State v. McKee

may not be cited except as provided by

Minn. Stat. § 480 A. 08, subd. 3 (1996).

 STATE OF MINNESOTA

 IN COURT OF APPEALS

C8-98-363

State of Minnesota,

by David Beaulieu, Commissioner,

Department of Human Rights,

Respondent,

vs.

City of Minneapolis,

Relator.

 Filed August 18, 1998

Affirmed in Part, Reversed in Part, and Remanded

Davies, Judge

Department of Human Rights

Carl M. Warren, Clinical Professor, Gregory Karpenko, Certified Student Attorney, University of Minnesota Law School, 190 Law Center, 229 19th Ave. S., Minneapolis, MN 55455 (for respondent)

Jay M. Heffern, Minneapolis City Attorney, Peter W. Ginder, Assistant City Attorney, 300 Metropolitan Centre, 333 South Seventh St., Minneapolis, MN 55402-2453 (for relator)

Considered and decided by Harten, Presiding Judge, Crippen, Judge, and Davies, Judge.

 U N P U B L I S H E D O P I N I O N

 DAVIES, Judge

Relator City of Minneapolis contests an administrative law judge's determination that its police department engaged in marital-status and gender discrimination, committed acts of reprisal, and maintained a hostile work environment. We affirm in part, reverse in part, and remand.

  FACTS

In 1987, Donald Smulski and Katherine Berg (complainants) were hired as police officers by the Minneapolis Police Department (MPD). They became romantically involved, began living together in 1988, and married in 1990.

In November 1990, complainants filed with the Minnesota Department of Human Rights (respondent) charges of marital-status and reprisal discrimination against relator City of Minneapolis. Berg also charged gender-based discrimination. Respondent determined there was probable cause and issued a complaint against relator based on those charges. In the complaint, respondent also alleged that the MPD maintained a hostile work environment.

An administrative law judge (ALJ) concluded that the MPD discriminated against complainants on the basis of gender and marital status, engaged in acts of reprisal, and maintained a hostile work environment, all in violation of the Minnesota Human Rights Act (Human Rights Act), Minn. Stat. § 363.03, subds. 1(2)(c), 7(1) (1996). The ALJ imposed significant punitive and treble compensatory damages, a civil penalty, and other relief against relator. This appeal followed.

  D E C I S I O N

An administrative agency's decision will be reversed on appeal if it is beyond statutory authority, legally erroneous, "unsupported by substantial evidence," or is arbitrary and capricious. Minn. Stat. § 14.69 (b), (d), (e), (f) (1996); see also State by Khalifa v. Hennepin County, 420 N.W.2d 634, 639 (Minn. App 1988) (applying Minn. Stat. § 14.69 to decision of ALJ in human rights case), review denied (Minn. May 4, 1988). Under the substantial evidence standard, we examine the entire record to determine whether the ALJ's decision "is supported by evidence that a reasonable mind might accept as adequate." Minneapolis Police Dept. v. Minneapolis Comm'n on Civil Rights, 425 N.W.2d 235, 239 (Minn. 1988).

  I.

The ALJ's conclusion that the MPD discriminated against complainants on the basis of their marital status is not supported by substantial evidence. At oral argument, counsel for respondent conceded there was no evidence that complainants, when not married, had been discriminated against because they were not married. Complainants were not treated differently from married couples in similar circumstances. Further, no MPD policy was applied to complainants discriminatorily by treating them as a married couple though they were unmarried.[1] The MPD, thus, did not discriminate against complainants on the basis of their marital status.

  II.

To establish a prima facie case of reprisal discrimination, complainants must show: (1) they engaged in statutorily protected conduct; (2) their employer took adverse action against them; and (3) the protected conduct and adverse action were causally related. Hubbard v. United Press Int'l, Inc., 330 N.W.2d 428, 444 (Minn. 1983).

Complainants did not establish a prima facie case because they did not show they engaged in statutorily protected conduct. Complainants argue that they engaged in protected conduct when, during meetings with Chief of Police John Laux and other supervisors, they alleged that they had been discriminated against in their work assignments because they were living together. See Minn. Stat. § 363.03, subd. 7(1) (opposing discrimination is protected conduct). The record indicates, however, that complainants did not, during these meetings, allege unlawful marital-status discrimination but rather made general complaints about their employment and possibly about being treated differently because they were romantically involved. Such general complaints, without specific allegations of unlawful discrimination, do not constitute protected activity. Dietrich v. Canadian Pacific Ltd., 536 N.W.2d 319, 326 (Minn. 1995). Complainants engaged in protected conduct only when they subsequently filed their discrimination claims. See Minn. Stat. § 363.03, subd. 7(1) (filing charge under Human Rights Act is protected conduct).

  III.

To establish a prima facie case of hostile work environment discrimination, employees must show that: (1) they belong to a protected group; (2) they were subjected to unwelcome sexual harassment; (3) the harassment affected a term or condition of employment; and (4) their employer knew or should have known of the harassment and failed to take adequate remedial action.[2] Klink v. Ramsey County by Zacharias, 397 N.W.2d 894, 901 (Minn. App. 1986), review denied (Minn. Feb. 13, 1987). Courts, when determining whether allegedly harassing language or conduct constitutes a violation of the Human Rights Act, should consider its "nature, frequency, intensity, location, context, duration, and object or target." Id.

The ALJ determined that the frequent and pervasive use of vulgar language, sexual joking, and display of offensive posters by Berg's supervisors and fellow officers created a hostile work environment for female MPD employees, including Berg. In isolation, none of these incidents created a hostile work environment, and none of the offensive conduct was specifically directed at Berg. But the cumulative effect of this conduct is sufficient to sustain the ALJ's determination that Berg was subjected to a hostile work environment. See Burns v. McGregor Elec. Inds., Inc., 955 F.2d 559, 564 (8th Cir. 1992) (impact of separate incidents may accumulate, creating hostile work environment beyond sum of individual episodes).

We must, however, reverse the ALJ's conclusions regarding the damages to other female MPD employees from that hostile work environment. Respondent chose not to pursue this case as a class action. See Minn. Stat. § 363.06, subd. 4(6) (1996) (Department of Human Rights has authority to "seek relief for a class of individuals affected by an unfair discriminatory practice"). Under respondent's complaint, the ALJ was authorized to determine whether Berg, and Berg alone, was subjected to a hostile work environment. Determination of damages to other victims was beyond the scope of the ALJ's authority.

  IV.

MPD argues that the ALJ should not have considered complainant Berg's hostile work environment and failure-to-promote claims because they were not included in her original charges of discrimination. But any claim "which can reasonably be expected to grow out of the [original] charge of discrimination" may be considered, even if it was not specifically alleged in the original charge or pled in the complaint. Sanchez v. Standard Brands, Inc., 431 F.2d 455, 466 (5th Cir. 1970).

The hostile work environment claim, which respondent added to the complaint following its investigation of Berg's charges, could reasonably be expected to arise from her original gender discrimination claim. The ALJ did not err by considering that claim insofar as it related to Berg's treatment by the MPD. It was also reasonable for the ALJ to consider Berg's claims that the MPD did not promote her to sergeant or weapons officer because of gender or retaliatory animus. Those claims are closely related to Berg's charges of gender and reprisal discrimination.

That does not, however, mean that Berg's claim of failure to promote has merit. The record shows that Berg was not promoted to sergeant because she declined to take an examination that was required of all candidates for promotion to that rank. The evidence is insufficient to show that the MPD's decision not to promote Berg to weapons officer was motivated by gender or retaliatory animus rather than resulting from the vagaries of management in a department of more than 800 persons. The ALJ's determination that relator discriminated against Berg by failing to promote her is not supported by substantial evidence and is reversed.

  V.

The standard of review for denial of a motion for mistrial is abuse of discretion. State v. Graham, 371 N.W.2d 204, 207 (Minn. 1985). Despite relator's claims to the contrary, there is no evidence that the ALJ abused his discretion by denying relator's motion for mistrial.

Relator also argues that a three-year delay between respondent's probable cause determination and the issuing of a formal complaint was unduly prejudicial. But the Human Rights Act does not establish a certain period of time during which a complaint must be filed after the probable cause determination. Minn. Stat. § 363.06, subd. 4 (1996), sets time limits only on the charging process. The delay, while substantial, was not shown to be prejudicial.

  VI.

An ALJ has broad discretion to determine an appropriate remedy under the Human Rights Act. The ALJ can order payment of compensatory damages, punitive damages, civil penalties, or "any other relief [that the ALJ] deems just and equitable." Minn. Stat. § 363.071, subds. 2, 2(a) (1996). Damage awards under Minn. Stat. § 363.071, subd. 2, may be modified "only if arbitrary and capricious or if unsupported by substantial evidence on the record as a whole." Continental Can Co. v. State, 297 N.W.2d 241, 251 (Minn. 1980).

The ALJ ordered relator to pay: (1) $72,699 in treble compensatory damages to complainants jointly; (2) $61,836 in treble compensatory damages for additional expenses and lost sergeant's wages to Berg; (3) $200,000 to Berg for mental anguish and suffering; (4) $25,000 to Smulski for mental anguish and suffering; (5) $17,000 in punitive damages to complainants; and (6) a $1,500,000 civil penalty to the state. The ALJ also ordered relator to develop policies and procedures to minimize discriminatory practices within the MPD and retained jurisdiction for three years to ensure relator's compliance with this requirement.

  A. Compensatory, Punitive, and Other Damages

With the exception of the hostile work environment claim, the ALJ's factual findings regarding discrimination against Berg are not supported by substantial evidence. It is, therefore, necessary to reverse the ALJ's award of compensatory damages to Berg, except as those damages reflect the harm she suffered as a result of the MPD's hostile work environment. Berg is entitled to receive damages for mental anguish and suffering, but the award of $200,000 is unwarranted and must be reduced. We remand to the ALJ for a determination of more appropriate compensatory and mental suffering damages.

The ALJ's factual findings regarding discrimination against Smulski are not supported by substantial evidence. For this reason, the ALJ's decision to award him compensatory damages and damages for mental anguish and suffering is reversed.

The ALJ's decision to award punitive damages to each complainant is not warranted on this record, and is reversed.

  B. Affirmative Relief

By ordering relator to develop procedures to prevent systemic hostile work environment discrimination, the ALJ essentially granted class-wide relief to MPD employees. But this case was not certified as a class action on behalf of the female employees of the MPD. The ALJ exceeded his authority by granting relief to persons other than Berg. See Minn. Stat. § 363.071, subd. 2 (ALJ has authority to grant relief only to "an aggrieved party, who has suffered discrimination") (emphasis added).

Because Berg was the only appropriate recipient of relief in this case, the ALJ should have tailored the affirmative remedies to alleviate the specific effects of discrimination against Berg. Insofar as the ALJ's grant of affirmative relief orders the MPD to develop policies and procedures affecting MPD employees other than Berg, it is reversed. The ALJ's decision to retain jurisdiction over this matter for three years is also unjustified and is reversed. We remand to the ALJ for a determination of what affirmative remedies, if any, are appropriate on behalf of Berg.

  C. Civil Penalty

When ordering payment of a civil penalty under the Human Rights Act, an ALJ must consider

the seriousness and extent of the violation, the public harm occasioned by the violation, whether the violation was intentional, and the financial resources of the respondent.

Minn. Stat. § 363.071, subd. 2. The penalty will be affirmed absent an abuse of discretion. Gillson v. State Dep't of Natural Resources, 492 N.W.2d 835, 843 (Minn. App. 1992), review denied (Minn. Jan. 28, 1993).

The ALJ abused his discretion by ordering relator to pay a $1,500,000 civil penalty. The ALJ did not explain how he decided that $1,500,000 was an appropriate civil penalty; this makes the award appear entirely arbitrary. Even if the ALJ had explained how he decided on that amount, there was no showing of actual discrimination against complainants that was sufficiently serious, pervasive, or damaging to the public good as to justify this enormous civil penalty. The civil penalty is grossly disproportionate to the severity of any injury for which there is evidentiary support. We reverse the ALJ's award and remand for a redetermination of what, if any, civil penalty is appropriate.

 Affirmed in part, reversed in part, and remanded.

[1] The ALJ concluded that the MPD discriminated against complainants by ordering them to separate as patrol partners. But the record shows that complainants decided to separate on their own before being ordered to do so. The MPD did not damage complainants by ordering them to do what they had already decided to do independently.

[2] Klink required that harassment be based on gender, but a subsequent supreme court decision has negated this requirement. Cummings v. Koehnen, 568 N.W.2d 418, 420 n.2 (Minn. 1997) ("Klink is in error to the extent that it requires a plaintiff to prove that sexual harassment is `based on sex' * * *.").