SLATHAR v. SATHER TRUCKING CORPORATION, 78 F.3d 415 (8th Cir. 1996)
DONALD A. SLATHAR, APPELLANT/CROSS-APPELLEE, v. SATHER TRUCKING
CORPORATION, AN IOWA CORPORATION; SATHER'S, INC., A DELAWARE CORPORATION,
APPELLEE/CROSS-APPELLANT.
Nos. 95-1864, 95-2003.
United States Court of Appeals, Eighth Circuit.
Submitted December 13, 1995.
Decided March 15, 1996.
Page 417
Appeal from the United States District Court for the District
of Minnesota.
Counsel who presented argument on behalf of the appellant was Michael
Albert Pinotti of St. Paul, Minnesota. John E. Thomas appeared on the
brief.
Counsel who presented argument on behalf of the appellee was William
G. Trumpeter of Chattanooga, Tennessee. Karen M. Smith appeared on the
brief.
Before McMILLIAN, JOHN R. GIBSON, and BEAM, Circuit Judges.
JOHN R. GIBSON, Circuit Judge.
[1] Donald Slathar appeals the judgment entered following an adverse
jury verdict in his Age Discrimination in Employment Act claim,
29 U.S.C. § 621-634 (1994), alleging he was wrongfully terminated
because of his age. Slathar argues that the district court[fn1] erred by
(1) instructing the jury on business judgment, (2) not allowing a former
Sather's human resource manager to testify, and (3) refusing to strike
part of the company's closing argument. We affirm.
[2] Slathar was born in January 1935. He began working for Powell's
Candies, Inc., a candy manufacturer, in 1976. Slathar's duties included
supervising maintenance in the facility, keeping the equipment running,
designing equipment, and plant engineering.
[3] In November 1991, Sather's purchased the Powell's facility.
Shortly thereafter, the company began restructuring the Powell's
organization to more closely reflect Sather's
Page 418
organizational structure. Powell's maintenance department had always
designed and built equipment in-house. In contrast, Sather's policy was
to purchase equipment on the open market.
[4] In January 1992, Sather's informed Slathar that he was being
terminated in March. The company claimed Slathar's position as a design
engineer was no longer needed, and his position was being eliminated.
Slathar believed he was being fired because of his age, and replaced as
maintenance supervisor by Ricky Vos, a Sather's employee in his
thirties, who was transferred to the former Powell's facility to serve
as Maintenance General Foreman.
[5] Slathar sued Sather's. Following the pre-trial conference the
district court dismissed Sather Trucking as a defendant and dismissed
Slathar's tortious interference claim. The jury returned a special
verdict on Slathar's Age Discrimination in Employment Act claim, finding
that Slathar's age was not a determining factor in the company's
decision to discharge Slathar. Based on the verdict, the district court
made a finding of fact in Slathar's Minnesota age discrimination claim
that the company did not discriminate against Slathar on the basis of
age. The court entered judgment against Slathar and he appeals.
I.
[6] Slathar argues that the district court erred by instructing the
jury on business judgment. He contends this instruction increased his
burden of proof and materially misstated the law. He also argues that
it was error to refuse to instruct the jury that if it found he was
discharged because of his pay, they could consider that his pay was tied
to his experience and age.
[7] The district court instructed the jury that they must find for
Slathar if age was a determining factor in his termination, and age is a
determining factor only if the company would not have terminated Slathar
but for his age. The court went on to instruct that an employer has the
right to make business decisions, absent intentional age discrimination,
"even if the factor motivating the decision to terminate is typically
correlated with age; such as pension status, salary or seniority." The
court submitted special interrogatories to the jury, and the jury
specifically found that age was not a determining factor in Slathar's
discharge.
[8] "We review the district court's formulation of jury instructions
for abuse of discretion. We must determine whether the jury
instructions, taken as a whole, fairly and adequately submitted the
issues in the case to the jury." Transport Ins. Co. v. Chrysler Corp.,
71 F.3d 720, 723 (8th Cir. 1995) (citations and internal quotations
omitted). "[T]he form and language of jury instructions are committed
to the sound discretion of the district court so long as the jury is
correctly instructed on the substantive issues in the case." Walker v.
AT & T Technologies, 995 F.2d 846, 849 (8th Cir. 1993) (quoting Williams
v. Valentec Kisco, Inc., 964 F.2d 723, 731 (8th Cir.), cert. denied,
506 U.S. 1014 (1992)).
[9] "The ADEA is not intended to be used as a means of reviewing the
propriety of a business decision." Gaworski v. ITT Commercial Fin.
Corp., 17 F.3d 1104, 1110 (8th Cir.), (quoting Jorgensen v. Modern
Woodmen of Am., 761 F.2d 502, 505 (8th Cir. 1985)), cert. denied,
115 S.Ct. 355 (1994). In Walker, 995 F.2d at 849, we held that, on the record
there before us, the employer was entitled to have the jury instructed
"that an employer may exercise business judgment in making personnel
decisions." An employer has the right to make business decisions, so
long as they are made in a nondiscriminatory manner. See Walker,
995 F.2d at 849-50.
[10] Even if Slathar was terminated because of his high salary, age
discrimination cannot necessarily be inferred. See Bialas v. Greyhound
Lines, 59 F.3d 759, 763 (8th Cir. 1995). Slathar's "status as an
experienced and thus higher paid employee [ ] does not in itself permit
an inference of age discrimination." Serben v. Inter-City Mfg. Co.,
36 F.3d 765, 766 (8th Cir. 1994) (per curiam), cert. denied,
115 S.Ct. 1402 (1995). Age discrimination may exist when an employer terminates
an
Page 419
employee based on a factor such as experience or salary when the
employer presupposes a correlation with age and uses that factor as a
proxy for age. Hazen Paper Co. v. Biggins, 507 U.S. 604, 612-13 (1993).
However, a decision to terminate an employee solely because of salary or
length of service is not age discrimination. Id. at 611. Age and
these other factors are analytically distinct. Id.
[11] Relying on St. Mary's Honor Center v. Hicks, 113 S.Ct. 2742
(1993), Slathar argues that the court's instruction confused the
substantive issues that the jury was supposed to decide, somehow
injecting procedural issues into the jury's decision and effectively
increasing his burden of proof. St. Mary's Honor Center,
113 S.Ct. at 2746, was a Title VII case tried to the court. The Court's discussion
of McDonnell Douglas burden shifting offers no support for Slathar's
argument. Reading the instructions as a whole, it is evident that the
jury's consideration was directed to whether age was the determining
factor in the decision to discharge Slathar, and Slathar had the burden
of proving that he was discharged because of his age. While the
instruction dealt with business judgment, pension status, salary, and
seniority, the instruction plainly stated the ultimate issue for the
jury's determination. See Walker, 995 F.2d at 849; Hazen Paper Co.,
507 U.S. at 611-613. The district court did not abuse its discretion by
giving the proffered instruction.
[12] Furthermore, the district court did not abuse its discretion by
refusing to instruct the jury that if it found that Slathar was
discharged because of his pay, it could consider that his pay is tied to
his experience and age. In proposing this instruction, Slathar
misconstrues the Court's statement in Hazen Paper Co.,
507 U.S. at 612-13, which noted that age discrimination may exist when an employer
uses another factor as a proxy for age. The Age Discrimination in
Employment Act requires that an employer not discriminate based on age.
It does not require an employer to ignore an employee's other
characteristics. The ultimate test is whether the company discriminated
against Slathar because of his age, and the district court properly
instructed the jury on this question.
II.
[13] Slathar next argues that the district court should have admitted
the testimony of Anita Darnell, a former human resources manager at
Sather's, regarding a phone conversation she had with Douglas Pendgraft,
the Sather's Corporate Director of Personnel. Darnell said that she did
not participate in the decision to terminate Slathar. Upon learning
that Slathar had been terminated, Darnell telephoned Pendgraft and
informed him that she believed terminating Slathar was a risky decision
because Slathar was in a protected group based on his age and perhaps
his disability. Pendgraft responded "that Sather's would take care of
it." The district court refused to allow Darnell's testimony on this
subject, finding it was irrelevant under Federal Rule of Evidence 401
because Darnell had not participated in the employment decision, the
conversation took place after the decision to terminate Slathar had been
made, and it amounted to nothing more than her opinion regarding the
company's potential exposure. Further, the court found that the value
of the proposed testimony was far outweighed by its prejudicial impact.
See Fed.R.Evid. 403.
[14] "Admission of evidence is a matter for the district court's
discretion and we will defer to the district court's ruling absent an
abuse of discretion." Morgan v. Arkansas Gazette, 897 F.2d 945, 952
(8th Cir. 1990). Stray remarks and statements by nondecisionmakers are
not direct evidence of discriminatory motive. See Beshears v. Asbill,
930 F.2d 1348, 1354 (8th Cir. 1991). Darnell's testimony that she told
a senior manager that Slathar was in a protected class is not evidence
of discrimination. See Bashara v. Black Hills Corp., 26 F.3d 820,
823-24 (8th Cir. 1994) (holding that human resources manager's
expression of concern over possible age discrimination claim was the
"equivalent of a stray remark" and did "not constitute evidence of
discriminatory animus").
Page 420
[15] Darnell was not involved in the decision to terminate Slathar,
and she did not offer her opinion of the decision until after it had
been made. Pendgraft's response is much too ambiguous to be considered
any sort of admission by company management, and it is not evidence of
discriminatory intent.
[16] The impact of Darnell's testimony would have been quite
prejudicial. "Although it had no direct bearing on the issue to be
decided . . . this testimony embellished the circumstantial evidence
directed to that issue by adding `smoking gun' type evidence," the
opinion of a company manager. Schrand v. Federal Pac. Elec. Co.,
851 F.2d 152, 156 (6th Cir. 1988). Such prejudice substantially outweighs
any probative value the proposed testimony might have. The district
court did not abuse its discretion by excluding Darnell's testimony.
III.
[17] Slathar contends that the district court erred by not striking a
portion of the company's closing argument. Addressing the issue of
damages and referring to the testimony of Slathar's expert Varns, the
company argued:
[L]adies and gentlemen, you'll recall Mr. Varns stated Mr.
Slathar drew nine to eleven weeks of unemployment compensation. He
worked 46 out of the 52 weeks that year, and yet he's drawing
unemployment compensation, making $21.00 an hour, 32 to 40 hours a week.
Take a look at the exhibit when you get back there. Ladies and
gentlemen, that's a fraud against the State.
[18] The district court overruled Slathar's objection to this
argument. Slathar now argues that we should grant a new trial because
this argument was based on evidence not contained in the record.
[19] "[C]losing arguments are made under the direct control of the
trial court. We will not disturb the court's ruling unless an abuse of
discretion occurred. To constitute reversible error, statements made in
closing argument must be plainly unwarranted and clearly injurious."
Pearce v. Cornerstone Clinic for Women, 938 F.2d 855, 859 (8th Cir.
1991) (citations omitted).
[20] The company's argument addresses both damages and Slathar's
credibility as a witness. Both parties argue the substantive issue of
whether Slathar violated Minnesota law and actually committed fraud on
the state. Whether Slathar committed fraud on the state is certainly
not a question for us to decide here, and it was not an issue for the
jury in this age discrimination case. Counsel's conclusion that Slathar
committed a fraud against the state, in our view, exceeds the bounds of
zealous advocacy.
[21] However, the district court instructed the jury several times
that statements of counsel were not evidence in the case. Further, in
denying Slathar's motion for a new trial, the court stated that the
comment of defense counsel "was clearly not outcome determinative." We
cannot conclude that this one sentence in the midst of the entire trial
is so egregious as to warrant reversal. See Moses v. Union Pac. R.R.,
64 F.3d 413, 417 (8th Cir. 1995) (holding that "[a]lthough we strongly
disapprove of defense counsel's closing argument, we decline to reverse
because plaintiff has failed to make a showing of prejudice").
[22] We affirm the decision of the district court. Because we
affirm, we need not reach the issues raised in the company's cross
appeal.
[fn1] The Honorable Donald D. Alsop, Senior Judge, United States
District Court for the District of Minnesota.
