U.S. v. Veal
| Citation | 365 F.Supp.2d 1034 |
| Decision Date | 24 August 2004 |
| Docket Number | No. 02-0720-CV-W-DW.,02-0720-CV-W-DW. |
| Parties | UNITED STATES of America, Plaintiff, v. Bobby VEAL and Jewel Veal, Defendants. |
| Court | U.S. District Court — Western District of Missouri |
Charles M. Thomas, Office of the United States Attorney, Kansas City, MO, Erin
Meehan Richmond, Trial Attorney, Rebecca B. Bond, Timothy J. Moran, U.S. Department of Justice, Washington, DC, for Plaintiff.
Geary Jaco, Kansas City, MO, for Defendants.
Before the Court are Defendants' motion for new trial, or in the alternative, motion for relief from judgment, or in the alternative, motion for remittitur or reduction in judgment. (Doc. No. 81.) For the following reasons, the motions are denied.
On June 12, 2003, the Court entered a default judgment against Defendants Bobby and Jewel Veal after they refused to participate in discovery and failed to comply with the Court's Order of April 15, 2003. With the entry of default, the Court found that the Veals had violated the Fair Housing Act, 42 U.S.C. § 3601 et seq., by engaging in a pattern or practice of housing discrimination on the basis of sex. (Doc. No. 29.)
From May 10-13, the case went to trial on the issue of damages. At trial, the Government identified eleven women ("aggrieved women") who it alleged were victims of the defendants' discriminatory housing practices, and sought compensatory and punitive damages for each. Through the testimony of the aggrieved women, among others, the Government sought to demonstrate that Bobby Veal made unwanted physical and verbal sexual advances towards the women, and that Jewel Veal knew of her husband's harassment but did nothing to stop it. The jury returned a verdict in favor of the Government, finding that the eleven aggrieved women were harmed by the Veals' practice of discrimination based on sex. A total of $47,804.00 in compensatory damages and $1,055,000.00 in punitive damages was awarded against them.1
In the pending motions, the Veals seek various forms of relief from the judgment against them. Numerous arguments are raised in support of the motions. Each will be addressed in turn.
In an Order dated April 15, 2003, the Court wrote the following:
[T]here is adequate information in the record showing that Defendants' failure to respond to discovery thus far is deliberate, intentional and designed to thwart the United States' effort to pursue this case. Therefore, the Court will require the Defendants to immediately serve complete responses to the United States pending discovery requests or the Court will impose sanctions including dismissal of Defendants' pleadings and entry of judgment on liability in favor of the United States.
(Doc. No. 17 at p. 4.) In addition to the above warning, the Court ordered the Veals to pay $2,000.00 to the plaintiff as a discovery sanction. Id.
On June 12, 2003, after the Veals failed to make the $2,000.00 payment and repeatedly refused to engage in discovery, the Court struck the defendants' pleadings and entered judgment in favor of the plaintiff. (Doc. No. 29.) In so doing, the Court held that the Veals had violated the Fair Housing Act by engaging in a pattern or practice of housing discrimination on the basis of sex. Id.
The Veals now contend that the Court erred by striking their pleadings and entering the judgment of default. Though the Veals concede that they failed to comply with discovery, they claim that their former attorney, Geary Jaco, not the parties themselves, is to blame. For example, they state that Mr. Jaco did not timely supply them with the plaintiff's discovery requests and concealed from them the court imposed $2,000.00 sanction. Because Mr. Jaco's misconduct led to the entry of the default judgment, the Veals urge the Court to set aside the default judgment and grant them a new trial.
Parties choose counsel at their peril. Inman v. Am. Home Furniture Placement, Inc., 120 F.3d 117, 118 (8th Cir.1997). It is "well-established that a party is responsible for the actions and conduct of his or her counsel and that, under appropriate circumstances, dismissal or default may be entered against a party as a result of counsel's actions." Everyday Learning Corp. v. Larson, 242 F.3d 815, 817 (8th Cir.2001). Default judgement, as a discovery sanction for counsel's misconduct, may be appropriate even without a finding of bad faith or willful misconduct on the part of the party. Id.
Applying the law to the facts at hand, and taking the Veals at their word — not an easy thing to do2 — the Court concludes that it did not error in entering the judgment of default. Assuming that Mr. Jaco was, in fact, solely responsible for the Veals' failure to comply with discovery, it is not improper for this Court to hold the defendants accountable for their lawyer's misconduct. Everyday Learning, 242 F.3d at 817-18. Inman, 120 F.3d at 118-19. Further, "[i]f they were truly diligent litigants who were misled and victimized by their attorney, they have recourse in a malpractice action." Id.See also Glick v. Henderson, 855 F.2d 536, 541 (8th Cir.1988) ()
In addition, the Court notes that the entry of default was not the first sanction imposed. Admittedly, "[t]he entry of default judgment should be a `rare judicial act.'" Comiskey v. JFTJ Corp., 989 F.2d 1007, 1009 (8th Cir.1993). However, as set forth above, the entry of default was not the Court's first choice; rather, an attempt was made to curb the defendants' discovery violations through a monetary sanction. This fact, among others, distinguishes the present situation from Baker v. Gen. Motors Corp., 86 F.3d 811 (8th Cir.1996), a case cited by the Veals.
Lastly, the Court questions whether the Veals suffered any real prejudice because of the entry of default. The default judgment established that Defendants had engaged in a pattern or practice of housing discrimination based on sex. Thus, the judgment established their general liability. The Government was still required to prove at trial that the eleven women it identified were victims of the Veals' discriminatory practice. The Government succeeded in doing so.
The Veals argue that certain claims brought by the Government are barred by Missouri's statute of limitations. As an affirmative defense, the defendants bear the burden of proving that the claims asserted against them are time-barred. Motley v. United States, 295 F.3d 820, 822 (8th Cir.2002). Unfortunately for the Veals, any statute of limitations defense they might have asserted was waived when their pleadings were struck and a default judgment was entered. In re Estate of Ferdinand E. Marcos Human Rights Litigation, 978 F.2d 493, 495 n. 2 (9th Cir.1992).
Next, the Veals argue that the punitive damages award of $1,055,000.00 is unconstitutionally excessive under BMW of North Am., Inc. v. Gore, 517 U.S. 559, 116 S.Ct. 1589, 134 L.Ed.2d 809 (1996) and State Farm Mut. Ins. Co. v. Campbell, 538 U.S. 408, 123 S.Ct. 1513, 155 L.Ed.2d 585 (2003). In Gore, and later in State Farm, the Supreme Court outlined three guideposts that courts should consider in determining whether a punitive damages award is unconstitutionally excessive: (1) the degree of reprehensibility of the defendant's misconduct; (2) the disparity between the actual or potential harm suffered by the plaintiff and the punitive damages award; and (3) the difference between the punitive damages awarded by the jury and the civil penalties authorized or imposed in comparable cases. Gore, 517 U.S. at 575, 116 S.Ct. 1589; State Farm, 538 U.S. at 418, 123 S.Ct. 1513.
With regard to the first of the guideposts, the Supreme Court has stated that the "most important indicium of the reasonableness of a punitive damages award is the degree of reprehensibility of the defendant's conduct." State Farm, 538 U.S. at 419, 123 S.Ct. 1513 (citing Gore, supra, at 575, 116 S.Ct. 1589). To determine the defendant's reprehensibility, a court should consider whether
the harm caused was physical as opposed to economic; the tortious conduct evinced an indifference to or a reckless disregard of the health or safety of others; the target of the conduct had a financial vulnerability; the conduct involved repeated actions or was an isolated incident; and the harm was the result of intentional malice, trickery, or deceit, or mere accident. Id.
Applying these factors to the facts in this case, the Court finds that the Veals' conduct is of the most reprehensible sort. Each of the victims was financially vulnerable — all of the women were receiving Section 8 public housing assistance at the time of the harassment, and several had been homeless prior to renting from the Veals. Though most of the women experienced economic injuries, by and large the harm done was physical. For example, Mr. Veal raped LaTonya Winters on two separate occasions and fondled most of the women numerous times. Further, the Veals' conduct was intentional and evinced a reckless disregard for the health and safety of the women. Mr. Veal secretly entered the homes of the women without notice, which had the effect of destroying any sense of security that the women had in their homes. For her part, Mrs. Veal did nothing to stop her husband's conduct or ensure the safety of the women. Instead, Mrs. Veal took the position that complaining victims were merely "bitches trying to get free rent and trying to get somewhere get out of paying rent." Transcript at p. 141.
The Court also notes that the Veals' conduct was not isolated...
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