After 27 years as an employee of New York Life Insurance Company (“New York Life”), Phyllis Meloff lost her job for billing seven months of personal commuting expenses to the company’s American Express card and failing to reimburse the company. Her supervisor sent an electronic message (“e-mail”), eventually forwarded to 16 employees, stating Meloff was fired for defrauding the company. She sued, alleging sex discrimination, re
BACKGROUND
When reviewing a grant of judgment as a matter of law, we are obliged to take the evidence in the light most favorable to the party opposing the motion, and must defer to the jury’s assessment of the evidence and the reasonable inferences drawn from it.
See Galdieri-Ambrosini v. Nat’l Realty & Dev. Corp.,
Meloff began her employment as a clerk typist in New York Life’s Philadelphia office in 1965, and received periodic pro-' motions over the years. She transferred to the New York office in 1985 and became a staff assistant in the central services office. In 1986, she was promoted to administrative assistant, a position later reclassified as staff consultant, and then service consultant. Meloff did not receive another promotion after 1986. She continued to reside in Philadelphia and commuted to work in New York by train.
Meloff inquired in October 1990 about further promotional opportunities and learned from her supervisor, Frances Don-nelly, about a service center pilot project. After receiving assurances from Jim Mell-bye, a corporate vice president for that unit, that promotions were ’possible, she transferred in November 1990. Despite assuming supervisory duties, she was not promoted, and she became increasingly frustrated. At her annual evaluation in November 1991, at which she received a favorable review, she expressed her disappointment to John Begley, her immediate supervisor. Meloff told Begley men less qualified than she were receiving promotions and that sex discrimination was to blame. She testified that she told Begley men in her group “are being promoted every day for lesser skills and lesser accomplishments. I felt that I was being discriminated against with all the accomplishments that I had had.” She named several men who she believed were promoted during the time she was not promoted, although she admitted on cross that the men she named always occupied higher positions than she did. Meloff told the jury she believed she was being discriminated against because:
For the first time since I arrived at the home office I was now supervising a group of people. My job description clearly stated that there were no supervisory responsibilities and men with lesser skills and accomplishments were being promoted on a more regular basis and I was told that the last piece of my puzzle to attain my promotion from Mr. Begley and Mr. Mellbye would be tomake the Dallas Phone Center a success, and it was.
Begley explained to Meloff on December 5, 1991, that she would not receive a promotion because Mellbye did not think Me-loff s position warranted one. Meloff told Begley she was being discriminated against and that she would talk to a lawyer. Meloff spoke with Mellbye on December 12, 1991, and she again complained of discrimination. Mellbye stated it was “customary” for him to report any complaints to his supervisor, Richard Koontz. Within the month, Koontz fired Meloff for misusing her corporate American Express card during a seven-month period when she charged her personal travel expenses without reimbursing the company.
Meloff received her corporate American Express card in April 1988 and signed a contract stating Meloff would “indemnify and hold harmless New York Life from any and all personal expenditures.... ” The New York Life personnel manual’s corporate credit card section states, “[t]his card is to be used for business purposes only. Use of the card for personal expenditures is prohibited.... Misuse or abuse of the card may result in revocation of the card and disciplinary action.” Meloff testified that she never saw this material, although she did consult the manual from time to time about other matters. On two occasions in late 1990 or early 1991, Me-loff spoke with Barbara Fagnano, then an assistant vice president in consumer affairs, about charging personal trips. Me-loff learned from Fagnano that she could obtain a credit memorandum from Alice Orisino 3 , supervisor of the transportation department, and submit it along with a reimbursement check.
Beginning in January 1991, Meloff used the card to pay for her monthly Amtrak commuter ticket. Both personal and business travel expenses were centrally billed to New York Life, while other expenses were billed to the cardholder. Meloff reimbursed the company for her travel through March, and the company’s treasury department accepted the reimbursement check and accompanying documentation. She continued to charge the company for her commuting expenses through December without making any reimbursement payments. Meloff blamed the oversight on a “heavy travel schedule” and illness in her family. She testified that she recognized her mistake and wrote a check for $3,600 before she went on vacation in late December. She left the check in her apartment. On January 6, 1992, she returned from vacation and went directly from the airport to work. She did not have the check with her.
When Meloff arrived at the office that morning, Larry Contello, a budget coordinator, confronted Meloff about her credit card charges and informed her that New York Life did not allow personal charges nor did it have a procedure for reimbursement. Meloff replied that she was unaware of any such restrictions. She obtained a reimbursement form from Orisino but was told that new company policy required a supervisor’s signature. Meloff then spoke to Mellbye:
I explained the whole situation of what had happened, that due to the heavy travel burdens and the onus of my family that I had been behind in my commuter pass payment and that I had a check that I wrote for $3600 and I wanted to present it to [Alice] Orisino to get the credit memorandum and I was told now because of a new procedure I had to get Mr. Mellbye to sign off on this credit memorandum.
Mellbye said he would have to check to make sure he had authority to sign, because the credit card came under a different budgeting department, but he also said, “no problem.” Meloff received fur
The jury heard testimony from Jerry McCaffrey, New York Life’s corporate vice president for human resources, regarding the treatment of another employee who misused his New York Life American Express. Mike Arbitman used his New York Life corporate card to pay for a variety of personal expenses, running up a bill in excess of $1,200 during 1990 and 1991. His card was canceled, but he suffered no other employment consequences as a result of the personal charges. 4 Koontz himself, who fired Meloff, admitted to charging some personal expenses on his corporate card, apparently without incident.
On January 10, 1992, Mellbye approached Meloff at the coffee cart and asked her to come to a meeting at his office at 11 a.m. When Meloff came to the meeting, she found Mellbye waiting with Koontz and Ellen Lindsey, director of Me-loffs project. Koontz fired Meloff during that meeting. He told her, “I am sorry, Phyllis, you are being terminated for misuse of your corporate credit card.” Meloff was shocked and upset he did not ask for her side of the story. Koontz simply gave Meloff a memorandum explaining she was fired for “gross misconduct,” and he promptly left the meeting. Lindsay then walked Meloff down to her office, handed Meloff her coat and pocketbook, and escorted her out of the building into a waiting car. Meloff told the jury:
I was devastated, humiliated. I couldn’t believe that this could possibly happen. How could someone be fired without the person who fired me even having the facts as to what took place. It just seemed absolutely incredible that something like this could happen to me. In all of my years at New York Life I never remember anything like this ever happening to an employee.
Although New York Life’s personnel manual requires a disciplinary memorandum to include the employee’s explanation of events, Koontz did not give Meloff an opportunity to explain. Koontz conceded that a reprimand was an option for misuse of a corporate credit card. However, New York Life’s guidelines allow for immediate termination of an employee for “theft or destruction of the Company’s ... property.”
Mellbye sent an e-mail with the subject heading “FRAUD” to Koontz and six New York Life managers who oversaw employees trained by Meloff. 5 The e-mail read:
WE FOUND IT NECESSARY TODAY TO TERMINATE PHYLLIS ME-LOFF, WHO USED HER CORPORATE AMERICAN EXPRESS CARD IN A WAY IN WHICH THE COMPANY WAS DEFRAUDED. PHYLISS [sic] HAD APPROX [sic] 27 YEARS WITH NEW YORK LIFE, AND WHOM WE CONSIDERED TO BE A VALUED ASSOCIATE. THIS ACTION REFLECTS OUR COMMITTMENT [sic] TO “ADHERE TO THE HIGHEST ETHICAL STANDARDS IN ALL OUR BUSINESS DEALINGS.” I SEND THIS TO YOU FOR YOUR OWN INFORMATION.
Koontz received th.e e-mail and sent it on to four additional managers in the service center pilot project. One of those recipients forwarded the e-mail to five of his employees. Although he does not recall doing so, in the course of informing a group of approximately twenty employees that Meloff had been fired, Mellbye may have given credit card fraud as the reason. Meloff received phone calls from about twenty employees who learned she was fired for credit card fraud and some mentioned having received the e-mail.
Grant of judgment as a matter of law
We turn first to the question of whether the district court erred in granting New York Life judgment as a matter of law despite a jury finding of liability on the defamation claim. The standard for granting motions for judgment as a matter of law and for reviewing such grants on appeal are the same.
See Galdieri-Ambrosini
(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 mov-ant that reasonable and fair minded [persons] could not arrive at a verdict against [it].
Galdieri-Ambrosini,
The parties appear to agree New York law applies to Meloffs claims. New York requires a libel plaintiff to prove five elements: (1) a written defamatory statement of fact regarding the plaintiff; (2) published to a third party by the defendant; (3) defendant’s fault, varying in degree depending on whether plaintiff is a private or public party; (4) falsity of the defamatory statement; and (5) injury to plaintiff.
See Celle v. Filipino Reporter Enters., Inc.,
Qualified privilege is a defense to defamation, one which New York Life relies on here.
See Weldy,
To rebut, Meloff must make two showings. First, she must prove the statement at issue was false.
See Weldy,
Second, as this case involved a private-figure plaintiff and a private matter, Meloff bore the burden of showing New York Life abused its privilege.
See Weldy,
We hold the district court erred in finding Meloff did not overcome the presumption of qualified privilege. Applying the strict standard of review, which forbids substituting our judgment for the jury’s, we find no reason to overturn the jury finding that the accusation of fraud was not substantially true. As discussed above, the test for “substantial truth” asks what the understanding of the general reader would be.
See Guccione,
Similarly, we find the evidence, viewed in the light most favorable to plaintiff, supports a finding of constitu
Therefore, as the standard for review requires us to draw every reasonable inference in plaintiffs favor, we find sufficient evidence existed to support the jury findings that (1) the accusation of fraud was not substantially true and that (2) New York Life’s actions reached the level of constitutional actual malice.
Grant of a neio trial
We turn our attention to whether the district court erred in granting defendants a new trial on the defamation claim in the event this Court reversed its grant of judgment as a matter of law. We review a district court’s decision to grant a new trial for abuse of discretion.
See Song v. Ives Labs. Inc.,
We hold the district court did not abuse its discretion in awarding a new trial. Freed from the constraints of review that bind a court when deciding whether to grant judgment as a matter of law, the district court could examine the evidence through its own eyes. The evidence here showed Meloff did abuse the credit card in violation of company policy set forth in the employment manual. Her case depends upon an e-mail disseminated to a select group of employees, containing only the rather cautious (if not cautious enough) statement that she “used her corporate credit card in a way in which the company was defrauded.” The evidence of constitutional malice was similarly attenuated. The allegations of malice turned on Meloffs controverted assertion that Mell-bye originally said “no problem” only to accuse her of “fraud” a week later. To find constitutional malice in these circumstances, the finder of fact needed to (1) credit Meloffs testimony that Mellbye originally said “no problem”; (2) discredit Mellbye’s testimony denying that statement; (3) credit Mellbye’s alleged earlier statement as a true reflection of his position regarding Meloffs conduct; (4) conclude Mellbye did not change his mind in the week between the alleged “no problem” and writing the defamatory e-mail; and (5) discount Mellbye’s testimony that when he sent the email, he believed Me-loffs conduct to be “fraud.” Again, under the more relaxed standards governing the grant of a new trial, the district court was free to examine the evidence through its own eyes and acted well within its discretion in granting a new trial on the defamation claim. As we affirm the district court’s grant of a new trial on the defama
Retrial of the retaliation claim
The district court correctly denied Me-loffs motion for a retrial on her retaliation claim. Meloff argued the court erred by not informing the jury it could “consider whether Meloffs discharge occurred soon after her complaints of sex discrimination.” A district court need not provide a charge “concerning every inference which might be drawn from the facts.”
Fernandez v. Fitzgerald,
Meloff also contended that the district court’s instructions on pretext were erroneous. In reviewing the jury charge as a whole,
see Owen v. Thermatool Corp.,
Conclusion
For the reasons given above, we vacate the district court’s judgment granting defendant judgment as a matter of law and affirm both the grant of a new trial on the defamation claim and denial of a retrial on the retaliation claim. Of course, Meloffs retaliation evidence is relevant evidence on the issue of New York Life’s motivation on the defamation claim. We remand to the district court for proceedings consistent with this opinion.
Notes
. Meloff brought her action under New York Human Rights Law, N.Y. Exec. Law § 290, the Administrative Code of the City of New York § 8-1-1, and New York common law.
. In briefs, depositions and trial transcripts, Orisino is referred to interchangeably as "Alex” or "Alice.”
. Arbitman was eventually fired for taking money from New York Life using petty cash vouchers.
. One of the e-mails reached the wrong employee because Mellbye mistyped the name.
