Palma v. Pharmedica Communications, Inc., CIV. No. 3:00CV1128 (HBF) (D. Conn. 9/30/2003)

• Decision Date: 30 September 2003
• Docket Number: CIV. No. 3:00CV1128 (HBF).
• Parties: RENE M. PALMA v. PHARMEDICA COMMUNICATIONS, INC.
• Court: U.S. District Court — District of Connecticut

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RENE M. PALMA v. PHARMEDICA COMMUNICATIONS, INC.

CIV. No. 3:00CV1128 (HBF).

United States District Court, D. Connecticut.

September 30, 2003.

RULING ON PLAINTIFF'S POST-TRIAL MOTIONS

HOLLY FITZSIMMONS, Magistrate Judge.

Plaintiff moves for an award of liquidated damages [Doc. #86] and also seeks front pay and benefits or, in the alternative, reinstatement to her former position [Doc. #104]. Also pending is plaintiff's Motion for Prejudgment and Post-Judgment Interest [Doc. #110].

MOTION FOR LIQUIDATED DAMAGES

The jury found that defendant violated the FMLA in discharging plaintiff. Section 29 U.S.C. § 2617(a)(1)(A)(iii)¹ of the FMLA provides that, in addition to compensatory damages specified in § 2617(a)(1)(A)(i) & (ii), an employer shall be liable for an amount of liquidated damages equal to the amount of wages, salary, employment benefits, or other compensation denied or lost to an employee, plus interest, by reason of the employer's violation of § 2615 of the statute. Liquidated damages are considered compensatory rather than punitive in nature. Reich v. Southern New England Telecommunications Corp., 121 F.3d 58, 71 (2d Cir. 1997) (interpreting liquidated damages statute under the FSLA)²; Rhoads v. F.D.I.C., 956 F. Supp. 1239, 1261 (D. Md. 1997) (reviewing analogous remedial provision under the Fair Labor Standards Act, 29 U.S.C. § 216 ("FLSA"), aff'd in part. rev'd in part on other grounds, 257 F.3d 373 (4th Cir. 2001). "Doubling of an award is the norm under the FMLA, because a plaintiff is awarded liquidated damages in addition to compensation lost. The district court's discretion to reduce the liquidated damages "must be exercised consistently with the strong presumption under the statute in favor of doubling." Nero v. Industrial Molding Corp., 167 F.3d 921, 929 (5th Cir. 1999) (quoting Shea v. Galaxie Lumber & Constr. Co., Ltd., 152 F.3d 729, 733 (7th Cir. 1998) (discussing FLSA liquidated damages provision)); Williams v. Rubicon, 808 So.2d 852, 861 (La. App. 1 Dir. 2002) ("Doubling is the norm, not the exception.").

The district court may reduce an award to only compensatory damages if the employer "proves to the satisfaction of the court that the act or omission which violated section 2615 of this title was in good faith and that the employer had reasonable grounds for believing that the act or omission was not a violation of section 2615." 29 U.S.C. § 2617(a)(1)(A) (iii). The employer must therefore show both good faith and reasonable grounds for the act or omission." Chandler v. Specialty Tires of America. Inc., 283 F.3d 818, 827 (6th Cir. 2002) (emphasis in original); see 29 U.S.C. § 2617(a)(1)(A) (iii).

After the jury found that a causal connection existed between Ms. Palma's opposition to an unlawful practice at Pharmedica and the termination of her employment and awarded her $140,000 in compensatory damages, the Court asked the jury, on an advisory basis, to answer Question 6. Question 6 stated: "[i]f you awarded damages in response to Question 5, do you find by a preponderance of the evidence that when Pharmedica discharged Ms. Palma, defendant reasonably believed its actions complied with the Family and Medical Leave Act?" The jury returned a note during deliberations asking whether they had to answer Question 6. The jury responded "yes" after the Court directed them to answer. Plaintiff correctly states that the interrogatory failed to reference the dual elements of defendant's affirmative defense under the statute of "good faith" and "reasonable grounds for believing." Defendant argues that the jury was properly charged on both elements of the good faith test. The Court takes the parties' arguments and the jury's response to Question 6 under advisement.

Pharmedica argues that "[t]he jury expressly found that in discharging the plaintiff Pharmedica reasonably believed its actions complied with the FMLA. In any event, even if the adequacy of the evidence supporting this finding were at issue, there is significant evidence demonstrating Pharmedica's legitimate business reasons for terminating the plaintiff." [Doc. #93 at 7]. Defendant argues that the decision to terminate plaintiff's employment was related to the reorganization of the company, pointing to the following evidence: (1) Stefanski's January 1999 memo regarding the organization; (2) "David Lynch, one of the persons who assumed plaintiff's duties was, unlike plaintiff, a degreed professional;" (3) "some of Ms. Palma's job responsibilities were being performed by lower paid temporary workers" such as Michele Olds; and (4) Timmerman, Stefanski, Bavasso and Cipollone's testimony "concerning the rapid growth of the company and the corresponding need to reorganize the accounting department to keep up with the increased workload." Id. at 8.

The burden of proof is on the employer, not the plaintiff, to establish whether the act or omission was in good faith and that the employer had reasonable grounds for believing that the act or omission was not in violation of the FMLA. 29 U.S.C. 2617(a)(1)(A) (iii); Nero, 167 F.3d at 928. A district court's decision on liquidated damages is reviewed for abuse of discretion; "that discretion must be exercised consistently with the strong presumption under the statute in favor of doubling." Shea v. Galaxie Lumber & Constr. Co., Ltd., 152 F.3d 729, 733 (7th Cir. 1998) (discussing FLSA liquidated damages provision) (citations omitted); Duty v. Norton-Alcoa Proppants, 293 F.3d 481, 497 (8th Cir. 2002) (reviewing grant of liquidated damages pursuant to the FMLA for an abuse of discretion) (citation omitted). "Even assuming that [the employer] acted in good faith the decision to award liquidated damages is still within the discretion of the trial court." Nero, 167 F.2d at 929.

Good faith requires more than a showing of ignorance of the prevailing law or uncertainty about its development. It is not enough to show that a violation was not purposeful. Nor is good faith demonstrated by the absence of complaints on the part of employees or conformity with industry-wide practice. Good faith requires that an employer first take active steps to ascertain the dictates of the law and then move to comply with them.

Williams v. Rubicon. Inc., 808 So.2d 852, 861 (La. Ct. 1st Cir. 2002) (citing Reich v. Southern New England Telecommunications Corporation, 121 F.3d 58, 71 (2d Cir. 1997)).

Several Courts have found in favor of the employer, holding that it acted in good faith and with a reasonable belief it was complying with the FMLA. Generally, these cases involve an employer's "good-faith mistake" as to whether its action violates the FMLA. Compare Dierlam v. Wesley Jessen Corp., 222 F. Supp.2d 1052, 1057 (N.D. Ill. 2002) (addressing question of first impression in the Seventh Circuit, and the "entire federal court system," the court denied liquidated damages.); Miller v. AT&T, 83 F. Supp.2d 700 (S.D. W. Va. 2000), aff'd, 250 F.3d 820 (4th Cir. 2000) (finding employer did not act in bad faith in terminating employee for excess unexcused absences on ground that employee's influenza A was not "serious health condition" covered under FMLA, and thus employer was not subject to liquidated damages, in light of regulation stating that flu was not "serious health problem."); Barrilleauz v. Thayer Lodging Group. Inc., Civ. No. 97-3252, 1999 U.S. Dist. Lexis 8206, *22 (E.D. La. May 25, 1999) ("It was reasonable, albeit legally incorrect, for Thayer to conclude that Barrilleaux was not entitled to FMLA leave because she had not worked for Thayer for the requisite time period."); Thorson v. Geminin. Inc., 96 F. Supp.2d 882 (N.D. Iowa 1999), aff'd, 205 F.3d 370, cert. denied, 531 U.S. 871 (2000) (the court found that the employer acted in good faith when it fired employee for excess absenteeism due to minor ulcers and gastritis as FMLA was only six months old at the time of termination, employer made active effort to learn law and comply with it, and employer's mistake about the law was only determined when Secretary of Labor issued advisory opinion during pendency of employee's appeal);³ with. Chandler v. Specialty Tires of America, Inc., 283 F.3d 818, 827 (6th Cir. 2002) (finding employer's good faith belief was unreasonable where employer testified that he had no experience with the FMLA the day he fired plaintiff, that he made no inquiries into her request for leave, that he made no independent effort to check the information supplied by her manager regarding her status, and that the decision to terminate plaintiff was based on an eight minute conversation with her manager.); Shea. 152 F.3d at 733 (district court's finding of good faith based on good faith record-keeping errors by defendants employees was not enough and defendant did not meet its burden of establishing its reasonable belief in the legality of the situation. "[A]n employer cannot satisfy its dual burden under [FSLA] § 260 solely by suggesting lower-level employees are responsible for the violations"); Reich, 121 F.3d at 71 ("That [employer] did not purposefully violate the provisions of the FLSA is not sufficient to establish that it acted in good faith."); Smith v. Diffee Ford-Lincoln Mercury, Inc., 298 F.3d 955, 959 (10th Cir. 2002) ("Relying on 29 U.S.C. § 2617 (a)(1)(A) (iii), and on the fact that the jury had necessarily rejected [the employer's] defense that it would have discharged Smith regardless of her taking FMLA leave, the judge found that he was required to award $62,785 in liquidated damages (equal to the sum of back pay of $58,000 and interest in the amount of $4,785) and did so."); Atchley v. Nordam Group, Inc., 180 F.3d 1143, 1151 (10th Cir. 1999) (upholding liquidated damages award of $9,000, stating the employer "has not shown us the evidence is so in his favor that the district court was in error to deny its motion."); Mummert v. Vencor. Inc., No. 99-16443, 99-16560, 2001 WL 1345999, *3 (9th Cir. Oct. 31, 2001) ...