Riofrio Anda v. Ralston Purina Co.

• Decision Date: 15 May 1991
• Docket Number: Civ. No. 89-645 HL.
• Citation: 772 F. Supp. 46
• Parties: Luis RIOFRÍO ANDA; Sylvia Marisol Unda González, and the conjugal partnership constituted by both, Plaintiffs, v. RALSTON PURINA COMPANY; Van Camp Seafood Company, Inc., and National Packing Company, Defendants.
• Court: U.S. District Court — District of Puerto Rico

772 F. Supp. 46

Luis RIOFRÍO ANDA; Sylvia Marisol Unda González, and the conjugal partnership constituted by both, Plaintiffs, v. RALSTON PURINA COMPANY; Van Camp Seafood Company, Inc., and National Packing Company, Defendants.

Civ. No. 89-645 HL.

United States District Court, D. Puerto Rico.

May 15, 1991.

COPYRIGHT MATERIAL OMITTED

Harry Anduze Montaño, Guillermo Ramos Luiña, Hato Rey, P.R., for plaintiffs.

O'Neill & Borges, Francisco M. Ramirez Rivera, Pedro A. Delgafo Hernándêz, Hato Rey, P.R., for defendants.

OPINION AND ORDER

LAFFITTE, District Judge.

In this diversity action plaintiffs sued for breach of an employment contract. A jury returned a verdict in favor of plaintiffs for $16,250 as salary due¹ and $48,750 for relocation expenses. Defendants argue that the relocation award is governed by the Employee Retirement Income Security Act of 1974 ("ERISA"), 88 Stat. 829, as amended, 29 U.S.C. § 1001 et seq., rather than Puerto Rico contracts law and alternatively, that under Puerto Rico law, the jury award is not supported by the evidence. Defendants move for a judgment notwithstanding the verdict (j.n.o.v.)² or a remittitur. Defendants also dispute the amount of attorney's fees and costs requested by plaintiffs. After due deliberation the Court grants defendants' motion for j.n.o.v. as to the relocation award.

I. BACKGROUND

Plaintiffs Luis Riofrío Anda ("Riofrío") and his wife Sylvia Marisol Unda González are citizens of Ecuador and are now living in Ponce, Puerto Rico. Defendants National Packing Company, its parent company Ralston Purina Co. and Van Camp Seafood, a Ralston division (collectively "Ralston") sought to hire Riofrío, an engineer in fishing technology, as the Quality Control Manager of Ralston's tuna and fishing products plant located in Ponce, Puerto Rico. Ralston invited Riofrío to San Diego to discuss the possibility of employment, and after visiting Puerto Rico at Ralston's expense, Riofrío accepted the offer and began working for Ralston in November 1984. Ralston paid for the transportation of plaintiffs' household goods from Ecuador and, since plaintiffs decided not to bring their automobile, Ralston paid plaintiffs the equivalent of freight and customs duties which plaintiffs applied toward the purchase of an automobile upon their arrival.³ Ralston terminated Riofrío's employment in February of 1988.

A contested issue at trial, and the primary issue now before the Court, involved relocation expenses. Riofrío claims that the offer of employment contemplated moving expenses back to Ecuador upon termination. Plaintiffs thus sought $50,000.00 for expenses pertaining to the relocation of their household goods and $55,000.00 for their automobile. Plaintiffs, however, never left Puerto Rico, arguing that they lacked the necessary funds to do so. Nonetheless, based on estimates of experts who testified as to the "book value" of the cost of moving plaintiffs' belongings from Ponce to Quito, Ecuador, the jury awarded plaintiffs $48,750.00.

Pursuant to Ralston's overseas relocation policy, the company claims it has always been willing to either undertake the responsibility of moving plaintiffs back to Ecuador or reimburse plaintiffs for expenses actually incurred in their return trip. Specifically, Ralston offered to pay for "return passage from Ponce to Quito for Riofrio and his family, including coach airfare and travel expenses; the cost of moving one automobile from Ponce to Quito, up to a maximum of $5,000.00;⁴ and moving (packing, loading, transporting, unloading, unpacking and insurance) of all household furnishings and personal effects...." Exhibit F, Defendant's Motion for Summary Judgment. According to Ralston, its relocation policies are designed to "make the employee whole for the moving expenses he might incur in moving ... back to the point of origin after the relationship with the Company ends." Attachment 1, Defendants' Motion for Summary Judgment at 8. Yet Ralston cautions that "the policy is not construed to provide employees for windfall profits for expenses not actually incurred." Id.

The basis for Ralston's motion for j.n.o.v. — indeed a claim that defendants have reiterated throughout this litigation — is its contention that the company's relocation policies are part of a welfare benefit plan for employees and as such, the plan falls within the ambit of ERISA. In so arguing, Ralston attempts to seek refuge in ERISA's broad federal preemption provisions as a legal defense to otherwise applicable Puerto Rico law. See 29 U.S.C. § 1144(a); Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 96, 103 S.Ct. 2890, 2899, 77 L.Ed.2d 490 (1983). An alternative basis for Ralston's motion for j.n.o.v. is its contention that the award of damages is contrary to Puerto Rico law since plaintiffs failed to present any evidence indicating that they actually incurred damages. In the event that the motion for j.n.o.v. fails, defendants seek a remittitur striking the award of $48,750.00 for relocation expenses as grossly excessive.

II. DISCUSSION

The standard used to evaluate a motion for a directed verdict or a j.n.o.v., pursuant to Rule 50, Fed.R.Civ.P., poses a heavy burden on the moving party. The evidence must be viewed in a light most favorable to the verdict winner. Aggarwal v. Ponce School of Medicine, 837 F.2d 17, 19 (1st Cir.1988); Insurance Company of North America v. Musa, 785 F.2d 370, 372 (1st Cir.1986). In so doing, the Court recognizes that it may not "`weigh the evidence nor pass on the credibility of witnesses, nor substitute its judgment for that of the jury.'" Aggarwal, 837 F.2d at 19 (citation omitted); C. Wright & A. Miller, Federal Practice and Procedure § 2524 (1971). Rather, the Court must simply weigh the sufficiency of the evidence to determine whether it fairly supports the jury's findings. The verdict must be upheld if "`fair minded men may draw different inferences and reasonably disagree as to what the verdict should be.'" Aggarwal, 837 F.2d at 19 (quoting Dumas v. MacLean, 404 F.2d 1062, 1064 (1st Cir.1968).

A slightly more liberal standard governs a motion for a remittitur. A movant's request for a remittitur, pursuant to Rule 59(e), Fed.R.Civ.P., allows a court to alter or amend the judgment and set aside a jury award even though there is substantial evidence to support it. C. Wright & A. Miller, Federal Practice and Procedure, § 2806 (1973). The Court need not "take that view of the evidence most favorable to the verdict-winner. The mere fact that evidence is in conflict is not enough to set aside the verdict.... Rather the judge is free to weigh the evidence for himself." Id. But a court should refrain from overturning a jury verdict unless it is evident that the jury has reached "a seriously erroneous result." Borras v. Sea-Land Service, Inc., 586 F.2d 881, 887 (1st Cir.1978) (citations omitted).

The First Circuit has sharpened the edges of this standard, stating that the verdict must be "so clearly against the weight of the evidence as to constitute a manifest miscarriage of justice." Hubbard v. Faros Fisheries, Inc., 626 F.2d 196, 200 (1st Cir.1980); accord Milone v. Moceri Family, Inc., 847 F.2d 35, 37 (1st Cir.1988). A jury is afforded broad latitude in its assessment of damages, "so long as the end result does not violate the conscience of the court or strike such a dissonant chord that justice would be denied were the judgment permitted to stand." Milone, 847 F.2d at 37. Nevertheless, a jury award must be reasonable, supported by the evidence, and not excessive. See Heddinger v. Ashford Memorial Community Hospital, 734 F.2d 81 (1st Cir.1984); Flores Caraballo v. Lopez, 601 F.Supp. 14 (D.P.R.1984). The Court turns now to defendants' argument that the policies pertaining to the distribution of relocation benefits constitutes a "plan" within the purview of ERISA.

A. ERISA

ERISA is a comprehensive statute designed to protect the interests of employees in benefit plans. Broadly speaking, its purpose is twofold: by federalizing much of the employment pension and benefit law ERISA promotes uniformity among state and local benefit plans, and through its imposition of fiduciary responsibilities and its requirements for reporting, disclosure, funding, and vesting, ERISA creates safeguards to preclude abuse in the mismanagement of funds accumulated to finance employee benefits.⁵ See generally Ingersoll-Rand Company v. McClendon, ___ U.S. ___, 111 S.Ct. 478, 112 L.Ed.2d 474 (1990); Shaw v. Delta Air Lines, supra, 463 U.S. 85, 103 S.Ct. 2890; H.R.Rep. No. 93-533, 93d Cong.2d Sess., reprinted in U.S.Code Cong. & Ad. News 4639 (1974).

"Employee benefit plans" under ERISA include "employee welfare benefit plans," 29 U.S.C. § 1002(1) or "employee pension benefit plans," 29 U.S.C. § 1002(2). Ralston asserts that its relocation policies constitute an "employee welfare benefit plan" which is defined as

any plan ... established or maintained by an employer or by an employee organization, or by both, to the extent that such plan ... was established or is maintained for the purpose of providing for its participants or their beneficiaries, through the purchase of insurance or otherwise, (A) medical, surgical, or hospital care benefits, or benefits in the event of sickness, accident, disability, death or unemployment, or vacation benefits, apprenticeship or other training programs, or day care centers, scholarship funds, or prepaid legal services, or (B) any benefit described in section 186(c) of this title § 302(c) of the Labor-Management Relations Act (other than pensions on retirement or death, and insurance to provide such pensions).

Section 3(1) of ERISA, 29 U.S.C. § 1002(1). Ralston notes that relocation benefits are not expressly written into the statute, but suggests that its policies are meant to provide assistance following the termination of employment and are thus akin to "benefits in the event of ... unemployment" under subsection (A) above.

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