Ramirez v. T&H Lemont, Inc. - Seventh Circuit Court of Appeals
Facts: Armando Ramirez ("Ramirez") filed a lawsuit against his former employer T&H Lemont, Inc. ("T&H") on the grounds that he had been subjected to discriminatory working conditions and a hostile work environment based upon his national origin. Ramirez, who is Hispanic and born in Mexico, claimed that he had been fired in retaliation for reporting the alleged harassment. After approximately three years into litigation and with discovery essentially over, Ramirez and his counsel had been unable to produce any witnesses to corroborate Ramirez's allegations. Ramirez's counsel subsequently filed a motion to withdraw, however Ramirez was soon after able to locate three former co-workers who confirmed his allegations. All three co-workers were deposed and gave similar testimony that T&H managerial and supervisory staff made things difficult for Ramirez, referred to him as a burro, and subjected him to discriminatory conditions.
Three months after before T&H's counsel was to re-depose one of the co-workers, Santiago Villagrana ("Villagrana"), Villagrana sent Ramirez's counsel a text and asked "what percent will I receive when the case is settled." Ramirez's counsel reported the text to T&H's counsel. Interesting enough, the same day Villagrana sent the text, he also contacted a T&H employee and said none of Ramirez's co-workers were supporting his claim anymore and Villagrana would be willing to testify for T&H if he could get his old job back.
After the district court held an evidentiary hearing to determine whether any witness had provided false testimony and whether witness tampering had occurred, the court found: that Ramirez had offered Villagrana money in exchange for favorable testimony, Villagrana had not witnessed the alleged discriminatory conduct, and all three co-workers had met with Ramirez before the depositions and discussed using the word burro when testifying, among other misconduct. As a result, the district court dismissed Ramirez's claim with prejudice. The court denied Ramirez's request to reconsider the dismissal and Ramirez subsequently appealed.
Holding: The Court of Appeals noted that dismissal of a claim with prejudice is within a court's power but requires a finding that the responsible party acted or failed to act with a degree of culpability that exceeds simple inadvertence or mistake. Therefore, any sanctions imposed must be premised on a finding that the responsible party willfully abused the judicial process or otherwise conducted the litigation in bad faith.
While prior caselaw had established a dismissal be proven by a "clear and convincing" standard of proof, the Court held that a "preponderance of the evidence" standard is more appropriate as it allocates the risk of error more or less equally between parties in a case. (For those unfamiliar with these standards of proof, "clear and convincing" requires the evidence presented be highly and substantially more probable to be true than not, while a "preponderance of the evidence" only requires that the greater weight of the evidence points to one side a/k/a more than 50% of the evidence points one way.) In addition, the Court pointed out that because the facts bearing on the merits of a Title VII suit only have to be proven by a preponderance of the evidence standard, it followed that sanctionable misconduct that has occurred in a Title VII case also be held to the same standard of proof.
In this case, the Court held that the evidence presented in district court was sufficient to establish a finding that witness tampering had occurred, when judged by a preponderance of the evidence standard of proof. As noted above, it had been established that Villagrana was paid for his testimony by Ramirez, Villagrana's testimony was "coached" and knowingly false, the alleged discriminatory conduct was not actually observed, among other misconduct.
Judgment: The Seventh Circuit Court of Appeals affirmed the district court's dismissal of the discrimination claim with prejudice as witness tampering had been established by a preponderance of the evidence standard of proof.
The Takeaway: This was a very interesting case to read through, and not just because of the details of the witness tampering that occurred. I wanted to highlight this case in particular to point out how the Seventh Circuit adopted a more relaxed standard of proof to prove witness tampering/sanctionable conduct in Title VII cases such as this. We could talk for days about whether the Court was right to adopt a different standard of proof here (and conflict with other circuits). However, I think the fact that because the Court based its reasoning on the grounds that since a Title VII case must be proven by a preponderance of the evidence standard, sanctionable misconduct should be as well makes sense. Whether this case will end up before the Supreme Court (as a result of a split among circuits on the standard of proof) is hard to say. It would not surprise me if it is appealed...but I would be a bit surprised if the Supreme Court actually agreed to hear the case.
For those who actively practice in litigation, sanctions are one of the topics you never want to have come up. Interesting to note here that the district court judge held that no evidence established that Ramirez's counsel had acted improperly. In fact, as soon as he got the text from Villagrana, Ramirez's counsel reported it to T&H's counsel and took steps to remedy the situation. Sometimes we cannot always pick our clients (or control what they do). But in cases like this, when witness tampering becomes apparent, it is always best to take steps to remedy the situation rather than trying to hide it and make matters worse.
Majority Opinion Judge: Judge Rovner
Date: December 30, 2016
Opinion: hr.cch.com/eld/RamirezTHLemont123016.pdf
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