Taylor v. Nabors Drilling USA, LP

Facts

The FEHA makes it “an unlawful employment practice for an employer to harass an employee because of the employee’s ‘sex, gender, gender identity, gender expression, … [or] sexual orientation.’” (Gov. Code, § 12940, subd. (j)(1); see Taylor, supra, 222 Cal.App.4th at p. 1235.) A hostile-work-environment claim requires unwelcome conduct that is “because of sex” and “sufficiently severe or pervasive to alter the conditions of [the plaintiff’s] employment and create an abusive work environment,” imputable to the employer. (Id. at p. 1236, quoting Lyle v. Warner Brothers Television Productions (2006) 38 Cal.4th 264, 279.)

Nabors Drilling, a drilling contractor, hired Max Taylor in June 2010 as a “floorhand” on an oil rig. (Taylor, supra, 222 Cal.App.4th at p. 1234.) The parties stipulated that Joe Mason and Jaime Mendez were Taylor’s supervisors within the meaning of the FEHA. (Ibid.) Because the harassers were supervisors, the employer’s liability was governed by the FEHA’s strict-liability standard. (Id. at p. 1237.)

The harassment was relentless and gender-specific. “Several times a day,” Mason called Taylor “a ‘queer,’ ‘faggot,’ ‘homo,’ and ‘gay porn star.’” (Taylor, supra, 222 Cal.App.4th at p. 1234.) Taylor testified: “I didn’t have a name. My name was not Max. It was queer. It was homo. The whole time.” (Ibid.) When Taylor had a facial infection, Mason said, in the crew’s presence, that an act of ejaculation “on your face … will make it clear right up,” and the crew laughed. (Ibid.) Mason posted a photograph of Taylor in the employees’ restroom that “had a big target around [his] mouth,” captioned “’Give me the money shot’” — which Taylor’s counsel argued connoted an act of oral sex. (Ibid.) Critically, Mason knew Taylor was heterosexual: Taylor had attended a barbecue at Mason’s house with his girlfriend, and the two couples had socialized. (Ibid.) When Taylor protested that he was not homosexual and had a girlfriend, Mason “laughed and … called [him] a pussy [and told him to] get back to work.” (Ibid.)

Mendez’s conduct was physical as well as verbal. While standing on the elevated rig floor above Taylor, Mendez urinated on him and “started laughing about it.” (Taylor, supra, 222 Cal.App.4th at p. 1234.) Mendez would “spank [Taylor’s] butt all the time,” and despite Taylor’s protest — “I’m not gay; don’t touch me” — continued the behavior. (Id. at pp. 1234–1235.) At times Mendez “would arouse himself in his overalls to get an erection” and then ask Taylor to sit on his lap; Mendez testified he did not consider Taylor to be gay. (Id. at p. 1235.) Taylor described it as “the worst working environment I have ever been through in my life. … It was inhumane.” (Ibid.) His girlfriend testified that he came home “very emotional” and “upset” every day. (Ibid.)

Taylor complained to human resources in September 2010. Mason did not return to the rig, was suspended, and was ultimately terminated after an investigation; Mendez ceased the harassment. (Taylor, supra, 222 Cal.App.4th at p. 1235.) Nabors terminated Taylor on December 19, 2010, citing tardiness, missed safety meetings, an unauthorized early departure, and a profane outburst at Mendez. (Ibid.)

Procedural history

Taylor’s March 2011 complaint pleaded four causes of action: hostile-work-environment sexual harassment, failure to prevent harassment, unlawful retaliation, and wrongful termination in violation of public policy. (Taylor, supra, 222 Cal.App.4th at p. 1235.) The jury returned a special verdict for Taylor on the harassment claim only, finding his complaint had not been “a motivating reason” for his discharge, and awarded $160,000 — $10,000 for past economic loss and $150,000 for past noneconomic loss. (Ibid.)

The trial court denied Nabors’s motion for judgment notwithstanding the verdict (JNOV) and awarded attorney fees of $680,520. (Taylor, supra, 222 Cal.App.4th at p. 1235.) On appeal, the unanimous panel affirmed the JNOV denial and the fee award, agreed the economic-damages award lacked evidentiary support, reduced Taylor’s recovery to $150,000, and affirmed the judgment as modified. (Id. at pp. 1235–1236, 1252–1253.) The Supreme Court denied review. (Id. at p. 1253 [postscript].) There was no dissent.

Issue

Two questions dominate the published analysis. First, on the merits: does substantial evidence support a finding that a heterosexual man was harassed “because of sex” under the FEHA where the harassment took the form of sustained attacks on his heterosexual identity, even absent evidence that the harassers acted from sexual desire? Second, on procedure: where a special verdict form, through a drafting typo, fails to elicit jury findings on two essential elements, must the judgment be reversed per se, or is the defect subject to harmless-error analysis?

Holding

Reasoning

Strict liability framed the merits. Because the parties stipulated that Mason and Mendez were supervisors, the court applied the FEHA’s strict-liability standard for supervisor harassment, removing any “knew or should have known” negligence inquiry from the case. (Taylor, supra, 222 Cal.App.4th at p. 1237.) The merits thus reduced to whether the conduct was “because of sex.”

“Because of sex” does not require sexual desire — embracing Singleton. Reviewing the JNOV denial for substantial evidence, the court found Singleton v. United States Gypsum Company (2006) 140 Cal.App.4th 1547 controlling. (Taylor, supra, 222 Cal.App.4th at pp. 1237–1238.) In Singleton, coworkers taunted a heterosexual male by suggesting he was homosexual, and the court reasoned that because the harassers “had targeted [the plaintiff’s] identity as a heterosexual male, it is axiomatic that they would treat women ‘differently’” — so the harassment was “because of sex,” in that it “employed attacks on Singleton’s identity as a heterosexual male as a tool of harassment.” (Id. at p. 1238, quoting Singleton.) Singleton further held “there is no requirement that the motive behind the sexual harassment must be sexual in nature,” and that “[s]exual harassment occurs when … sex is used as a weapon to create a hostile work environment.” (Ibid.) The Taylor panel found the facts before it indistinguishable: Mason and Mendez “’employed attacks on [Taylor’s] identity as a heterosexual male as a tool of harassment.’” (Ibid.)

The court declined to follow Kelley. Nabors relied on Kelley v. The Conco Companies (2011) 196 Cal.App.4th 191, which had criticized Singleton and held that crude same-sex propositions were not actionable absent “evidence that an alleged harasser was acting from genuine sexual interest.” (Taylor, supra, 222 Cal.App.4th at pp. 1238–1239, quoting Kelley.) The Taylor court squarely chose sides: “We believe that Singleton was correctly decided and we disagree with Kelley.” (Id. at p. 1239.) It distilled the governing rule narrowly: “a heterosexual male is subjected to harassment because of sex under the FEHA when attacks on his heterosexual identity are used as a tool of harassment in the workplace, irrespective of whether the attacks are motivated by sexual desire or interest.” (Ibid.) The court grounded the rule in Title VII, citing Oncale v. Sundowner Offshore Services, Inc. (1998) 523 U.S. 75, 80, for the proposition that “harassing conduct need not be motivated by sexual desire,” and in California authority recognizing that “[t]he focus … is whether the victim has been subjected to sexual harassment, not what motivated the harasser.” (Ibid., quoting Mogilefsky v. Superior Court (1993) 20 Cal.App.4th 1409, 1418.)

A legislative tailwind. The court noted, in a footnote that has become a fixture of FEHA practice, that Kelley “sparked a legislative reaction”: in 2013 the Legislature amended section 12940, subdivision (j)(4)(C) to provide that “[s]exually harassing conduct need not be motivated by sexual desire,” with the bill’s author stating the amendment “would overturn the decision in Kelley v. Conco Companies.” (Taylor, supra, 222 Cal.App.4th at p. 1239, fn. 2, quoting Stats. 2013, ch. 88, § 1, and the Assembly committee analysis.) The amendment took effect January 1, 2014 — twelve days before this opinion filed — so the court’s holding and the statute marched in step.

The special verdict typo. The form, drafted by Taylor’s counsel and expressly approved by Nabors’s counsel, contained a fatal directional error. After the jury answered “yes” to question 4 (objective hostility), the form told it: “If your answer to question 4 is yes, then skip ahead to question 10.” (Taylor, supra, 222 Cal.App.4th at p. 1241.) It should have said “no.” (Ibid.) Following the erroneous instruction, the jury never answered question 5 (whether Taylor subjectively perceived the environment as hostile) or question 6 (whether that environment was a substantial factor causing harm) — both essential elements under CACI No. 2521A. (Id. at pp. 1240–1241 & fn. 4.) A special verdict “is ‘fatally defective’ if it does not allow the jury to resolve every controverted issue,” and a reviewing court analyzing it de novo “does not imply findings in favor of the prevailing party.” (Id. at pp. 1240, 1242.)

Forfeiture, then the larger ground. The court agreed with the trial court that Nabors had forfeited the defect by failing to object before the jury was discharged, when the omissions were apparent on polling and could have been cured by further deliberation. (Taylor, supra, 222 Cal.App.4th at pp. 1242–1243, quoting Keener v. Jeld-Wen, Inc. (2009) 46 Cal.4th 247, 263–264.) It distinguished Saxena v. Goffney (2008) 159 Cal.App.4th 316 and Behr v. Redmond (2011) 193 Cal.App.4th 517, where the complaining parties had preserved the issue or where the plaintiff had deliberately omitted an essential finding; here the omission was an inadvertent “typo” in a form both sides had approved. (Id. at pp. 1243–1244.)

First impression: harmless error can save a defective special verdict. The court’s signature move was to hold that, “[i]rrespective of whether appellant forfeited its claim,” reversal was not required because the defect was harmless. (Taylor, supra, 222 Cal.App.4th at p. 1244.) The line of cases barring a reviewing court from “imply[ing] findings,” it observed, had never addressed the effect of California Constitution, article VI, section 13, or Code of Civil Procedure section 475 — and “’cases are not authority for propositions not considered.’” (Ibid.) Rejecting any “reversible per se” or “structural error” characterization, the court reasoned that the typo had not deprived Nabors of a jury trial or a fair hearing: “Appellant had a lengthy jury trial before a fair and unbiased trial judge and jury. … The only thing that went wrong was the erroneous drafting of the special verdict form.” (Id. at pp. 1244–1245.) It distinguished criminal dicta in Gamache and Anzalone as inapposite to a civil special-verdict typo, invoking the “strong presumption that any error falls within the trial error category.” (Id. at p. 1245 & fn. 6.)

The judgment was “clearly right.” Applying the constitutional standard, the court “easily conclude[d]” that, but for the typo, the jury would have answered “yes” to questions five and six: the facts were “aggravated, even on paper,” the jury was properly instructed on both elements and presumed to have followed those instructions, and it had found Taylor mentally suffered and awarded substantial damages. (Taylor, supra, 222 Cal.App.4th at pp. 1245–1246.) Tellingly, the court added a candid caveat: “If we had a legitimate doubt concerning prejudice, we would reverse.” (Id. at p. 1246.) Finding no reasonable probability of a different result after a ten-day trial, it found no miscarriage of justice. (Ibid.)

Damages: emotional-distress proof and the economic-loss correction. The court rejected Nabors’s argument that Taylor had to prove “serious” or “severe” emotional distress, holding that the IIED threshold does not govern FEHA recovery: “proof of the elements of the tort of intentional infliction of emotional distress is not a prerequisite for the recovery of compensatory damages [under the FEHA] for mental anguish and humiliation.” (Taylor, supra, 222 Cal.App.4th at pp. 1246–1247.) The $150,000 noneconomic award did not “shock[] the conscience,” and the excessiveness challenge was independently forfeited for want of legal analysis. (Id. at pp. 1247–1248.) But the court agreed the $10,000 economic award was unsupported: it rested on lost wages calculated from the discharge date, and “[s]ince the jury determined that respondent was lawfully discharged, he was not entitled to recover damages for lost compensation.” (Id. at p. 1248.)

Attorney fees: lodestar, multiplier, and proportionality. The court affirmed the $680,520 fee award despite the trial court’s failure to state its lodestar or multiplier, presuming the court considered all appropriate factors and inferring a reduced lodestar times a multiplier of roughly 1.4–1.5. (Taylor, supra, 222 Cal.App.4th at pp. 1249–1250.) A dissatisfied party must request specific findings; Nabors had not. (Id. at pp. 1250–1251.) The court rejected both the proportionality attack — there is “’no mathematical rule requiring proportionality between compensatory damages and attorney’s fees’” — and the demand for apportionment, since the four causes of action were “inextricably intertwined.” (Id. at p. 1251.) The contingent-risk and preclusion factors alone justified the multiplier. (Id. at pp. 1251–1252.)

Significance

Taylor is a doctrinal capstone in the same-sex, “because of sex” line that runs from Oncale through Singleton and Kelley. By expressly endorsing Singleton and rejecting Kelley, the Second District resolved an open appellate split in favor of the rule that harassment exploiting a man’s heterosexual identity is actionable without any showing of the harasser’s sexual desire. The timing is significant: the opinion filed twelve days after Senate Bill 292 codified the same principle in section 12940, subdivision (j)(4)(C), making Taylor a useful bridge authority for conduct predating January 1, 2014, and a confirmation of legislative intent for conduct after it. Practitioners citing the statute can point to Taylor as the appellate decision that read the FEHA the way the Legislature simultaneously confirmed it should be read.

Its second contribution is procedural and, by the court’s own description, of first impression: a special verdict rendered defective by a drafting error is subject to harmless-error analysis under article VI, section 13, and is not “reversible per se.” That holding tempers the otherwise unforgiving rule that a reviewing court may not imply findings to rescue a defective special verdict. The limits, however, are real — the court emphasized it would reverse on “a legitimate doubt concerning prejudice,” so the doctrine rescues only verdicts that are “clearly right” on the whole record. (Taylor, supra, 222 Cal.App.4th at p. 1246.)

Key quotes

“a heterosexual male is subjected to harassment because of sex under the FEHA when attacks on his heterosexual identity are used as a tool of harassment in the workplace, irrespective of whether the attacks are motivated by sexual desire or interest.” (Taylor, supra, 222 Cal.App.4th at p. 1239.)

“We hold that a defective special verdict form is subject to harmless error analysis. As we shall explain, here the error is harmless and there is no miscarriage of justice.” (Id. at p. 1244.)

“If we had a legitimate doubt concerning prejudice, we would reverse.” (Id. at p. 1246.)

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Practice pointer

Open questions

The court expressly declined to decide which of two arithmetic combinations the trial court used to reach the fee award, holding only that the result was supportable; it inferred “either a lodestar figure of $453,680 and a multiplier of 1.5 … or a lodestar figure of $486,086 and a multiplier of 1.4,” leaving the actual calculation unresolved. (Taylor, supra, 222 Cal.App.4th at pp. 1249–1250.) It also “need not consider the first [multiplier] factor” — novelty and difficulty — because the second and third factors alone sufficed, leaving that factor’s weight unexamined. (Id. at p. 1252.) Finally, the harmless-error holding leaves open how much doubt is “legitimate” enough to compel reversal of a defective special verdict in a closer case, since here the court found the judgment “clearly right” and the omitted findings inevitable. (Id. at p. 1246.)