Pearl v. City of L. A.

• Decision Date: 18 June 2019
• Docket Number: B285235
• Citation: Pearl v. City of L. A., 36 Cal.App.5th 475, 248 Cal.Rptr.3d 508 (Cal. App. 2019)
• Parties: James PEARL, Plaintiff and Respondent, v. CITY OF LOS ANGELES, Defendant and Appellant.
• Court: California Court of Appeals

36 Cal.App.5th 475

248 Cal.Rptr.3d 508

James PEARL, Plaintiff and Respondent,

v.CITY OF LOS ANGELES, Defendant and Appellant.

B285235

Court of Appeal, Second District, Division 7, California.

Filed June 18, 2019

Michael N. Feuer, Los Angeles City Attorney, James P. Clark, Chief Deputy City Attorney, Thomas H. Peters, Chief Assistant City Attorney, Blithe S. Bock, Assistant City Attorney, Shaun Dabby Jacobs and Matthew Scherb, Deputy City Attorneys, for Defendant and Appellant.

Scolinos, Sheldon & Nevell, Todd F. Nevell, Daniel G. Sheldon, Pasadena; The Ehrlich Law Firm and Jeffrey I. Ehrlich for Plaintiff and Respondent.

PERLUSS, P. J.

A jury awarded James Pearl $ 17,394,972, including $ 10 million in past and $ 5 million in future noneconomic damages, in his employment action against the City of Los Angeles for harassment and failure to prevent harassment and retaliation in violation of the Fair Employment and Housing Act (FEHA) ( Gov. Code, § 12940 et seq. ). The City moved for a new trial, arguing the damages were excessive. Finding that at least some of the jury's award for past noneconomic harm was intended to punish the City rather than to compensate Pearl, the trial court conditionally granted the City's new trial motion unless Pearl agreed to a remittitur reducing past noneconomic damages by $ 5 million. Pearl accepted the remittitur; and the trial court denied the City's new trial motion and entered an amended judgment in the amount of $ 12,394,972, exclusive of attorney fees and costs.

On appeal the City contends the court abused its discretion in utilizing the remittitur procedure to reduce damages. Without challenging the jury's liability findings, the City argues that, once the court found that aspects of the jury's award were punitive, it had no choice but to grant a new trial on the limited issue of damages. We affirm.

FACTUAL AND PROCEDURAL BACKGROUND

1. The Evidence at Trial

a. Pearl's evidence

The City's Department of Public Works, Bureau of Sanitation hired Pearl in 2002 to work in the Wastewater Management Division and promoted him to supervisor in 2005. By all accounts, Pearl was a hard worker. Pearl supervised, among others, employees Lafayette Griffin and Byron Tate. In 2010 Pearl requested a disciplinary investigation of Tate, asserting that Tate's attendance was sporadic and his work performance subpar. Tate complained to management that Pearl had favored Griffin and unfairly targeted Tate. The City twice transferred Pearl to less favorable positions while it investigated Tate's complaint. Observing that other employees had not been transferred despite complaints from their subordinates and suspecting he was the victim of race discrimination (Pearl is African-American), Pearl filed an administrative complaint with the Department of Fair Employment and Housing (DFEH) in December 2010, naming high-ranking managers Barry Berggren and Robert Potter as responsible for the alleged misconduct.

According to witnesses who testified at trial, in 2011 Potter used a software program to create an image of Griffin and Pearl embracing on a jet ski. The image, taken from Griffin's social media page, had originally depicted Griffin and a male companion on a jet ski. In Potter's edited version Pearl's head had been superimposed on Griffin's companion's body, and the blue water from the original photograph had been replaced with sewer water. Potter called two employees into his office to show them the digitally edited image and seemed proud of his editing work. The employees understood, although Potter did not articulate it, that the photograph was intended to depict Griffin and Potter as a same-sex couple. They were disappointed someone at Potter's level of management would do such a thing. The image became widely disseminated within the Wastewater Management Division. Potter boasted about maintaining it as his screensaver on his work computer.

Gerald Watson, one of Pearl's managers at the Sanitation Bureau and Potter's good friend, obtained the digitally altered image and uploaded it to his cell phone. He showed it to other employees in the division and stated many times, "Can you believe this gay-assed shit? Look at this gay assed motherfucker."

James Tomlin, one of Pearl's fellow supervisors at the Sanitation Bureau, complained in an email to management that management's comments about Pearl and Griffin were making him uncomfortable. According to Tomlin, Watson habitually used homophobic slurs when discussing Pearl with others and said Pearl had "kept Griffin close" so the two could engage in oral sex in the office.

In April 2011 Pearl was transferred to a desk job, where he was ordered to "do nothing" and "stay in his cubicle." On April 25, 2011 Pearl received notice of intent to take disciplinary action; on July 18, 2011 he was placed on administrative leave; and on August 30, 2011 he was terminated. Pearl was told he was fired for falsifying Griffin's time reports by using an improper code and for intimidating a witness. Pearl insisted he filled out the time reports exactly as he had been taught and denied engaging in any intimidating or improper conduct. Pearl filed an administrative appeal challenging his termination. Following a hearing over several days in July and August 2012, the administrative law judge found Pearl had followed procedures and the City had no basis to terminate him. The administrative law judge recommended reinstatement, and the City did not seek review. Pearl was reinstated on October 4, 2012.

Pearl had initially been unaware of the edited image that was circulating or the statements by Watson and others as to his perceived sexual orientation. He had heard whispered comments such as "gay ass shit" and "homos" in his presence but did not realize the slurs referred to him. In the summer of 2012, however, he received a copy of Tomlin's email in his mailbox and learned about Watson's perpetuation of the rumors about him. Pearl's wife, who had learned about the rumors from someone else, asked Pearl whether he had been fired for having sex with Griffin. Pearl felt humiliated.

Pearl returned to work in October 2012. Following Pearl's reinstatement, the disparaging comments became frequent and pervasive. Pearl's coworkers and subordinates said to others loudly and in his presence: "The fag supervisor's back. Here he is in the picture." "Quit being a fag." "That's some gay shit." "All fags stick together."

Gabriel Fajardo, who worked under Pearl's supervision, testified people asked him after Pearl returned to work, "[H]ow does it feel working for the fag? Are you going to stay in the office? Don't be in the office alone with the fag." Fajardo did not tell Pearl about these comments, and Pearl did not overhear them. Fajardo, who had filed his own complaint against the City for discrimination, harassment and retaliation, did not report the remarks to management, explaining "it wouldn't do any good because management started it." Over the City's objection, Fajardo also briefly testified the City retaliated against him when he attempted to exercise his rights under the Family Medical Leave Act to care for his disabled son.

Michael Bejarano worked with Pearl and in his testimony described a culture of pervasive harassment based on actual and perceived sexual orientation at times perpetrated by, and at other times silently condoned, by management. On one occasion Bejarano complained to management after Watson's son, a Wastewater Management Division employee under Bejarano's supervision, told him to get his "faggot ass" back in the office. Potter spoke to Bejarano and assured him the matter would be addressed. Watson's son was transferred. Three weeks later Watson's son returned to his position. Bejarano testified after his complaint the City retaliated against him by writing him up for work that had been properly performed. Meanwhile, the culture in the Wastewater Management Division persisted.

One morning Pearl arrived at work to find a corn cob, an anal sex toy and coupons for hot dogs on his desk. He did not know who had placed the items there. Rather than interceding to stop the behavior, Pearl testified, Pearl's supervisors, including Watson, either participated in it or ignored it. Pearl did not feel he had any choice other than to continue doing his job.

Two weeks after Pearl's return to work in October 2012, management directed his immediate supervisor, Bernie Rogers, to investigate Pearl for wrongdoing. When Rogers found no evidence of wrongdoing, management insisted he investigate again. Watson showed Rogers the image of Pearl and Griffin. Shortly thereafter, Watson replaced Rogers as Pearl's direct supervisor. Pearl amended his complaint with the DFEH to state a claim for harassment based on perceived sexual orientation. He continued to do his job.

In October 2013 Paul Blasman replaced Watson as Pearl's supervisor and immediately began criticizing his work. Pearl believed the criticisms were unfair and pretextual. On December 24, 2013 Blasman asked Pearl to formally reprimand Fajardo. Pearl refused, telling Blasman he would not be part of a scheme to retaliate against "an innocent man."

On December 26, 2013 Pearl experienced chest pains and fainted at work. Paramedics rushed Pearl to the hospital, where he was treated for acute stress disorder and perniciously elevated blood pressure that had caused him to lose consciousness. Pearl had no prior history of hypertension. Pearl, then 52 years old, was placed on medical leave and has not worked since.

b. Expert testimony on Pearl's injuries

Dr. Darrell Burstein, Pearl's treating physician, testified that Pearl suffers from malignant hypertension, a condition caused by extremely elevated blood pressure that frequently causes irreversible organ damage. In April 2017 Pearl fainted and was diagnosed with atrial fibrillation, AFib, an abnormal heart arrhythmia that can lead to blood clots, stroke and other complications. An MRI revealed that malignant...