Real v. Continental Group, Inc.

• Decision Date: 17 January 1986
• Docket Number: No. C-83-2871.,C-83-2871.
• Citation: 627 F. Supp. 434
• Court: U.S. District Court — Northern District of California
• Parties: Emil V. REAL, Plaintiff, v. The CONTINENTAL GROUP, INC., a corporation, and Continental Can Company, a corporation, Defendants.

627 F. Supp. 434

Emil V. REAL, Plaintiff, v. The CONTINENTAL GROUP, INC., a corporation, and Continental Can Company, a corporation, Defendants.

No. C-83-2871.

United States District Court, N.D. California.

January 17, 1986.

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Orrick, Herrington & Sutcliffe by Cynthia L. Remmers, Laurie J. Miller and Gary R. Siniscalco, San Francisco, Cal., for plaintiff.

Thelen, Marrin, Johnson & Bridges by Janet F. Bentley, Christopher J. Rillo, and Janice Lehrer-Stein, San Francisco, Cal., for defendants.

DECISION and ORDER

MYRON L. GORDON, Senior District Judge.

The plaintiff, Emil V. Real, filed this action under the Age Discrimination in Employment Act (ADEA), 29 U.S.C. § 621 et seq., and a parallel provision of the California Fair Employment and Housing Act (FEHA), Cal.Govt.Code § 12941, charging that he was demoted, denied certain job opportunities and ultimately forced out of his job by the defendants, The Continental Group, Inc. and Continental Can Company (Continental), because of his age. The plaintiff also charged the defendants with breach of an employment contract between the parties and with violation of the covenant of good faith and fair dealing.

Following a trial on the merits, the jury returned a special verdict finding that the defendants had willfully discriminated against the plaintiff because of his age. The jury awarded Mr. Real damages for lost past compensation (back pay) of $132,910.00 but did not award the plaintiff punitive damages or damages for emotional distress or for lost future compensation (front pay). Pursuant to the jury's special verdict, the court entered judgment for the plaintiff in the amount of $265,820; this figure included $132,910 in back pay damages and a like amount in liquidated damages for the defendants' willful discrimination.

Continental has moved for judgment notwithstanding the verdict pursuant to Federal Rule of Civil Procedure 50(b) or, in the alternative, for remittitur or a new trial on the question of back pay damages pursuant to Federal Rule of Civil Procedure 59. The plaintiff has also moved for judgment notwithstanding the verdict as to several of the jury's findings or, alternatively, for a new trial. Both motions for judgment notwithstanding the verdict will be denied as will the plaintiff's alternative motion for a new trial. The defendants' motion for a partial new trial will be denied conditioned upon the plaintiff's acceptance of a remittitur of damages to the extent they exceed $50,000. If the plaintiff does not accept the remittitur, a new trial will be held on the limited issue of back pay damages.

Additionally, the defendants have filed objections to the plaintiff's bill of costs. This dispute will be held in abeyance pending the plaintiff's acceptance of the remittitur or, if refused, the resolution of the partial new trial.

BACKGROUND

Mr. Real, born January 27, 1924, went to work for Continental in 1950. From 1950 until 1975, he held various engineering positions with the company, receiving several promotions and regular merit pay increases in recognition of his job performance. In 1975, he was promoted to Manager of Industrial Engineering for Continental's Pacific Division, a grade E-15 position.

In 1980 and 1981, as part of a company reorganization effort, Continental consolidated several divisions, including the Pacific Division, headquartered in San Mateo, California, where the plaintiff was employed, and the Northwest Division, based in Portland, Oregon. The merger of these two divisions in June 1981 formed the Western Division, with headquarters in Portland.

During the 1981 consolidation, the job of Manager of Industrial Engineering for the newly-formed Western Division was given to Paul Zinter, who was then 46 years old and the Manager of Industrial Engineering for the old Northwest Division. Mr. Zintner was selected over the plaintiff, who was then 57 years old.

Following the 1981 consolidation, Mr. Real was demoted five grades to the position of Supervisor of Industrial Engineering in Continental's San Mateo office. His salary and benefits remained the same as they had been in his previous grade E-15 position.

As part of a subsequent company reorganization in early 1982, Mr. Real's position as Supervisor of Industrial Engineering was eliminated. The plaintiff was offered the job of Supervisor of Quality Control (grade E-11) at Continental's Pittsburg, California, plant, but he was not granted relocation benefits. Mr. Real declined the offer, which subsequently was accepted by H.L. Kaeser, then 59 years of age.

Continental denied Mr. Real's request that he be given the job of Supervisor of Quality Control at the company's San Jose, California, plant. That position went to E.J. Leek, then aged 57.

Finally, in February 1982, Continental offered Mr. Real the position of Plant Buyer for the San Jose Plant, a grade E-6 job. In that position, Mr. Real would have retained his previous salary and benefits. However, in late February 1982, Mr. Real stopped working for Continental, although he received his full salary through June 1982.

In support of their motion for judgment notwithstanding the verdict or, in the alternative, for remittitur or a new trial on the issue of back pay damages, the defendants contend that (1) there is insufficient evidence to support the jury's finding that the defendants discriminated against the plaintiff because of his age in its decision to award the Portland job to Paul Zinter or in its subsequent employment decisions concerning the plaintiff; (2) there is insufficient evidence to support the jury's finding that the defendants constructively discharged the plaintiff; (3) there is insufficient evidence to support the jury's finding of willful discrimination; and (4) there is no evidence to support the jury's award of back pay damages to the plaintiff.

The plaintiff supports his motion for judgment notwithstanding the verdict by contending that there is not sufficient evidence to support the jury's findings that (1) Continental's 1983 offer to reinstate the plaintiff to a comparable position was made in good faith; and (2) the plaintiff was not entitled to punitive damages. The plaintiff further requests that the court reject the jury's finding denying lost future compensation and instead find that he is entitled to such an award because he reasonably refused reinstatement.

The plaintiff's alternative motion for a new trial is based on his contentions that (1) there is insufficient evidence to support the jury's finding that the 1983 reinstatement offer was made in good faith; (2) there is insufficient evidence to support the jury's finding that the plaintiff is not entitled to punitive damages; (3) there is insufficient evidence that the plaintiff's rejection of the reinstatement offer was unreasonable; (4) the court erred in its instructions regarding liquidated and punitive damages; (5) the jury verdict concerning damages is inconsistent; and (6) the court erred in directing a verdict for the defendants on the plaintiff's common law claims.

The court will consider first the parties' claims relating to issues of liability. Damage issues raised in the respective motions will then be considered.

LEGAL STANDARDS

Entry of judgment notwithstanding the verdict is appropriate only if the court finds that the evidence and its inferences, considered as a whole and viewed in the light most favorable to the nonmoving party, can support but one reasonable conclusion. William Inglis & Sons Baking Co. v. ITT Continental Baking Co., Inc., 668 F.2d 1014, 1026 (9th Cir.1981), cert. denied, 459 U.S. 825, 103 S.Ct. 57, 74 L.Ed.2d 61 (1982). The court may not consider the credibility of the witnesses nor may it weigh the evidence to reach a result that it finds more reasonable than that arrived at by the jury. Id. Judgment notwithstanding the verdict will not be granted if the jury verdict is supported by substantial evidence. Mosesian v. Peat, Marwick, Mitchell & Co., 727 F.2d 873, 877 (9th Cir.1984), cert. denied, ___ U.S. ___, 105 S.Ct. 329, 83 L.Ed.2d 265 (1985).

A new trial, in contrast, will be ordered if the court finds that "the jury's verdict was clearly contrary to the weight of the evidence." William Inglis, supra, 668 F.2d at 1027. If the court, viewing the evidence in the light most favorable to the prevailing party, finds that the damage award is excessive, it may either grant the new trial motion or deny the motion conditioned upon the prevailing party's acceptance of a remittitur of the damage award. Fenner v. Dependable Trucking Co., 716 F.2d 598, 603 (9th Cir.1983).

LIABILITY ISSUES

I. Liability for Age Discrimination

A. Plaintiff's Burden of Proof

To meet his burden in an age discrimination case, the plaintiff must prove that age was a determining factor in the employer's challenged conduct in the sense that "but for" the discrimination the allegedly unlawful conduct would not have occurred. Kelly v. American Standard, Inc., 640 F.2d 974, 984 (9th Cir.1981). Because the plaintiff in the case at bar relies on a disparate treatment theory, proof of Continental's discriminatory intent is required. Sakellar v. Lockheed Missiles and Space Co., 765 F.2d 1453, 1455 (9th Cir. 1985).

The plaintiff may attempt to meet his burden directly, by presenting direct or circumstantial evidence of discriminatory motive, or indirectly. The Ninth Circuit Court of Appeals employs a modified version of the formula set forth in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973), to cases involving indirect proof of age discrimination. Douglas v. Anderson, 656 F.2d 528, 531-32 (9th Cir.1981). Under McDonnell Douglas, the plaintiff must first establish a prima facie case of age discrimination by a preponderance of the evidence. Id. at 531. The specific elements of the prima facie case vary depending on the facts of each case. I...