g) With respect to the testimony of Kenichi Nishikawa, the court finds it was not credible. Nishikawa's testimony also included damaging admissions, which reflected poorly on the other matters to which he testified.
h) With respect to Masafumi Omoto, the court finds his testimony was generally not credible. Omoto made admissions damaging to the defendant's case.
II. CONCLUSIONS OF LAW
1. Defendant, the Quasar Company, a Delaware corporation and a subsidiary of a Japanese corporation, is obligated to comply with American employment discrimination laws. Sumitomo Shoji America, Inc. v. Avagliano, 457 U.S. 176, 72 L. Ed. 2d 765, 102 S. Ct. 2374 (1982).
2. At all times relevant to this action, Quasar was an employer as defined by 42 U.S.C. § 2000e(b) and, thus, is subject to Title VII of the Civil Rights Act of 1964 ("Title VII"). 42 U.S.C. § 2000e et seq.
3. The plaintiffs fully complied with all jurisdictional prerequisites to bring an action under Title VII.
4. In relevant part, Section 703(a)(2) of Title VII makes it unlawful for an employer subject to the Act "to limit, segregate or classify its employees . . . in any way which would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect his status as an employee, because of such individual's . . . national origin." 42 U.S.C. § 2000e-2(e). Employment discrimination based upon national origin violates Title VII. See e.g. Bilka v. Pepe's, Inc., 601 F. Supp. 1254 (N.D.Ill. 1985); Thomas v. Rohner-Gehrig & Co., 582 F. Supp. 669 (N.D.Ill. 1984); Porto v. Canon, U.S.A., Inc., 28 Fair Empl. Prac. Cas. (BNA) 1679 (N.D.Ill. 1981).
5. Quasar accomplished its discrimination by reserving certain of its managerial positions for employees of Japanese national origin, by evaluating and paying Quasar's managerial employees of Japanese national origin on an entirely different basis from that used to evaluate and pay Quasar's managerial employees of American national origin, and by exempting all of its managerial employees of Japanese national origin from Quasar's RIF, all without lawful justification.
6. In Oxman v. WLS-TV, 846 F.2d 448, 455 (7th Cir. 1988), the Seventh Circuit set forth the elements a plaintiff must show to establish a prima facie case of employment discrimination in a RIF context. Oxman was an ADEA case. Its rationale, however, applies equally to claims of discrimination pursuant to Title VII. See Oxman, 846 F.2d at 452. These plaintiffs established a prima facie case by showing that they were members of a protected group, namely persons of American national origin, that they were performing according to Quasar's legitimate expectations, that Quasar terminated their employment, and that similarly situated managerial employees of Japanese national origin were treated more favorably.
7. Once the plaintiffs established the elements of a prima facie case, the burden shifted to Quasar to articulate lawful reasons for these plaintiffs' discharges. See Oxman, 846 F.2d at 453. Quasar introduced evidence that it discharged the plaintiffs because of its dire financial condition and that the ability to speak Japanese was necessary to perform certain positions which were reserved for managerial employees of Japanese national origin, to rebut plaintiffs' prima facie case.
8. After Quasar articulated a nondiscriminatory reason for these plaintiffs' discharges, the burden shifted back to plaintiffs to demonstrate that Quasar's proffered reasons were pretextual. Plaintiffs could have made such a demonstration in one of two ways: Plaintiffs could show either that the discriminatory reason more likely than not motivated Quasar or that Quasar's proffered explanations were not credible. See Oxman, 846 F.2d at 453 (citing LaMontagne v. American Convenience Products, Inc., 750 F.2d 1405, 1409 (7th Cir. 1984)).
9. Plaintiffs met this burden of proof by offering evidence that Quasar segregated and classified its managerial workforce along lines of national origin, that Quasar used different systems to evaluate and pay its managerial employees of Japanese national origin, and that Quasar exempted managerial employees of Japanese national origin from the RIF. As a result of Quasar's discriminatory segregation of its workforce, and pursuant to its discriminatory system of evaluation and compensation, Quasar significantly enhanced the financial remuneration received by its managerial employees of Japanese national origin at the very time that Quasar was adversely affecting the employment of its managerial employees of American national origin. This evidence raised the inference not only that Quasar's proffered nondiscriminatory reason of its financial condition was incredible, but also that this defense was pretextual.
10. Furthermore, the evidence presented at trial demonstrated that Quasar's other proffered nondiscriminatory reason for plaintiffs' discharges -- i.e., that the ability to speak Japanese was necessary to perform certain positions -- was pretextual. Specifically, plaintiffs elicited testimony and evidence which demonstrated that, in the past, many managerial employees of American national origin who did not speak Japanese performed the marketing, financial and managerial duties which Quasar suddenly contended could only be performed by employees of Japanese national origin, including travelling to Japan and communicating with employees located in Japan.
11. As a matter of law, this court concludes that Quasar impermissibly discriminated against plaintiffs on the basis of their American national origin when Quasar terminated their employment. Quasar would not have discharged the plaintiffs but for their national origin.
12. The evidence of record in this action demonstrates that Quasar had many positions for which each of these plaintiffs was qualified. Quasar never offered such positions to any of the plaintiffs. The testimony at trial demonstrates that Quasar was prepared to "defend" its decisions to offer employment opportunities to others for a variety of reasons. That is, if asked why any of the plaintiffs were not offered a position, Quasar would provide a "reason" -- sometimes without ascertaining whether the "reason" applied. For example, Quasar determined that these plaintiffs would not relocate -- without consulting plaintiffs.
13. The court also finds as a matter of law that plaintiffs exercised every effort to mitigate their damages by obtaining other employment. Accordingly, the court finds in favor of the plaintiffs and against the defendant as to Counts II, IV and VI.
14. The damages assessed by the jury with respect to the plaintiffs' age claims are supported by the evidence and exceed the damages which the court might reasonably award under Title VII, not only because of the jury finding that the defendant willfully violated the ADEA, but also because the remedial scheme of the ADEA is more generous than that of Title VII. McKnight v. General Motors Corp., 908 F.2d 104, 117 (7th Cir. 1989). The court, however, notes that if the jury verdicts did not fully remedy the defendant's discrimination as to these plaintiffs, the court would award the plaintiffs back and front pay as to the Title VII claims in the same amounts actually awarded by the jury.
III. POST-TRIAL MOTIONS
Also pending before the court are the parties' post-trial motions. Plaintiffs move for prejudgment interest and defendant moves to revise non-final judgment, or alternatively to alter or amend the judgment.
A. Defendant's Motion to Amend the Judgment
Defendant sought at trial to exclude any evidence relating to front pay, arguing that a determination with respect to front pay should be reserved to the court. (Defendant's Motion in Limine to Exclude Evidence Regarding Front Pay or Benefits). The court denied the defendant's motion in limine pursuant to Coston v. Plitt Theatres, Inc., 831 F.2d 1321 (7th Cir. 1987) vacated on other grounds 485 U.S. 1007, 99 L. Ed. 2d 700, 108 S. Ct. 1471 (1988). In Coston, the Seventh Circuit stated that: "Authority and reason both suggest that while the decision to award front pay is within the discretion of the trial court, the amount of damages available is a jury question." Coston, 831 F.2d at 1337, n. 4.
Following the jury verdicts in favor of the plaintiffs awarding back pay, front pay and finding that the defendant's violation of the ADEA was willful, defendant filed the motion to amend the judgment. The motion argues that: front pay should not have been awarded because liquidated damages were awarded; the court should have determined the amount and availability of front pay; and the plaintiffs' back and front pay awards should have been measured against the jobs they sought. The liquidated damages referred to in the defendant's motion were awarded by the court following the jury verdict finding that the defendant's violation of the ADEA was a willful violation. The court doubled the damages awarded by the jury for front and back pay in awarding the liquidated damages.
The defendant's memorandum in support of the motion first argued that the court impermissibly doubled the award of the front pay as part of the liquidated damage award. Defendant bases this contention on its analysis of the following provisions of the ADEA and the Fair Labor Standards Act ("FLSA"), respectively:
The provisions of the chapter shall be enforced in accordance with . . . section . . . 216 . . . of this title . . . Amounts owing to a person as a result of a violation of this chapter shall be deemed to be unpaid minimum wages or unpaid overtime compensation under this section 216 . . . Provided, that liquidated damages shall be payable only in cases of willful violations of this chapter. In any action brought to enforce this chapter the court shall have jurisdiction to grant such legal or equitable relief as may be appropriate to effectuate the purposes of this chapter, including without limitation judgments compelling employment, reinstatement or promotion, or enforcing the liability for amounts deemed to be unpaid minimum wages or unpaid overtime compensation under this section.
29 U.S.C § 626(b).
Any employer who violates the provisions of section 206 or section 207 of this title shall be liable to the employees affected in the amount of their unpaid minimum wages, or their unpaid overtime compensation, as the case may be, and in an additional equal amount as liquidated damages.
29 U.S.C. § 216(b).
Defendant correctly argues that the court should not consider front pay as a component of the "amounts owing" under section 626(b) in calculating liquidated damages, because the reference to reinstatement in the statute follows the reference to "amounts owing" and front pay is a prospective remedy. Graefenhain v. Pabst Brewing Co., 870 F.2d 1198, 1210 (7th Cir. 1989). It follows from this analysis and is the law in this Circuit that because front pay is not mentioned explicitly in the statute itself, front pay is only awarded in lieu of reinstatement. Accordingly, the court will amend the judgment to reflect the doubling of the back pay award only for liquidated damages.
Defendant argues, however, that because front pay is awarded in lieu of reinstatement, it must not only be awarded by the district judge, but also the amount awarded must be determined by the judge. The defendant engages in semantics. An award of reinstatement is an equitable remedy committed to the discretion of the district judge and is preferable to an award of front pay. Hybert v. Hearst Corp., 900 F.2d 1050, 1055 (7th Cir. 1990). It is also true that if the district judge considers the Seventh Circuit's McNeil factors and determines that reinstatement is inappropriate under the facts of a given case, the judge may consider front pay as an alternative to reinstatement. The alternative remedies of reinstatement or front pay are available in the event that some further award is necessary to make the plaintiff whole. In that respect the defendant's analysis that the availability of front pay must be determined by the judge is accurate. The judge must consider the options of reinstatement or front pay. The defendant is arguing, however, that the jury is incapable of determining the amount of front pay appropriately awarded. There is a split of authority as to whom should decide the amount of front pay damages to be awarded. Compare Fite v. First Tennessee Production Credit Ass'n, 861 F.2d 884, 893 (6th Cir. 1988) (jury question); Hansard v. Pepsi-Cola Metropolitan Bottling Co., Inc., 865 F.2d 1461 (5th Cir. 1989) (jury question); Coston v. Plitt Theatres, Inc., 831 F.2d 1321, 1337, n. 4 (7th Cir. 1987) (jury question) vacated and remanded on other grounds 485 U.S. 1007, 108 S. Ct. 1471, 99 L. Ed. 2d 700 (1988); Maxfield v. Sinclair International, 766 F.2d 788, 795-96 (3d Cir. 1985) (jury question) cert. denied 474 U.S. 1057, 88 L. Ed. 2d 773, 106 S. Ct. 796 (1986); Davis v. Combustion Engineering, Inc., 742 F.2d 916, 922 (6th Cir. 1984) (jury question); Eivins v. Adventist Health System/Eastern & Middle America, Inc., 660 F. Supp. 1255, 1264 (D. Kan. 1987) (jury question); with Dominic v. Consolidated Edison Co., 822 F.2d 1249 (2d Cir. 1987) (issue for the court); Wildman v. Lerner Stores Corp., 771 F.2d 605, 616 (1st Cir. 1985) (issue for the court); Miller v. Pabst Brewing Co., 670 F. Supp. 1420 (E.D. Wis. 1987) (issue for the court), affirmed on other grounds 870 F.2d 1198, 1206 (7th Cir. 1989) ("we need not address the difficult question whether a jury trial is available with respect to an award of front pay under the ADEA"). Even if the court were not bound by the relevant Seventh Circuit precedent,
assessing damages is clearly within the competence of a jury. Moreover, in the case of a front pay award, unlike other damage awards, there is the additional protection afforded the defendant in the judge's determination whether front pay may appropriately be awarded at all, which involves consideration of many factors, outlined below, not the least of which is the degree to which the jury must engage in speculation in awarding such damages. Finally, even though front pay is an alternative remedy to reinstatement, it is a legal remedy, not an equitable one. McKnight v. General Motors Corp., 908 F.2d 104, 117 (7th Cir. 1990).
Defendant also argues that front pay is not appropriately awarded where liquidated damages have been awarded. Yet, the authority upon which defendant relies clearly states that the award of liquidated damages is one factor to be considered in awarding front pay and does not stand for the proposition that front pay and liquidated damages may never be awarded to the same plaintiff. See e.g. Graefenhain v. Pabst Brewing Co., 870 F.2d 1198, 1205 (7th Cir. 1989); McNeil v. Economics Laboratory, Inc., 800 F.2d 111, 118-19 (7th Cir. 1986), cert. denied 481 U.S. 1041, 95 L. Ed. 2d 823, 107 S. Ct. 1983 (1987). The authorities cited by the defendant recognize that the decision to award front pay is neither in lieu of liquidated damages nor is it as simplistic as the defendant represents it to be.
This court determines that reinstatement is not a proper remedy under the facts of this case. In this case, no offer of reinstatement has been made and it was represented to the court that the defendant would not rehire the plaintiffs and the relationship between the parties is clearly hostile. Moreover, the period of time for which front pay was assessed was relatively short given the plaintiffs' career path with the defendant and the court's findings of fact reflect the plaintiffs' unsuccessful attempts in mitigation of damages and their inability to find truly comparable employment.
The court also finds that the award of front pay damages is appropriate under the facts of this case. Again, the relatively short period of time for which these damages were assessed by the jury weighs in favor of the award. This is not a case in which an award of front pay is speculative. That is so because the evidence at trial demonstrated that these plaintiffs were virtually model, career employees. It does not take any leap of faith to conclude that but for the defendant's discrimination, these men would have enjoyed continued employment until retirement. Moreover, the plaintiffs' attempts to mitigate their damages support the conclusion that the award of front pay is not a windfall to plaintiffs. In short, if front pay is not justified under the facts of this case, it is hard to imagine any set of circumstances under which it would be. Finally, although front pay may be less appropriate where there is an award of liquidated damages following the jury's finding that the defendant's conduct was willful, the balance of factors weighs so heavily in favor of the award of front pay in this case that to deny it would be an injustice. "A substantial liquidated damages award only makes front pay less appropriate if a front pay award would be highly speculative due to the lengthy period for which damages are sought and the lack of certainty that plaintiff would have remained employed during such a lengthy period." Graefenhain v. Pabst Brewing Co., 870 F.2d 1198, 1205 (7th Cir. 1989).
The final argument raised in the defendant's motion is that the plaintiffs' back and front pay awards should have been measured against the jobs they sought. Defendant claims that because one of the plaintiffs' theories at trial was that the defendant could have found the plaintiffs other positions at Quasar, the plaintiffs' damages should have been measured against the salaries applicable to those positions. The court rejects the defendant's argument. Quasar never offered the plaintiffs these positions and can hardly argue now that the salaries should apply. "For purposes of calculating back pay, the appropriate comparison is the position that the plaintiff would have occupied had no violation occurred rather than a non-discriminatory alternative," even though the plaintiffs testified they would have accepted non-discriminatory, lower-paying positions. Metz v. Transit Mix, Inc., 692 F. Supp. 987, 939 (N.D. Ind. 1988). Moreover, the facts of this case are distinguishable even from Metz in that the positions which plaintiffs would have accepted were not non-discriminatory alternatives, i.e. the defendant could not permissibly raise the salaries of its managerial employees of Japanese national origin and demote its managerial employees of American national origin. Accordingly, the defendant's motion to amend the judgment in this case is granted in part and denied in part. The judgment will be amended only to the extent that the liquidated damage award will be revised so that it reflects the doubling of the back pay awards only. The motion is denied to the extent that the front pay award will not be vacated or reduced.
B. Plaintiffs' Motion for Prejudgment Interest
Plaintiffs' motion for prejudgment interest must be denied because of the Seventh Circuit's interim opinion in Graefenhain v. Pabst Brewing Co., 870 F.2d 1198 (7th Cir. 1989), which held that an award of back pay liquidated damages precludes the award of prejudgment interest. The court does, however, award post-judgment interest. 28 U.S.C. § 1961(a); Bell, Boyd & Lloyd v. Tapy, 896 F.2d 1101 (7th Cir. 1990). Also, the plaintiffs are entitled to attorneys fees and costs as prevailing parties. 29 U.S.C. §§ 626(b) (ADEA) and 217(b)(FLSA); 42 U.S.C. § 2000e-5(k) (Title VII); 28 U.S.C. § 1920. The plaintiffs' attorneys are directed to submit a petition for attorneys' fees and costs within 30 days of receipt of this opinion and order.
The court enters judgment pursuant to Rule 58 of the Federal Rules of Civil Procedure in favor of plaintiffs Fortino, Meyers and Schulz and against the defendant as to Counts II, IV and VI of the complaint. Defendant's motion to amend the judgment is granted in part and denied in part. Plaintiffs' motion for prejudgment interest is denied. Plaintiffs' attorneys are directed to submit a petition for attorneys' fees and costs within 30 days of receipt of this memorandum opinion and order.