Wilson v. S & L Acquisition Co., L.P.

• Decision Date: 04 September 1991
• Docket Number: No. 89-7764,89-7764
• Parties: 56 Fair Empl.Prac.Cas. 1233, 57 Empl. Prac. Dec. P 41,028 Alice N. WILSON, Plaintiff-Appellee, Cross-Appellant, v. S & L ACQUISITION CO., L.P., Defendant-Appellant, Cross-Appellee. Alice N. WILSON, Plaintiff/Counterclaim-Defendant-Appellee, Cross-Appellant, v. SELIGMAN & LATZ, INC., d/b/a S & L Acquisition Company, L.P., Defendant/Counterclaim-Plaintiff-Appellant, Cross-Appellee.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1429

940 F.2d 1429

56 Fair Empl.Prac.Cas. 1233,

57 Empl. Prac. Dec. P 41,028

Alice N. WILSON, Plaintiff-Appellee, Cross-Appellant, v. S & L ACQUISITION CO., L.P., Defendant-Appellant, Cross-Appellee Alice N. WILSON, Plaintiff/Counterclaim-Defendant-Appellee Cross-Appellant v. SELIGMAN & LATZ, INC., d/b/a S & L Acquisition Company, L.P. Defendant/Counterclaim-Plaintiff-Appellant, Cross-Appellee.

No. 89-7764.

United States Court of Appeals, Eleventh Circuit.

Sept. 4, 1991.

Joe C. Ashworth, Josie A. Alexander, Jackson, Lewis, Schnitzler & Krupman, Atlanta, Ga., for defendant-appellant, cross-appellee.

G. Danie Evans, Birmingham, Ala., for plaintiff-appellee, cross-appellant.

Appeal from the United States District Court for the Northern District of Alabama.

Before KRAVITCH and COX, Circuit Judges, and HENDERSON, Senior Circuit Judge.

PER CURIAM:

In these cross-appeals the plaintiff-appellant, ¹ Alice E. Wilson and the defendant-appellee, Seligman & Latz, Inc., ² challenge a judgment arising out of an age discrimination suit and a fraud action filed in the United States District Court for the Northern District of Alabama. Because we find that the district court made certain oral findings at the conclusion of a hearing on post-judgment motions of both parties and then substantially changed those rulings to Wilson's detriment in its later written order we reverse and remand for further proceedings.

I.

Alice Wilson was born March 1, 1927, in Birmingham, Alabama. She graduated from high school in 1945 and during the same year obtained her license as a beautician. For a number of years, she either owned her own beauty salons or sold beauty products for various cosmetic companies.

S & L, as it relates to this case, was comprised of four semi-autonomous divisions. In this litigation we are concerned only with the affairs of the beauty division, Essanelle. Essanelle operated beauty salons in leased space in department stores throughout the country. Administratively, this division of S & L was divided into five geographic regions. In addition to these regional accounts, Essanelle also operated a number of national "accounts" that were on the same footing with the regional accounts. Each regional area was supervised by a vice president who, in turn, reported to the president of Essanelle. Below the level of regional vice president was that of group supervisor who managed the salons housed in the various branches of a particular department store chain. Below the position of group supervisor was the assistant group supervisor and then the individual salon managers.

Wilson was hired during the summer of 1984 as the assistant group supervisor for the salons located in the Pizitz department stores in Alabama. This group was one of several that comprised Essanelle's southeastern region. At the time Wilson was employed, the post of group supervisor at Pizitz was vacant. In January, 1985, she was promoted to group supervisor. With this promotion, she received an annual salary of $25,000.00 plus other corporate benefits including health insurance and vacation pay.

Shortly thereafter, in March, 1985, Carol Cona, the southeastern regional vice president, began negotiating with a well known Birmingham hair stylist, John Brown, for the position of group supervisor for the Pizitz stores. Her interest in Brown as the Pizitz supervisor was his name recognition and his extensive media contacts in the Birmingham area. She felt that his promotional skills would greatly increase profitability of the Pizitz salons. He was eventually hired in May, 1985, at a salary of $35,000.00 per year.

When Wilson heard rumors about the negotiations between Brown and Cona and his eventual employment as group supervisor at Pizitz, she confronted Cona with respect to her future status with S & L. Cona explained that she was not being fired from S & L, but told her of the two options available to her: she could transfer to Atlanta as an assistant group supervisor with the Rich's group of stores without a reduction in benefits or salary or she could remain in Birmingham with Pizitz as a salon manager with one of its stores. Unfortunately, there were no salon manager positions open with Pizitz at that time.

Faced with this choice, Wilson decided to go to Atlanta. She was assured by Cona that if for any reason the Atlanta move did not work out, the company would pay her expenses to move back to Birmingham. In Atlanta her duties remained essentially the same. Soon after Wilson's transfer to Atlanta, Carol Cona was moved to another area of responsibility within the company and was replaced by Chris Webster as the southeastern regional vice president. On April 15, 1986, Webster asked Wilson if she would consider transferring to the Neiman Marcus store in Atlanta as a salon manager. Neiman Marcus was a "national account" and, as a consequence, was separate from the southeastern region which included the Rich's and Pizitz groups. She replied she would accept the Neiman Marcus job as long as her benefits remained the same. The next day, Webster fired Wilson without explanation.

In spite of the fact that she had been discharged from the Rich's group on April 16, 1986, she was hired a month later at the Neiman Marcus store as the salon manager, but at the reduced salary of $18,000.00 per year. She continued as manager until she resigned on July 7, 1986, because it had become apparent to her that her fortunes at S & L were on the decline. She came to this conclusion after receiving information from others, primarily John Brown, that her age was a motivating factor for the treatment she received while employed with S & L. In her resignation letter, she promised to work until August 14, 1986, to enable the company to find a replacement. She was fired on July 30, 1986, by the vice president of the Neiman Marcus account. After returning to Birmingham, she commenced this action.

II.

Wilson filed suit against her former employer alleging violations of the Age Discrimination in Employment Act (ADEA), 29 U.S.C. Secs. 621-634 ³ and the Equal Pay Act (EPA), 29 U.S.C. Sec. 206(d)(1) ⁴. She also charged S & L with sex discrimination pursuant to the provisions of Title VII. ⁵ Wilson later filed a second complaint for common law fraud under Georgia law against S & L claiming that the company fraudulently induced her to stay in Atlanta at a lower pay scale and then failed to honor the promise to pay for her moving expenses back to Alabama in the event she could not continue her employment in Georgia. Jurisdiction for the fraud cause of action was predicated on diversity of citizenship. S & L's answer to the complaint for fraud included a counterclaim seeking damages for the filing of a frivolous suit. On the motion of the defendant, the district court consolidated both actions for trial.

After an eight-day trial, the jury found in favor of Wilson on the age discrimination and fraud actions and in favor of S & L on the equal pay suit. The jury awarded $100.00 as compensatory damages and $112,500.00 in punitive damages on the fraud case and a total of $49,312.00 for the age discrimination claim representing back pay, lost benefits and liquidated damages. Liquidated damages may be awarded upon a finding by the court that the defendant willfully discriminated against the plaintiff. See 29 U.S.C. Sec. 626(b). Damages under the ADEA are both legal and equitable. 29 U.S.C. Sec. 626(b) provides the relief for violation of the act. The section also refers to 29 U.S.C. Sec. 216(b) which contains virtually the same language.

Amounts owing to a person as a result of a violation of this chapter [shall be wages as provided for in sections 216 and 217] of this title: Provided, That liquidated damages shall be payable only in cases of willful violations of this chapter. In any action brought to enforce this chapter the court shall have jurisdiction to grant such legal or equitable relief as may be appropriate to effectuate the purposes of this chapter, including without limitation judgments compelling employment, reinstatement or promotion, or enforcing the liability for amounts deemed [as damages].

29 U.S.C. Sec. 626(b) (emphasis in original).

In a separate order and opinion, the district court found in favor of the defendant on the Title VII claim for sex discrimination.

After judgment was entered by the court, both parties filed post-trial motions. S & L moved for judgment notwithstanding the verdict, or in the alternative, a new trial or remittitur in both the fraud and ADEA cases. Wilson moved for reinstatement or prospective relief (front pay). ⁶ She also filed motions for prejudgment interest and attorneys' fees.

On June 16, 1989, the district court heard arguments on all the motions except the motion for attorneys' fees. The hearing was not transcribed. To cure this defect, the parties filed a motion to supplement the record on appeal containing a joint stipulation of the district court's oral rulings made at this hearing. ⁷

After oral argument, the district court stated from the bench that it was "inclined to hold" ⁸ that the jury award of $112,500.00 in punitive damages and $100.00 in compensatory damages on the fraud case should be remitted to a total of $50,000.00 damages. If the plaintiff failed to accept the remittitur to $50,000.00, then the district court would order a new trial. The district court also said that it was inclined to hold the jury erred in finding that Wilson was constructively discharged when she resigned in July, 1986. This statement, taken alone, implies that the court was granting S & L's motion for judgment notwithstanding the verdict. However, the court went on to hold that Wilson was wrongfully discharged on April 16, 1986, the date she was abruptly fired as assistant supervisor with the Rich's group by Webster, the regional vice president. The court did not articulate its reason for finding that the discrimination had come to...