Labor & Employment Law Daily Wrap Up, DISCRIMINATION—SEXUAL HARASSMENT—10th Cir.: Jury award of punitive damages without finding Title VII violation requires new trial, (Apr 1, 2025)

By Kathleen Kapusta, J.D.

The jury’s finding of liability for punitive damages could not logically coexist with its finding of no Title VII violation.

After affirming summary judgment against the retaliation claim of a restaurant server who unsuccessfully alleged that her employer’s “half-hearted” investigation of her sexual harassment complaint and placing her on the same shift as her harasser after his return from suspension were adverse employment actions, the Tenth Circuit found her coworker and co-plaintiff was entitled to a new trial on her Title VII claims based on the jury’s inconsistent verdict awarding her punitive damages after finding her employer did not violate her Title VII rights. The appeals court also rejected several evidentiary challenges by the plaintiffs because they failed to preserve them in the court below (Culp v. Remington of Montrose Golf Club, LLC, No. 24-1022 (10th Cir. Mar. 31, 2025)).

The employees, servers for a golf club and causal dining restaurant, alleged that they were sexually harassed by a male coworker. Neither complained at first but when the employer learned of the alleged conduct, its general manager and HR director investigated. The GM conducted very cursory interviews of 10 female servers and ultimately suspended and demoted the alleged harasser from assistant floor manager to bartender. He was also placed on probation for 30 days.

Alleged retaliation. After the investigation, the first employee claimed her hours were reduced. She resigned as a result. The second claimed that the employer inadequately investigated her complaint and retaliated against her by assigning her to work with the harasser after he returned from his suspension. When she complained to the GM, he allegedly told her “Gosh, Steph, do we have to do this every week?” She then left the restaurant and never returned.

Lower court proceedings. The employees sued under Title VII and state law for sexual harassment and retaliation and under Colorado common law for tortious negligent supervision and retention. The district court granted summary judgment on the second employee’s retaliation claims. The remaining claims proceeded to trial and while the jury found against the employees on each of their claims, it inconsistently awarded the first employee punitive damages on her Title VII claim. The inconsistency was ultimately resolved by setting aside the punitive damages award.

Retaliation claim. On appeal, the Tenth Circuit, affirming summary judgment against the second employee’s retaliation claims, agreed that she did not suffer an adverse employment action. Her argument that the sheer inadequacy of the investigation was materially adverse was foreclosed by circuit precedent, said the court, noting that it has held that an employer’s failure to investigate an internal discrimination complaint cannot support a retaliation claim absent a showing of demonstrable harm. While the employee argued that the investigation was “dismissive” of her allegations, dismissiveness is not demonstrably harmful in and of itself, the court noted, and she failed to explain how the inadequate investigation did anything more than inconvenience her.

Regarding her claim that her employer continued scheduling her to work when the harasser was also on duty, the court pointed out that because he regularly worked four or five evenings a week and she almost always worked evenings, it would have been hard to give her much work after he returned. Nor did she request any schedule change to avoid him. Moreover, given the significant punishment he had received, it was not unreasonable for the employer to believe that he would not promptly return to the same misbehavior that would put his employment at risk.

Inconsistent jury verdict. Turning to the inconsistent jury verdict, the court found that the jury acted contrary to the instructions in the verdict form when it awarded the first employee punitive damages even though it found no Title VII violation. Further, said the court, the award was contrary to law because punitive damages may be awarded in Title VII actions only if a plaintiff proves that her employer “engaged in a discriminatory practice or discriminatory practices with malice or with reckless indifference to the federally protected rights of an aggrieved individual.”

Concluding that the jury verdict could not be reconciled, the court explained that the jury’s finding of liability for punitive damages in Question 5 on the verdict form could not logically coexist with its finding of no Title VII violation in Questions 1 and 3. “Answering Question 5 affirmatively necessitated finding a violation in either Question 1 or 3. The jury’s answers ‘destroy each other.’”

Surplusage. As to the district court’s surplusage finding, the appeals court noted that due to some verdict form peculiarities, the jury may not have realized it should have answered Question 5 only if it answered Questions 1 or 3 in the affirmative. Regardless, said the court, the answers were inconsistent and should not have been ignored. Observing that the “guiding light, at least in this circuit, is whether the jury’s special-verdict answers ‘indicat[e] that the jury was confused or abused its power,” the court explained that when there is no plausible way to reconcile the jury’s answers, it must conclude that the jury was confused or abused its power and therefore order a new trial.

Because the jury’s verdict on the employee’s hostile-work-environment and retaliation claims was irreconcilably inconsistent with its award of punitive damages, the court reversed the district court’s denial of her motion for a new trial on these claims.

Circuit precedent. Addressing the issue as to why the district court did not resubmit the matter to the jurors with further instructions and why the employee could seek appellate relief when she did not request resubmission in the court below, the appeals court turned to circuit precedent. “Under prior decisions of this circuit,” it explained, “the court could not resubmit special verdicts to the jury for clarification.” And because the district court could not resubmit special verdicts, injured parties could appeal even if they did not preserve the matter in district court by making a futile objection before the jury was discharged. “Under that precedent, we do not require [the employee] to have preserved in district court the inconsistent-verdict arguments she makes in this court.”

Supervening authority. In 2016, however, the U.S. Supreme Court, in Dietz v. Bouldin, held that a district court “has the inherent power to rescind a jury discharge order and recall a jury for further deliberations after identifying an error in the jury’s verdict.” In that decision, the Court explained that the judge had inherent power to recall the jury even though that power was not specifically set out in the Federal Rules of Civil Procedure.

As a result of Dietz, said the court, “the difficulties of this case should rarely arise in the future. If the district court has concerns about the inconsistency of a jury’s verdicts, it may ask the jury to reconsider.” Moreover, the court observed, f a party does not point out the problems with the verdict to the court and request jury reconsideration, it forfeits the issue on appeal.

The case is No. 24-1022.

Judge: Hartz, H.

Attorneys: Damon Davis (Killian, Davis, Richter & Fredenburg) for Stacie Culp and Stephanie Peters. Nicholas H. Gower (Hoskin Farina & Kampf) for Remington of Montrose Golf Club, LLC.

Companies: Remington of Montrose Golf Club, LLC

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