The opinion of the court was delivered by: Longobardi, Senior District Judge.[fn1] [fn1] The Honorable Joseph J. Longobardi, Senior United States District Judge for the District of Delaware, sitting by designation.
Plaintiff Kathye L. Helgeson was employed by American International
Group ("AIG"), in their wholly owned subsidiary, American International
Group Claims Services ("AIGCS"),*fn2 from October 1994 until November
1996. Plaintiff originally filed suit in San Diego County Superior
Court, but defendants removed the case to this Court. The Complaint
contained ten causes of action, including claims for: (1) sexual
harassment, (2) retaliation, (3) pretextual constructive discharge, (4)
breach of employer's harassment policies (5) breach of implied employment
contract, (6) breach of implied contract of good faith and fair dealing,
(7) negligence, (8) negligent supervision, (9) intentional infliction of
emotional distress, and (10) negligent
infliction of emotional distress. Before removal to federal court, the
state court dismissed the third and tenth causes of action. This Court
granted defendants' motion for summary judgment on the fourth, fifth,
sixth, seventh, and eighth causes of action.*fn3 Immediately preceding
trial, plaintiff voluntarily dismissed the first cause of action.
Accordingly, the only issues that went to trial were the plaintiff's
claims of retaliation and intentional infliction of emotional distress.
A jury trial was held from June 8-15, 1998, at which the jury found for
the plaintiff on both claims. The jury made the following findings of
fact in its verdict: (1) plaintiff reasonably and in good faith believed
she was sexually harassed in violation of the FEHA*fn4 or the public
policy of California; (2) plaintiff, or someone on her behalf, complained
or otherwise protested to defendants that she believed she was sexually
harassed; (3) defendants took some adverse employment action against
plaintiff after she or someone on her behalf complained or protested; (4)
the complaints were a motivating factor for defendants' adverse
employment action; (5) plaintiff sustained injury, damages, loss or harm
as a result of defendants' retaliation; (6) defendants engaged in
outrageous conduct; (7) the individuals who engaged in outrageous conduct
acted within the scope of their employment; (8) plaintiff suffered severe
emotional distress caused by this outrageous conduct; and (9) plaintiff
has proven by clear and convincing evidence that any of the individuals
who engaged in this conduct are guilty of malice, oppression, fraud or
despicable conduct. The jury then awarded plaintiff $350,000 in economic
damages,*fn5 $650,000 in non-economic damages, and $1,250,000 punitive
Currently pending before this Court are defendants' motions for: (1)
Judgment as a Matter of Law Pursuant to Rule 50(b), and (2) New Trial
or, Alternatively, Remittitur Pursuant to Rule 59. Also pending is
plaintiffs Motion for Attorneys Fees and Costs.
Briefly summarized, the relevant facts, in a light most favorable to
the plaintiff,*fn6 are as follows: From October 1994 through November
1996, AIG employed Kathye Helgeson as a fraud investigator in the claims
division of AIGCS' San Diego office. AIGCS, a wholly-owned subsidiary of
AIG, adjusts claims for insurance carriers owned by AIG. On April 3,
1996, plaintiff was engaged in a conversation with Ronnie Austin, a
supervisor at AIGCS. In this conversation, plaintiff was acting
defensively in response to Mr. Austin's earlier suggestion in a meeting
that she needed to handle more claims. Mr. Austin suggested that the two
continue the conversation outside, where plaintiff continued to act
defensively. At this, point, Mr. Austin stated that she should relax, and
that she was not being investigated. He then added' that "if we caught
you in bed with a dead man or a live woman, then we might have to
investigate you." Plaintiff reported this comment to David Sossaman, a
co-worker who had been plaintiffs former direct supervisor. Mr. Sossaman
subsequently notified Ken Coleman, Mr. Austin's supervisor.
Subsequent to plaintiff's report to Mr. Sossaman, and Mr. Sossaman's
report to Mr. Coleman, several events occurred that plaintiff alleged
were in retaliation for her reporting Mr. Austin's comment. These events
include: (1) MG threatened to put plaintiff on a work program designed to
help her meet critical success goals; (2) Mr. Coleman threatened to lay
off plaintiff if she did not transfer to the Costa Mesa office, a threat
that AIG rescinded three days later; and (3) defendants assigned several
cases to Mr. Sossaman that should have been assigned to plaintiff,
although the evidence showed that this practice was occurring before the
April incident. Subsequently, at the end of June, plaintiff took a leave
of absence from AIG. Plaintiff returned in September, and within two
weeks received a verbal reprimand for improperly using her E-mail to
spread rumors. Defendant also reprimanded plaintiff for improperly
contacting a supervisor in the New York office even though she was
expressly given permission to do so. Additionally, Mr. Coleman issued an
inaccurate performance review of plaintiff's October performance.
Finally, on November 22, 1996, plaintiff resigned from AIG.
III. Notion for Judgment as a Matter of Law
Defendants' first motion is for Judgment as a Matter of Law Pursuant to
Rule 50(b) of the Federal Rules of Civil Procedure. "Judgment as a matter
of law is proper if the evidence, construed in the light most favorable
to the nonmoving party, permits only one reasonable conclusion, and that
conclusion is contrary to the jury's." Lambert v. Ackerly, 156 F.3d 1018,
1021-22 (9th Cir. 1998) (citing Forrett v. Richardson, 112 F.3d 416, 419
(9th Cir. 1997)); Bank of the West v. Valley Nat'l Bank of Ariz.,
41 F.3d 471, 477 (9th Cir. 1994).
The standard for deciding a Rule 50(b) motion "is
appropriately strict." The court must determine
whether the evidence, viewed in the light most
favorable to the plaintiffs, was sufficient to have
allowed a reasonable juror to arrive at a verdict for
plaintiffs. The court must draw all reasonable
inferences in plaintiff's favor, and all questions of
credibility must likewise be decided in plaintiffs'
favor. . . . [T]he court should grant the motion only
when (1) there is such a complete absence of evidence
supporting the verdict that the jury's findings could
only have been the result of sheer surmise and
conjecture, or (2) there is such an overwhelming
amount of evidence in favor of the movant that
reasonable and fairminded men could not arrive at a
verdict against him.
Datskow v. Teledyne Continental Motors Aircraft Products, 826 F. Supp. 677,
682 (W.D.N.Y. 1993) (citing Stubbs v. Dudley, 849 F.2d 83, 85 (2d Cir.
1988); Konik v. Champlain Valley Physicians Hosp., 733 F.2d 1007, 1013
(2d Cir. 1984); Mattivi v. South African Marine Corp., 618 F.2d 163,
167-68 (2d Cir. 1980)).
B. Intentional Infliction of Emotional Distress Claim
Plaintiff's first cause of action was for intentional infliction of
emotional distress. The jury found in plaintiff's favor. The tort of
intentional infliction of emotional distress is comprised of three
elements: (1) extreme and outrageous conduct by the defendants with the
intention of causing, or reckless disregard of the probability of
causing, emotional distress (2) the plaintiff suffered severe or extreme
emotional distress; and (3) the plaintiff's injuries were actually and
proximately caused by the defendants' outrageous conduct.*fn7 KOVR-TV,
Inc. v. Superior Court,
31 Cal.App.4th 1023, 1028, 37 Cal.Rptr.2d 431 (Cal.Ct.App. 1995).
Defendants argue that there is insufficient evidence to support the
jury's finding of extreme and outrageous conduct.
To prove extreme and outrageous conduct, "plaintiff must show that
defendant[s'] conduct was outrageous and beyond all bounds of decency."
Berdan v. Ortho-McNeil Pharmaceutical, Inc., No. C-96-207-VRW, 1997 WL
811782, at *5 (N.D.Cal. Dec. 31, 1997) (citing Cervantez v. J.C. Penney
Co., Inc., 24 Cal.3d 579, 156 Cal.Rptr. 198, 595 P.2d 975 (Cal. 1979)).
The conduct "must be so extreme as to exceed all bounds of that usually
tolerated in a civilized community. Generally, conduct will be found to
be actionable where the recitation of the facts to an average member of
the community would arouse his resentment against the actor, and lead him
to exclaim, `Outrageous!'" Cochran v. Cochran, 65 Cal.App.4th 488, 494,
76 Cal.Rptr.2d 540 (Cal.Ct.App. 1998) (citing and quoting KOVR-TV, 31
Cal.App.4th at 1028, 37 Cal.Rptr.2d 431; Rest.2d Torts, § 46, comment
d). See also Cabanas v. Gloodt Associates, 942 F. Supp. 1295, 1311
(E.D.Cal. 1996). "In evaluating whether the defendant's conduct was
outrageous, it is `not enough that the defendant has acted with an intent
which is tortious or even criminal, or that he has intended to inflict
emotional distress, or even that his conduct has been characterized by
"malice," or a degree of aggravation which would entitle the plaintiff to
punitive damages for another tort. Liability has been found only where the
conduct has been so outrageous in character, and so extreme in degree, as
to go beyond all possible bounds of decency, and to be regarded as
atrocious, and utterly intolerable in a civilized community.'" Cochran,
65 Cal.App.4th at 496, 76 Cal.Rptr.2d 540 (quoting Rest.2d Torts, §
46, comment d).
The actions upon which plaintiff bases her claim are the adverse
employment actions that are also the basis for her retaliation claim.
These actions are: AIG threatened to place plaintiff on a work program;
AIG did not assign plaintiff a sufficient number of cases with which to
meet her critical success goals; Mr. Coleman threatened to lay off
plaintiff; an in-house AIG attorney, during an interview with Mr.
Sossaman, asked whether Mr. Sossaman and plaintiff were having an
affair; AIG issued two verbal reprimands that had no basis in fact; Mr.
Coleman issued an inaccurate performance evaluation; Mr. Coleman promised
plaintiff he would be there when she returned to work from her leave of
absence, but was absent upon her return; and AIG took away assignments
that were within plaintiff's territory. (See plaintiff's memorandum at
All of the actions submitted by plaintiff are every-day management
decisions. Performance reviews, counseling sessions, lay-off decisions,
and work assignments are all decisions that businesses make every day.
"Managing personnel is not outrageous conduct beyond the bounds of human
decency, but rather conduct essential to the welfare and prosperity of
society. . . . If personnel management decisions are improperly
motivated, the remedy is a suit against the employer for discrimination."
Janken v. GM Hughes Electronics, 46 Cal.App.4th 55, 80, 53 Cal.Rptr.2d 741
(Cal.Ct.App. 1996). Even if these decisions were improperly motivated,
they fall far short of the necessary standard of outrageous conduct
beyond all bounds of decency.
A sampling of cases demonstrates that the conduct in evidence in this
far short of the evidence needed to prove extreme and outrageous
conduct. See, e.g., King v. AC & R Advertising, 65 F.3d 764 (9th Cir.
1995) (under California law, employer's alleged actions against employee
did not constitute "extreme and outrageous conduct," and employer thus
was not liable for intentional infliction of emotional distress; employer
allegedly changed employee's status to at-will, restructured his
compensation package, terminated him after he rejected proposal and
subsequently rehired him, and made age-related comments); Schneider v.
TRW, Inc., 938 F.2d 986, 992-93 (9th Cir. 1991) (no intentional
infliction of emotional distress where plaintiffs evidence showed her
supervisor screamed, yelled, and made threatening gestures while
criticizing her job performance); Janken, 46 Cal.App.4th 55,
53 Cal.Rptr.2d 741 (no intentional infliction of emotional distress for
firing in violation of FEHA based on age); Yurick v. Superior Court,
209 Cal.App.3d 1116, 1123-30, 257 Cal.Rptr. 665 (Cal.Ct.App. 1989)
(comments that plaintiff was over forty and senile did not give rise to
claim for intentional infliction of emotional distress); Trerice v. Blue
Cross of California, 209 Cal.App.3d 878, 257 Cal.Rptr. 338 (Cal. Ct.App.
1989) (employer's conduct was not so outrageous as to state claim for
intentional infliction of emotional distress, where employer presented
plaintiff with termination package that she accepted, withdrew that
package and told plaintiff that she was still employed, told plaintiff
that position would be eliminated, provided plaintiff with termination
package that was less advantageous than original one, and required
plaintiff to work during last days of employment performing duties
normally performed by persons of lower rank); Ankeny v. Lockheed Missiles
and Space Co., 88 Cal.App.3d 531, 536-37, 151 Cal.Rptr. 828 (Cal.Ct.App.
1979) (no intentional infliction of emotional distress where plaintiff
alleged his employer prevented him from becoming a union steward,
transferred him from job to job, wrongly denied him promotions, assigned
him inappropriate job tasks, and personally insulted him). But see Alcorn
v. Anbro Engineering, Inc., 2 Cal.3d 493, 86 Cal.Rptr. 88, 468 P.2d 216
(Cal. 1970) (African-American employee alleged he was fired in a
despicable manner when his supervisor did so while shouting various
racial epithets was entitled to damages for intentional infliction of
emotional distress); Rulon-Miller v. International Business Machines
Corp., 162 Cal.App.3d 241, 255, 208 Cal.Rptr. 524 (Cal.Ct.App. 1984)
(Evidence supported finding of intentional infliction of emotional
distress where company fired plaintiff for dating another employee, even
though company had policy of not interfering in private lives of
employees. "The combination of statements and conduct would under any
reasoned view tend to humiliate and degrade [the plaintiff]. To be denied
a right granted to all other employees for conduct unrelated to work was
to degrade her as a person."), disapproved on other grounds, Foley v.
Interactive Data Corp., 47 Cal.3d 654, 254 Cal.Rptr. 211, 765 P.2d 373
The defendants' actions, while possibly demonstrating poor business
judgment, are not so extreme and outrageous to justify an award for
intentional infliction of emotional distress.*fn8 The conduct does not
rise to that described in Rulon-Miller and Alcorn. Moreover, defendants'
conduct is less extreme than the conduct in King, Ankeny and Schneider
where the court found no intentional infliction of emotional distress as
a matter of law. Here, plaintiff was not insulted, degraded, yelled at,
physically threatened, or publicly humiliated. She did not incur any
racial slurs, and defendants made no employment decisions based on her
personal life. Although defendants carried out their business decisions in
a manner offensive to plaintiff, was not extreme and outrageous as a
matter of law. While offensive, defendant'
conduct was not so egregiously outside the realm of civilized conduct to
give rise to a verdict in the plaintiff's favor. In short, there is a
complete absence of evidence to support the jury's finding of outrageous
Accordingly, defendants' Motion for Judgment as a Matter of Law is
granted for the claim of intentional infliction of emotional distress.
Section 12940(f) of the California Government Code makes it unlawful
"[f]or any employer . . . to discharge . . . or otherwise discriminate
against any person because the person has opposed any practices forbidden
under [the FEHA]." The elements of retaliation that plaintiff needed to
prove to the jury are: (1) she reasonably believed that Mr. Austin had
sexually harassed her in violation of FEHA or the public policy of
California; (2) plaintiff or someone acting on her behalf complained
about or otherwise protested to defendants that she in good faith
believed that Mr. Austin had sexually harassed her by making an offensive
comment; (3) defendants took some adverse employment action against her
after she complained or protested about the comment; (4) her complaints
or protests were a motivating factor for the adverse employment action;
and (5) the adverse action caused her injury, damage, loss or ...