Murrell-Travland v. On Q Financial Incorporated
Filing
94
JUDGMENT: IT IS ORDERED, pursuant to Rule 58 of the Federal Rules of Civil Procedure, entering judgment on Travland's claim in her favor and against On Q in the amount of $79,800.19. Signed by Judge G Murray Snow on 7/30/2013. (LFIG)
1
WO
2
3
4
5
6
IN THE UNITED STATES DISTRICT COURT
7
FOR THE DISTRICT OF ARIZONA
8
9
Lindsay R. Murrell-Travland; and Sonny N.
Travland,
No. CV-11-01622-PHX-GMS
JUDGMENT ORDER
10
Plaintiffs,
11
v.
12
On Q Financial,
corporation,
13
Inc.,
an
Arizona
Defendant.
14
Pending before the Court is the verdict on Plaintiff Lindsay Travland’s Title VII
15
16
pregnancy discrimination claim and the issue of appropriate equitable relief.
17
I.
JURY VERDICT
18
Travland claimed that Defendant On Q Financial, Inc. discharged her on the basis
19
of her pregnancy in violation of Title VII’s prohibition on sex discrimination.1 After
20
hearing all the evidence, the jury returned a verdict that answered specific interrogatories.
21
The jury made the following determinations: (1) Travland’s pregnancy or her request to
22
1
23
24
25
26
27
28
The statute defines sex discrimination in the following manner:
The terms “because of sex” or “on the basis of sex” include, but are not
limited to, because of or on the basis of pregnancy, childbirth, or related
medical conditions; and women affected by pregnancy, childbirth, or
related medical conditions shall be treated the same for all employmentrelated purposes, including receipt of benefits under fringe benefit
programs, as other persons not so affected but similar in their ability or
inability to work, and nothing in section 2000e-2(h) of this title shall be
interpreted to permit otherwise.
42 U.S.C. § 2000e(k).
1
take time off for childbirth was a motivating factor for On Q’s decision to discharge her;
2
(2) On Q’s decision to discharge Travland was also motivated by a lawful reason; (3) On
3
Q would not have made the same decision to discharge Travland even if Travland’s
4
pregnancy or her request to take time off for childbirth had played no role in On Q’s
5
decision to discharge Travland; (4) Travland was entitled to compensatory damages; and
6
(5) Travland was not entitled to punitive damages. (Doc. 92.) The jury awarded Travland
7
$68,000 in compensatory damages.
8
Nevertheless, the parties acknowledge that, pursuant to statute, a jury’s award of
9
compensatory and punitive damages on Title VII claims against an employer of On Q’s
10
size are collectively capped at $50,000, in addition to any equitable back pay award to be
11
calculated by the Court. 42 U.S.C. § 1981a(b)(3)(A). The Court therefore reduces the
12
compensatory damages award on Travland’s claim to $50,000.
13
II.
BACK PAY
14
Title VII of the Civil Rights Act of 1964 permits courts to grant equitable
15
remedies to employees who have been subjected to impermissible discrimination by
16
employers with fifteen or more employees. See 42 U.S.C. § 2000e–5(g). “The relevant
17
remedies include reinstatement and awards of back pay and front pay.” Caudle v. Bristow
18
Optical Co., Inc., 224 F.3d 1014, 1020 (9th Cir. 2000). “The district court has wide
19
discretion in awarding remedies to make a Title VII plaintiff whole.” Odima v. Westin
20
Tucson Hotel, 53 F.3d 1484, 1495 (9th Cir. 1995). In making its equitable award, the
21
Court relied on the following determinations.
22
23
24
25
Travland is seeking back pay for a 53 week period from October 9, 2007, the day
of her termination, until October 15, 2008.
At the time of her termination, Travland’s yearly salary was $68,000. Her weekly
salary was therefore $1,307.69.
26
The appropriate cutoff date for back pay is the end of March 2008. The
27
uncontroverted evidence is that Travland had a job offer on that date from Colonial
28
Insurance. Under Title VII’s provisions for back pay, “interim earnings or amounts
-2-
1
earnable with reasonable diligence by the person or persons discriminated against shall
2
operate to reduce the back pay otherwise allowable.” 42 U.S.C. § 2000e-5(g)(1).
3
Consequently, a plaintiff seeking back pay has “a duty to mitigate damages by seeking
4
alternative employment with ‘reasonable diligence.’” Caudle, 224 F.3d at 1020. The
5
Supreme Court described this duty as “ancient” and observed that, “[a]lthough the
6
unemployed or underemployed claimant need not go into another line of work, accept a
7
demotion, or take a demeaning position, he forfeits his right to backpay if he refuses a job
8
substantially equivalent to the one he was denied.” Ford Motor Co. v. E. E. O. C., 458
9
U.S. 219, 231–32 (1982). This is “because the availability of [a] better job terminates the
10
ongoing ill effects of the defendant’s refusal to hire the claimant.” Id. at 234. The
11
defendant bears the burden of showing “(1) there were suitable positions available for
12
[plaintiff]; and (2) she failed to use reasonable care and diligence in seeking out those
13
positions.” E.E.O.C. v. High Speed Enter., Inc., 833 F. Supp. 2d 1153, 1162 (D. Ariz.
14
2011) (citing Jackson v. Shell Oil, 702 F.2d 197, 202 (9th Cir. 1983); E.E.O.C. v. Farmer
15
Bros. Co., 31 F.3d 891, 906 (9th Cir. 1994)).
16
The primary question is whether the Colonial Insurance job was suitable. While
17
this position required a different skill-set than her work as a mortgage loan processor,
18
Travland testified that she had been performing similar work and had even formed an
19
LLC to focus on business-to-business group health insurance. With regard to income,
20
Travland testified that she could have earned $75,000–100,000 a year in commissions
21
working as an independent contractor with Colonial. That arrangement differs from her
22
previous position, which came with the comfort of a salary, benefits, and overtime. Still,
23
that salary was $7,000 less than the low end of Travland’s own estimate of what she
24
would likely make as an independent contractor for Colonial. In light of the significantly
25
higher level of income (at least 10%) that Travland would gain working for Colonial and
26
the fact that Travland already had the necessary skill-set to succeed in that job, the Court
27
concludes that the Colonial job was substantially equivalent to the position Travland held
28
with On Q. Travland’s contention that taking the job would present childcare
-3-
1
complications does not make the job unsuitable. Any full-time position would require
2
childcare adjustments. The fact that this job would have paid on commission does not so
3
complicate the matter of paying for childcare as to render it unsuitable. Consequently, her
4
refusal to take that job terminates On Q’s liability for back pay.
5
Because the position was offered at the end of March 2008, the Court will
6
terminate On Q’s back pay liability at the first week of April 2008. Travland is
7
consequently entitled to 25 weeks of back pay. Her unadjusted pay entitlement is
8
$32,692.30.
9
At the time of her termination, Travland had accrued 145 hours of “paid time off”
10
or PTO. She was earning an annual salary of $68,000, at an hourly rate (assuming a 5
11
day, 8 hour workweek) of $32.69. She was therefore entitled to $4,740.38 in accrued
12
PTO. However, Travland testified that she had to take six weeks off of work to deliver
13
her baby and would have exhausted any accrued PTO for that purpose. Because the Court
14
has not yet deducted any of those six weeks from her back pay entitlement, the PTO is
15
already included in her back pay recovery.2
16
The Court now makes the following deductions from the $32,692.30. As discussed
17
above, Travland was under doctor’s orders not to return to work after her delivery for six
18
weeks, which amounts to 30 work days, or 240 work hours. She would have used her 145
19
hours of PTO to cover some of that time off, but would not be working for the remaining
20
95 hours. Travland did not testify that she would have otherwise been working and
21
entitled to her salary during that period. Consequently, the Court deducts $3,105.77 from
22
her pay, bringing the subtotal to $29,586.53.
23
Travland testified that she was offered a severance package that included
24
approximately 30 days of pay. Nevertheless, she also testified that she did not sign the
25
agreement, and thus, presumably, did not receive the 30 days of pay—at least there was
26
no evidence to that effect. No deduction has been made on this basis.
27
28
2
Travland has avowed that she is not seeking the value of any other lost benefit.
-4-
1
Travland received state unemployment benefits totaling $13,285.00 during this
2
period, and around $3,000 in disability benefits. On Q contends that these benefits should
3
be deducted from any award of back pay. The collateral source rule, however, states that
4
“‘benefits received by the plaintiff from a source collateral to the defendant may not be
5
used to reduce that defendant’s liability for damages.’” McLean v. Runyon, 222 F.3d
6
1150, 1155–56 (9th Cir. 2000) (quoting 1 Dan B. Dobbs, Law of Remedies § 3.8(1) at
7
372–73 (2d ed. 1993)). The rule ensures that a defendant does not “get a windfall for
8
collateral benefits received by the plaintiff.” Id. at 1156; see also Gypsum Carrier, Inc. v.
9
Handelsman, 307 F.2d 525, 534 (9th Cir. 1962) (“As between the injured person and the
10
tortfeasor, the former’s claim is the better. . . . The tortfeasor bears only the single burden
11
for his wrong. That burden is imposed by society . . . to deter” wrongful conduct.”).
12
While Defendant may be responsible for an increased unemployment tax for its former
13
employees that are awarded benefits, it presented no evidence or argument to this effect,
14
or to otherwise demonstrate that the benefits awarded by the state were not truly
15
collateral. Nor did On Q present any other evidence or assertion that unemployment
16
benefits do not fall within what might otherwise be characterized as benefits from a
17
collateral source. The unemployment and disability benefits were collateral.
18
The Ninth Circuit has observed, that “[o]ur precedent is not absolutely clear as to
19
whether a district court has discretion to deduct collateral benefits from a damages award
20
under Title VII.” McLean, 222 F.3d at 1156 n.7. Compare Kauffman v. Sidereal, 695
21
F.2d 343, 347 (9th Cir. 1982) (“We . . . hold that unemployment benefits received by a
22
successful plaintiff in an employment discrimination action are not offsets against a [Title
23
VII] back pay award.”), with Naton v. Bank of California, 649 F.2d 691, 700 (9th Cir.
24
1981) (holding that district court had discretion to deduct collateral benefits from a back
25
pay award under the ADEA, which uses the same standards as Title VII); see also Lussier
26
v. Runyon, 50 F.3d 1103, 1109 (1st Cir. 1995) (concluding that Kauffman and Naton
27
reflect “an internal division” in this circuit on the issue whether district courts have
28
discretion to deduct collateral benefits from damages awards under anti-discrimination
-5-
1
statutes).
2
In the absence of any argument or evidence that unemployment benefits are not
3
truly a “collateral source,” this Court follows Kauffman. Its language is clear that state
4
unemployment benefits should not be deducted from any award of back pay under Title
5
VII. 695 F.2d at 347. That case is the most factually similar, since it involved an award
6
under Title VII while Naton involved a different statute, and it is the Ninth Circuit’s latest
7
pronouncement on the topic. Therefore, the Court makes no deduction for the state
8
unemployment or disability benefits awarded to Travland.
9
The Court therefore awards Travland $29,586.53 in back pay. “An award of
10
prejudgment interest on a back pay award is appropriate.” Domingo v. New England Fish
11
Co., 727 F.2d 1429, 1446 (9th Cir. 1984). The interest rate used to calculate prejudgment
12
interest is within the discretion of the trial judge. W. Pac. Fisheries, Inv. v. SS President
13
Grant, 730 F.2d 1280, 1288 (9th Cir. 1984). This discretion must be exercised with a
14
view to the fact that prejudgment interest is an element of compensation, not a penalty.
15
Id.; Jung v. Potter, No. CV 04–429–PHX–MHM, 2008 WL 2620905 at *6 (D. Ariz. July
16
1, 2008). In calculating prejudgment interest, the Court will use the weekly average 1–
17
year constant maturity Treasury yield. See id.; see also Blankenship v. Liberty Life Assur.
18
Co. of Boston, 486 F.3d 620, 628 (9th Cir. 2007) (“Generally, ‘the interest rate prescribed
19
for post judgment interest under 28 U.S.C. § 1961 is appropriate for fixing the rate of
20
prejudgment interest unless the trial judge finds, on substantial evidence, that the equities
21
of that particular case require a different rate.’” (quoting Grosz–Salomon v. Paul Revere
22
Life Ins. Co., 237 F.3d 1154, 1163–64 (9th Cir. 2001)). For the day ending July 25, 2013,
23
the applicable interest rate was 0.12%,3 yielding prejudgment interest of $213.66.
24
Although neither party discussed the issue of postjudgment interest, “[u]nder the
25
provisions of 28 U.S.C. § 1961, postjudgment interest on a district court judgment is
26
mandatory.” Air Separation, Inc. v. Underwriters at Lloyd’s of London, 45 F.3d 288, 290
27
3
28
Selected Interest Rates, Board of Governors of the Federal Reserve System,
http://www.federalreserve.gov/releases/h15/update/.
-6-
1
(9th Cir. 1995) (citing Perkins v. Standard Oil Co., 487 F.2d 672, 674 (9th Cir. 1973)).
2
Postjudgment interest applies to the entire judgment, including principal, prejudgment
3
interest, attorneys’ fees, and costs. Id. at 291. The postjudgment interest rate is set “at a
4
rate equal to the weekly average 1–year constant maturity Treasury yield, as published by
5
the Board of Governors of the Federal Reserve System, for the calendar week preceding .
6
. . the date of the judgment.” 28 U.S.C. § 1961(a). Accordingly, the Court will award
7
post-judgment interest at 0.12% per year.
8
After making the relevant deductions, the Court awards Travland $29,800.19 in
9
back pay, inclusive of prejudgment interest. Together with the compensatory damages
10
awarded by the jury, which are capped at $50,000, judgment is entered in Travland’s
11
favor on her Title VII and Pregnancy Discrimination Act claims in the total amount of
12
$79,800.19.
13
IT IS THEREFORE ORDERED, pursuant to Rule 58 of the Federal Rules of
14
Civil Procedure, entering judgment on Travland’s claim in her favor and against On Q in
15
the amount of $79,800.19.
16
Dated this 30th day of July, 2013.
17
18
19
20
21
22
23
24
25
26
27
28
-7-
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?