to show that this evidence is not cumulative or would produce a different result.”

As to the personnel files of the two terminated employees, the trial court found that the documents clearly fell within the scope of Appellants' discovery requests and should have been produced. The trial court noted that the voluntary termination of both employees came to light at trial and that both personnel files were then made available to Plaintiffs' counsel during trial. Nonetheless, the trial court found:

[P]laintiff has failed to meet the Carthen² standard. Plaintiff's counsel has not demonstrated that by the use of due diligence he would [not] [sic] have been able to earlier discover the defendants' failure to produce the requested files. Plaintiff clearly had information by which to identify both employees who were hired at or near the time of Mr. McCullough's termination. Further, Plaintiffs have failed to demonstrate how this evidence would have affected the outcome of the trial. In point of fact, the terminations of both [employees] came to light during the trial. In the post-trial hearing there was no showing of what testimony or evidence would have been available to plaintiff, had the personnel files been timely produced.

[Errors in singular reference to “Plaintiff” appear in original.]

On appeal, Appellants do not contest the sufficiency of these findings. Appellants thus concede that none of the information withheld during discovery was “new evidence” which would have affected the outcome of trial. Appellants also concede that though some of the information should have been disclosed earlier, all of the information was available to Appellants shortly before or during trial, and its non-disclosure could not be separated from Appellants' lack of due diligence.

Notwithstanding, Appellants argue that the trial court should not have applied the Carthen standard, which required Appellants to prove that they exercised due...