State of Arizona v. Asarco LLC

773 F.3d 1050, 2014 U.S. App. LEXIS 23255, 125 Fair Empl. Prac. Cas. (BNA) 753, 2014 WL 6918577
Court of Appeals for the Ninth Circuit·Decided December 10, 2014·No. 11-17484·Published·Cited by 52 cases

Opinion

OPINION

THOMAS, Chief Judge:

This appeal presents the question of whether a $300,000 punitive damages ver *1053 diet, in a Title VII sexual harassment case in which only nominal damages were awarded, comports with due process. Given the statutory scheme that governs punitive damages in Title VII cases and the circumstances of this case, we conclude that the award does not violate due process. We affirm the judgment of the district court.

I

ASARCO, LLC (“ASARCO”) operates the Mission Mine complex in Sahuarita, Arizona, near Tucson. Mission Mine includes a copper mine from which copper ore is extracted and a mill facility in which the ore is crushed, filtered, and refined. Angela Aguilar worked at the Mission Mine complex from December 2005 through November 2006. She started as a mill laborer and became a car loader operator in March 2006. A month later, she then became a filter operator in the filter plant and two months later, a rod and ball mill person. Aguilar alleges that during her time at ASARCO, she was subjected to sexual harassment, retaliation, intentional infliction of emotional distress, and was constructively discharged from her employment.

The State of Arizona filed suit against ASARCO under the Arizona Civil Rights Act in Pima County Superior Court, alleging harassment, disparate treatment, and retaliation against Aguilar. Aguilar subsequently filed her own lawsuit against ASARCO, alleging harassment, constructive discharge, and retaliation under Title VII. The proceedings were consolidated and removed to the United States District Court for the District of Arizona.

After an eight-day trial, the jury found ASARCO liable on Aguilar’s sexual harassment claims, in violation of 42 U.S.C. § 2000e-2, but not on her constructive discharge or retaliation claims. The jury awarded no compensatory damages, but awarded $1 in nominal and $868,750 in punitive damages. The jury was instructed' on the standard for granting punitive damages found in 42 U.S.C. § 1981a(b). Following the judgment, ASARCO filed a renewed motion for judgment as a matter of law, contending, in part, that the punitive damages award was unconstitutionally excessive. In the alternative, it urged the court to grant a new trial because of evidentiary errors.

The district court rejected the motion for judgment as a matter of law. Applying the due process analysis in BMW of North America, Inc. v. Gore, 517 U.S. 559, 116 S.Ct. 1589, 134 L.Ed.2d 809 (1996), it concluded the punitive damages award was not unconstitutional but, given the $300,000 cap on compensatory and punitive damages found in § 1981a(b)(3)(D), reduced the award to $300,000. The court also rejected ASARCO’s new trial motion, and granted Aguilar’s request for injunctive relief, directing ASARCO to update its harassment policies. Finally, the court granted Aguilar’s motion for attorneys’ fees and costs, in the total amount of $350,902.75.

ASARCO timely appealed, arguing that the district court erred by refusing to reduce the punitive damages award further, by admitting evidence of other employees who witnessed pornographic graffiti, and by awarding Aguilar attorneys’ fees. A three-judge panel of this court affirmed the district court as to the evidence and attorneys’ fees, but vacated- the $300,000 punitive damages award. Applying the three factors found in Gore, the panel majority concluded that while ASARCO’s conduct was reprehensible, the ratio of 300,-000 to 1 between the punitive and nominal damages awards was excessive. Arizona v. ASARCO LLC, 733 F.3d 882, 885-92 (9th Cir.2013). Citing to the highest ratio *1054 it could locate among discrimination cases, 125,000 to 1 in Abner v. Kansas City S. R.R. Co., 513 F.3d 154, 164 (5th Cir.2008), the majority reduced the award to $125,000. ASARCO, 733 F.3d at 891-92. Dissenting in part, Judge Hurwitz stated that he would affirm the entire $300,000 judgment in light of the applicable statutory cap, which provides employers with notice of the penalties they could face for Title VII violations. Id. at 892-93 (Hurwitz, J., concurring in part and dissenting in part).

Upon the majority vote of the active, non-recused judges of the court, we agreed to rehear this case en banc. Arizona v. ASARCO LLC, 755 F.3d 1044 (9th Cir.2014). We have jurisdiction under 28 U.S.C. § 1291. We apply “a de novo standard of review when passing on district courts’ determinations of the constitutionality of punitive damages awards.” Cooper Indus. v. Leatherman Tool Grp., Inc., 532 U.S. 424, 436, 121 S.Ct. 1678, 149 L.Ed.2d 674 (2001). Even when a defendant makes a constitutional challenge to a punitive damages award, however, we defer to the district court’s “findings of fact unless they are clearly erroneous.” Id. at 440 n. 14, 121 S.Ct. 1678.

II

Applying Gore, ASARCO argues that the district court erred in upholding the jury’s punitive damages award, which the court then reduced to $300,000 because of the statutory cap on damages contained in § 1981a. At oral argument, ASARCO argued the award should be reduced far below the $125,000 awarded by the three-judge panel, an amount which it contends is still constitutionally excessive. ASARCO also argues the award should be re- ' duced below the $2500 per offense punitive damages amount awarded in Mendez v. County of San Bernardino, 540 F.3d 1109, 1120-23 (9th Cir.2008).

A

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State of Arizona v. Asarco LLC, 773 F.3d 1050, 2014 U.S. App. LEXIS 23255, 125 Fair Empl. Prac. Cas. (BNA) 753, 2014 WL 6918577 (9th Cir. 2014).

773 F.3d 1050 (State of Arizona v. Asarco LLC) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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