Opinion
Case No. 3:18-cv-01069-SB
04-24-2020
DON JOSEPH, Plaintiff, v. WEST LINN PAPER COMPANY, Defendant.
FINDINGS AND RECOMMENDATION
BECKERMAN, U.S. Magistrate Judge.
Plaintiff Don Joseph ("Joseph") has moved for entry of default judgment against defendant West Linn Paper Company ("WLPC") under Fed. R. Civ. P. 55. Joseph seeks default judgment on all of his claims, an award of economic and noneconomic damages, and attorney's fees and costs to be determined on a later motion. (ECF No. 19.) The Court has jurisdiction over this matter under 28 U.S.C. § 1331 (federal question) and 28 U.S.C. § 1367 (supplemental jurisdiction), and has personal jurisdiction over WLPC, an Oregon corporation registered to do business in Oregon. (Compl. ¶ 6.) For the reasons stated below, the Court recommends that the district judge grant Joseph's motion for default judgment and award economic damages in the amount of $107,751.93 and noneconomic damages in the amount of $100,000.00.
BACKGROUND
The Court takes the factual allegations of the complaint as true. See TeleVideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917-18 (9th Cir. 1987) (providing that, upon entry of default, "the factual allegations of the complaint, except those relating to the amount of damages, will be taken as true." (quoting Geddes v. United Fin. Grp., 559 F.2d 557, 560 (9th Cir. 1977))).
Joseph was a WLPC employee. (Compl. ¶ 5, ECF No. 1.) On or about August 16, 2016, Joseph was injured on the job. (Compl. ¶ 8.) After the incident, Joseph notified his supervisor of the injury and informed Human Resources that he would need to take time off work. (Compl. ¶ 9.) In the following weeks, Joseph updated his supervisor on his progress, sent status updates to the head of Human Resources, Jennifer Crown ("Crown"), and received workers' compensation. (Compl. ¶¶ 11-24.) Joseph received an email from Crown regarding Family and Medical Leave Act ("FMLA") leave and short-term disability benefits, and the paperwork for the essential job functions of his position, which Joseph felt inaccurately described the functions of his job. (Compl. ¶ 26.) Crown later notified Joseph that WLPC approved his medical leave. (Compl. ¶ 34.) In the next month, Joseph alerted Crown that he did not receive his benefits packet. (Compl. ¶ 39.) In response, Crown asked that Joseph come into the office the next day to receive his enrollment material. (Compl. ¶ 39.)
On or about December 2, 2016, Joseph arrived at WLPC believing that he would discuss his enrollment paperwork. (Compl. ¶ 40.) Instead, Brian Konan ("Konan") and Crown asked Joseph whether he was able to perform his duties. (Compl. ¶ 40.) Joseph answered that he was unsure, mentioned that he had yet to complete physical therapy, and said that the list of physical requirements for the job "was extreme even for an uninjured person." (Compl. ¶ 40.) Crown asked Joseph "whether it would be better if [he] found a new line of work due to the physical work at [WLPC]," but Joseph responded, "no," "that he liked working at WLPC." (Compl. ¶ 40.) Konan and Crown discussed the issue separately and returned to inform Joseph that he "had exhausted all of his FMLA [leave] and that they decided to let [him] go." (Compl. ¶ 40.)
Joseph asked why they were letting him go. (Compl. ¶ 40.) He reminded them that he had complied with the company's requests, kept them informed and updated on his progress, and that he was trying to get better to return to work and had an upcoming appointment to discuss returning to work. (Compl. ¶ 40.) Konan responded that "they did not feel that Mr. Joseph could perform the work required even after he was done healing," and offered that the company would pay Joseph's premiums and health insurance for three months if Joseph signed a letter "releasing them from any liability to his release from work" within the next ten days. (Compl. ¶ 40.)
Joseph asked to retrieve his personal belongings from his locker but was told that he needed to return another day. (Compl. ¶ 40.) Security escorted Joseph off the property, and when Joseph returned to retrieve his belongings, Crown informed Joseph that his belongings were at security. (Compl. ¶ 48.)
Joseph brings claims for: interference, discrimination, and retaliation under (1) FMLA, 29 U.S.C. § 2601 et seq., and (2) the Oregon Family Leave Act, Or. Rev. Stat. (hereinafter "O.R.S.") § 659A.150 et. seq.; (3) discrimination and retaliation under O.R.S. § 659A.040; (4) failure to reinstate under O.R.S. § 659A.043; (5) failure to reemploy under O.R.S. § 659A.046; (6) discrimination and retaliation under O.R.S. § 659A.199 for reporting WLPC's actions; (7) disability discrimination under O.R.S. § 659A.112; and (8) wrongful termination under Oregon common law. (Compl. ¶¶ 50-121.)
After WLPC failed to file responsive pleadings pursuant to the parties' agreement in a joint status report, Joseph moved for an order of default, which the Clerk entered on December 21, 2018. (Joint Status Report at 2, ECF No. 12; Pl.'s Mot. for Default, ECF No. 16; ECF No. 18.) After Joseph filed a motion for default judgment, the Court entered an Order to Show Cause, allowing Joseph to supplement his motion to satisfy his burden of proving that he is entitled to the damage award he seeks. (ECF Nos. 19 and 21.) The Court held an evidentiary hearing, at which Joseph testified and the Court admitted Joseph's hearing exhibits. (ECF No. 26.) Joseph marked his W-2s and tax returns from 2015-2019 as hearing exhibits to support his lost wages calculation:
| Year | Wages Plaintiff Earned | Lost Wages |
|---|---|---|
| 2015 | $51,764 | $0 |
| 2016 | $25,492 | $26,272 |
| 2017 | $0 | $51,764 |
| 2018 | $26,448 | $25,316 |
| 2019 | $24,874 | $26,890 |
| Total Lost Wages: | $130,242 |
ANALYSIS
I. LEGAL STANDARD
Upon entry of default, "the factual allegations of the complaint, except those relating to the amount of damages, will be taken as true." TeleVideo Sys., Inc., 826 F.2d at 917-18 (quoting Geddes, 559 F.2d at 560). The district court has discretion to grant a motion for default judgment and may consider several factors to determine whether default judgment is appropriate. See Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986) (setting forth the relevant factors, including possible prejudice to the plaintiff, merits of the claim, sufficiency of the complaint, the sum of money at stake, the possibility of a dispute concerning material facts, whether the default was due to excusable neglect, and the strong policy favoring decisions on the merits).
II. DISCUSSION
The Court finds that the Eitel factors, on balance, support entry of default judgment here, because Joseph has presented sufficient allegations in his complaint for the Court to determine that his claims have merit, the material facts do not appear to be in dispute, the amount of money at stake is reasonable, and WLPC was aware of this litigation but chose not to defend against Joseph's claims.
WLPC ceased business operations in October 2017 and certain of its unsecured creditors filed an involuntary bankruptcy proceeding against WLPC, which resulted in the creation of a Creditor Trust on March 8, 2018. (ECF No. 10 at 1; ECF No. 14 at 1.) The parties informed the Court on October 11, 2018 that Joseph had chosen not to pursue his claims through the Creditor Trust, and that WLPC would file a responsive pleading by October 25, 2018. (ECF No. 11 at 2.) Instead, WLPC's counsel filed an unopposed motion to withdraw as counsel, at WLPC's direction, on October 25, 2018. (ECF No. 13 at 1.) Joseph's counsel reported at the evidentiary hearing that the WLPC plant has now reopened under a new name.
A. Damages
Joseph seeks $130,242 in past lost wages, $122,079.36 in future lost wages, and $250,000 in noneconomic damages. (Pl.'s Mot. for Default J. at 7; Pl.'s Exs. 1-5.) For the reasons stated below, the Court recommends that the district judge award Joseph $107,751.93 in economic damages and $100,000 in noneconomic damages.
Joseph originally sought $183,119.04 in past lost wages, based on his representation that he had not worked since his termination (Joseph Decl. ¶ 46; Pl.'s Mot. for Default J. at 7), but Joseph provided updated information at the evidentiary hearing and adjusted his past wage loss calculation to $130,242.00. (Pl.'s Exs. 1-5.)
In a civil action for alleged violations of Oregon's unlawful employment statute, a court "may order injunctive relief and any other equitable relief that may be appropriate, including but not limited to reinstatement or the hiring of employees with or without back pay," O.R.S. § 659A.885(1), and may award "compensatory damages or $200, whichever is greater, and punitive damages[.]" O.R.S. § 659A.885(3) (allowing compensatory and punitive damages for alleged violations of, among another sections, O.R.S. §§ 659A.040, 659A.043, 659A.046, 659A.112, and 659A.199). "Compensatory damages include both economic and noneconomic damages." Hamlin v. Hampton Lumber Mills, Inc., 349 Or. 526, 540 n.12 (2011) (citing Tadsen v. Praegitzer Indus., Inc., 324 Or. 465 (1996)); see also 29 U.S.C. § 2617(a) (providing that any employer who violates FMLA shall be liable to any eligible employee affected for damages equal to the amount of "any wages, salary, employment benefits, or other compensation denied or lost to such employee by reason of the violation").
1. Economic Damages
The Court recommends that the district judge award Joseph $107,751.93 in economic damages: $107,751.93 in past lost wages and $0 in future lost wages.
a. Past Lost Wages
Joseph seeks $130,242.00 in past lost wages, based on his calculation reflected in the summary table he presented at the evidentiary hearing. In a civil action alleging an unlawful employment practice, the Court may award back pay during "the two-year period immediately preceding the filing of the action." O.R.S. § 659A.885(1); see also Lubbes v. RSG Forest Prod., Inc., No. CV 05-880 MO, 2007 WL 539499, at *2-3 (D. Or. Feb. 14, 2007) (finding that back pay was limited to the period between the plaintiff's termination and when the plaintiff filed the complaint under O.R.S. § 659A.885(1)); but see Eichenberger v. Falcon Air Exp. Inc., No. CV-14-00168, 2015 WL 3999142, at *5 (D. Ariz. July 1, 2015) (providing, in a case where a plaintiff with FMLA and Title VII claims requested back pay, that "[a] plaintiff's lost wages are calculated from the date of the discriminatory act to the date of final judgment" (citing Thorne v. City of El Segundo, 802 F.2d 1131, 1136 (9th Cir. 1986), a Title VII case)).
Joseph seeks lost wages for all of 2016, but he was employed until his termination on December 2, 2016. The Court assumes this wage loss calculation was an error, as Joseph has not provided any authority to support an award of lost wages prior to termination.
The Court may also award compensatory damages to cover the "gap period" in Oregon's statute between when back pay ends and front pay begins. See McMillan v. Li Ning Sports USA, Inc., No. 110708760, 2013 WL 9591371, at *2 (Or. Cir. Dec. 18, 2013) (holding that O.R.S. § 659A.885(3), which permits the court to award compensatory damages, "provides for 'back pay' and lost wages during the 'gap' period" between when the plaintiff filed the complaint and the jury verdict); Lubbes, 2007 WL 539499, at *2-3 (recognizing the plaintiff's argument that the statute creates a "gap" between back pay and front pay under Oregon's statutory scheme, and considering whether the court may award compensatory damages during this period). FMLA does not create a gap between front pay and back pay. Instead, the entire back pay period is "from the date of the discriminatory act to the date of final judgment." Eichenberger, 2015 WL 3999142, at *5 (quoting Thorne, 802 F.2d at 1136).
The Court hereinafter uses "past lost wages" to refer to both the two-year back pay period and the "gap" between when back pay ends and front pay begins under Oregon's statute.
The Court recommends that the district judge award Joseph lost wages equal to the difference between the wages Joseph earned during his final year at WLPC (i.e., 2015-2016) and the wages he earned post-termination in 2016, 2017, 2018, and 2019. Specifically, Joseph earned $51,764.56 in wages during 2015, his final full year at WLPC. (Pl.'s Ex. 5, at 1.) WLPC terminated Joseph on December 2, 2016. See Eichenberger, 2015 WL 3999142, at *5 (calculating back pay from the termination date). Joseph lost three weeks and four days of wages in December 2016, equivalent to $3,782.79. (Pl.'s Ex. 1, at 30.) In 2017, Joseph earned $0, a $51,764.56 difference from his 2015 wages. (Pl.'s Ex. 2, at 4.) In 2018, Joseph earned $26,448.68, a $25,315.88 difference. (Pl.'s Ex. 3, at 28.) Finally, Joseph earned $24,875.86 in 2019, a $26,888.70 difference from his 2015 wages. (Pl.'s Ex. 4, at 1-2.) Accordingly, the Court recommends that the district judge award Joseph $107,751.93 in past lost wages. See Winter v. Guard Force Int'l, Inc., No. 3:16-CV-2408-SI, 2017 WL 3151256, at *2 (D. Or. July 25, 2017) (awarding economic damages representing the plaintiff's lost wages prior to and after filing the complaint).
Under both Oregon's unlawful employment statute and FMLA, the employer bears the burden of proving that the plaintiff failed properly to mitigate damages. See Schubbe v. Diesel Serv. Unit Co., 71 Or. App. 232, 237 (1984) ("Defendant concedes that it had the burden to prove that the plaintiff failed to mitigate and could have obtained employment elsewhere." (citing Quick v. Swing, 53 Or. 149 (1909) and Brenneman v. Auto Teria, Inc., 260 Or. 513, 522 (1971))); Dunn v. CSK Auto, Inc., No. CV-05-116-HU, 2006 WL 2345807, at *3 (D. Or. Aug. 11, 2006) ("Plaintiff has the duty to use reasonable efforts to mitigate damages. Defendant has the burden of proving that plaintiff failed to use reasonable efforts to mitigate damages."); Thomas v. Comprehensive Options for Drug Abusers, Inc., No. 3:14-CV-01843-BR, 2016 WL 3636929, at *8 (D. Or. July 6, 2016) ("When an employee seeks an award of back pay, the employee has an affirmative duty to mitigate damages by exercising reasonable efforts to find other suitable employment." (citing Ford Motor Co. v. EEOC, 458 U.S. 219, 231 n.15 (1982))).
Joseph initially used a 2016 weekly pay stub for $1,173.84 to calculate annual earnings of $61,039.68 at the time of termination. (Pl.'s Mot. for Default J. at 7.) Per the Court's request for additional information, Joseph submitted a form W-2 Wage and Tax Statement for 2015 which provides that Joseph earned $51,764 in W-2 wages during his final year at WLPC, and he used his 2015 wages to calculate lost wages. (Pl.'s Ex. 5, at 1.) Accordingly, the Court also uses the $51,764 annual earnings figure to calculate lost wages.
This calculation is based on Joseph earning $51,764.56 a year, which equals $995.47 a week ($51,764.56 over 52 weeks), $199.09 a day ($995.47 over five days). Accordingly, Joseph lost $3,782.79 in wages for 2016 ($995.47 x 3 weeks + $199.09 x 4 days) based on the assumption that Joseph was able to return to work in December 2016 and work until the end of the year.
b. Future Lost Wages
Joseph seeks future lost wages for two years, i.e., 104 weeks, in the amount of $122,079.36. (Pl.'s Mot. for Default J. at 7.) ///
Future lost wages, or "front pay," is an award of damages for "lost compensation during the period between judgment and reinstatement or in lieu of reinstatement." Pollard v. E.I. du Pont de Nemours & Co., 532 U.S. 843, 846 (2001) (defining front pay in a Title VII case); see Traxler v. Multnomah Cty., 596 F.3d 1007, 1009 n.1 (9th Cir. 2010) (adopting this definition of front pay in a FMLA case and quoting Pollard, 532 U.S. at 846). Front pay is a form of compensatory damages under O.R.S. § 659A.885(3). See Scruggs v. Josephine Cty., No. CIV. 06-6058-CL, 2008 WL 5262717, at *3 (D. Or. Dec. 17, 2008) ("Courts have found that 'compensatory damages' as used in [O.R.S. §] 659A.885 includes front pay." (collecting cases)); but see Traxler, 596 F.3d at 1011 (holding that, "under the FMLA, front pay is an equitable remedy that must be determined by the court, both as to the availability of the remedy and the amount of any award").
A plaintiff seeking front pay "must prove such damages with reasonable probability." Tadsen, 324 Or. at 473. This requires evidence that "the plaintiff would have earned a particular amount of income in the future, were it not for the defendant's wrongful conduct." Tadsen, 324 Or. at 473; see also Winter, 2017 WL 3151256, at *2 (finding, on a motion for default judgment, that the plaintiff who sought six years of lost future wages did not provide "any evidence showing that there is a 'reasonable probability' that she would have earned a particular amount of income in the future" (quoting Tadsen, 324 Or. at 473)). "Evidence of [a] plaintiff's future earning capacity need not be capable of exact monetary determination, but must indicate fairly the capacity of the plaintiff to earn money in his usual vocation, and the probability of his being able to do so in the future." Wooton v. Viking Distrib. Co., Inc., 136 Or. App. 56, 66 (1995) (citations omitted); see also Traxler v. Multnomah Cty., No. 06-1450-KI, 2008 WL 2704445, at *5 (D. Or. July 1, 2008) (reducing the jury's front pay award for a FMLA claim after reviewing the plaintiff's testimony because, although "[it] is reasonable to assume that there may be some disparity in earning capacity for a period of time," the court found "it unreasonable . . . to assume that the disparity [would] continue for the rest of [the plaintiff's] working life" considering the levels she advanced and that she was "young and ha[d] good job skills").
Here, Joseph testified at the evidentiary hearing that he is currently employed full-time and is now earning roughly the same amount that he would have earned if he had remained employed at WLPC. Accordingly, the Court recommends that the district judge deny Joseph's request for future lost wages.
c. Total Lost Wages
In sum, the Court recommends that the district judge award Joseph $107,751.93 in economic damages, which represents $107,751.93 in past lost wages and $0 in future lost wages.
2. Noneconomic Damages
Joseph seeks $250,000 in emotional distress damages. (Pl.'s Mot. for Default J. at 7, 9.) Under Oregon law, a court may award compensatory damages, to include noneconomic damages, for alleged violations of O.R.S. §§ 659A.040, 659A.043, 659A.046, 659A.112, and 659A.199. See O.R.S. § 659A.885(3); but see Farrell v. Tri-Cty. Metro. Transp. Dist. of Or., 530 F.3d 1023, 1025 (9th Cir. 2008) (holding that FMLA does not provide for emotional distress damages).
Joseph testified at the evidentiary hearing that, as a result of his termination, he experienced loss of sleep for two years, depression, and anxiety. (See also Joseph Decl. ¶ 47 (declaring that, "[a]s a result of [his] termination," he "suffered emotional distress and anxiety and loss of sleep").) Joseph testified that he felt unappreciated when WLPC terminated him for being injured on the job, and was anxious because he could not figure out his next source of income. (See also Joseph Decl. ¶ 47 (stating that he has experienced and continues to "experience worry and distress at the loss of [his] income and the effect [his] termination has had on [his] career").) Joseph testified that he was his family's primary wage earner at the time, and following his termination, he felt that he could not provide for his family. Unable to pay his mortgage, he sold his home and moved in with his daughter. Moving in with his daughter made him feel like less of a father. He was unable to provide for his wife and son who lived with him, and he could not help his children if they needed help financially.
In response to the Court's request that Joseph provide evidence of emotional distress awards in similar Oregon employment cases, Joseph cited two cases, Arnold v. Pfizer, No. 3:10-CV-01025-AC, and Melendez v. Morrow County School District, No. CV 07-0875-AC. The Arnold and Melendez juries awarded $500,000 and $175,000, respectively, in noneconomic damages. See Arnold v. Pfizer, Inc., No. 3:10-CV-01025-AC, 2015 WL 268967, at *6 (D. Or. Jan. 21, 2015) (upholding the jury's emotional distress damage award of $500,000, and finding that the evidence supported the award where the plaintiff's career in her industry "'was ruined,' as she was unable to find work in [her] field;" the plaintiff testified that the termination "shook her confidence, caused anger, and disappointment;" the plaintiff "felt embarrassed and humiliated;" and her husband testified that she was unable to sleep, was embarrassed, and lost motivation); Melendez v. Morrow Cty. Sch. Dist., No. CV 07-0875-AC (D. Or. Apr. 27, 2010), ECF No. 181 (jury verdict) (awarding the plaintiff $75,000 in noneconomic damages because the defendant retaliated against the plaintiff for reporting child abuse and $100,000 in noneconomic damages because the defendant discriminated against him on the basis of his disability); Compl. ¶ 70, Melendez v. Morrow Cty. Sch. Dist., No. CV 07-0875-AC, 2007 WL 4764767 (D. Or. June 13, 2007) (alleging that, as a result of discrimination and retaliation for reporting child abuse, the "plaintiff suffered and continued to suffer humiliation, anxiety, distress, and impairment of his personal dignity").
See Winter, 2017 WL 3151256, at *3 (holding that the plaintiff "has not met her burden of demonstrating her entitlement to non-economic damages" based only on declaration testimony where the plaintiff did not also provide "any emotional distress damage awards in similar employment retaliation cases in Oregon").
The Court finds that the $100,000 noneconomic damage award for disability discrimination in Melendez is more in line with recent emotional distress awards in similar employment cases in this district. See, e.g., Dunlap v. Liberty Nat. Prods., Inc., No. 3:12-CV-01635-SI, 2016 WL 591759, at *4 (D. Or. Feb. 12, 2016) (noting that jury awarded $70,000 in noneconomic damages on the plaintiff's disability discrimination claims where the plaintiff was terminated soon after returning to work following a workplace injury); see also Williams v. Metal Polishing by Timothy, Inc., No. 15CV19977, 2016 WL 8114595, at *1 (Or. Cir. Ct. Dec. 16, 2016) (enforcing the jury's award of $115,000 in noneconomic damages for workers' compensation discrimination under Oregon law where the plaintiff alleged that he "suffered humiliation, anger, frustration, embarrassment, sleeplessness, harm to his reputation, loss of self esteem, feelings of worthlessness and loss of enjoyment of life"); Pl.'s Third Am. Compl. ¶ 63, Williams v. Metal Polishing by Timothy, Inc., No. 15CV19977, 2016 WL 7984585 (Or. Cir. Ct. Oct. 24, 2016) (setting forth the allegations quoted above); Vargas v. The Chick Inc., 11-C-11754, 2013 WL 3072014 (Or. Cir. Ct. Jan. 2, 3013) (awarding $70,000 in noneconomic damages where the plaintiff was terminated soon after returning to work following a workplace injury).
Joseph's hearing testimony was compelling, and he clearly suffered emotional distress as a result of his termination following a workplace injury. He was unable to find another job for some time, could not pay his mortgage, could not support his family, and had to move in with his daughter. Those circumstances caused him sleeplessness, anxiety, and depression. Viewing Joseph's testimony in the context of the comparator cases discussed above, the Court finds that an award of $100,000 in noneconomic damages is appropriate here.
CONCLUSION
For the reasons stated, the Court recommends that the district judge GRANT Joseph's motion for default judgment (ECF No. 19), enter default judgment, and award damages in the amount of $207,751.93 ($107,751.93 in past lost wages and $100,000 in noneconomic damages).
SCHEDULING ORDER
The Court will refer its Findings and Recommendation to a district judge. Objections, if any, are due within fourteen (14) days. If no objections are filed, the Findings and Recommendation will go under advisement on that date. If objections are filed, a response is due within fourteen (14) days. When the response is due or filed, whichever date is earlier, the Findings and Recommendation will go under advisement.
DATED this 24th day of April, 2020.
/s/_________
STACIE F. BECKERMAN
United States Magistrate Judge