Kerr Selgas v. American Airlines ( 1997 )


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  • USCA1 Opinion







    United States Court of Appeals
    For the First Circuit
    ____________________


    No. 96-1117

    MARY JANE KERR SELGAS,

    Plaintiff, Appellee,

    v.

    AMERICAN AIRLINES, INC., AND
    WHADZEN CARRASQUILLO,

    Defendants, Appellants.


    ____________________

    APPEAL FROM THE UNITED STATES DISTRICT COURT

    FOR THE DISTRICT OF PUERTO RICO

    [Hon. Jose Antonio Fuste, U.S. District Judge] ___________________

    ____________________

    Before

    Torruella, Chief Judge, ___________
    Coffin and Campbell, Senior Circuit Judges. _____________________

    ____________________

    Howard B. Comet with whom Andrew B. Steinberg and Vicente J. ________________ _____________________ __________
    Antonetti were on brief for appellants. _________
    Judith Berkan with whom Rosalinda Pesquera and Mary Jo Mendez- ______________ __________________ ________________
    Vilella were on brief for appellee. _______


    ____________________

    January 13, 1997
    ____________________





















    COFFIN, Senior Circuit Judge. At issue in this case are the ____________________

    equitable remedies awarded to the plaintiff, Mary Jane Kerr

    Selgas ("Kerr Selgas"), in a sex discrimination suit against her

    employer, American Airlines ("American"). A jury awarded Kerr

    Selgas a lump sum award in that suit that included an unspecified

    amount for front pay. In an earlier appeal, this court affirmed

    the judgment. See Kerr Selgas v. American Airlines, Inc., 69 ___ ____________ ________________________

    F.3d 1205 (1st Cir. 1995) ("Kerr I"). The district court _______

    subsequently ordered Kerr Selgas reinstated by American.

    American maintains in this appeal that front pay and

    reinstatement are mutually exclusive equitable remedies, and that

    the court therefore erred in allowing both to Kerr Selgas. It

    further claims that the district court erred in ordering

    reinstatement without conducting a hearing, without permitting

    American to conduct additional discovery, and in considering

    extra-record evidence submitted by Kerr Selgas. We affirm the

    court's legal judgment that both front pay and reinstatement are

    permissible, but we vacate the district court's order and remand

    for a hearing on whether reinstatement is an appropriate remedy

    here.

    BACKGROUND __________

    The facts of the underlying suit are discussed in detail in

    our opinion in Kerr I; accordingly, we relate here only those ______

    facts relevant to the instant appeal.

    Mary Jane Kerr Selgas was fired by American Airlines in 1992

    after 18 years with the company; she brought suit under federal


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    and Puerto Rico law, alleging sex discrimination, harassment, and

    violation of her local law right to privacy. At the conclusion

    of a three week trial, a jury awarded her over $1 million in

    damages; under Puerto Rico law, this was doubled automatically to

    over $2 million. A remittitur and the rejection of punitive

    damages by this court in Kerr I resulted in a final damages award ______

    of $1.2 million.

    While Kerr Selgas had requested reinstatement in her initial

    complaint, and also in subsequent motions, the district court set

    this issue aside during the course of the trial and during the

    pendency of the Kerr I appeal. One month after this court's ______

    decision in Kerr I on November 13, 1995, the district court ______

    ordered American to reinstate Kerr Selgas. The court did so

    without holding a full hearing on this issue, and its order was

    based on the evidence received at trial and on additional

    materials submitted with motions by Kerr Selgas. American claims

    that this reinstatement order is improper for two reasons.

    First, it argues that reinstatement and front pay are alternative

    remedies and that Kerr Selgas was fully compensated by the jury

    award including front pay. Second, if reinstatement is

    permissible, it argues that it should not have been ordered here

    without first giving American additional discovery and an

    opportunity to be heard on the issue, particularly if evidence

    obtained after the trial was to be considered.

    DISCUSSION __________

    Our review of the district court's decision that both front


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    pay and reinstatement could be awarded together as part of the

    remedies available to a Title VII plaintiff is de novo, as we __ ____

    review for legal error. Compagnie de Reassurance d'Ile de France ________________________________________

    et al. v. New England Reinsurance Corp., et al., 57 F.3d 56, 71 _______ ______________________________________

    (1st Cir. 1995) (review of legal rulings is de novo). However, __ ____

    in reviewing a district court's decision to actually award

    equitable relief, we utilize the abuse of discretion standard.

    Lussier v. Runyon, 50 F.3d 1103, 1111 (1st Cir. 1995). Our _______ ______

    review is deferential, and we will not normally find an abuse of

    discretion absent strong evidence of a lapse in judgment. Texaco ______

    Puerto Rico v. Department of Consumer Affairs, 60 F.3d 867, 875 ___________ _______________________________

    (1st Cir. 1995). In Title VII cases, we must be mindful of the

    statute's dual purposes of eliminating discrimination and making

    its victims whole. Id. __

    A. Equitable Remedies Under Title VII: Front Pay and
    Reinstatement.

    The remedial scheme in Title VII is designed to make a

    plaintiff who has been the victim of discrimination whole through

    the use of equitable remedies. Albemarle Paper Co. v. Moody, 422 ___________________ _____

    U.S. 405, 418 (1975). These remedies (which include

    reinstatement, back pay, and front pay) are accordingly intended

    to compensate a plaintiff for the effects of the discrimination,

    both past and future, and to bring the plaintiff to the position

    which s/he would have occupied but for the illegal act(s). See ___

    Shore v. Federal Express Corp., 777 F.2d 1155, 1159 (6th Cir. _____ ______________________

    1985). Under Title VII, the first choice is to reinstate the

    plaintiff at the original employer; this accomplishes the dual

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    goals of providing full coverage for the plaintiff and of

    deterring such conduct by employers in the future. See Scarfo v. ___ ______

    Cabletron Systems, Inc., 54 F.3d 931, 954 (1st Cir. 1995). _______________________

    Where reinstatement is not immediately available as a

    remedy, either due to the plaintiff's condition, or due to

    conditions at the employer that preclude the plaintiff's return

    (such as hostility of other employees, or the need for an

    innocent employee to be "bumped" in order to reinstate the

    plaintiff), front pay is available as an alternative to

    compensate the plaintiff from the conclusion of trial through the

    point at which the plaintiff can either return to the employer or

    obtain comparable employment elsewhere. See id.; see also Powers ___ ___ ___ ____ ______

    v. Grinnell Corp., 915 F.2d 34, 42 (1st Cir. 1990); Wildman v. ______________ _______

    Lerner Stores Corp., 771 F.2d 605, 616 (1st Cir. 1985) (front pay ___________________

    may be awarded in ADEA suits where reinstatement is impracticable

    or impossible; circumstances of each case to be considered);

    Dillon v. Coles, 746 F.2d 998, 1006 (3rd Cir. 1984). It is this ______ _____

    context, where the overarching preference is for reinstatement

    and front pay is an alternative for finite periods during which

    reinstatement is unavailable,1 which is the key to understanding

    the construction of remedial packages. In this context, it can

    be seen that front pay and reinstatement are not mutually

    ____________________

    1 See, e.g., Scarfo v. Cabletron Systems, Inc., 54 F.3d ___ ____ ______ ________________________
    931, 953 (1st Cir. 1995)("Front pay refers to damages for wages
    from the date of judgment to some specified date in the
    future."); Thompson v. Sawyer, 678 F.2d 257, 293 (D.C. Cir. ________ ______
    1982)("[F]ront pay should persist, however, only until the wrongs
    for which plaintiffs are owed backpay have been righted.")

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    exclusive. Front pay takes a plaintiff to the point of

    employability. Reinstatement at that point would, in effect,

    "perfect" the remedy because the plaintiff would be back in the

    very job she lost unlawfully.

    Trial courts have discretion to fashion the awards in Title

    VII cases so as to fully compensate a plaintiff in a manner that

    suits the specific facts of the case; this discretion includes

    the selection of the elements which comprise the remedial

    recovery.2 Albemarle, 422 U.S. at 415-16. Traditionally, the _________

    court determines the whole remedial package in one fell swoop.

    Hybrid awards combining front pay with other equitable elements,

    while rare, are not novel. The Court of Appeals for the District

    of Columbia in Thompson v. Sawyer, 678 F.2d 257, 268 (D.C. Cir. ________ ______

    1982), commended a district court's award (although it

    reformulated certain of the elements) which included back pay and

    front pay to be paid to female bindery workers at the Government

    Printing Office through such time as women comprised half of the

    litigated positions. Reinstatement and front pay were explicitly
    ____________________

    2 American claims that by presenting her claim for front
    pay to the jury in the form of jury instructions, Kerr Selgas
    "elected" front pay as a remedy, rather than reinstatement. It
    is clear that in a Title VII case, it is the court which has
    discretion to fashion relief comprised of the equitable remedies
    it sees as appropriate, and not the parties which may determine
    which equitable remedies are available. See James v. Sears, ___ _____ ______
    Roebuck & Co., 21 F.3d 989, 997 (10th Cir. 1994) (decision to ______________
    award reinstatement or front pay is at court's discretion;
    plaintiffs who refused reinstatement where not impracticable or
    impossible may not elect front pay simply because they prefer it
    as remedy). Additionally, Kerr Selgas' repeated requests for
    reinstatement in her original complaint and in subsequent motions
    bely a claim that she elected one form of recovery over the
    other.

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    cobbled together as part of the relief afforded the plaintiff in

    Valdez v. Church's Fried Chicken, Inc., 683 F. Supp. 596 (W.D. ______ _____________________________

    Tx. 1988), where reinstatement to a managerial position was

    ordered as soon as a position became available and front pay was

    ordered to continue until the reinstatement occurred. This

    court, while it has not previously addressed this particular

    issue, has indicated a preference for a flexible approach in the

    construction of remedial awards. See Lussier, 50 F.3d at 1112 ___ _______

    (remedial tapestry is made up of multiple strands of relief).3

    The district court therefore had the option here of combining an

    award of front pay with reinstatement. Its only limitation was

    to avoid duplication. See Scarfo, 54 F.3d at 955 (citing Dopp v. ___ ______ ____

    HTP Corp., 947 F.2d 506, 516 (1st Cir. 1991)(duplicative remedies _________

    are to be avoided)). Because courts typically consider all

    remedies at the same time, duplication most commonly would be

    avoided by denying front pay when an immediate reinstatement is

    ordered.

    Although the district court was not explicit about what it

    was doing in this instance (allowing American to argue that

    reinstatement had been excluded as a prospective remedy), it

    appears to have bifurcated the traditional remedies analysis on

    the assumption that, since Kerr Selgas was unable to return to

    work at the time of trial, pay for some future time -- i.e.,
    ____________________

    3 We note that the cases American has cited from our
    circuit merely support the proposition that reinstatement is the
    preferred first remedy, and that where this is unavailable, front
    pay may be awarded, rather than precluding a remedial package
    which contains both elements.

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    front pay -- was necessary to compensate Kerr Selgas, whether or

    not reinstatement would be an appropriate additional remedy.4 It

    therefore reserved the reinstatement issue for later resolution,

    and sent the compensatory elements (back pay, front pay, and

    damages) to the jury for determination.5 By including front pay

    in its lump sum award, the jury fully compensated Kerr Selgas for

    the discrimination she had suffered from the point of the initial

    illegal act to the point at which she would once again be

    employable at her prior level. The court then took up post-trial

    whether American was required to take her back.

    Due to the amorphous nature of the jury award -- it was

    simply a lump sum with no distinctions made between the amounts

    allocated to back pay, front pay, or damages, and with no

    statement as to the time period which the front pay portion was

    intended to cover -- it cannot be stated with any certainty which

    dates or figures the jurors determined were applicable to the

    front pay issue.6 In other words, it is not clear when they
    ____________________

    4 In its June 23, 1994 Order, the district court
    explicitly stated that the issue of reinstatement remained
    pending resolution by the court.

    5 We would counsel district courts in the future to be
    explicit about the procedures they are following, whether they
    choose to reserve an equitable remedy for future determination,
    or conclude that it is inapplicable in a particular instance.

    6 Additionally, an award of front pay, constituting as it
    does, an estimate of what a plaintiff might have earned had s/he
    been reinstated at the conclusion of trial, is necessarily
    speculative. See Loeb v. Textron, Inc., 600 F.2d 1003, 1023 (1st ___ ____ _____________
    Cir. 1979). However, this speculative aspect should not deter
    courts from fashioning awards that accomplish Title VII's goals
    of making a wronged plaintiff whole. See Barbour v. Mitchell, 48 ___ _______ ________
    F.3d 1270, 1280 (D.C. Cir. 1995) (noting courts and juries

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    thought she would be ready to return to work. Testimony at

    trial, however, put the longest date at 18 months after trial, or

    October 1995.7 Furthermore, in its charge to the jury, the

    court specifically limited any damages to those caused by the

    defendants' wrongful conduct.8 Reinstatement was ordered in

    December 1995. The front pay and reinstatement awards thus seem

    most reasonably to cover separate and distinct periods of time.9

    Because there is no duplication, the two equitable remedies of

    front pay and reinstatement could be used in concert to achieve
    ____________________

    routinely engage in some speculation based on factual record in
    other situations such as personal injury cases when valuing lost
    earning capacity).

    7 American's expert testified that Kerr Selgas was fit to
    return to work immediately after the conclusion of trial; Kerr
    Selgas' expert, on the other hand, testified that it would be
    eight to 18 months before she would be able to return to work.
    The testimony concerning her income loss included estimates
    presented by her expert as to the losses she would sustain were
    she to return to work immediately, six months after trial, and
    one year after trial.

    8 In its instructions to the jury, the court stated that
    the jury could award damages only for injuries that the plaintiff
    proved were caused by the defendants' alleged wrongful conduct.
    The court then instructed the jury to consider as elements of any
    damages award back pay, compensatory damages for any future
    pecuniary losses, and damages for emotional pain, suffering,
    inconvenience and mental anguish. It specifically required the
    jury to consider two factors relating to damages for loss of
    future earnings: reduction of the award by any amount that the
    plaintiff would have expended in making those earnings; and
    secondly, reduction of the award by considering the interest that
    the plaintiff could earn on the amount of the award if she made a
    relatively risk-free investment.

    9 Taken at its outside possible limit, the award for
    front pay would seem to have extended from the date of judgment
    (4/13/94) through October 1995. Reinstatement was ordered by
    the district court on December 13, 1995. Accordingly, there is
    no overlap between the time period covered by the front pay award
    and that covered by the reinstatement order.

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    Title VII's goal of fully compensating the plaintiff. This

    brings us to American's second point on appeal: whether the

    process used to reach the reinstatement decision was proper.

    B. Admission of Evidence and Lack of Hearing on Restitution.

    American contends that the trial court erred in ordering

    reinstatement because it impermissibly considered evidence not

    adduced at trial, and because American was not permitted

    additional discovery or a hearing on the reinstatement issue.

    In considering the plaintiff's post-trial motion for

    reinstatement, the court had before it both the evidence received

    at trial, and additional evidence submitted by the plaintiff

    purporting to demonstrate that some of the issues which might

    have earlier precluded reinstatement (including hostility of

    other employees and the plaintiff's own inability to work) were

    no longer bars to her return.10 The district court explicitly

    relied upon some of this evidence in its order, citing the

    information in a newspaper article relating to the departure of

    certain individuals from American, and her treating

    psychologist's statement that Kerr Selgas was fit to return to

    work. However, the court also noted that defendants had
    ____________________

    10 Specifically, the plaintiff produced news reports that
    one of the chief offenders in her experience at American, Whadzen
    Carrasquillo, had left the company. She also produced a
    statement by her treating psychologist, Carlos Velasquez, stating
    he believed she was fit to return to work at American.
    Velasquez' affidavit, however, speaks only in the most general
    terms: it states that on the basis of unspecified tests conducted
    at unspecified dates, Kerr Selgas "is currently[...]functioning
    adequately" and that he therefore believes she is "now able to
    return and to carry out her duties as Account Sales Executive at
    American Airlines."

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    presented testimony at trial that Kerr Selgas was fit to return ________

    to work in March 1994.11

    The adversarial system's search for truth and the assessment

    of remedies are predicated upon an open and fair exchange of

    ideas and information. Lussier, 50 F.3d at 1113. It is a _______

    fundamental principle of this system that a fact finder may not

    consider extra-record evidence concerning disputed adjudicative

    facts. Id. at 1114. While we have suggested in at least one ___

    case that parties might possibly waive a deprivation of the

    evidentiary and procedural guarantees embodied in the managed

    adversarial system with regard to extra-record evidence, or

    consent to a court's consideration of it, see id. at 1115, the ___ ___

    evidence supporting such a voluntary and knowing waiver would

    need to be significant and unequivocal.

    Such is not the case here. American repeatedly stated its

    opposition to Kerr Selgas' reinstatement, and more importantly

    repeatedly requested a hearing and discovery on the reinstatement

    issue.12 Kerr Selgas herself requested a jury trial on the ____
    ____________________

    11 Kerr Selgas suggested at oral argument that the
    district court could have reached its determination without
    relying on the new evidence; however, this is belied by the
    language of the district court's order.

    12 American opposed Kerr Selgas' motion for reinstatement
    in a 12-page opposition filed on December 23, 1994, citing among
    other reasons, the need for an evidentiary hearing and additional
    discovery due to the lack of sufficient information in either
    the evidence submitted at trial or the later submissions with
    which to determine whether Kerr Selgas was in fact fit to return
    to work. In its July 27, 1995 Opposition to Plaintiff's Renewed
    Request for Reinstatement and Related Benefits, American also
    opposed Kerr Selgas' reinstatement. Again, in its December 8,
    1995 Opposition to Plaintiff's Request for Reinstatement and

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    reinstatement issue in her July 10, 1995 motion requesting

    reinstatement. Therefore, there is no indication of any

    intention on either party's part to waive a hearing on the

    reinstatement issue.

    Where the district court based its determination at least

    partially on information not properly before it in the form of

    evidence admitted at trial, and where the remedy to be accorded

    the plaintiff is as significant as reinstatement, we are hesitant

    to applaud anything less than strict adherence to those

    procedures which accord each party the opportunity to be fairly

    heard on key issues. Accordingly, while we hold that

    reinstatement may properly be awarded in a Title VII case

    together with front pay as long as there is no duplication

    between the two awards, in this case we believe a hearing should

    have been held to determine whether reinstatement was

    appropriate. Therefore, we vacate the district court's

    reinstatement order and remand for proceedings consistent with

    this opinion to determine whether Kerr Selgas should be

    reinstated by American.13

    ____________________

    Related Benefits, American raised its objection to reinstatement
    being ordered without an evidentiary hearing and the opportunity
    for further discovery.

    13 We anticipate a limited hearing on the reinstatement
    issue. See Uno v. City of Holyoke, 72 F.3d 973, 992 (1st Cir. ___ ___ _______________
    1995) (on remand, lower court may conduct hearing without having
    new trial and permit parties to supplement the existing record
    with additional facts). As Kerr Selgas has been compensated for
    the time from the initial act to the point of her employability,
    further monetary damages are not available to her, and the
    damages question is no longer open.

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    CONCLUSION __________

    Courts may properly combine the equitable remedies of front

    pay and reinstatement in order to meet Title VII's goal of

    providing full compensation to the victims of illegal

    discrimination, as long as there is no economic or chronological

    duplication between the awards. However, the protections

    inherent in the adversarial system demand that full and complete

    hearings be provided on contested issues affecting these

    equitable remedies.



    Vacated and remanded. No costs to either party. ________________________________________________
































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