Free Reply to Response to Motion - District Court of Colorado - Colorado

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Civil Action No. 04-cv-1067-REB-CBS WILLIAM R. CADORNA, Plaintiff, v. CITY AND COUNTY OF DENVER, COLORADO, a municipal corporation, Defendant. REPLY BRIEF IN SUPPORT OF MOTION TO ALTER OR AMEND JUDGMENT Defendant, City and County of Denver, Colorado ("Denver"), by and through its counsel, hereby submits the following reply brief in support of its Motion to Alter or Amend Judgment and Supporting Brief ("Motion to Alter or Amend"). 1. As an alternative to its motion for a new trial, Denver has filed the Motion

to Alter or Amend. In it, Denver showed that (a) the amount of damages awarded by the jury greatly exceeded the maximum amount of damages that could have been awarded based on the evidence, and (b) if the Court does not grant Denver a new trial, the Court should reduce the amount of damages to conform to the evidence. 2. In his Response, Cadorna argues at length that the Court should deny the

Motion to Alter or Amend because the jury has broad discretion with respect to damages. (See Resp. at 4-6.)1 This argument, however, completely ignores the point

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In his Response, Cadorna purports to describe a "very strict standard" for challenging an award of damages, by quoting extensively from Malandris v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 703 F.2d 1152 (10th Cir. 1981) and Bennett v. Longacre, 774 F.2d 1024 (10th Cir. 1985). The standard Cadorna cites, however, applies to a motion

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raised in the Alternative Motion. Regardless of the width, breadth, or depth of the jury's discretion, it does not have discretion to award damages that exceed the maximum amount supported by the evidence.2 emphasized a number of years ago: It is hornbook law that the fact-finder, whether it be a jury or the court, may not be permitted to reach its verdict or decision merely on the basis of guess or conjecture but that there must be evidence, direct or circumstantial, upon whi[ch] logically its conclusion may be based. Marrazzo v. Scranton Nehi Bottling Co., 223 A.2d 17, 21 (Pa. 1966). 3. Federal courts, including the Tenth Circuit, have likewise emphasized that As the Supreme Court of Pennsylvania

the amount of damages "must be ascertainable 'in some manner other than by mere speculation conjecture or surmise, and by reference to some definite standard.'" John for a new trial based on the amount of the jury verdict. See Malandris, 703 F.2d at 1168 & n.5a; Mason v. Texaco, Inc., 948 F.2d 1546, 1560 (10th Cir. 1991). In the alternative Motion to Alter or Amend, Denver is not requesting a new trial. It is requesting a remittitur. And as the Malandris Court recognized, a different standard applies to the "widely recognized remedy" of remittitur. Malandris, 703 F.2d at 1168. Using the remedy of remittitur, the court may correct a jury's award of damages when such damages are calculable from the evidence introduced at trial and the jury's award is not supported by that evidence. R.E.B., Inc. v. Ralston Purina Co., 525 F.2d 749, 755 (10th Cir. 1975) (jury's verdict reduced to amount supported by evidence introduced at trial); Holmes v. Wack, 464 F.2d 86, 89 (10th Cir. 1972) ("[W]here the court believes that the judgment for damages is excessive, that is, it is against the weight of the evidence, the court may order a remittitur and alternatively direct that there be a new trial if the plaintiff refuses to accept it.") When the evidence establishes a calculable range of damages and a jury's damage award departs from that range, the court's task is "to ascertain a figure which fairly responds to the evidence." Ralston Purina, Co., 525 F.2d at 755.
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Further, it is hard to understand why an award that is three times (and $400,000 more than) the maximum amount the jury could have awarded legitimately does not demonstrate passion and prejudice. This is particularly true in light of the fact that Cadorna's counsel acknowledged in a post-verdict article, that the jury's verdict was due to passion and prejudice. See Carolyn Matthews, 'Jury From Heaven': Jurors Over Age 55 Aided Lawyer in Winning $1.2M Verdict, LAW W EEK, December 12, 2006, at 1, 13) (statement by Brennan's counsel that Cadorna "was approached by members of the jury after the verdict who said they favored the plaintiff early and just awaited the chance to award [sic] him financially.") (Ex. R to Denver's Mot. for New Trial).) 2

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A. Henry & Co. v. T.G. & Y. Stores Co., 941 F.2d 1068, 1071 (10th Cir. 1991) (citation omitted); see also Century 21 Real Estate Corp. v. Meraj Int'l Invest. Corp., 315 F.3d 1271, 1281 (10th Cir. 2003) ("Enforcement of a verdict based on speculative evidence of damages can be a miscarriage of justice."). Accordingly, "when the jury award is not 'within the universe of possible awards which are supported by the evidence,' courts must provide relief . . . ." Rivera Castillo v. Autokirey, Inc., 379 F.3d 4, 14 (1st Cir. 2004) (citation omitted); see also Lowe v. Southmark Corp., 998 F.2d 335, 337 (5th Cir. 1993) (It is necessary that a jury's calculation of back pay be reasonable and supported by evidence presented in the record."); Nat'l Farmers Org., Inc. v. Kinsley Bank, 731 F.2d 1464, 1472 (10th Cir. 1984) ("'In order for the evidence to be sufficient to warrant recovery of damages there must be some reasonable basis for computation which will enable the jury to arrive at an approximate estimate thereof.'") (citation omitted). 4. In fact, one of the cases on which Cadorna relies heavily makes it clear

that when an amount of damages is not supported by competent evidence, it cannot stand. Cadorna quotes Bennett v. Longacre, 774 F.2d 1024, 1028 (10th Cir. 1985), as stating that "the amount of damages awarded by a jury can be supported by any competent evidence tending to sustain it." But this means that the adverse is also true, and that if "the amount of damages awarded by a jury" is not "supported by any competent evidence tending to sustain it," the amount of the award cannot stand. 5. In other words, if evidence is presented showing that the plaintiff's back

pay loss is between $100,000 and $200,000, a jury has the discretion to return a verdict that falls anywhere within that range. But a jury does not have the discretion to return a verdict awarding $600,000 in back pay. An award of that amount is not 'within the

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universe of possible awards which are supported by the evidence . . . .'" Rivera Castillo, 379 F.3d at 14 (citation omitted). 6. And that is precisely the case here. As Denver showed in its Motion to

Alter or Amend, although evidence existed that would support an award of damages in the amount of $205,515.55, no evidence supported the much higher amount ­ $610,571.00 ­ awarded by the jury. Accordingly, the Court "must provide relief" Id. 7. In an attempt to avoid a reduction in the amount of damages, Cadorna

praises the jury's intelligence and acumen and hypothesizes that the jury's intelligence and acumen might have led the jury to adjust the award upward to take into account factors such as taxes. (See, e.g., Resp. at 8.) But Cadorna's hypothesis proves the point Denver has made in its Motion to Alter or Amend. The jury's verdict was not based on evidence because there was no evidence presented to the jury on which it could have made such a hypothesized upward adjustment. Thus, the jury's verdict must have been the result of speculation and conjecture, and it cannot stand. See Roberts v. Adams, 47 P.3d 690, 697 (Colo. App. 2002) (reversing damages for cost to replace carpet on stairs and master bedroom where plaintiff presented no evidence of the replacement cost); R&R Real Estate Co. v. C&N Armstrong Farms, Ltd., 854 N.E.2d 365, 371 (Ind. App. 2006) (where lease provided that defendant would pay plaintiff ten cents a bushel rent for use of grain-storage bins, but plaintiff offered no evidence about number of bushels stored in bins, plaintiff was not entitled to an award of damages); see also ESCA Corp. v. KPMG Peat Marwick, 939 P.2d 1228, 1234 (Wash. App. 1997), aff'd 959 P.2d 651 (Wash. 1998); Shearer's Inc. v. Lyall, 717 S.W.2d 128, 130 (Tex. App. 1986).

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8.

Recognizing the huge disparity between the amount of damages

supported by the evidence and the amount of damages awarded by the jury, Cadorna attempts to narrow the gap by making three arguments. First, Cadorna argues that the evidence showed that he "would have received an additional $8,727 in lost vacation and sick pay for 2007 and 2008." (Resp. at 10 (citing Tr.741:18-25).) But Cadorna's

damages were limited to back pay ­ which encompassed a time period that ended on June 29, 2006 ­ and thus his damages would not include "lost vacation and sick pay for 2007 and 2008." 9. Second, Cadorna contends that Denver's calculation fails to include

amounts Cadorna lost because he was precluded from participating in the Deferred Retirement Option Plan ("DROP") between October 31, 2003, and June 29, 2006. Cadorna asserts that "in raw, 'arithmetic' terms, the deposits to his DROP investment account . . . would have totaled $85,797.80." (Resp. at 7.) Further, because of

potential growth, "[t]he jury may well have calculated that [the DROP account] might have grown to something in the range of $150,000.00 by June 29, 2006." (Id. at 8.) 10. respects. Cadorna's argument about the DROP account is flawed in four separate First, DROP is not a lost benefit. Upon reinstatement, Cadorna will be

eligible to participate in DROP, and if Cadorna elects to participate in DROP, pension payments will be made to a DROP account just as they would have been beginning in October 2003, absent Cadorna's retirement. Accordingly, at most, DROP is a deferred benefit. 11. With proper proof, Cadorna might have been able to recover some

amount because of the deferral of his participation in DROP. But Cadorna failed to offer

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proper proof. No evidence was ever presented as to the amount that was lost by Cadorna because of the deferral of his participation in DROP. Accordingly, any amount awarded for that loss would have been improper because it would have been based wholly on speculation, conjecture, and guess. 12. For the same reason, any award based on the jury's speculation about the

amount earned on the DROP investment would also have been completely improper because no evidence was presented about the growth rate. In fact, the absurdly high rate of investment growth postulated by Cadorna ­ a $65,000 increase in the account even though the very first amounts deposited would have been made less than three years earlier ­ demonstrates that for the jury to have estimated the earnings of the DROP account, it would have had to "pull figures out of a hat . . . ." Neiman-Marcus Group, Inc. v. Dworkin, 919 F.2d 368, 372 (5th Cir. 1990). 13. In any event, DROP cannot properly be characterized as a "lost" benefit

because Cadorna received it. The DROP payments were actual pension payments to an employee who retired and then deferred retirement. (See Tr.673:18-674:8 (Ex. E).) When Cadorna retired, he received the actual pension payments that he would have received from DROP. Because of the jury's verdict, Cadorna will receive the back pay he lost. Thus, Cadorna will be fully compensated: He will have received the full amount of his salary, and he will have received the full amount of DROP. 14. Nor does the collateral source rule preclude this analysis, as Cadorna

suggests. (See Resp. at 11.) The payments Cadorna received are not from a collateral source; they are from the identical source. Cadorna received the actual pension

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payments that he would have received from DROP. He is not entitled to receive them again.3 15. Cadorna's third argument in his effort to narrow the gap between the

evidence of damages and the award of damages is to argue that the monthly payments he made to his pension plan each month were damages he incurred, and not an offset to his damages. But Cadorna's argument makes no sense. Cadorna made pension payments while he was employed. After his retirement, he did not have to make the pension payments, that is, he saved the cost of making pension payments. Thus, his costs were reduced because of his retirement, and the amount of that reduction is an offset of his damages. 16. Cadorna appears to believe that his contributions are a loss because they

are not "credited to [his] pension account." (Resp. at 10.) But this merely reflects a misunderstanding of pension funds. Cadorna's pension is not limited to the amount of his contributions, so that when the money he contributes is gone, the plan stops making payments to him. Rather, pension funds are structured to make annuity payments after retirement. If people who are entitled to receive payments die soon after retirement, they do not get the full benefit of their contributions. Alternatively, if people who are entitled to receive payments live for a long time after retirement, they may receive more than the full amount of their contributions. Thus, the fact that Cadorna did not make

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Even if the DROP account were considered a component of Cadorna's damages, it would only increase the maximum jury award from $205,515.55 to $291,313.35. Thus, the compensatory damages award and the liquidated damages award would still both have to be reduced by $319,257.65, for a total reduction of the judgment by $638,515.30. 7

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payments does not mean that he will not receive pension payments. The pension contributions were properly treated as an offset to Cadorna's damages. ACCORDINGLY, for the reasons set forth above and in Cadorna's Motion to Alter or Amend, if the Court denies Denver's motion for a new trial, Denver requests that the Court reduce the total judgment ­ reflecting both compensatory and liquidated damages ­ to $411,031.10: $51,984.21 in compensatory damages and $51,984.21 in liquidated damages on Cadorna's first claim; and $153,531.34 in compensatory damages and $153,531.34 in liquidated damages on Cadorna's second claim. Respectfully submitted this 23rd day of February, 2007. BROWNSTEIN HYATT & FARBER, P.C. s/ Richard Barkley_________________ Richard P. Barkley James S. Hardy 410 17th Street, 22nd Floor Denver, Colorado 80202 (303) 223-1100 s/ Christopher Lujan________________ Christopher M.A. Lujan, Esq. Asst. City Attorney, Litigation Section City and County of Denver 201 West Colfax, Department 1108 Denver, Colorado 80202 ATTORNEYS FOR DEFENDANT

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CERTIFICATE OF SERVICE The undersigned hereby certifies that on the 23rd day of February, 2007, a true and correct copy of the foregoing REPLY BRIEF IN SUPPORT OF MOTION TO ALTER OR AMEND JUDGMENT was served via the CM/ECF system to the following: Mark E. Brennan, Esq. Mark E. Brennan, P.C. P.O. Box 2556 Centennial, Colorado 80161 Email: [email protected] s/ Richard Barkley_________________ Richard P. Barkley

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