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Gracia v. Sig matron International, Inc.

United States Court of Appeals, Seventh Circuit

November 29, 2016

Maria N. Gracia, Plaintiff-Appellee,
Sig matron International, Inc., Defendant-Appellant.

          Argued September 8, 2016

         Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 1:11-v-07604 - Edmond E. Chang, Judge.

          Before Fla um, ROVER, and SYKES, Circuit Judges.

          ROVNER, Circuit Judge.

         Maria Gracia sued her employer, SigmaTron, International, Inc., for sexual harassment and for terminating her in retaliation for reporting sexual harassment. A jury found in favor of SigmaTron on the claim of sexual harassment but returned a verdict for Gracia on the retaliation count. SigmaTron challenges both the judgment in Gracia's favor and the amount of damages awarded by the jury. We affirm.


         Maria Gracia entered the workforce at the age of sixteen. After holding jobs at Burger King, Dollar Tree and various staffing companies, Gracia began working on the assembly line for the defendant, SigmaTron, in 1999. SigmaTron is an international, publicly-traded company that manufactures printed circuit board assemblies. The company has approximately 2500 employees at manufacturing facilities in the United States, Mexico, Taiwan and Vietnam. Its products are used in aviation, home appliances and medical devices, among other applications. A highly regarded employee at SigmaTron, [1]Gracia was promoted multiple times over the years until she achieved the position of assembly supervisor in 2004 or 2005.

         In her capacity as assembly supervisor, Gracia was responsible for product output and quality, for scheduling personnel and for directing team members in their work, among other things. Team members on the assembly line connected electronic components to circuits boards according to the customers' requirements. Solder, the material used to attach components to circuit boards, may be made with lead or without lead. In some instances, customers requested that a particular solder be employed, and it was the assembly supervisor's job to make sure that all customer requirements were met.

         Gracia reported to Patrick Silverman, a production manager. In late 2007, Silverman began engaging in problematic conduct towards Gracia. He sent her a series of emails containing graphic photographs of partially nude women in degrading poses. In early 2008, he sent Gracia an email with a photo of her younger sister on which someone had superimposed an image of a male co-worker dressed as a baby, with the caption, "Mother, milk please, " in Spanish.[2] Gracia testified that the unwelcome pictures made her feel embarrassed, uncomfortable and upset. But she did not object to Silverman when he sent the photos and did not inform the company's human resources department because Silverman was her boss. Gracia had noticed that Silverman and the company's executive vice-president, Greg Fairhead, were good friends, and she feared she would lose her job.[3] Greg Fairhead is the brother of Gary Fairhead, the CEO of SigmaTron.

         In mid-2008, Silverman started writing Gracia up for tardiness. Gracia did not deny that she had been late on multiple occasions, sometimes as little as a minute and at times for longer intervals. But Silverman had not previously objected to her schedule and prior to mid-2008, Gracia's attendance record had been described by Silverman as "excellent." One evening in the fall of 2008, [4] Gracia received a series of late night calls at home from Silverman. He asked her to join him at a party with David Niemi, a man who had previously worked at SigmaTron. She declined the invitation.[5] On October 15, a few weeks after she declined Silverman's late-night party invitation, several months after receiving the explicit emails, and after years of being an exemplary employee, Gracia was suspended for two days for tardiness. When she returned to work after the suspension, she requested a meeting with SigmaTron's corporate human resources manager, Sandra Miedema.

         At the October 20 meeting, Gracia told Miedema for the first time about the late-night phone calls from Silverman and that Silverman had been treating her differently. She explained that he had begun writing her up for tardiness even though her timeliness had not been an issue before. Miedema noticed that Gracia's appearance had deteriorated since she had seen her last, that she looked dull and lacked luster. Even her clothing, jewelry and makeup had changed. Four days later, Miedema called Gracia in for a second meeting. Gracia again discussed the late-night phone calls and told Miedema that Silverman had been treating her differently and that he was sexually harassing her.[6] Miedema asked Gracia, "Is he sweet on you?" and Gracia replied, "Yes." Miedema also asked Gracia if she was on drugs. Gracia denied that she was taking drugs and offered to undergo drug testing. Miedema then dropped the subject.

         At the end of that second meeting, Miedema bypassed her own supervisor and brought Gracia to the office of Greg Fairhead, SigmaTron's executive vice-president. Miedema said that she did not like the idea of Silverman "pushing at Maria." Gracia repeated to Fairhead that Silverman had subjected her to multiple unwanted late-night phone calls at home. Fairhead replied that Silverman had called her only once. Gracia tried to tell Miedema and Fairhead more about Silverman's inappropriate conduct but Fairhead spoke over her and gave her no chance to interject. After a break in the meeting, during which Miedema and Fairhead spoke privately to Silverman, Gracia was brought back in to speak with Miedema, Silverman and Fairhead. Ultimately, Gracia was told to shake hands with Silverman and work together.

         Dissatisfied with the company's response to her claim of sexual harassment, Gracia filed a charge with the Equal Employment Opportunity Commission ("EEOC"), alleging sex and national origin discrimination. SigmaTron received a copy of the EEOC charge on November 19, 2008. Approximately two weeks later, on December 4, Silverman purportedly told Fairhead that he had received a report from Eduardo Trujillo, another SigmaTron supervisor, that Gracia had allowed an employee to use the wrong solder on a customer's order, using unleaded solder on a board that called for solder with lead. Silverman claimed that when Trujillo pointed out the problem to Gracia, she had not taken the matter seriously. Silverman asserted that when Trujillo told him about the problem, he (Silverman) went to the production floor, segregated the contaminated product and took care of the problem. After Silverman conveyed this purported sequence of events to Fairhead, Trujillo confirmed Silverman's story to Fairhead. The next day, approximately six weeks after Gracia's first complaint to Miedema about Silverman's sexual harassment and two weeks after the company received Gracia's EEOC charge, SigmaTron terminated Gracia's employment.[7]

         At trial, however, Trujillo, a SigmaTron supervisor, denied making any report to Silverman about Gracia or employees on her assembly line, and did not recall Gracia speaking to him about the soldering incident. Instead, Trujillo testified that he was called into Fairhead's office on December 5 and asked "about the wrongdoing of boards being soldered." He responded to Fairhead that he "was aware, as well as the whole group of inspectors." According to Trujillo, employees often used the wrong solder on circuit boards at SigmaTron, and that to the best of his knowledge, no one had ever been fired because of the inadvertent use of the incorrect solder on a circuit board. Trujillo also testified that, approximately one month before Gracia was fired, Silverman advised Trujillo to stay away from Gracia because he (Silverman) was "throwing bombs at" her.

         Gracia testified that, on December 4, Trujillo brought to her attention that an employee was using the wrong solder, and that she addressed the problem immediately and appropriately. She removed the products from the employee applying the wrong solder and delivered them to the correct area. She also determined which employee had made the mistake, a group leader who accepted responsibility. According to Gracia, Silverman never came to the production floor and was not involved in rectifying the problem. As we discuss below, because Gracia prevailed at trial on her retaliation claim, we credit the version of the facts that support the jury's verdict. The jury was free to believe Gracia and Trujillo, and correspondingly free to determine that Silverman and Fairhead had lied about the incident.[8]

         In response to the retaliation claim, SigmaTron asserted at trial that the company terminated Gracia's employment because she had allowed an assembly line worker to use the wrong solder, did not resolve the problem and did not take the matter seriously. As for the harassment claim, the company argued that Silverman's alleged conduct did not meet the standard for hostile work environment, that Gracia had little evidence corroborating her claims, and that Gracia did not avail herself of the company's sexual harassment policy because she never informed her employer that Silverman had done anything other than invite her to a party and treat her differently by writing her up for tardiness. The jury found in favor of SigmaTron on the sexual harassment claim and in favor of Gracia on the retaliation claim. The jury awarded Gracia $57, 000 in compensatory damages and $250, 000 in punitive damages.[9] SigmaTron appeals.


         On appeal, SigmaTron contends that it is entitled to judgment as a matter of law on the retaliation claim because the evidence was insufficient to support the jury's verdict. SigmaTron also maintains that the compensatory and punitive damages awards are unsupported by the evidence, and that the punitive damages are both disproportionate to the harm suffered by Gracia and out of line with ...

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