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North v. Madison Area Association for Retarded Citizens-Developmental Centers Corp.

decided: April 4, 1988.


Appeal from a Judgment of the United States District Court for the Western District of Wisconsin. No. 84-C-861--Barbara B. Crabb, Judge.

Cummings and Cudahy, Circuit Judges, and Grant, Senior District Judge.*fn* Cudahy, Circuit Judge, concurring in part and dissenting in part.

Author: Grant

GRANT, Senior District Judge.

James North, a black male, brought suit under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq. ("Title VII"), and 42 U.S.C. § 1981, alleging that his former employer, Madison Area Association for Retarded Citizens ("MAARC"), discriminated against him on the basis of his race. More specifically, North alleged that he was wrongfully discharged from his employment on the basis of his race; was subjected to racial harassment; and, was disparately treated at the time of his termination.*fn1

Upon demand, and without objection, all issues were tried to a jury.*fn2 The jury, however, became deadlocked in its deliberations, and was unable to return a verdict. As a result, the district court declared a mistrial and thereafter directed a verdict in favor of MAARC on each count of the complaint, denying North's motion for a new trial. North filed a motion for reconsideration, which the district court denied. This appeal followed. For the following reasons, we now affirm the judgment of the district court.


"In reviewing a district court's grant of a motion for directed verdict . . . the standard to be applied is the same as that applied by the trial court." Panter v. Marshall Field & Co., 646 F.2d 271, 281 (7th Cir.), cert. denied, 454 U.S. 1092, 70 L. Ed. 2d 631, 102 S. Ct. 658 (1981). We must determine whether the evidence presented at trial, when viewed in the light most favorable to the non-moving party and combined with all reasonable inferences that may be drawn therefrom, provides a sufficient probative basis for a verdict free from speculation over claims which are legally unfounded. Webb v. City of Chester, Illinois, 813 F.2d 824, 828 (7th Cir. 1987); Panter v. Marshall Field & Co., 646 F.2d at 281. It is well-established that:

A mere scintilla of evidence is not enough to require the submission of an issue to the jury. The decisions establish a more reasonable rule "that in every case, before the evidence is left to the jury, there is a preliminary question for the judge, not whether there is literally no evidence, but whether there is any upon which a jury can properly proceed to find a verdict for the party producing it, upon whom the onus of proof is imposed."

Gunning v. Cooley, 281 U.S. 90, 94, 74 L. Ed. 720, 50 S. Ct. 231 (1930), quoting Improvement Co. v. Munson, 81 U.S. (14 Wall.) 442, 448, 20 L. Ed. 867 (1871); Van Houdnos v. Evans, 807 F.2d 648, 650 (7th Cir. 1986); Hohmann v. Packard Instrument Co., 471 F.2d 815, 819 (7th Cir. 1973). A motion for directed verdict thus raises only a question of law, for which our review is de novo. Webb v. City of Chester, Illinois, 813 F.2d at 827; McMahon v. Eli Lilly and Company, 774 F.2d 830, 832 (7th Cir. 1985).*fn3


The facts, viewed in a light most favorable to North, are as follows. MAARC is a nonprofit, publicly-funded corporation that serves developmentally disabled adults. As a corporate entity, MAARC acts primarily through its Board of Directors, a group of about twelve volunteers, most of whom have an adult child or relative who is a MAARC client. Among its other powers, the Board has the sole authority to make employment decisions, including the authority to hire and fire personnel, and to award employment benefits. MAARC receives the majority of its funding, approximately one million dollars, from the Unified Services Board, a county agency, and the rest from Title XIX (a federal program serving the handicapped), donations and income from subcontract work performed by MAARC clients.

James North began his employment with MAARC in May 1974, as an instructor. In 1977, he became coordinator of a new project known as Property Maintenance Services ("PMS") in which eligible clients were divided into crews and sent into the community to perform generally maintenance-type services on a subcontract basis. The program thus generated both income and expenses for MAARC. In 1979, North's position was upgraded to that of PMS manager, in which capacity he performed both administrative and client-related duties. The greater percentage of North's time as manager was spent working with the clients. There were two non-management supervisory positions under North in the PMS program: a work coordinator and a work supervisor. Both positions were "union jobs" and involved only client-related responsibilities.

In August 1981, the Board of Directors appointed Richard Berling as the new Executive Director of MAARC. MAARC had been experiencing financial difficulties prior to Berling's arrival, with the corporation showing a net loss in 1980. Those difficulties continued in 1981 when MAARC was notified by the Unified Services Board that its funding would be cut for the last three months of 1981. In October 1981, MAARC lost a quarter million dollar transportation contract with Dane County, Wisconsin, for the upcoming year. In 1982, the Unified Services Board again proposed a decrease in funding to MAARC, and recommended that MAARC meet the financial demands placed upon it by reducing its administrative staff where possible, without reducing client services.*fn4

In accordance with the Unified Services Board directive, MAARC undertook a reorganization of its administrative staff at the end of 1981 and beginning of 1982. The positions of marketing manager, personnel officer, assistant executive director and transportation officer were eliminated.*fn5 In addition, the position of business manager was downgraded to an ...

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