Free 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. ______________________________________________________________________ PLAINTIFF'S RESPONSE TO DEFENDANT'S MOTION TO ALTER OR AMEND JUDGMENT AND SUPPORTING BRIEF ______________________________________________________________________ Plaintiff, William R. Cadorna ("Plaintiff" or "Mr. Cadorna") hereby responds to the December 11, 2006 Motion to Alter or Amend Judgment and Supporting Brief ("motion") filed by Defendant City and County of Denver ("Defendant" or "City") pursuant to Fed.R.Civ.P. 59(e): I. Introduction. The evidence and facts support the June 29, 2006 jury award and thus this Court should not amend or alter the judgment because no errors of law or manifest injustice have occurred. Fed.R.Civ.P. 59(e). Plaintiff agrees that Jury Instruction No. 26 (See Exhibit A to Defendant's motion) was submitted to the jury for damages on Cadorna's two claims for relief, wrongful

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termination and failure to reinstate under the Age Discrimination in Employment Act ("ADEA") 29 U.S.C. §§621-634. Plaintiff objects to Defendant's assertion that the only evidence presented on the amount of Mr. Cadorna's Damages was Exhibit 57 (See Exhibit B to Defendant's motion) entitled "Cash Benefits if Member had not Retired." Contrary to this assertion, there was witness testimony from Ida Roberts, the City's benefits manager, and William Cadorna which expanded on Plaintiff's damages. (Tr: 740:9-25, 741:1-25)(See Ex. A). II. The Evidence Supports the Economic Damages Awarded by the Jury. It was Plaintiff's good fortune, and the City's misfortune, that the jury impaneled to hear this case pursuant to the Seventh Amendment was highly intelligent, educated, diverse, and mature. The jury included a 63 year-old former investment manager for a large insurance company, a 51 year-old warehouse manager, a 54 year-old retired Naval Officer and computer programmer, a 60 year-old retired restaurant owner, a 65 year-old retired executive assistant, a 40 year-old flight attendant, a 57 year-old political consultant married to a City engineer, and a 40 year-old shop foreman. Throughout trial, the jury displayed remarkable attentiveness and comprehension. Many took extensive notes. They brought with them the cumulative experience of eight lifetimes and careers, spanning some 430 years. There is every reason to believe they took their duties very seriously, and deliberated very conscientiously, in strict accordance with the Court's instructions. There is certainly no evidence whatsoever to the contrary.

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After eight days of trial, and due deliberation over several hours, the jury found that the City unlawfully terminated Plaintiff, and subsequently refused to reinstate him, because of his age. The jury awarded him $610,571.00 in back pay. Unlike, say, a verdict for $10,000,000.00, this sum clearly did not spring from the fevered minds of an unthinking mob motivated by passion and prejudice. It obviously resulted from careful computation. It obviously represented the jury's conscientious estimate, based upon all of the evidence, of the full amount(s) necessary to make Plaintiff whole for his economic losses. "The concept underlying the remedial scheme in employment discrimination cases is to make the plaintiff whole." Perdue v. CUNY, 13 F.Supp.2d 326, 340 (E.D.N.Y. 1998). The amount of damages to which an injured party is entitled is a matter within the sole province of the jury. Loughridge v. Chiles Power Supply Co., Inc., 431 F.3d 1268, 1281 (10th Cir. 2005). See also Ismail v. Cohen, 899 F.2d 183, 186 (2nd Cir. 1990) (It is well settled that the "calculation of damages is the province of the jury.") Because the jury found Defendant's violation of the ADEA to be willful, this Court entered judgment reinstating Plaintiff, effective June 29, 2006, and awarding him $610,571.00 in back pay and $610,571.00 in liquidated damages. The City now seeks judicial nullification of the jury's considered verdict, in cavalier derogation of Plaintiff's Seventh Amendment rights. It would have this Court substitute its judgment for that of the jury, simply because the evidence may admit of a range of estimates of the economic losses caused by the City's misconduct, or a range of estimates of the total amount(s) required to place Plaintiff in exactly the same position

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he would have been in had he not been unlawfully terminated and denied reinstatement. The City now complains that the jury did not limit its award to (less than) the purely arithmetic, "bare-bones" amounts having failed to do so before the jury was excused. In Malandris v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 703 F.2d 1152, 1168 (10th Cir. 1981), the Tenth Circuit enunciated the very strict standard governing a request by an unlucky Defendant that a judge usurp the jury's constitutional role: We have said that absent an award so excessive as to shock the judicial conscience and to raise an irresistible inference that passion, prejudice, corruption or other improper cause invaded the trial, the jury's determination of the damages is considered inviolate. Metcalfe v. Atchison, Topeka and Santa Fe Railway Co., 491 F.2d 892, 898 (10th Cir.); Ketchum v. Nall, 425 F.2d 242 (10th Cir.); see Hudson v. Smith, 618 F.2d 642, 646 (10th Cir.); Colorado Coal Furnace Distributors, Inc. v. Prill Manufacturing Co., 605 F.2d 499 (10th Cir.). Such bias, prejudice or passion can be inferred from excessiveness. Wells v. Colorado College, 478 F.2d 158, 162 (10th Cir.); Earl W. Baker & Co. v. Lagaly, 144 F.2d 344, 347 (10th Cir.). However, a verdict will not be set aside on this basis unless it is so plainly excessive as to suggest that it was the product of such passion or prejudice on the part of the jury. Wells v. Colorado College, supra; see Snowden v. Matthews, 160 F.2d 130, 131 (10th Cir.). As the Tenth Circuit later declared in Bennett v. Longacre, 774 F.2d 1024, 1028 (10th Cir. 1985): It is a fundamental legal principle that the determination of the quantum of damages in civil cases is a fact-finder's function. The trier of the facts, who has the first-handed opportunity to hear the testimony and to observe the demeanor of the witnesses, is clothed with a wide latitude and discretion in fixing damages, pursuant to the court's instructions, deemed proper to fairly compensate the injured party. See Rosen v. LTV Recreational Development, Inc., 569 F.2d 1117, 1123 (10th Cir. 1978). We have held that the amount of damages awarded by a jury can be supported by any competent evidence tending to sustain it. Hitchcock v. Weddle, 304 F.2d 735, 737 (10th Cir. 1962). We will not disturb a jury's finding on damages unless it is so unreasonable "as to shock the judicial conscience and to

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raise an irresistible inference that passion, prejudice, corruption, or other improper cause invaded the trial . . ." Barnes v. Smith, 305 F.2d 226, 228 (10th Cir. 1962). In evaluating claims of excessiveness, the evidence must be viewed in a light most favorable to the jury's verdict. Zerr v. Trenkle, 454 F.2d 1103, 1105 (10th Cir. 1972). The City hopes to persuade this Court that the jury's modest verdict was so excessive "as to shock the judicial conscience and to raise an irresistible inference that passion, prejudice, corruption, or other improper cause invaded the trial."1 Mr. Cadorna sought back pay to compensate him for the entire injury he suffered as a result of Defendant's age discrimination. The purpose of back pay is to completely redress the economic injury the plaintiff has suffered as a result of discrimination. In this sense, when awarding back pay, a court should attempt to place a victim of unlawful discrimination in as near a position as she would have been in absent the discrimination. An award of back pay, therefore, should ordinarily consist of lost salary, including anticipated raises, and fringe benefits. EEOC v. Joint Apprenticeship Committee of the Joint Indust. Bd. of the Electrical Indust., 164 F.3d 89, 101 (2d Cir. 1998)(citations omitted). Damages need not be determined via a mathematical formula; they may be an approximation if the fact of damages is certain and there is some evidence from which the jury can make a reasonable estimation. Confederated Tribes of Siletz Indians of Or. v. Weyerhaeuser Co., 411 F.3d 1030, 1045 (9th Cir. 2005), See also, Bluebonnet Savings Bank, F.S.B. v. U.S., 266 F.3d 1348, 1355 (Fed. Cir. 2001), Compania Pelineon De Navegacion, S.A. v. Texas Petroleum Co., 540 F.2d 53, 56 (2d Cir. 1976), Contemporary Mission, Inc. v. Bonded Mailings, Inc., 671 F.2d 81, 84 (2d Cir. 1982).
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"Plus ça change, plus c'est la même chose."

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Damages do not have to be calculable with mathematical exactitude, so long as the plaintiff introduces some evidence which is sufficient to allow a reasonable estimate of damages, it is incumbent upon the trier of fact to determine a monetary award which will adequately compensate the plaintiff. Sir Speedy, Inc. v. L & P Graphics, Inc., 957 F.2d 1033, 1038 (2d Cir. 1992). "It is enough if the evidence adduced is sufficient to enable a court or jury to make the fair and reasonable approximation." Bluebonnet Savings Bank, F.S.B., 266 F.3d at 1356, quoting Specialty Assembling & Packing Co. v. U.S., 355 F.2d 554, 572 (Ct.Cl. 1972). When properly instructed, the jury has wide discretion as to the amount of damages to be awarded. Vanskike v. Union Pacific R. Co., 725 F.2d 1146, 1150 (8th Cir. 1984). The verdict of the jury will not be set aside as a matter of law unless the amount is grossly and manifestly excessive. Id. The jury's award of damages may not be reversed unless the verdict is so grossly excessive as to indicate passion or prejudice. Loughridge v. Chiles Power Supply Co., Inc., supra. (emphasis added). The amount of damages awarded by a jury may not be disturbed unless it is completely without support in the record. Id. The City has presented no evidence that the jury was motivated by passion or prejudice. The City requests that the Court substitute its judgment on damages for that of the jury, without any evidence that the jury was misguided. The City argues that the jury verdict should be altered or amended because the jury must have awarded Mr. Cadorna salary and lost benefits beyond the date of verdict (June 29, 2006), or improperly "grossed up" its verdict to offset presumed attorney's fees.

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However, there are numerous reasonable factors the jury, given its vast collective business, financial, and practical experience, may have considered when calculating Mr. Cadorna's lost back pay that would be squarely grounded in the evidence and which would hardly be the product of passion or prejudice. First and foremost, the City neglects to acknowledge the very large sum Mr. Cadorna would have accumulated in his tax-deferred, 401(K)-like "DROP" investment account had he elected the DROP on October 31, 2003. (Tr. 673:18-25, 674:5-11)(See Ex. B). Just in raw, "arithmetic" terms, the deposits to his DROP investment account between October 31, 2003 and June 29, 2006 would have totaled $85,797.80. Because Cadorna was terminated on January 2, 2003, 10 months prior to being eligible to elect the DROP program, he lost any positive rate of return investment income which would have accumulated for five years in his DROP account. As Ida Roberts testified, if the money in the DROP account had been put in a taxdeferred, interest-bearing account achieving even the lowest possible rate of return, Mr. Cadorna's DROP account would have yielded a much higher value than the $166,617.74 shown on Exhibit 57. (Tr. 706:4-25, 707:1-4)(See Ex. C). Given its financial and business acumen, the jury may very well have applied historic rates of growth they themselves had experienced in their own IRA, SEP, or 401(K) to these sums to come up with a reasonable estimate of what $85,797.80 would have equaled had it been allowed to grow tax-deferred for three and one-half years. Even if one assumes an extremely conservative rate of tax-deferred growth, its value would have exceeded $100,000 by June 29, 2006. In all likelihood (and the jury probably realized

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this, given its financial and business acumen), it would have been considerably greater. The jury may well have calculated that it might have grown to something in the range of $150,000.00 by June 29, 2006. Such a calculation, tied squarely to evidence concerning Plaintiff's DROP contributions and the jury's understanding of tax-deferred growth of investments based upon its collective experience, would under no circumstances be "so plainly excessive as to suggest that it was the product of such passion or prejudice on the part of the jury." Second, the jury was undoubtedly mindful of Ben Franklin's famous aphorism that, "[i]n this world nothing is certain but death and taxes." There was some discussion at trial of the taxes to which Mr. Cadorna's earnings, collateral-source retirement annuity, or DROP investments would, or would not, be subject. Again, given its vast collective business, financial, and practical experience, there is good reason to suppose that the jury considered the very high state and federal tax rates to which any sum of back pay it awarded Mr. Cadorna would be subject because it would be received in one lump sum. This would be an appropriate consideration for the jury, so long as it were tied to evidence concerning the sums Mr. Cadorna would receive as back pay. Wulf v. City of Wichita, 883 F.2d 842, 871-73 (10th Cir. 1989)(acknowledging that, had back pay received under a §1983 claim been taxable, a 50% enhancement for taxes due on a lump sum payment could have been appropriate); See also, EEOC v. Joe's Stone Crab, Inc., 15 F.Supp.2d 1364, 1380 (S.D. Fla. 1998) (a district court, in the exercise of its discretion, may include a tax component in a lump sum back pay award to compensate prevailing discrimination plaintiffs).

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The City does not dispute that Mr. Cadorna is entitled to $205,515.55 in lost wages and benefits. It mistakenly (as is argued later) asserts that Mr. Cadorna should not be granted damages for the $15,524.28 in pension contributions he would have been able to make had he not been terminated. After all, these pension contributions would have accrued to his benefit, in his pension account. In any event, according to the City's figures, if his "avoided" pension contributions are not deducted, the City would agree that his back pay should be at least $221,039.83. If one very conservatively assumes the value of Plaintiff's DROP account as of June 29, 2006 would have been a mere $100,000.00, this would result in a back pay calculation, without taking any other possible earnings or benefits (such as vacation pay or sick leave) into account, of $321,039.83. If the jury quite reasonably applied a 50% enhancement to this amount to offset state and federal taxes that would be imposed, at alternative minimum tax rates, to this sum, it would total $481,559.74. If one less conservatively, but nevertheless reasonably, assumes the value of Plaintiff's DROP account as of June 29, 2006 would have been $150,000.00, this would result in a back pay calculation, without taking any other possible earnings or benefits (such as vacation pay or sick leave) into account, of $371,039.83. If the jury quite reasonably applied a 50% enhancement to this amount to offset state and federal taxes that would be imposed, at alternative minimum tax rates, to this sum, it would total $556,559.74. Again, these calculations are based upon the City's own figures. They do not include lost vacation and sick pay, which Ida Roberts conceded Plaintiff would have

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continued to earn. (Tr. 738:17:25-741:1-25)(See Ex. D). Plaintiff would have received an additional $8,727 in lost vacation and sick pay for 2007 and 2008. (Tr. 741:1825)(See Ex. D). Plaintiff hardly means to concede or suggest that these figures are superior to those computed by the jury. The point of the foregoing exercise is to illustrate how the jury, based upon substantial evidence in the record and its collective business, financial, and practical experience, could have quite rationally, without passion or prejudice of any kind, calculated Plaintiff's back pay to be $610,571.00. In short, there is no evidence that the jury award was grossly or manifestly excessive. There is sufficient evidence in the record to support the economic damages award of $610,571.00, and additional liquidated damages of $610,571.00. III. The Employee Pension Contributions are an Item of Damages, Not an Offset to Damages. As a firefighter, Mr. Cadorna was not required to pay Social Security. Hence, funds that would otherwise have been deducted from gross wages for social security were instead put into his pension account. (Tr. 702:13-24)(See Ex. E). The City mischaracterizes these deductions as payments Mr. Cadorna "avoided", and argues that they should be offset against Mr. Cadorna's salary. (See pg. 5-6 of Defendant's motion). The City ignores that these pension contributions were a benefit Mr. Cadorna lost because of his unlawful termination. These contributions would have been credited to Mr. Cadorna's pension account (Tr. 703: 11-18)(See Ex. F). Specifically, the City contends that Mr. Cadorna's lost wages/salary it computes from March 15, 2003 to June 29, 2006 (computed by the City to be $194,053.50) plus

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the amount of lost health insurance contributions ($26,986.33) should be offset by the amount of pension payments ($15.524.28) Mr. Cadorna allegedly "avoided". The City computes that Mr. Cadorna's total back pay should accordingly be just $205,515.55 ($194,053.50 plus $26,986.33, minus $15,524.28). IV. Conclusion. The City has presented no evidence that the jury was motivated by passion or prejudice. There is sufficient evidence in the record to support the jury award for $610,571. The award should not be altered or amended simply because the award did not conform to the City's preferred arithmetic. Further, Plaintiff's pension payments should not be offset against his lost salary and health insurance benefits as this Court previously ruled that such pension payments are a collateral source. Therefore, the City's request that this Court reduce the total judgment to $411,031.10 in both compensatory and liquidated damages should be DENIED. WHEREFORE, for the reasons set forth above, this Court should DENY the City's Motion to Alter or Amend the Judgment and AFFIRM the jury award in the amount of $610,571 plus liquidated damages in the amount of $610,571.

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Respectfully submitted this 31st day of January, 2007. ANNE WHALEN GILL, LLC /s/ Sharlene J. Aitken Sharlene J. Aitken Anne Whalen Gill 510 Wilcox Street, Suite C Castle Rock, CO 80104 (303) 713-9050 MARK E. BRENNAN, P.C. /s/ Mark

E. Brennan

P.O. Box 2556 Centennial, CO 80161 (303) 552-9394 or (303) 797-7687 ATTORNEYS FOR PLAINTIFF

CERTIFICATE OF SERVICE The undersigned hereby certifies that on the 31st day of January, 2007, a true and correct copy of the foregoing RESPONSE TO MOTION TO ALTER OR AMEND JUDGMENT AND SUPPORTING BRIEF was served via the CM/ECF system to the following: Richard P. Barkley Hamid M. Khan Brownstein Hyatt & Farber, P.C. 410 17th Street, 22nd Floor Denver, Colorado 80202 Christopher M.A. Lujan Assistant City Attorney, Litigation Section City and County of Denver 201 West Colfax, Department 1108 Denver, Colorado 80202 /s/ Mark 12

E. Brennan