Free Uncategorized - District Court of Arizona - Arizona

1 2 3 4 5 6 7 8 9 10 11 12 Charles Schwab Corporation, 13 Defendant. 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Pending before the Court are five motions in limine: Defendant's Motion in Limine to Preclude Evidence Related to Plaintiff's Lack of Medical Insurance (Dkt. 129); Defendant's Motion in Limine to Prelude Evidence Related to Alleged Ailments Following Her Termination (Dkt. 130); Defendant's Motion in Limine to Preclude Evidence Related to Alleged Discrimination or Retaliation Against Other Persons (Dkt. 131); Plaintiff's Motion in Limine re: Evidence of Unemployment Earnings (Dkt. 133); and Plaintiff's Motion in Limine re: Evidence Not Considered by the Decision Makers (Dkt. 136). The Motions are fully briefed. BACKGROUND In 1999, Plaintiff began working for Defendant in its "Build-A-Broker" program. In 2001, she took a position as an Operations Specialist, reviewing checks and clearing debit cards. On October 15, 2003, Plaintiff complained of sexual harassment from her co-worker Ed Steinert ("Steinert"). Defendant investigated the matter. After the investigation,
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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA

Marcela Johnson, Plaintiff, vs.

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No. CV 04-0790-PHX-EHC ORDER

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Defendant determined that Plaintiff had been dishonest during the course of the investigation in violation of company policy. Defendant terminated Plaintiff on November 5, 2003. Plaintiff filed a claim with the Equal Employment Opportunity Commission ("EEOC") on November 10, 2003, alleging that her termination was the result of discrimination based on sex. Plaintiff amended her EEOC complaint on December 5, 2003, to include a claim asserting that the termination was based on her national origin. The EEOC issued a right-to-sue letter on January 26, 2004. On June 30, 2004, Plaintiff filed a complaint with the National Labor Relations Board ("NLRB") alleging that she had been retaliated against in connection with her sexual harassment claim. The NLRB dismissed her complaint. Plaintiff filed this case on April 22, 2004. (Dkt. 1). She filed her First Amended Complaint on July 16, 2004, alleging that she was sexually harassed, discriminated against based on her sex and national origin, and that Defendant retaliated against her for her complaint of sexual harassment. (Dkt. 2). On August 31, 2004, Defendant filed an Answer claiming that Plaintiff was fired because she made false allegations of sexual harassment and lied during the investigation of her sexual harassment claim. (Dkt. 5). DISCUSSION Unless specifically excluded, "[a]ll relevant evidence is admissible." Fed. R. Evid. 402. Evidence is relevant if it has "any tendency to make the existence of any fact that is of consequence to the determination of the action more or less probable than it would be without the evidence." Fed R. Evid. 401. The Federal Rules standard of relevance is "a liberal one." Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579, 587 (1993). A court may, in its discretion, exclude relevant evidence "if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury." Fed. R. Evid. 403. I. Defendant's Motion in Limine to Preclude Evidence Related to Plaintiff's Lack of Medical Insurance Defendant seeks to preclude Plaintiff from introducing any evidence relating to her lack of medical insurance after she was terminated. Defendant argues that such evidence is -2-

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irrelevant. Plaintiff argues that the evidence is relevant to her claim for damages. In ruling on Defendant's Motion for Summary Judgment re: Damages, the Court found that Plaintiff was only entitled to recover actual medical expenses that she incurred.1 (Dkt. 173). The Court granted Defendant's Motion for Summary Judgment with respect to the value of lost medical benefits because Plaintiff did not put forth evidence of any actual medical expenses. Accordingly, the Court will grant Defendant's Motion and preclude Plaintiff from introducing evidence relating to her lack of medical insurance after she was terminated. II. Defendant's Motion in Limine to Prelude Evidence Related to Alleged Ailments Following Her Termination Defendant seeks to preclude Plaintiff from introducing evidence relating to Plaintiff's alleged ailments occurring after she was terminated. Defendant argues that Plaintiff will attempt to introduce evidence of stress, headaches, stomach aches, sleeplessness and acne. Defendant argues that Plaintiff attributes these ailments to the activity associated with this case and that any emotional distress associated with litigation is not recoverable and should be precluded as it is prejudicial and will confuse the jury. Litigation is a matter of choice and damages arising from it are not recoverable. See Flowers v. First Hawaiian Bank, 295 F.Supp.2d 1130, 1140 (D. Haw. 2003) (holding that litigation stress is not recoverable as damages); Knussman v. Maryland, 272 F.3d 625, 641 (4th Cir. 2001) ("In general, litigation-induced emotional distress is never a compensable element of damages."); Stoleson v. U.S., 708 F.2d 1217, 1223 (7th Cir. 1983) (holding stress induced by litigation is not recoverable). Plaintiff claims that she has been suffering from stress, headaches, stomach aches, sleeplessness and acne since the day Defendant terminated her employment. (Dkt. 142, ex. A at pgs. 19-20).

An employee who is wrongfully terminated may collect damages for the loss of health insurance benefits. EEOC v. Farmer Bros. Co., 31 F.3d 891, 902 (9th Cir. 1994). The measure of such damages is the amount of any actual expenses incurred by the employee. Id. "'[L]ost insurance coverage, unless replaced or unless actual expenses are incurred, is simply not a monetary benefit owing to the plaintiff.'" Farmer Bros. Co., 31 F.3d at 902 (citing Galindo v. Stoody Co., 793 F.2d 1502, 1516 (9th Cir. 1986)). -3Document 174 Filed 03/30/2007 Page 3 of 11

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Plaintiff's claims are arguably not solely related to litigation. Accordingly, this Motion in Limine will be denied without prejudice to objections at trial. III. Defendant's Motion in Limine to Preclude Evidence Related to Alleged Discrimination or Retaliation Against Other Persons Defendant seeks to preclude Plaintiff from introducing evidence relating to other complaints or allegations of discrimination by Defendant that were made by other present or former employees of Defendant. Defendant argues that this "me too" evidence is irrelevant and would confuse the jury. Defendant further argues that its probative value, if any, is outweighed by the danger of unfair prejudice. Plaintiff did not file a Response to Defendant's Motion. Local Rule of Civil Procedure 7.2(i) provides that "if the opposing party does not serve and file the required answering memoranda...such non-compliance may be deemed a consent to the...granting of the motion and the Court may dispose of the motion summarily." The Court construes Plaintiff's failure to file a Response as consent to granting Defendant's Motion. The Court will grant Defendant's Motion. IV. Plaintiff's Motion in Limine re: Evidence of Unemployment Earnings Plaintiff seeks to preclude Defendant from admitting evidence with respect to unemployment compensation Plaintiff collected after she was terminated. Plaintiff cites Kauffman v. Sidereal Corp., which held that "unemployment benefits received by a successful plaintiff in an employment discrimination action are not offsets against a back pay award." 685 F.2d 343, 347 (9th Cir. 1983). Plaintiff argues that evidence regarding Plaintiff's unemployment earnings is irrelevant. Defendant argues that there is conflict within the Ninth Circuit as to whether the Court has discretion to deduct collateral benefits from a plaintiff's back pay award. Defendant cites Naton v. Bank of California where the Ninth Circuit held that a district court had discretion to deduct collateral benefits from an ADEA back pay award. 649 F.3d 691, 700 (9th Cir. 1981). Defendant argues that the Court should apply the holding of Naton and retain discretion to deduct the unemployment compensation from any back pay award Plaintiff may receive. Id. -4-

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The Ninth Circuit noted Naton in Kauffman and decided that unemployment compensation was collateral and therefore not an offset against a Title VII back pay award. 685 F.2d at 346. The Ninth Circuit cited a Supreme Court ruling upholding the National Labor Relations Board's refusal to deduct unemployment benefits from an employee's back pay award for discriminatory discharge. Id. at 346 (citing National Labor Relations Board v. Gullett Gin Co., 340 U.S. 361, 364 (1951)). The Supreme Court reasoned that

consideration should not be given to collateral losses in framing an order to reimburse employees for their lost earnings and likewise no consideration should be given to collateral benefits that employees may have received. Id. at 346-347. The Ninth Circuit adopted the reasoning of Gullett Gin because on another occasion the Supreme Court stated that the back pay provision of Title VII "was expressly modeled on the back pay provision of the National Labor Relations Act." Id. at 346 (citing Albermarle Paper Co. v. Moody, 422 U.S. 405, 419 (1975)). The unemployment compensation that Plaintiff has received is not deductible from any back pay she is awarded. Thus, evidence relating to Plaintiff's unemployment earnings is irrelevant to the determination of back pay and is not admissible. The Court will grant Plaintiff's Motion. V. Plaintiff's Motion in Limine re: Evidence Not Considered by the Decision Makers Plaintiff seeks to exclude evidence that was not considered in making the decision to terminate Plaintiff's employment. Plaintiff argues that such evidence is not relevant and in any event, its probative value is substantially outweighed by prejudice to Plaintiff. Plaintiff specifically addresses: (1) Plaintiff's relationship with co-worker, Brad Allen ("Allen"); (2) Plaintiff's subsequent employment; (3) the administrative law judge's decision and findings of fact; and (4) results of a polygraph test that Plaintiff failed in connection with an application for employment following her dismissal by Defendant. A. Plaintiff's Relationship with Allen Plaintiff argues that the evidence relating to her alleged relationship with Allen is irrelevant and in any event, more prejudicial than probative. Plaintiff argues that the material -5-

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issues in this case are whether Defendant terminated Plaintiff in retaliation for protected activity and whether Defendant treated her differently because she was a Hispanic female. Plaintiff argues that because Defendant admits that Plaintiff's relationship with Allen did not factor into its decision to terminate Plaintiff, it is irrelevant to the issues of this case. Plaintiff further argues that Federal Rule of Evidence 412 precludes the admission of such evidence. 1. Relevance Defendant argues that Plaintiff fabricated her claim of sexual harassment. Defendant argues that evidence of Plaintiff's relationship with Allen is relevant because it shows why Plaintiff fabricated her claims about Steinert. Defendant alleges that Plaintiff and Allen suspected that Steinert was telling Allen's wife about their relationship.2 The Court finds that evidence regarding Plaintiff's motive to lie is arguably relevant to disproving Plaintiffs allegation that Steinert sexually harassed her which is essential to Plaintiffs claim in Count I.3 4 Defendant further argues that Plaintiff's lies about her relationship with Allen are relevant to her credibility as a witness. The range of evidence that maybe elicited for the purpose of discrediting a witness is liberal. U.S. v. Palmer, 536 F.3d 1278, 1282 (9th Cit. 1976). Inquiry is permitted for the purpose of testing a witness's "sincerity, truthfulness and motives." Id. Thus, evidence of Plaintiff's affirmative attempts to lie about her relationship with Allen is arguably relevant to Plaintiff's credibility as a witness.

Defendant claims that Plaintiff wrote several e-mails to Allen about Steinert. Defendant claims that an e-mail exchange occurring just two days before Plaintiff complained about Steinert provides evidence that Plaintiff had motive to fabricate her sexual harassment claim. The Court notes that this evidence is not relevant to the determination of whether Defendant terminated Plaintiff in retaliation for protected activity or whether Defendant treated Plaintiff differently because she was a Hispanic female because Plaintiff's relationship with Allen was not considered in the decision to terminate Plaintiff. For the same reason, the Court finds evidence relating to Plaintiff's alleged suspicions that Steinert was calling Allen's wife relevant. -6Document 174 Filed 03/30/2007 Page 6 of 11
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Defendant also argues that evidence of the relationship between Plaintiff and Allen is relevant to show Allen's potential bias as a witness. Evidence demonstrating possible bias of a witness is relevant. See Davis v. Alaska, 415 U.S. 308, 316 (1974) (holding that "[t]he partiality of the witness is subject to exploration at trial and is always relevant as discrediting the witness and affecting the weight of his testimony.") Thus, evidence of Plaintiff's relationship with Allen is arguably probative of Allen's potential bias as a witness. 2. Prejudice Plaintiff argues that evidence of Plaintiff's relationship with Allen "could easily prejudice the jury to render a decision on an improper basis, such as emotions or moral judgment." The Court finds the risk of prejudice to Plaintiff outweighs the probative value of this evidence. The Court will therefore sustain Plaintiff's objection without prejudice to re-offering at trial. 3. Federal Rule of Evidence 412 Plaintiff also argues that Federal Rule of Evidence 412 precludes the introduction of any evidence of her relationship with Allen. "Rule 412's coverage extends over sexual harassment lawsuits." B.K.B. v. Maui Police Dept., 276 F.3d 1091, 1104 (9th Cir. 2002). 412(a) provides that the following evidence is not admissible in any civil proceeding involving alleged sexual misconduct: (1) Evidence offered to prove that any alleged victim engaged in other sexual behavior. (2) Evidence offered to prove any alleged victim's sexual predisposition. 412(b)(2) provides an exception to 412(a) if the evidence is otherwise admissible and its probative value substantially outweighs the danger of harm to the victim and of unfair prejudice to any party. A party seeking to offer evidence pursuant to 412(b), must comply with the procedure detailed in 412(c), which requires that: (1) a motion be filed at least 14 days before trial specifically describing the evidence and stating the purpose for which it is offered; (2) that the motion be served on all parties and the alleged victim; and (3) that the

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court conduct a hearing in camera and afford the victim and parties a right to attend and be heard. Defendant argues that the evidence of Plaintiff's relationship with Allen will not be offered to prove Plaintiff's "other sexual behavior" or "sexual predisposition." Plaintiff argues that the evidence will be offered to show that Plaintiff had motive to lie about Steinert's conduct and to impeach Plaintiff's credibility as a witness. The Court sustains Plaintiff's objection pending further consideration pursuant to the provisions of Rule 412. B. Plaintiff's Subsequent Employment Plaintiff seeks to preclude the introduction of her employment record, documents, and testimony from her employers after she was terminated by Defendant. She argues that such evidence is irrelevant and prejudicial. Plaintiff argues that Defendant will introduce this evidence hoping to "paint" Plaintiff in a bad light. Defendant argues that the evidence is relevant to Plaintiff's claim for damages. Title VII plaintiffs have a duty to mitigate damages incurred from wrongful termination by seeking alternative employment. See Claude v. Bristow Optical Co., Inc., 224 F.3d 1014, 1020 (9th Cir. 2000). Plaintiffs must use reasonable diligence in finding other suitable employment. Odima v. Westin Tucson Hotel, 53 F.3d 1484, 1497 (9th Cir. 1995). While Plainitff must use reasonable diligence to secure alternative employment, it is unclear whether her employment record, documents, and testimony from her subsequent employers are relevant to determining reasonable diligence. The Court will sustain Plaintiff's objection without prejudice to Defendants offering this evidence at trial, out of the presence of the jury. C. The Administrative Law Judge's Decision and Findings of Fact Plaintiff seeks to preclude the introduction of evidence relating to an administrative proceedings held before the NLRB. Plaintiff argues that the evidence and issues before the administrative law judge were different from those that will be before the jury and that such evidence is irrelevant, and if not, overly prejudicial. Defendant cites Baldwin v. Rice, 144 F.R.D. 102, 104-05 (E.D. Cal. 1992), arguing that courts have admitted administrative findings when decisions are made on facts pertinent to the issues in the case and when the -8-

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parties participated in the administrative proceedings. Defendant further argues that the Ninth Circuit has rejected the argument that federal administrative agency opinions were prejudicial citing Plummer v. Western Int'l Hotels Co., Inc., 656 F.2d 502 (9th Cir. 1981) (holding that evidence may be presented "refuting the findings of the [administrative agency]" and "point[ing] out deficiencies in the [administrative record]"). The authorities Defendant cites in support of its argument addressed cases that were tried de novo following administrative proceedings. This case is not a trial de novo of an administrative decision.5 Nevertheless, some of the factual findings made by the administrative law judge maybe relevant to this case.6 The Court will sustain Plaintiff's objection without prejudice to offering this evidence at the time of trial out of the presence of the jury. D. Polygraph Test Plaintiff seeks to preclude the introduction of polygraph test results relating to Plaintiff's employment application with the City of Phoenix Police Department. Defendant

Plaintiff filed the NLRB complaint on June 30, 2004, alleging that Defendant had engaged in an unfair labor practice by infringing the right to engage in concerted activities with other employees. (Dkt.16, ex. B). The NLRB concluded that Defendant had not violated the National Labor Relations Act because "Plaintiff was not engaged in protected concerted activity within the meaning of Section 7 of the Act" and dismissed the NLRB Complaint. (Dkt. 11, ex. A, pg. 14). The administrative law judge however continued his analysis: "for the sake of completeness, and in the event that either the Board, or a reviewing court, disagree[d] with [his] finding...." (Dkt. 11, ex A. pg. 14). He went on and analyzed several of the issues in the present case. (Dkt. 11, ex A. pg. 14-20). Defendant thereafter filed a Motion for Partial Summary Judgment in this case arguing that Defendant was entitled to judgment as a matter of law as to Counts II through V based on collateral estoppel. (Dkt. 10). The Court denied Plaintiff's Motion finding that the administrative law judge never issued a final order with respect to the claims asserted in Counts II through V because those claims were only addressed after the administrative law judge had dismissed the case finding that "Plaintiff was not engaged in protected concerted activity within the meaning of Section 7 of the Act". (Dkt. 25). This Court noted in its June 27, 2005 Order denying Defendant's Motion for Partial Summary Judgment based on collateral estoppel, that the administrative law judge had made a "very thorough, thoughtful, and persuasive, if not entirely necessary, assessment of what is likely to be essentially the same evidence that would be presented at trial in this case." (Dkt. 25, pg. 7). -9Document 174 Filed 03/30/2007 Page 9 of 11
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argues that the results of the polygraph test are relevant to proving damages and discrediting Plaintiff's credibility. In U.S. v. Ramirez-Robles, the Ninth Circuit upheld the finding that the probative value of a polygraph test was outweighed by its prejudicial impact. 386 F.3d 1234, 1245 (9th Cir. 2004). Similarly, the Court finds that the polygraph test results in this case are not admissible at trial to impeach Plaintiff's credibility as a witness or to prove damages because the probative value of the test is outweighed by its prejudicial impact and its potential to mislead the jury. Accordingly, IT IS ORDERED that Defendant's Motion in Limine to Preclude Evidence Related to Plaintiff's Lack of Medical Insurance is GRANTED. (Dkt. 129). IT IS FURTHER ORDERED that Defendant's Motion in Limine to Prelude Evidence Related to Alleged Ailments Following Her Termination is DENIED without prejudice to an objection made at trial. (Dkt. 130). IT IS FURTHER ORDERED that Defendant's Motion in Limine to Preclude Evidence Related to Alleged Discrimination or Retaliation Against Other Persons is GRANTED. (Dkt. 131). IT IS FURTHER ORDERED that Plaintiff's Motion in Limine re: Evidence of Unemployment Earnings is GRANTED. (Dkt. 133). IT IS FURTHER ORDERED that Plaintiff's Motion in Limine re: Evidence Not Considered by the Decision Makers is GRANTED as follows (Dkt. 136): (1) Defendant is precluded from introducing evidence of Plaintiff's relationship with Allen except as otherwise provided in this Order; (2) Defendant is precluded from introducing evidence relating to Plaintiff's employment record, documents, and testimony from her employers after she was terminated by Defendant, without prejudice to an offering at trial made out of the presence of the jury; (3) Defendant is precluded from introducing the administrative law judge's findings and opinion, without prejudice to an offering at trial made out of the presence of the jury;

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(4) Defendant is precluded from introducing evidence of the polygraph test results relating to Plaintiff's employment application with the City of Phoenix Police Department. DATED this 29th day of March, 2007.

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