Paul S. Segal v. Gilbert Color Systems, Inc.Paul S. Segal v. Gilbert Color Systems, Inc.
Paul S. Segal brought this suit against his former employer, Gilbert Color Systems, Inc. (Gilbert), charging that Gilbert had discharged him because of the demands inherent in his service as a federal grand juror, in violation of
Each party then filed a pair of post-trial motions. Gilbert sought either to reduce the verdict or to set it aside; Segal countered by asking the district court to tack on prejudgment interest and to award counsel fees. The district judge granted three of these four motions: he (i) shrunk the verdict to $22,341.90, (ii) granted interest on the lessened verdict amount from the date suit was filed at an interest rate of 10% per annum, and (iii) awarded counsel fees to the appellee in the sum of $7,447.68 (one-third of the reduced verdict). Gilbert appealed. Segal did not.
In this proceeding, Gilbert no longer contests liability. Rather, its remonstrance is limited to the supposed excessiveness of the verdict as pared by the district court, the propriety of the award of prejudgment interest, and the amount and manner of calculation of attorneys’ fees. We will address these points seriatim, presenting in connection with each asseveration the facts as they relate to the particular contention.
1. Excessiveness of Verdict
We need not tarry long on Gilbert’s lament that the verdict, even after the remittitur, is overgenerous. The evidence before the jury revealed that Segal was hired in July of 1979 as a salesman for the appellant’s color separator services. His base salary was $20,000.00 per year. His arrangement with Gilbert also called for the payment of commissions over and above salary if his sales performance topped a set annual plateau. There was evidence in the record that Gilbert’s projections showed some expectation that Segal would earn, between salary and commissions, upward of $30,000.00 yearly. 2 In addition, Segal received the use of a company car 3 and a fringe benefit insurance package. Segal valued the former at $100.00 weekly, and automobile repair receipts limned the pertinent particulars of the vehicle (make, model, mileage, year, etc.). Gilbert’s comptroller estimated the cost of the insurance package at $85.00 monthly.
Segal began his grand jury service in the United States District Court in Boston, Massachusetts on November 5, 1979. The term of the grand jury was eighteen months. On November 8, 1979, Segal was dismissed by his employer — a dismissal which, as Gilbert concedes for purposes of this appeal, was in derogation of
This court has consistently declined to play Monday morning quarterback in reviewing a jury’s assessment of damages. A verdict should stand unless it is
Our focus in this case must, of course, be not on the verdict itself, but on the verdict as adjusted by the trial judge. As previously noted, the district court did trim the verdict; it deducted from the jury’s award the amounts earned by the appellee attributable to his grand jury service and the monies which he garnered in his short-lived employment in the Spring of 1980. 4 The resultant total — $22,341.90—is not beyond the pale; given the facts of this case, it does not even hover near the periphery. The jury had before it a smorgasbord of evidence: it could rationally have found damages in excess of $30,000.00 by any one of a number of combinations of salary, commissions, and fringe benefits for all or some substantial part of the eighteen month period. 5
We have made the “detailed appraisal of the evidence bearing on damages” which
Gruenthal,
II. Prejudgment Interest
We turn next to the district court’s award of prejudgment interest. The essential facts pertinent to this issue are not in dispute: the appellee did not request an instruction on prejudgment interest; the judge did not, therefore, charge the jury in respect to such interest; no stipulation was entered into anent the subject; no objection was taken to the interest-free charge as given; and the jury returned only a general verdict.
The question of Segal’s entitlement to interest rose, like Lazarus, from the dead only after the jury had spoken; it was raised by the appellee’s counsel for the
Gilbert’s assignment of error does not condemn the availability of prejudgment interest per se in a
Our consideration of this issue must start with
We have next examined the legislative history of
The proposed legislation would provide statutory employment protection to Federal jurors... by giving the district courts jurisdiction over legal actions by aggrieved employee-jurors to redress their rights. The enactment of this provision wousld be desirable in redressing the present disparity of bargaining position between a harassing employer and his employee who is summoned for jury duty in a Federal court. It would also place employers on notice as to their legal duty not to interfere with jury service by employees and would offer employees the assurance that their rights in this regard will be protected by law.
Id. at 5480.
And, with respect to an itemization of damages, Congress did nothing more than parrot the statutory language,
see
In sum, both the Act and its legislative history are barren of any reference to prejudgment interest. We are aware of no auxiliary federal statute which calls for
Justice Black noted in
Rodgers, supra,
that “the failure to mention interest in statutes which create obligations has not been interpreted by [the] Court as manifesting an unequivocal congressional purpose that the obligation shall not bear interest.”
[A] persuasive consideration in determining whether such obligations shall bear interest is the relative equities between the beneficiaries of the obligation and those upon whom it has been imposed. And this Court has generally weighed these relative equities in accordance with the historic judicial principle that one for whose financial advantage an obligation was assumed or imposed, and who has suffered actual money damages by another’s breach of that obligation, should be fairly compensated for the loss thereby sustained.
Id.
In view of the manifest purposes of
Our inquiry, however, does not end at this point. Though prejudgment interest was generieally appropriate in Segal’s case, a question still remains as to whether it was properly claimed and awarded.
Furtado v. Bishop,
Assuming arguendo that prejudgment interest was discretionary, federal law dictated that the jury should decide whether to assess it. But the question of prejudgment interest was not submitted to the jury, nor did plaintiffs ask that the jury be instructed on it. Consequently, the award of prejudgment interest must be stricken.
Furtado I,
While an effort might be made to distinguish
Furtado I
on the ground that “
As
Furtado I
and its progeny adequately evince, we are “hesitant to impose an inflexible rule requiring — or barring — prejudgment interest.”
Kolb,
The appellee, who failed entirely to preserve a claim for prejudgment interest before the case was submitted to the jury, was not entitled under federal common law to a post-hoc award of such interest. The district court erred in granting Segal’s motion.
III. Counsel Fees
The remaining issues on this appeal center around the district court’s award of counsel fees to the appellee. Gilbert mounts a two-pronged attack on this ruling: it urges, first, that the fees so granted should have been limited to $1,000.00; and second, that even if that ceiling did not apply, the district court failed properly to compute the size of the award.
A. Applicability of § 3006A Limits
The appellant’s initial contention implicates the express provisions of
An individual claiming that his employer has violated the provisions of this section may make application to the district court for the district in which such employer maintains a place of business and the court shall, upon finding probable merit in such claim, appoint counsel to represent such individual in any action in the district court necessary to the resolution of such claim. Such counsel shall be compensated and necessary expenses repaid to the extent provided by section 3006A of title 18, United States Code.
And,
Prior to the time this suit was commenced, Segal filed an application for appointment of counsel pursuant to “Title
The appellant now complains that it did not receive notice of the motion to vacate, and that it “would be both unjust and inequitable to hold Gilbert Color liable for attorneys’ fees in the absence of proper notice of its potential liability beyond the [
If Gilbert received Segal’s application without the endorsement thereon of the magistrate’s order, it was in no way misled. All the appellant could have known was that Segal was attempting to secure the appointment of counsel. And, if Gilbert received the application with the magistrate’s action endorsed thereon, it was thereby alerted to the existence of the miscellaneous file (M 79-61) and was chargeable with entering an appearance therein if it wished it to be heard,
see
D.N.H. Local Rule 6(b), or with monitoring the docket therein if it wished to apprise itself of developments.
Cf
B. Calculation of the Award
The second theorem on which the appellant questions the fee award gives us considerably more pause. Although the district court did make a passing reference to the time expended by Segal’s lawyer in the prosecution of the action and to a general range of billing rates, Segal v. Gilbert Color Systems, No. C-80-17-L, slip op. at 1-2 (D.N.H. Dec. 29, 1983), it is clear that the fee was awarded on a percentage basis. The district court stated:
28 U.S.C. 1875(d) relates to reasonable attorney’s fees which may be allowed to a prevailing employee as well as expenses.
Counsel for the plaintiff took this case on a contingency basis and should be awarded attorney’s fees on that basis in the sum of $7,447.68.
The court in awarding attorney’s fees based on one-third of the recovery is conversant with the provisions of 28 U.S.C. 1875...
Id. at 6.
It is true that no court has yet taken the measure of what comprises a “reasonable attorney’s fee” within the purview of this Act. We have, however, long since adopted a time-and-rate-based method of calculation in cases involving the fee-shifting provisions of those federal statutes which do not expressly dictate an alterna
While the rule has grown up primarily in the rugged mountains of
We recognize and reaffirm the broad discretion accorded district judges in fee-setting matters.
See Gabriele v. Southworth,
The Court should address the issue of entitlement as an antecedent and separate question, ... without regard to the existence of a private fee agreement. Should it decide that an award of fees is warranted, the Court should then set a reasonable fee. This determination too should be divorced from consideration of a fee arrangement.
It is, therefore, requisite that we return this matter to the court below so that a reasonable counsel fee may be fixed in line with our established precedents. We do not mean to suggest that the dollar amount of the fee as awarded by the district court was unreasonable; indeed, given the results obtained and the admittedly sketchy information in the record on appeal, it appears modest. But, whether this remand results merely in the reaffirmation of the fee previously set, or in a greater or lesser fee, is not the point: the interests of both precedent and orderly procedure prohibit such short-cuts, whether or not they coincidentally lead to the correct destination in a given case.
IV. Conclusion
To recapitulate, we hold (i) that the district court, after trimming the jury verdict, properly refused further reductions therein; (ii) that the appellant’s alternative motion to set aside the verdict on grounds of excessiveness was meritless; (iii) that prejudgment interest was incorrectly appended to the award of damages after the fact; (iv) that the appellee was entitled to counsel fees unlimited by the strictures of
Accordingly, the judgment below is
Affirmed in part, reversed in part; and the case is remanded to the district court for further proceedings consistent herewith. Costs awarded in favor of appellee.
Notes
.
(a) No employer shall discharge, threaten to discharge, intimidate, or coerce any permanent employee by reason of such employee’s jury service, or the attendance or scheduledattendance in connection with such service, in any court of the United States.
. Although Segal's sales record during his first (and, as matters turned out, last) few months on Gilbert’s payroll was less than exhilarating, there was evidence in the record to counter any inference of ineffectuality on his part; some time was spent as a trainee, and an additional period was devoted to covering for vacationing fellow employees. And, giving the plaintiff the benefit of all favorable inferences on the defendant’s claim of excessiveness,
see Cleverly v. Western Electric Co.,
. The automobile arrangement went into effect in the Fall of 1979. Prior thereto, Segal used his own car for business travel, and Gilbert reimbursed him.
. Segal has acceded to the district court’s action, and has indicated his assent to the remittitur. He has filed no cross-appeal in this court. Accordingly, we need not reach the question of whether or not the jury’s verdict was properly pruned below.
. It would be senseless to analyze all of the permutations which could lucidly have produced such a verdict. One example should suffice. For the period from the date of Segal’s firing to the end of 1980, a span of one year and seven weeks, the jury could have found that his gross damages comprised close to $35,000.00 (roughly $23,000.00 in wages, $10,000.00 or so in commissions, and over $1,000.00 in insurance benefits). And, if mitigating off-sets were not fully accounted for, the trial judge surely cured any perceived shortcoming in this regard by granting the remittitur.
. That reference was an obvious misnomer. There is no such section of the United States Code. Plainly, the motion intended to allude to
. In any event, the appellant has pointed to no rule or statute which required service upon it of either the
. In a logical extension of this principle, we have recently applied this yardstick to state fee-shifting statutes which are similarly devoid of specific self-contained criteria.
E.g., Virzi Subaru, Inc. v. Subaru of New England,
. In applying this method (most prominently associated with the
Johnson
court’s Title VII decision and cited with approval by both houses of Congress when the Fees Act,
. Such concerns are generally thought to entail (i) the encouragement of meritorious suits which might not otherwise be brought; (ii) the deterrence of obstructive delaying tactics in the litigation; and (iii) the minimization of violations by an increase in the wrongdoer’s liability.
E.g., Furtado v. Bishop,