A pretrial order both in the trial court and on appeal, may be modified only to prevent manifest injustice.
Defendant employer appealed from an adverse judgment entered in favor of a female employee based on a jury verdict in the district court on her claims for retaliation and employment discrimination. The jury awarded compensatory and punitive damages, attorney's fees, and interest. The employee was terminated when her position was eliminated and not rehired, and asserted the reasons were discriminatory and retaliatory. Shortly before the case went to trial, the United States Supreme Court decided Kolstad v. American Dental Assoc. Pursuant to that case, the employer moved to amend the pretrial order to raise, as an affirmative defense to the punitive damages claim, evidence of its good faith effort to comply with Title VII of the Civil Rights Act of 1964. The trial court denied the motion. During jury selection, the court sustained a challenge to the employer's strike of a female juror, finding the employer's reason for striking her pretextual.
Whether the employer should have been allowed to assert a good faith defense?
On appeal, the court upheld the prospective juror challenge finding as not constituting clear error, but vacated the award of punitive damages and attorney's fees. The trial court should have allowed the good faith defense to be raised, and could have remedies any prejudice to the employee by granting a brief continuance in the trial to allow her to conduct discovery.
The award of punitive damages and attorney fees was vacated, and the matter remanded for a new trial limited to the issue of punitive damages, in which the employer would be allowed to raise a good faith defense.