Appeal from the United States District Court for the Northern District of Illinois, Eastern Division, No. 85 C 05902-Milton I. Shadur, Judge.
Coffey and Ripple, Circuit Judges, and Eschbach, Senior Circuit Judge.
The plaintiffs-appellants, 13 Chicago police officers, appeal the district court's grant of judgment notwithstanding the verdict (JNOV) in favor of the defendants-appellees, City of Chicago, Fred Rice, and Raleigh Mathis. The court's JNOV order overturned the lion's share of a jury's $4.29 million verdict finding that the plaintiffs had been transferred from the City's Office of Municipal Investigations to assignments within the Chicago police department because of their race and political affiliation. The plaintiffs further appeal the court's entry of a directed verdict in favor of the defendant Harold Washington (the former mayor of Chicago). We affirm in part, reverse in part, and remand for further proceedings.
Prior to the summer of 1984, the plaintiffs, thirteen white Chicago police officers, had all been assigned to posts within the City of Chicago's Office of Municipal Investigation (OMI). The mayor of Chicago established OMI, an independent division of city government, in 1977 (under the title "Office of Professional Review") for the purpose of investigating corruption within city government. In 1980, Mayor Jane Byrne appointed James Maurer (defendant Mathis's predecessor) to head the OMI unit. Maurer, with the benefit of an increased budget, selected and trained highly qualified officers of his choosing in an attempt to professionalize the office. Among these officers were all of the 13 plaintiffs, most of whom Maurer had known and worked with for many years.*fn1 By the time of Maurer's removal in April of 1984, OMI employed 32 sworn (Chicago police department) and unsworn (civilian) investigators.
During the 1983 mayoral campaign, which pitted Harold Washington against Jane Byrne in the Democratic primary and later Washington against Bernard Epton, the Republican candidate, in the general election, eight of the appellants campaigned for either Byrne or Epton. Several attended fund raisers for one or the other. One plaintiff, Shanahan, organized and co-hosted a large fund raiser for Byrne, which 1500 people attended. Five of the plaintiffs made campaign contributions to Epton, and another (Capesius) purchased a ticket and attended an Epton rally. Another plaintiff (Flanagan) canvassed his precinct and worked actively for Epton (whether Mathis knew of these activities was, as we shall see, one bone of contention at trial).
The year following his election as mayor of the City, Washington removed Maurer, and on April 23, 1984, appointed Mathis to the position of Executive Director of OMI. Mathis, a strong Washington supporter, reported directly to William Ware, then Washington's chief of staff. Shortly after his appointment, Mathis conducted a survey of the gender and race of the OMI staff, and on May 24, 1984, wrote a memo to Ware reporting that of the 32 police officers assigned to OMI, 28 were white males, three were black, and one, who had just started a month earlier, was a Hispanic female. Mathis's memo also noted that all of OMI's lieutenants and sergeants were white males. The memo concluded:
"As this data indicates, affirmative action concepts do not exist in this department, either in its civilian or police components.
Due to the obvious constraints in dealing with the civilian career service personnel, resolving this imbalance will be a long-range goal. However, in reference to the police personnel, this is being dealt with immediately.
Further reports on this progress will follow."
Subsequently, Mathis met with Ware at City Hall to discuss the May 24 memorandum. During their discussion, Ware asked Mathis what he intended to do about the perceived "imbalance" in the racial makeup of OMI personnel. Mathis replied that "I told him I intend to correct that imbalance by the selection of different personnel from the police department."
Within weeks of his meeting with Ware, Mathis began instituting the transfer of sworn personnel from OMI to other positions within the Chicago police department. In mid-June 1984, Mathis informed three supervisors, including plaintiffs Di Maggio and Cappitelli, that he was transferring them out of OMI. Officer Di Maggio testified that Mathis told them he was transferring them "because I'm bringing my own people in." Shortly thereafter, Paul Lewis, then OMI director of operations, informed plaintiff Capesius, another supervisor, that "I had better put my P.A.R. [Personnel Action Request] form in and get out or I could be dumped anywhere in the city." Subsequently, Capesius requested and was granted a transfer. Similarly, plaintiff Wojnar testified that his supervisors advised him that the detectives' positions were not stable and that his "status as a detective could not be guaranteed." Based upon this information, Wojnar asked to be transferred to his previous unit in order to avoid "being sent to a distant location." Plaintiff Gartner also requested a transfer in June but only after Mathis informed him that his transfer was imminent.
About one month later (on July 25, 1984), Mathis ordered the transfer of a group of eight sworn investigators out of OMI. Five of the plaintiffs (Cygnar, Flanagan, O'Driscoll, Shanahan and Rubino) were transferred as part of this group. The other three plaintiffs (Bleke, Riggio and Murray) left OMI shortly thereafter at their own request although each testified that the July 25 transfer order played a role in his decision to request a transfer.*fn2
As the plaintiffs transferred out and Mathis brought in new officers to replace them, the racial and gender makeup of OMI personnel dramatically altered. Most new officers were not individual replacements for the plaintiffs although Flanagan testified that he was replaced by a black male, and Murray testified that he was replaced by a white male. While a number of the replacements were white, a majority of the people Mathis brought in were black or Hispanic. By August 31, 1984, the number of white male officers at OMI had been reduced from 28 to 15 (Mathis brought in 13 of these 15) while the number of minority investigators had been increased from four to 17. Mathis reported these personnel changes, including the race and sex figures, to Ware in a memo dated August 30, 1984.
Subsequently, the plaintiffs sued Mathis, Mayor Washington, Fred Rice, and the City of Chicago under 42 U.S.C. § 1983, alleging that their transfers out of the OMI unit had been politically and racially motivated in violation of the first and fourteenth amendments to the U.S. Constitution, respectively. Plaintiffs' complaint also stated claims for relief under the due process clause of the fourteenth amendment and Title VII of the Civil Rights Act of 1964. A problem that plagues this case (to the defendants' detriment) took shape soon after the plaintiffs filed their lawsuit -- a problem that relates to the defendants' defensive posture on the plaintiffs' racial discrimination claim. Beginning with their answer and continuing throughout trial, the defendants have defended against the plaintiffs' race claim on one primary ground: that Mathis's actions were based not upon discriminatory animus but rather his legitimate desire to "bring in his own people." But also thrown in for good measure have been hints at a backup theory: that if Mathis's transfer decisions were based upon the plaintiffs' race, Mathis still did not violate the plaintiffs' fourteenth amendment rights because he was attempting in good faith to institute a valid affirmative action program.
As we discuss later, this backup theory (essentially legal discrimination) is at odds with the defendants' primary defense of non-discrimination. More significantly, the defendants failed to pursue this second line of attack in those terms either before or during trial -- they neither filed a motion of summary judgment on the issue (couched in terms of qualified immunity or otherwise) nor did they raise the issue in their motion for a directed verdict at the close of the plaintiffs' case.*fn3 While the affirmative action defense should thus have been dead and buried at that point, the trial judge, at neither party's request, resurrected the issue at the last minute in the form of this special interrogatory to the jury (which all the jurors answered in the affirmative).*fn4
"Do you find that Raleigh Mathis's decision to reassign plaintiff out of OMI to the extent it was substantially motivated by the intent to discriminate against plaintiff because of his race, was perceived by Mathis as a means to correct what he considered a previously-existing racial imbalance within OMI?"
Taking the bait, the defendants finally included the lost "affirmative action defense" in their motions for a JNOV, which leads to the subject of this appeal: the district court's ruling on the defendants' motions for judgment notwithstanding the jury's verdict in the plaintiffs' favor.
At the close of all the evidence, the jury (after deliberation) returned a verdict in favor of the plaintiffs on their race and political discrimination claims*fn5 totalling $4.29 million. The jury's verdict for each plaintiff was identical: $55,000 in compensatory and $275,000 in punitive damages (the latter against Mathis alone). As part of their verdict, the jury answered "Yes" to each of two special interrogatories:
"1. Was Raleigh Mathis's decision to reassign any of the following plaintiffs out of the Office of Municipal Investigations substantially motivated by the political affiliations of that plaintiff?
2. Was Raleigh Mathis's decision to reassign any of the following plaintiffs out of the Office of Municipal Investigations substantially motivated by the race of that plaintiff?"
As to each plaintiff, the jury answered "No" to a third special interrogatory:
"3. If you have found either the political affiliation or race, or both, of any plaintiff was or were a substantial motivating factor or factors in Raleigh Mathis's decision to reassign that plaintiff, would Raleigh Mathis have reached the same decision to reassign that plaintiff even in the absence of that plaintiff's political affiliation and even without reference to that plaintiff's race?"
Finally, the jury answered "Yes" to the fourth interrogatory-again as to each plaintiff:
"4. Do you find that Raleigh Mathis's decision to reassign plaintiff out of OMI, to the extent it was substantially motivated by the intent to discriminate against plaintiff because of his race, was perceived by Mathis as a means to correct what he considered a previously-existing racial imbalance within OMI?"
After the jury returned its verdict, the defendants moved alternatively for JNOV, a new trial, or remittitur. In these motions, the defendants argued that the evidence was insufficient to support the jury's verdict, that Mathis was entitled to qualified immunity, and that both the compensatory and punitive damage awards were excessive and unsupported in the evidence.
The trial court disposed of these motions in two separate orders which the court entered a month apart. In his first order, the trial judge (1) granted JNOV in favor of the defendants on the plaintiffs' political discrimination claim, finding that "no . . . credence can be given to the jury's determination as to Mathis's having been politically motivated"; (2) granted JNOV against three of the plaintiffs (Bleke, Murray and Riggio) on their race discrimination claims but denied the motion as to plaintiffs Cappitelli and Di Maggio; (3) ruled that Mathis was entitled to qualified immunity; and (4) granted any successful plaintiff the option of remittitur (from $55,000 to $15,000) or a new trial on the issue of damages. Notwithstanding having already closely scrutinized the jury's factual findings, the court withheld final ruling on the motions with regard to the remaining plaintiffs pending further factual submissions from the parties. The court stated that it was doing so for two primary reasons: (1) because it believed the parties' previous submissions had failed to pay close enough attention to the legal significance of the factual differences among the plaintiffs; and (2) because the parties had failed to furnish the judge with the trial transcript. (In making his rulings, the judge stated that he "has had to rely on [his] own necessarily incomplete (though extensive) trial notes." This statement is most surprising in that if the parties did not provide a transcript, we fail to understand why the judge himself refused to order a transcript on his own before taking the drastic step of overturning a jury's verdict in a complex case.)
After receiving further submissions from the parties, and without the benefit of a trial transcript,*fn6 the court entered its final order on the defendants' post-trial motions. The order granted the defendants' JNOV motion with respect to the remaining plaintiffs' claims of race discrimination, except the plaintiff Flanagan, who was directly replaced by a black officer. As with plaintiffs Cappitelli and Di Maggio, the court granted Flanagan the option of accepting remittitur in the amount of $15,000 or a new trial on damages. Finally, the court ordered that "if and to the extent any of these rulings*fn7 granting JNOV may be reversed on appeal, a new trial is awarded as to both liability and damages-unless, again at each plaintiff's option, a like remittitur to $15,000 is accepted."
The plaintiffs appeal the court's entry of JNOV (to the extent the rulings are not in their favor) arguing, inter alia, that the court erred in substituting its judgment for that of the jury on the political and racial discrimination claims. Further, the plaintiffs insist that Mathis is not, as the court ruled, entitled to qualified immunity (and thus shielded from an award of punitive damages). The plaintiffs also take issue with the court's conditional reduction of the jury's compensatory damages award, as well as with the court's entry of a directed verdict in favor of the defendant Washington.
"The standard under which we review the district court's decision to enter a directed verdict is the same as the standard used to evaluate a judgment notwithstanding the verdict, and is the same on appeal as it is in the trial court." Eggert v. Weisz, 839 F.2d 1261, 1263 (7th Cir. 1988). Reviewing the district court's decision on the defendants' motions for JNOV (and the directed verdict as to defendant Washington), we must determine de novo "whether the evidence presented, combined with all reasonable inferences permissibly drawn therefrom, is sufficient to support the verdict when viewed in a light most favorable to the party against whom the motion is directed." Tice v. Lampert Yards, Inc., 761 F.2d 1210, 1213 (7th Cir. 1985). See also Webb v. City of Chester, 813 F.2d 824, 827-28 (7th Cir. 1987). In applying this standard, neither the district judge nor the appellate court may "resolve conflicts in testimony or weigh and evaluate the evidence, functions that are reserved to the factfinder. . . . If the evidence, taken as a whole, ...