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McGhee v. Schreiber Foods, Inc.

Court of Appeals of Missouri, Western District, Second Division

August 9, 2016

WILLIAM McGHEE, Respondent,

         Appeal from the Circuit Court of Henry County, Missouri The Honorable James K. Journey, Judge

          Before Karen King Mitchell, Presiding Judge, and Cynthia L. Martin and Gary D. Witt, Judges

          Karen King Mitchell, Presiding Judge

         William McGhee filed suit under the Missouri Human Rights Act (MHRA) against Schreiber Foods, Inc., alleging age discrimination in his termination from employment. A jury found in favor of McGhee, and the trial court entered a judgment totaling $1, 170, 030.45 in damages, costs, and attorneys' fees. Schreiber appeals the trial court's denial of its motions for judgment notwithstanding the verdict, new trial, and remittitur. Finding no error, we affirm.


         On October 5, 2009, McGhee was employed as a press operator at Schreiber's plant in Clinton, Missouri. McGhee operated a large commercial printing press, known as a Vision Press. One of a press operator's duties is to conduct periodic maintenance and cleaning on the press, which includes cleaning the large steel drum on the inside of the press. The press is a dangerous machine, capable of causing severe injury or death, and, for that reason, Schreiber's policies and procedures manual included a "lockout/tagout program, " which every press operator must follow in order to de-energize the press before touching it to clean it. Part of the lockout/tagout policy is the "inch[-]safe service method, " by which the employee slowly "[j]og[s] the drum . . . to the point that needs to be cleaned, and then stop[s] the" drum. After the drum has stopped, the employee is to "[w]ipe off the drum . . . and then remove the cleaning hand and [j]og to the next spot that needs to be cleaned, and stop again." In other words, this method of cleaning prohibits an employee from touching the press drum while it is in motion. A violation of the lockout/tagout policy is considered a "Group III" violation, for which the consequence is discharge.

         On October 5, 2009, McGhee's supervisor, Chuck Burton, and Human Resources Manager Ken Kephart, received a report from two employees alleging that McGhee was cleaning the drum as it was rotating, which constituted a violation of the inch-safe method. Burton and Kephart called McGhee into a meeting to discuss the alleged violation. McGhee denied cleaning the drum while it was moving and offered to demonstrate his cleaning method on the machine. Burton and another supervisor, Philip Smith, went to the Vision Press with McGhee, where he demonstrated how he cleaned the drum. At the press, McGhee demonstrated that he cleaned the drum by slowly jogging it forward, then stopping the drum and reaching forward with his rag to clean it. McGhee recalled one of the men saying that someone watching from another vantage point "might misconstrue that as a violation, " when cleaning occurs so soon after the drum stops moving, because there is still a danger that built up "kinetic energy" might cause the "drum to surge."

         The next day, Burton and Kephart issued a "Coaching and Corrective Action Form" to McGhee, noting that he had been given a Group III corrective action, with automatic suspension pending termination, for a lockout/tagout policy violation. The reason given was that McGhee had been "observed cleaning the drum on the [press] while the drum was in motion and not using the inch[-]safe service method." McGhee filed an appeal under Schreiber's peer review policy.

         Under Schreiber's policy, an employee facing termination for a Group III violation may appeal this determination to either the Plant Manager or a "Peer Review Panel." McGhee sought review of his Group III corrective action by peer review panel. Schreiber's policy allows a panel to "review management's actions to ensure that application of policy or practice was followed correctly and consistently." A panel has the authority to grant or deny an appeal, or to modify management's decision to a lesser punishment. A panel is not allowed to "modify a decision to make it more severe than the original management action." Rather, a panel can only leave the initial punishment in place or reduce it.

         Panels are comprised of five members, three of whom are hourly employees of the same classification as the employee, and two of whom are salaried or managerial employees. The employee chooses a panel by picking the names of five hourly employees from a hat and then selecting three of the five. The employee then picks the name of three salaried/managerial employees from a hat and selects two of the three. The HR Manager, Kephart, facilitates the process. He is "responsible for scheduling meetings, handling all required logistics, generating panel records[, ] and ensuring that all sessions conform to" policy. The HR Manager also "suggest[s] that certain witnesses be called" to present evidence.

         McGhee chose to file an appeal to the peer review panel, which upheld the termination. In April of 2010, following additional incidents involving safety violations at Schreiber, discussed more fully infra, which McGhee believed were handled inconsistently with his termination, McGhee sent an email to Plant Manager Rick Heck, asking that his termination be reconsidered. Schreiber responded with a letter setting forth its belief that "your termination for a lockout safety violation was appropriate, fair[, ] and consistent with policy and the way other similar situations were handled." The letter continued, "An additional peer review completed by a Home Office HR person was also conducted and it concluded that the termination and peer review were handled appropriately." The letter concluded that Schreiber could not "offer [McGhee] any hope of reinstatement." Following a complaint to the Missouri Commission on Human Rights, McGhee filed suit, alleging that Schreiber had discriminated against McGhee based on his age.

         At trial, there was evidence presented that the two employees who initially reported that they had seen McGhee cleaning the drum while it was in motion could not have seen McGhee's actions from the vantage point from which they claimed to have watched him. And while Burton, who was present during McGhee's demonstration of his cleaning method, testified at trial that he saw McGhee touch the drum during his demonstration, Kephart testified, and the written notes from the peer review reflect, that Burton told the panel that McGhee was reaching toward the drum while it was in motion and it looked as though he was going to make contact with it, but Burton reached out and stopped McGhee.

         Over Schreiber's objection, McGhee introduced evidence of six current and former employees of Schreiber who were accused of safety violations, four of them under the age of forty, and two over the age of fifty, at the time of their incidents. The stated intent was to show that, having committed similar safety violations, the four younger employees were treated more favorably than the three (counting McGhee) employees over the age of fifty.

         Denise Davis, age thirty-six, was a press operator at Schreiber's plant. On March 30, 2009 (approximately six months before McGhee's incident), while Davis was cleaning the press drum as it was rotating, her hand became caught between the drum and other parts of the machine, causing severe damage to Davis's hand and arm. Davis was given a Group II corrective action, which was a less serious violation than Group III. Group II violations included a monetary penalty, but did not include the threat of immediate termination. Davis appealed the Group II violation to a peer review panel, which upheld the punishment.

         Immediately after Davis's violation, Schreiber amended its policy to explicitly require that press operators use the inch-safe service method when cleaning the drum. The revised policy also included an extensive definition, consisting of several sentences, of the inch-safe method.

         Six weeks later, fifty-four-year-old Roger Mehan was working as a press operator at Schreiber's plant when he used a piece of plastic to knock an accumulation of ink from a piece of equipment called an anilox, which is located close to the drum. The drum was in motion, but Mehan's hand did not come into contact with any moving parts. Kephart testified that it was a "gray area" whether knocking ink off with a stick, as opposed to one's hand, would be a violation of the lockout/tagout policy. Nevertheless, Mehan received a Group III corrective action for violating the lockout/tagout policy, which he appealed to the Plant Manager. Mehan's Group III violation was upheld, but he was given the opportunity to stay with Schreiber by signing a "last chance agreement, " which is available only to employees with no prior safety violations.[2] A last chance agreement allows the employee to keep his job, but the violation of any work rule within the next twelve months results in termination.

         Kenny Raynes, age thirty-nine, and Russ Seedyk, age thirty-six, were also press operators at Schreiber's plant. On March 25, 2010, Raynes and Seedyk's supervisor, Jared Fosnow, reported that Raynes and Seedyk were in the "danger zone" of the "rewind" section of the press while the press was not properly locked out and tagged out. In addition to requiring that an employee not touch the moving drum of the press, the lockout/tagout policy required that an employee working in a machine's danger zone attach his or her lock to the power source. Both operators initially received Group III corrective actions for lockout/tagout violations. Seedyk and Raynes both appealed to Plant Manager Richard Heck. Raynes admitted that he violated the lockout/tagout policy by "not applying locks when required or making sure [his] partner had [his] locks installed." He also described in his review application how Seedyk violated the lockout/tagout policy by leaning into the danger zone to cut film loose without first applying a lock to the air pressure valve. Seedyk, however, told Heck that he and Raynes had properly inserted their locks to lockout/tagout the press. Heck determined that, "due to inconsistencies" in Seedyk's and Raynes's stories, he was "unable to say with 100% confidence that a lockout/tagout violation occurred." Heck did, "however, believe . . . that safety practices performed . . . were questionable." Heck therefore reduced the corrective action from a Group III to a Group II, for "violation of safety rules or plant safety practices." Heck was unable to articulate what violation of safety rules took place, other than a lockout/tagout policy violation.

         On April 21, 2010, fifty-seven-year-old laminator operator Tom Weaver was issued a Group III corrective action for a lockout/tagout policy violation when he was observed by supervisor Chad Williams inside the "unwind turret" of the laminator machine without his lock applied to the energy source of the press. Weaver sought peer review of his corrective action. Weaver explained during peer review that he was not working on the machine, but rather was handing rags or tools to maintenance employee Rick Jackson, who was working on the machine. When Weaver was inside the unwind turret, Jackson's locks were applied to the machine. With Jackson's locks applied, the unwind turret was incapable of moving. The peer review panel upheld the termination.

         On December 23, 2011, three press operators reported that they had witnessed 25-year-old press operator Nathan Tirey violating the lockout/tagout policy while cleaning the press drum. One of the witnesses was McGhee's former partner, Teresa Kaiser. Kaiser submitted a written statement to supervisor Chuck Burton describing her observations, including that she and two other operators were standing near the press while Tirey was cleaning, and noticed the drum was continuously moving. Kaiser then approached the back of the press where Tirey was standing and she saw Tirey reaching past the guard and wiping the drum while it was moving. When Tirey saw Kaiser standing there, he stopped what he was doing and waited for her to leave before starting back up again. Tirey was issued a Group III corrective action, and he requested peer review. Tirey testified at trial that the witnesses could not have seen him cleaning the drum from their vantage points, and explained that he was rotating the drum with a rag lodged between the drum and another piece of equipment and that he was not physically touching the drum. Tirey's request for peer review did not contain the explanation he gave to the jury, and the notes from his peer review were apparently lost, leaving no documentation from the review. The peer review panel reversed the corrective action entirely, but recommended that Tirey "be retrained in the inch[-]safe service method." Marty Kline, a press operator who served on Tirey's peer review panel, testified that the panel recommended training for Tirey because "there was some gray area in the way in his statement on how he was doing it."

         Following trial, the jury found in favor of McGhee and awarded $300, 000 in compensatory damages and $350, 000 in punitive damages. The trial court entered judgment in accordance therewith, in addition to awarding McGhee $386, 282.81 in attorneys' fees, $14, 820.27 in costs, $66, 512.20 in front pay, and prejudgment interest in the amount of $52, 415.17, for a total judgment of $1, 170, 030.45. Schreiber appealed.


         In Schreiber's five points on appeal, it argues that the trial court committed reversible error in: (1) denying Schreiber's motion for judgment notwithstanding the verdict because the six other disciplined employees were not similarly situated to McGhee, in that their discipline was either decided by different decision makers or they were subject to different conduct policies, and thus the evidence did not support a finding of discriminatory intent or motive; (2) denying Schreiber's motion for new trial because the evidence of discipline of six comparators was not admissible because they were not similarly situated to McGhee; (3) denying Schreiber's motion for judgment notwithstanding the verdict because there was insufficient evidence to support a finding of age discrimination; (4) denying Schreiber's motion for judgment notwithstanding the verdict on the award of punitive damages because McGhee failed to offer sufficient evidence to prove that Schreiber acted with evil motive or reckless indifference; and (5) denying Schreiber's motion for remittitur of the punitive damages award because the totality of the circumstances show that the punitive damages award was excessive.

         Schreiber's first three points all rely on its contention that the disciplinary outcomes of comparators offered by McGhee as evidence of discrimination were inadmissible because the comparators were not similarly situated to McGhee.[3] Accordingly, we discuss the points together.

         I. Evidence of Comparator Employees

         "Generally, trial courts enjoy considerable discretion in the admission or exclusion of evidence, and we will only reverse a decision of the trial court upon a finding of an abuse of discretion." Foreman v. AO Smith Corp., 477 S.W.3d 649, 655 (Mo. App. E.D. 2015). "We will not find an abuse of discretion unless the ruling is clearly against the logic of the circumstances then before the court and is so arbitrary and unreasonable that it shocks the sense of justice and indicates a lack of careful consideration." Id. (quoting 8000 Maryland, LLC v. Huntleigh Fin. Servs. Inc., 292 S.W.3d 439, 446 (Mo. App. E.D. 2009)). "Our standard of review for a trial court's denial of a motion for new trial is the same [as] the standard for the admission or rejection of evidence . . .: for abuse of discretion." Id. at 657.

         "The standards of review for denial of a motion for directed verdict and denial of a motion for judgment notwithstanding the verdict are essentially the same." Hurst v. Kansas City, Mo. Sch. Dist., 437 S.W.3d 327, 336 (Mo. App. W.D. 2014) (quoting DeWalt v. Davidson Serv./Air, Inc., 398 S.W.3d 491, 498 (Mo. App. E.D. 2013)). "When reviewing a circuit court's denial of a judgment notwithstanding the verdict, [t]his [c]ourt must determine whether the plaintiff presented a submissible case by offering evidence to support every element necessary for liability." Spalding v. Stewart Title Guar. Co., 463 S.W.3d 770, 778 (Mo. banc 2015) (quoting Smith v. Brown & Williamson Tobacco Corp., 410 S.W.3d 623, 630 (Mo. banc 2013)). "We view 'the evidence in the light most favorable to the jury's verdict, giving the plaintiff the benefit of all reasonable inferences and disregarding evidence and inferences that conflict with that verdict.'" Hurst, 437 S.W.3d at 336 (quoting Sanders v. Ahmed, 364 S.W.3d ...

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