Harvey v. Office of Banks & Real Estate

In the

United States Court of Appeals

For the Seventh Circuit

____________

Nos. 02-3501 & 03-1416

RENARD J. HARVEY, and ROBBIE CLARK, as

personal representative of RALPH KING, deceased,

Plaintiffs-Appellees,

v.

OFFICE OF BANKS AND REAL ESTATE and

William A. DARR, in his official capacity as

Commissioner of the Office of Banks and

Real Estate,

Defendants-Appellants.

____________

Appeals from the United States District Court

for the Northern District of Illinois, Eastern Division.

No. 97 C 5463—Wayne R. Andersen, Judge.

____________

ARGUED SEPTEMBER 3, 2003—DECIDED JULY 26, 2004

____________

Before RIPPLE, ROVNER, and DIANE P. WOOD, Circuit

Judges.

DIANE P. WOOD, Circuit Judge. Renard J. Harvey, Ralph

King, Brian Robinson, and Dennis Wells, all African-

Americans, were employees of the State of Illinois’s Office

of Banks and Real Estate (OBRE). In this suit, they claimed

that they had been subject to unlawful racial discrimination

2 Nos. 02-3501 & 03-1416

and retaliation on the job, in violation of Title VII, 42

U.S.C. § 2000e et seq., and 42 U.S.C. § 1981. Wells was

dismissed from the case at the close of the plaintiffs’

evidence and the jury found against Robinson. Harvey and

King prevailed at trial on most of their claims. The jury

found that OBRE had discriminated against Harvey on the

basis of race when it demoted him from a top management

position. King prevailed on three claims: the jury found that

he had been discriminated against on two separate oc-

casions when he failed to receive a promotion and that

OBRE retaliated against him after he complained about

race discrimination in the agency’s promotion practices.

OBRE appeals from these findings, contending that there

is insufficient evidence to support the verdict in favor of

Harvey and King. We affirm.

I

A

Because the issues on appeal turn almost exclusively on

what evidence was before the jury, our review of the facts

is necessarily detailed. We present them in the light most

favorable to the jury’s verdict. Roy v. Austin, 194 F.3d 840,

842 (7th Cir. 1999). On June 1, 1996, a merger of two Illinois

state agencies—the Office of Savings and Residential Finance

and the Office of Banks and Trusts—created OBRE, an entity

that oversees the regulation and licensure of, among other

things, state-chartered banks and trust companies, savings

banks and loan associations, mortgage bankers and brokers,

and real estate brokers and salespersons. The agency is

headquartered in Springfield and has offices in Chicago.

At the times relevant to this litigation, Jack Schaffer

served as the Commissioner of OBRE. Below Schaffer were

Assistant Commissioners who headed the agency’s four

bureaus. Assistant Commissioner Jay Stevenson ran the

Bureau of Residential Finance, which has two divisions:

Nos. 02-3501 & 03-1416 3

Mortgage Banking, where Harvey worked, and Thrift

Regulation. Assistant Commissioner Scott Clarke headed

the Bureau of Banks and Trusts Companies, which oversees

state-chartered and commercial banks. The Bureau examines

the information systems of banks through its Information

Services section, where King worked until his death in

September 1999. (King’s executor, Robbie Clark, is pursuing

this litigation on his behalf.) Assistant Commissioner

Robert Thompson ran the Bureau of Administration, which

houses the agency’s human resources and equal employment

opportunity personnel. Finally, Assistant Commissioner

Chris McAuliffe headed the Bureau of Real Estate Professions,

which regulates various entities and persons involved in

real estate transactions.

OBRE employees are classified by the Illinois Department

of Central Management Services (CMS), the state agency

that administers the Personnel Code. In 1993-1994, CMS

created a new two-tiered scheme for the classification of

management titles within state agencies. Persons holding

a position classified as a Senior Public Service Administra-

tor (SPSA) are appointed to a renewable four- year term.

These term appointments are intended for top management

jobs that involve “major administrative responsibilities” and

“policy making” duties. ILL. ADMIN. CODE tit. 80, § 302.800.

In 1997, the top salary for SPSAs was approximately

$96,000. By contrast, a Public Service Administrator (PSA)

is not subject to the term appointment process; as of 1997 the

top salary for a PSA was approximately $65,000. Testimony

at trial supported the conclusion that the SPSA classification

accords higher status, prestige, rank, and career opportuni-

ties. CMS also administers the regulations governing

reclassification of job positions. The Personnel Code states

that each agency head must report to CMS “any significant

changes in the duties of every position within the agency.”

ILL. ADMIN. CODE tit. 80, § 301.20. Once CMS is notified of

the change, it undertakes “a survey, audit, or such other

4 Nos. 02-3501 & 03-1416

investigation as may be deemed necessary . . . to determine

the proper allocation” of a position. Id.

B

With this background in mind, we turn first to Harvey’s

case. In 1976, Harvey began his employment with the Office

of the Commissioner of Savings and Residential Finance,

one of OBRE’s predecessor agencies. Although he started

out in a trainee position, Harvey steadily rose through the

ranks. In 1989, he joined the Mortgage Banking division of

the agency, which was charged with the examination,

licensing, and supervision of regulated entities in the

mortgage industry. Harvey’s work, which he performed

under the supervision of William Kaddatz, involved licens-

ing. In 1991, Kaddatz gave Harvey a stellar evaluation and

requested that he be promoted to an assistant supervisor

position. The agency declined to follow Kaddatz’s recom-

mendation. The following year, the deputy commissioner and

general counsel of the agency, Paula Hiza, seconded the

promotion request and observed that Harvey was a “tal-

ented and reliable manager.” Hiza commented favorably on

Harvey’s “professionalism, breadth of knowledge, and

experience” and urged the agency to promote him. Once

again, however, Harvey was not promoted. In June 1993,

Kaddatz again gave Harvey high marks on his evaluation

and repeated the request for a promotion by saying “it is my

understanding that Mr. Harvey is finally going to be

promoted to [ ] assistant supervisor.”

In 1993, Schaffer became Commissioner of the agency,

now renamed the Office of Savings and Residential Finance.

He selected Dea Brennan to serve as Director of Mortgage

Banking and requested that she reorganize the division.

Brennan promoted Harvey in July 1993 to the position of

Manager of Licensing, which was classified as an SPSA

appointment. Harvey’s four-year term was thus scheduled

Nos. 02-3501 & 03-1416 5

to run from 1993 until 1997. After Brennan’s initial favor-

able action, the relationship between Harvey and Brennan

began to sour almost immediately. A few weeks after assum-

ing his new post, Harvey sent Brennan a memo expressing

concern with what he perceived to be her micro-manage-

ment of his job duties. In this memo, Harvey complained

that Brennan was frustrating his ability to manage his

employees and that he felt “relegated to the position of a

clerk.” At about the same time, Harvey missed a day of

work because of flooding at his house. In accordance with

new personnel procedures that she had recently issued,

Brennan demanded that Harvey bring documentation to her

from his plumber. Harvey complained to Commissioner

Schaffer, who told him to “placate” Brennan by bringing in

a note. Harvey acquiesced and brought in a receipt from his

plumber.

Although Brennan conceded that she had a “hands-on”

management style, she seemed particularly invested in

monitoring Harvey. Other Mortgage Banking employees

testified that Brennan had a “personal vendetta” against

Harvey and that she kept him on a “shorter leash” than

anyone else. It is clear from the cantankerous e-mails pre-

sented to the jury that Brennan butted heads with Harvey

over everything from work assignments to vacation time.

In 1994, Commissioner Schaffer issued a Request for

Proposals (RFP) seeking external consultants to help him

improve agency operations. He hired a consultant named

Alan Drazek, who recommended that the Mortgage Banking

division name Harvey as the Manager of Supervision. The

person in this position was responsible for issuing commu-

nications to regulated entities addressing shortcomings

raised during their examination or licensing processes.

Prior to her promotion as Director, Brennan had served as

Manager of Supervision with SPSA rank.

In a January 1995 memorandum, Commissioner Schaffer

at last adopted Drazek’s recommendation and announced

that Harvey would become the Manager of Supervision in

6 Nos. 02-3501 & 03-1416

the Mortgage Banking division. Harvey retained his SPSA

designation when this job change occurred. Sometime in

1995, Donald Keane was appointed to fill the Manager of

Licensing job that Harvey had vacated. Brennan called a

meeting to introduce Keane, a Caucasian, to the licensing

staff, who were all African-Americans. Two staff members

present at that meeting, Karen Weaver-Harris and Jean

Mukwaya, told the jury that Brennan had introduced Keane

to them as their “overseer.” Although Harvey was not pres-

ent at this meeting, both Mukwaya and Weaver-Harris

confided to him that they felt Brennan’s use of this word

was racially hostile, as it evoked the image of slaves on a

plantation.

Unsurprisingly in light of this inauspicious start, Keane

had a difficult time working with his staff and went to

Harvey for advice. When Harvey told Keane about the

“overseer” comment, which Keane claims he did not recall,

Keane immediately went to Brennan, who in turn called her

supervisor, Assistant Commissioner Jay Stevenson.

Stevenson asked to speak with Harvey and Keane about the

incident. According to Keane and Harvey, Stevenson told

them that Brennan had an “abrasive personality” and that

they should not worry too much about the incident. No

further investigation was conducted. Both Harvey and

Keane stated that they believed this was an inadequate re-

sponse to the problem. Weaver-Harris and Mukwaya also

told the jury that Brennan had made other comments to

them that they believed were racially derogatory. Brennan

said that she could not recall whether or not she made the

comments.

After this incident, Harvey’s relationship with Brennan

continued to deteriorate. The tension between them was

well known throughout the agency, as was Harvey’s belief

that his treatment at her hands was motivated by race. Some-

time during 1995-1996, Harvey told Assistant Commissioner

McAuliffe that Brennan was mistreating him because he

Nos. 02-3501 & 03-1416 7

was black. McAuliffe testified that he reported to Schaffer

in “general terms” that Harvey had concerns about race

discrimination. McAuliffe also told Stevenson and general

counsel Carl Stewart that Harvey had complained of race

discrimination. Stevenson told the jury that he was aware

of Harvey’s perception that race was a factor in the way

Brennan was treating him. Schaffer testified that he was

aware of Harvey’s unhappiness, but did not know whether

it was based on concerns about racial discrimination. Brennan

stated that on three occasions Harvey had complained to

her about a glass ceiling for African-Americans at the

agency. After the 1996 agency merger creating OBRE,

Harvey was approached about taking a job in another di-

vision that was classified with the lower PSA designation.

Harvey declined, saying that he did not believe that such a

reclassification was justified and that he would view such

an act as race discrimination. No investigation, formal or

informal, was ever initiated by the agency to address

Harvey’s concerns.

About a month before Harvey’s four-year term appoint-

ment was set to expire, Commissioner Schaffer met with

Brennan and Stevenson to discuss a range of issues. Brennan

testified that she “spontaneously” brought up Harvey’s

reappointment because she needed to make decisions about

the division’s staffing needs for the upcoming year. Schaffer

said that he first had to decide whether Harvey would be

retained by the agency or not, and if so, he then had to

determine Harvey’s appointment status. According to

Brennan, Schaffer said that if Harvey was reappointed to

another four-year SPSA appointment “there would be more

of the same.” Although Brennan testified that she was

“plugging for Mr. Harvey’s retention in the Mortgage

Banking division” at the meeting with Schaffer, an e-mail

she sent after this meeting reveals that she did not think

highly of Harvey’s performance. Schaffer testified that he

decided to retain Harvey as the Manager of Supervision

8 Nos. 02-3501 & 03-1416

based on Brennan’s recommendation, but to reclassify him

at the lower PSA designation.

After Schaffer asked Stevenson to relay the news, Harvey

received a note from Stevenson summoning him to

Springfield to discuss his future employment with the

agency. Stevenson carried out this order in a bizarre way.

When Harvey arrived in Springfield, Stevenson drove Harvey

to Stevenson’s church in a state vehicle. Harvey had no idea

why Stevenson had brought him there, initially assuming

that Stevenson needed to pick something up on their way to

lunch. Instead, Stevenson asked Harvey to sit in a pew,

explained to him that the church was a source of strength,

told Harvey that he did not have a racist bone in his body,

and said that Harvey should not view the reclassification as

a “racial act.” Stevenson then drove Harvey back to OBRE

and informed him that he could accept the PSA reclassifica-

tion voluntarily or have it take effect involuntarily. Harvey

felt he had no choice at that point and accepted the demo-

tion.

Harvey then filed this discrimination lawsuit, alleging

that the reclassification of his job was unlawfully based on

his race. The jury agreed and awarded him $100,000 in

compensatory damages on his demotion claim. Based on the

jury’s findings, the district court awarded an additional

$30,000 in back pay.

C

Ralph King began working for the Illinois Office of

Banks and Trusts in 1986. Prior to joining the agency, King

had worked as a computer programmer, senior program-

mer, programmer analyst, systems analyst, senior systems

analyst, and systems project manager. King had worked his

way up from a trainee position to a Bank Examiner I, Bank

Examiner II, and finally Bank Examiner III. In 1993, King

was promoted from Bank Examiner III to Field Supervisor,

Nos. 02-3501 & 03-1416 9

a PSA management position with supervisory responsibili-

ties over other bank examiners in the Chicago office. The

same year that King became a Field Supervisor, a Cauca-

sian named Tom Kaufmann was also promoted from Bank

Examiner III to Field Supervisor. Kaufmann, who was

located in the agency’s Springfield office, had the same

responsibilities as King for banks located in downstate

Illinois. Larry Coleman, who served as the director of the

section, supervised both King and Kaufmann.

Although King and Kaufmann both supervised the work

of approximately 5-7 examiners, the record indicates that

King’s examinations involved larger and more complex

financial institutions. Yet King’s staff examiners were

among the least experienced in the agency and were prone

to higher turnover than their downstate counterparts.

Further, King did not have any clerical or support staff in

Chicago to assist him in reviewing examination reports.

Although he was in a management position, King had to do

all of his own copying, faxing, and typing. Despite these

challenges, King was also appointed by the agency to head

a Y2K compliance effort intended to ensure that the in-

formation systems of regulated financial institutions were

adequately prepared for the new millennium.

According to Coleman’s evaluations, King performed his

job at the highest level. In 1994, Coleman gave King the

best rating possible, commenting on the “phenomenal” job

King had done training new examiners and the “superior”

management skills he had exhibited during his first year in

the Field Supervisor position. Coleman again gave King the

highest possible rating in 1995, noting that King continued

to meet the many challenges of his job in “an exemplary

manner.”

The division underwent a reorganization in 1995 and

Coleman was laid off. Scott Clarke took over Coleman’s du-

ties. Clarke asked Kaufmann, the downstate Field Supervisor,

to assume increasing responsibilities as “acting” Assistant

Director. Clarke did not post this position and did not

10 Nos. 02-3501 & 03-1416

consider King. Although Kaufmann was never formally

appointed to the Assistant Director position, he received a

pay raise in 1996 for doing the job. As part of his increased

responsibilities, Kaufmann conducted King’s performance

evaluation in 1996. King explained that he and Kaufmann

had risen through the ranks together and that Kaufmann

had once said that King should have been named to the

Assistant Director position. In his evaluation, Kaufmann

awarded King the second-highest rating. When asked at

trial for the basis of his rating, Kaufmann stated that

King’s turnaround time on examination reports was longer

than the division standard. However, there is no mention of

turnaround time in Kaufmann’s written evaluation.

According to King, Kaufmann had said that Clarke instructed

him not to give King the highest rating on his evaluation.

Even though Kaufmann and Clarke denied that this occurred,

the jury obviously chose to believe King. Furthermore,

Clarke admitted that Kaufmann came to him after conduct-

ing King’s evaluation to “bounce it off of him.”

In December 1996, Kaufmann announced his resignation.

The agency did not post Kaufmann’s position. Instead, Clarke

promoted a Caucasian named John Turner to fill

Kaufmann’s Field Supervisor position. Turner had been a

Bank Examiner III and had no management or supervisory

experience with the agency. Despite King’s experience in

the Field Supervisor position, Clarke chose to give Turner

the “acting” Assistant Director title that Kaufmann had

assumed. Although Clarke told the jury that he had con-

sidered King for the Assistant Director position, employ-

ment forms produced at the time of Turner’s promotion

stated that Turner “was the only candidate considered.”

King believed that Clarke’s decision to appoint Turner

was motivated by race. On May 7, 1997, King sent a memo

to Clarke, stating that the manner in which Kaufmann and

Turner were selected for the “acting” Assistant Director job

violated the agency’s equal employment policy. Specifically,

Nos. 02-3501 & 03-1416 11

King told Clarke that he (King) should have been “afforded

an opportunity to advance in this Agency just like anyone

else.” King continued: “To deny me this right is Discrimina-

tion, and accordingly, a violation of Section XVI of the

Agency Employee Handbook.” King added that only if all

employees are “allowed to compete for job positions on an

equitable basis . . . can we say that this Agency provides

Equal Employment Opportunity for everyone in the Agency.”

He concluded the memo by informing Clarke that he

wanted to discuss these concerns at their upcoming meeting

regarding King’s 1997 performance evaluation. King never

received a response to his memorandum from anyone at the

agency.

What Clarke did in response to King’s memorandum is

not clear because he gave inconsistent statements at trial.

First, Clarke told the jury that he referred King’s memo to

an Equal Employment Opportunity officer at the agency and

never discussed the memo with King. Clarke then testified

that he met King in Chicago on May 7, 1997, to discuss King’s

performance evaluation. (He thought that the meeting

occurred on May 7, but he could not produce any evidence

to support this assertion.) He claimed that he did not dis-

cuss King’s memo at the performance evaluation because he

had not yet received it. When impeached with his own

deposition testimony asserting that he had discussed the

memo with King at his “subsequent” performance evalua-

tion, Clarke explained that “subsequent” meant King’s per-

formance evaluation in 1998, a full year later. When pressed,

he changed his story again and said that in 1998 he did not

actually discuss King’s May 7 memo but simply addressed

King’s broader concerns about his job. Clarke claims he

completed King’s evaluation form on the following day, May

8, but did not see King’s memo until May 9, when he

returned to his Springfield office.

Apart from these shifting tales, the evidence showed that

Clarke signed the salary adjustment form accompanying

12 Nos. 02-3501 & 03-1416

King’s 1997 performance evaluation on May 8, one day after

King sent his memo. This form indicates that King received

the second-highest rating and that Clarke had recom-

mended a salary increase in the middle of the range

permissible for this rating. Although Clarke was quick to

submit the salary adjustment form, he did not sign King’s

substantive evaluation until June 5, 1997. Unlike the glowing

comments in King’s previous evaluations, the 1997 evalua-

tion observed that King “has at times appeared to be

resistant to change in policies, procedures and techniques.”

Turner resigned from the agency effective May 5, 1998.

Instead of approaching King to take over the position, as he

had done with Kaufmann and Turner, Clarke posted the

Assistant Director position at the SPSA level. Shortly after

seeing the announcement, King sent an e-mail to Clarke,

asking that he be considered for the job. King also asked

Clarke why the position was located in Springfield because

he felt that this would discourage minority applicants from

pursuing the opportunity. King testified that prior to

Clarke’s tenure, the Assistant Director job had been held by

an employee in Chicago. Although King did not tell Clarke

that he was unwilling to move to Springfield, he did voice

concerns about making the move in light of the limited

support he had received from Clarke. Kaufmann, who had

left the agency in 1996, also applied for the Assistant

Director position. A three-person interview panel, which

included Clarke, selected Kaufmann over King.

In his discrimination suit, King alleged that Turner’s pro-

motion in 1997 as “acting” Assistant Director and

Kaufmann’s selection in 1998 as Assistant Director were

based on the impermissible use of race. He also claimed

that Clarke retaliated against him on his 1997 salary ad-

justment for his May 7 memorandum complaining of dis-

crimination. The jury returned a verdict for King on all three

counts, awarding him $100,000 in compensatory damages on

the promotion claim dealing with Turner’s appointment in

Nos. 02-3501 & 03-1416 13

1997, $50,000 on the promotion claim involving Kaufmann’s

selection in 1998, and $150,000 on his 1997 salary adjust-

ment retaliation claim. The district court also awarded King

$4,170 in back pay.

At the end of the plaintiffs’ case, and again at the close of

all evidence, OBRE moved for judgment as a matter of law

pursuant to Federal Rule of Civil Procedure 50(a). The

district court denied both of these motions. Following the

adverse verdict, the district court also denied OBRE’s Rule

59 motion requesting a new trial based on excessive

damages.

II

We review de novo the district court’s decision to deny

OBRE’s motion for judgment as a matter of law, Appelbaum

v. Milwaukee Metro. Sewerage Dist., 340 F.3d 573, 578 (7th

Cir. 2003), and determine only whether any rational jury

could have found for the plaintiffs. Emmel v. Coca-Cola

Bottling Co., 95 F.3d 627, 630 (7th Cir. 1996). Just as we do

with summary judgment decisions, we examine all the

evidence in the record to determine whether a reasonable

jury could have found in favor of Harvey and King. Reeves

v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150

(2000). This process differs from the one used for summary

judgments only insofar as we now know exactly what evi-

dence the jury considered in reaching its verdict. Massey v.

Blue Cross-Blue Shield of Ill., 226 F.3d 922, 924 (7th Cir.

2000). We are required to draw all reasonable inferences in

favor of the nonmoving party, here Harvey and King, and

we do not weigh the evidence or make credibility determina-

tions. Reeves, 530 U.S. at 150; Tart v. Illinois Power Co.,

366 F.3d 461, 472 (7th Cir. 2004). Although we review the

entire record, we disregard all evidence favorable to the

moving party that the jury is not required to believe. Reeves,

530 U.S. at 151. Our job at this stage is not to determine

14 Nos. 02-3501 & 03-1416

whether the jury believed the right people, but only to assure

that it was presented with a legally sufficient basis to

support the verdict. Massey, 226 F.3d at 924. Finally, our

review of the court’s denial of the new trial motion is for

abuse of discretion. Hasham v. Cal. State Bd. of Equaliza-

tion, 200 F.3d 1035, 1052-53 (7th Cir. 2000).

Most of the evidence that Harvey and King presented was

circumstantial in nature, but that fact alone says nothing

about the soundness of the jury’s verdict. See Desert Palace

v. Costa, 539 U.S. 90, 99-100 (2003) (reaffirming the utility

of circumstantial evidence in proving intentional discrimi-

nation). Evidence that tends to show that a defendant’s

explanation for an employment practice is “unworthy of

credence,” Tex. Dep’t of Cmty. Affairs v. Burdine, 450 U.S.

248, 256 (1981); Reeves, 530 U.S. at 147; Massey, 226 F.3d

at 925, is probative of intentional discrimination and indeed

“may be quite persuasive.” Reeves, 530 U.S. at 147.

Notwithstanding these well-established standards, OBRE

has devoted a majority of its brief to the argument that it is

entitled to judgment as a matter of law because Harvey and

King did not meet their prima facie burden under

McDonnell Douglas Corporation v. Green, 411 U.S. 792

(1973). This argument completely misses the mark. After a

full trial, the only pertinent question is whether there was

enough evidence to permit the jury to consider the ultimate

questions of discrimination and retaliation. It is not, as

OBRE argues, an occasion for the court to march back

through the intermediary burden-shifting steps established

by McDonnell Douglas. We instead look to the totality of the

evidence to determine whether the plaintiffs presented

sufficient evidence to support the jury’s determinations that

they were the victims of intentional discrimination and in

King’s case, retaliation. Hall v. Gary Cmty. Sch. Corp., 298

F.3d 672, 675 (7th Cir. 2002) (McDonnell Douglas burden-

shifting framework is “unnecessary when reviewing judg-

ments as a matter of law”); Millbrook v. IBP, Inc., 280 F.3d

Nos. 02-3501 & 03-1416 15

1169, 1174 (7th Cir. 2002) (once a trial is complete, “the

burden-shifting framework of McDonnell Douglas falls

away”); Hasham, 200 F.3d at 1044 (post-trial the

“McDonnell Douglas framework drops out of the analysis”);

Mathur v. Bd. of Trs. of S. Ill. Univ., 207 F.3d 938, 942 (7th

Cir. 2000) (“In reviewing the district court’s grant of

judgment as a matter of law, we do not need to march

through the familiar steps set forth in McDonnell

Douglas . . . .”); Massey, 226 F.3d at 925 (after trial “we

need not tarry on the to’s and fro’s” of the McDonnell

Douglas framework).

A. Harvey

Harvey presented evidence showing that he was perform-

ing his job in an exemplary fashion, and that OBRE

nonetheless demoted him and treated a similarly situated

Caucasian employee named Roger Copley more favorably.

OBRE takes issue with Harvey’s characterization of the

change in his job classification from SPSA to PSA as an

unfavorable action, because his salary and benefits re-

mained unchanged, presumably in order to argue that the

jury could not base a finding of discrimination on an action

with no tangible ill effects. Nonetheless, the jury was not

compelled to view the reclassification in this light. Even a

lateral transfer with no loss in pay or benefits may, in cer-

tain circumstances, qualify as a materially adverse employ-

ment action. Collins v. State of Ill., 830 F.2d 692, 702 & n.7

(7th Cir. 1987) (collecting cases). Further, there was ample

evidence before the jury supporting the conclusion that

reclassification from a SPSA to PSA could only be charac-

terized as a demotion. An OBRE official conceded at trial

that it is “unusual” for a person who holds an SPSA job to

be reclassified to the lower PSA designation. In its ruling

denying OBRE’s motion for a new trial, the district court

noted that several Caucasian OBRE employees testified

16 Nos. 02-3501 & 03-1416

that they would be “far from indifferent about being

relegated to the lower PSA classification.”

In response to Harvey’s charge that the demotion could be

explained only by racial discrimination, OBRE offered the

jury four alternative nondiscriminatory possibilities. It first

argued that Harvey was reclassified based on the rec-

ommendation of Drazek, the external consultant retained

by Commissioner Schaffer to improve agency operations.

Second, it claimed that CMS (the state agency authorized

with assuring that job classifications conform to the

Personnel Code) had suggested that Harvey’s position was

more appropriately classified at the PSA level. Third, it

asserted that Commissioner Schaffer relied on his own

knowledge and experience to conclude that Harvey’s job

duties did not reach the level of an SPSA. Finally, it said

that Harvey was demoted because his job did not contain

the “major administrative” or “policy-making” responsibil-

ities required by state regulations for SPSA positions. But

at this stage, we can upset the jury’s verdict only if it was

compelled to accept one of those possibilities instead of the

racial discrimination explanation it chose to believe.

Even if another jury might have accepted one or more of

OBRE’s theories, there is ample evidence in the record to

support this jury’s rejection of them. Harvey presented evi-

dence that Drazek did not recommend reclassification of his

job; that CMS never undertook a review of his position to

determine if it was properly classified; and that Harvey was

in fact performing SPSA-level responsibilities at the time he

was demoted. The evidence also showed that Commissioner

Schaffer decided to retain Copley (the Caucasian employee)

in an SPSA position even though Copley held the same title

as Harvey and performed similar job responsibilities. The

jury was free to interpret this evidence as an indication that

neither OBRE nor CMS thought that Harvey’s job title and

responsibilities warranted only a PSA classification.

Nos. 02-3501 & 03-1416 17

The first of OBRE’s four reasons for demoting Harvey is

that Drazek recommended the reclassification. Before this

court, OBRE asserted that Drazek was asked to “make sure

[the agency] was in compliance with CMS rules and require-

ments.” The RFP issued by Schaffer, however, makes no

mention of CMS nor does it indicate that the outside con-

sultant would have authority to change statutorily defined

job classifications. Further, Drazek’s response to the RFP

does not list job reclassification as part of his proposed work

for OBRE. The memorandum issued by Schaffer announc-

ing Drazek’s recommendations does not indicate that

Harvey’s job was to be reclassified from the SPSA level, and

Harvey asserts that he was never told that he would be

reclassified based on Drazek’s recommendation.

The only indication in the Drazek report that Harvey

should be demoted from SPSA to PSA is an undated,

unnumbered organizational chart suspiciously appended to

the text of the report. Individuals at Harvey’s level in other

divisions of the agency are given SPSA designations.

Indeed, Harvey is the only person in the management level

of the agency with a PSA classification. In an organizational

chart dated July 1, 1997, however, which was prepared a

full two and a half years after the Drazek report was

complete and after Harvey’s four-year term appointment

expired, Harvey’s position is labeled as an SPSA. Without

making too much of the agency’s organizational charts, we

reemphasize the central point—Drazek’s report makes no

mention of job classifications of any kind, let alone a

recommendation that Harvey should be demoted from SPSA

to PSA. The job description that Drazek provided for

Harvey’s new post encompassed SPSA policy-making and

administrative responsibilities. In the face of this evidence,

there is no way to claim that the jury had to accept OBRE’s

contention that it demoted Harvey based on the Drazek

report. More than that, the jury was entitled to view this

baseless explanation as circumstantial evidence of inten-

18 Nos. 02-3501 & 03-1416

tional discrimination. Koski v. Standex Int’l. Corp., 307 F.3d

672, 677 (7th Cir. 2002); Reeves, 530 U.S. at 147 (stating

that the jury can infer discrimination from the falsity of the

employer’s explanation).

The jury was also entitled to take into account the timing

of the issuance of Drazek’s report and the reclassification of

Harvey’s position. The report can help OBRE only if it

honestly motivated the agency’s decision at the time of

Harvey’s demotion. Paluck v. Gooding Rubber Co., 221 F.3d

1003, 1015 (7th Cir. 2000); Michas v. Health Cost Controls of

Ill., Inc., 209 F.3d 687, 695 (7th Cir. 2000); Cullen v. Olin

Corp., 195 F.3d 317, 324 (7th Cir. 1999), cert. denied, 529 U.S.

1020 (2000); Jackson v. E.J. Brach Corp., 176 F.3d 971, 985

(7th Cir. 1999). Drazek issued a draft of his report in 1994,

but Harvey’s position was not reclassified until August

1997. At trial, OBRE officials stated that Harvey could have

been reclassified at any time during his four-year term.

Maybe so. But when the agency issued a memorandum in

1995 announcing the changes recommended by Drazek, it

did not explain that Harvey’s job had been reclassified and

no one in the agency told Harvey that he was being de-

moted to a PSA based on Drazek’s recommendation. The

jury was entitled to draw an adverse inference from the

agency’s effort to claim that its decision to reclassify Harvey

in 1997 was motivated by the three-year-old Drazek report.

The second reason that OBRE gave for its decision to

demote Harvey was that CMS recommended reclassifica-

tion. On the very last day of the four-week trial in this case,

Assistant Commissioner Thompson, who heads the OBRE’s

Bureau of Administration, testified that he met with two

CMS employees to review organizational charts in prepara-

tion for the 1996 agency merger. According to Thompson,

the CMS employees looked at the organizational charts and

observed that Harvey’s position “came up as an exception”

because Harvey did not have subordinates reporting to him.

They suggested that the position was probably more

Nos. 02-3501 & 03-1416 19

appropriate for the PSA classification. OBRE is pinning its

argument on this casual observation. It is undisputed that

CMS did not undertake a full review of Harvey’s position

prior to reclassification, as it is required to do under the

regulations. See ILL. ADMIN. CODE tit. 80, § 301.20. Further,

no documentation of the meeting between Thompson and

the CMS employees was ever produced in this litigation,

Thompson never spoke to anyone else at the agency about

any such meeting, and CMS itself took no action in re-

sponse to it. OBRE did not mention Thompson’s discussion

with CMS until the last day of trial and the agency did not

identify the CMS employees as potential witnesses. The

jury was entitled to view this last-minute and half-baked

account as a post-hoc explanation “designed to obscure”

unlawful behavior. Emmel, 95 F.3d at 629; Perfetti v. First

Nat. Bank of Chi., 950 F.2d 449, 456 (7th Cir. 1991).

Third, OBRE claims that Commissioner Schaffer decided

to reclassify Harvey based on his own knowledge and

experience. On direct examination, Schaffer was explicitly

asked about what drove his decision to reclassify Harvey.

He gave the puzzling answer that he “didn’t want [Harvey]

to get a pay cut.” Schaffer did not, however, consider de-

moting Copley. Copley had joined the agency at approxi-

mately the same time as Harvey, and had the corresponding

title and responsibilities for the division that regulated

savings and loan entities. Stevenson explained that OBRE

did not change Copley’s classification from SPSA to PSA

because Copley’s salary was “too high”—Copley was earning

$96,000, while Harvey was earning $58,248. This is hardly

evidence that shows a nondiscriminatory environment, and

there was ample evidence before the jury to show that the

two men held precisely comparable jobs.

Finally, OBRE contends that Harvey was demoted be-

cause his job did not involve the “major administrative” or

“policy-making” responsibilities required of SPSA positions.

Again, the testimonial and documentary evidence belies

20 Nos. 02-3501 & 03-1416

this justification. Prior to her promotion as Director,

Brennan held the Manager of Supervision job as an SPSA

term appointee. She testified that her responsibilities were

“identical” to Harvey’s and that she also did not have any

direct reports in that position. The job description provided

by Drazek specifically included SPSA responsibilities and

trial testimony demonstrated that Harvey was indeed

performing the management responsibilities contemplated

by the position.

The Supreme Court has explained that the employer is in

the best position to provide the actual reason for its decision

and when it has failed to do so, “discrimination may well be

the most likely alternative explanation.” Reeves, 530 U.S. at

147. As the Court observed in Furnco Construction Corpora-

tion v. Waters, 438 U.S. 567 (1978), “when all legitimate

reasons for rejecting an applicant have been eliminated as

possible reasons for the employer’s actions, it is more likely

than not the employer, who we generally assume acts only

with some reason, based his decision on an impermiss-

ible consideration such as race.” Id. at 577. We conclude

that OBRE’s failure to produce evidence supporting its

reasons for demoting Harvey entitled the jury to disregard

these justifications as unworthy of belief.

The only hope remaining for OBRE lies in the Supreme

Court’s suggestion in Reeves that judgment as a matter of

law may not be appropriate “if the plaintiff created only a

weak issue of fact as to whether the employer’s reason was

untrue and there was abundant and uncontroverted inde-

pendent evidence that no discrimination had occurred.” 530

U.S. at 148. This is not such a case. Harvey introduced

credible evidence to suggest that his supervisor made de-

rogatory remarks about African-Americans and that she

had a personal vendetta against Harvey that he believed

was motivated by race. Nearly every high ranking official at

the agency knew that Harvey believed he was being treated

less favorably because he was African-American, yet no

Nos. 02-3501 & 03-1416 21

investigation of any kind was ever initiated. When Harvey

was finally told about the demotion, he was sitting in a

church pew listening to Stevenson tell him that the demo-

tion was not a “racial act.” At no point in this conversation

did Stevenson offer Harvey any legitimate reason for the

agency’s action. Relying on this evidence, the jury was

entitled to infer that OBRE’s decision was in fact motivated

by racial animus. For all of these reasons, the district court

correctly denied OBRE’s motions for judgment as a matter

of law in Harvey’s case.

B. King

We now turn to the evidence supporting the jury’s verdict

in favor of King on his promotion and retaliation claims.

OBRE relies on our decision in Millbrook v. IBP, Inc., 280

F.3d 1169 (7th Cir. 2002), to argue that King cannot show

pretext because Clarke selected the person he felt was most

qualified for the job. (We ignore its use of the word “pretext”

and consider this argument as one urging that the evidence

was so one-sided in its favor that the question of discrimina-

tion should not have gone to the jury.) Millbrook held that,

when an employer asserts that it chose an applicant instead

of the plaintiff because the selected candidate was more

qualified, “evidence of the applicants’ competing qualifica-

tions does not constitute evidence of pretext unless those

differences are so favorable to the plaintiff that there can be

no dispute among reasonable persons of impartial judgment

that the plaintiff was clearly better qualified for the

position at issue.” 280 F.3d at 1180 (citation and internal

quotation marks omitted). OBRE’s reliance on Millbrook is

misplaced for at least two reasons.

First, the plaintiff in Millbrook failed to identify any evi-

dence calling into question the veracity of the employer’s

reason for its decision. Id. at 1183. We recently emphasized

that nothing in Millbrook forecloses a comparison of

22 Nos. 02-3501 & 03-1416

qualifications where the employer offers conflicting expla-

nations for its employment decision. David v. Caterpillar,

Inc., 324 F.3d 851, 862 (7th Cir. 2003). At trial, Clarke told

the jury that he considered King for the “acting” Assistant

Director position but ultimately selected Turner. The evidence

in the record, however, contradicted Clarke’s testimony by

showing that Turner was the “only candidate considered.”

Clarke claimed that Turner was more qualified for the job

because he had a Certified Information Systems Auditor

(CISA) credential, which King did not. Clarke conceded, how-

ever, that the CISA was not required for the job. Finally,

Clarke testified that he promoted Turner over King because

Turner had better computer skills. Yet, Clarke admitted

that King had the computer skills necessary to assess the

information technology systems of Chicago’s most sophisti-

cated financial institutions and to head the agency’s Y2K

efforts.

Because Clarke’s testimony was impeached and because

his explanations were not supported by other evidence in

the record, the jury could reasonably have come to the con-

clusion that Clarke did not honestly believe Turner to be

the most qualified candidate. David, 324 F.3d at 862; see

also Emmel, 95 F.3d at 633-34 (“The defendants are off base

in arguing that because the testimony of their officers . . .

was not contradicted directly, the jury had to accept it. The

jury may have thought them liars. It is the prerogative of a

jury or other trier of fact to disbelieve uncontradicted

testimony unless other evidence shows that the testimony

must be true.”) (quoting EEOC v. G-K-G, Inc., 39 F.3d 740,

746 (7th Cir. 1994)). When a plaintiff offers specific evi-

dence from which the jury may reasonably infer that the

proffered reasons are not truthful, the case turns on the

credibility of the witnesses. Collier v. Budd Co., 66 F.3d

886, 893 (7th Cir. 1995). In reviewing a Rule 50 motion, we

will not second-guess a jury on credibility issues. It was the

jury’s prerogative to disbelieve Clark’s testimony and we

have no basis to question its decision.

Nos. 02-3501 & 03-1416 23

OBRE’s reliance on Millbrook is troubling for a second

reason. Turner had not only been promoted over King.

Turner had leapfrogged over King by moving from a Bank

Examiner III to the acting Assistant Director position. King

had served as a Field Supervisor since 1993 while Turner

worked in a non-management position as a bank examiner.

This is quite different from the Millbrook scenario. Here,

with people of such disparate qualifications, a comparison

of the two standing alone would be sufficient to support the

jury’s verdict. While there certainly may be reasons for an

employer to catapult a lower-level Caucasian employee over a

higher-ranked African-American employee, this type of

promotion would call for a more searching inquiry into the

comparable qualifications of the candidates than the one

required in the Millbrook situation. We need not undertake

this inquiry here, however, given the wealth of evidence

King presented that permitted the jury to disbelieve

OBRE’s explanations for Turner’s promotion.

With respect to Kaufmann’s selection as the Assistant

Director in 1998, King again presented sufficient evidence

for the jury to infer discrimination. At trial, Clarke testified

that King was qualified for the Assistant Director position.

On appeal, OBRE argues that King was not promoted

because he wavered about relocating to Springfield. But

nowhere in the record is there evidence that King flatly

refused to make such a move. Furthermore, King’s hesita-

tion to relocate cannot be viewed in isolation. Recall King’s

testimony that the Assistant Director prior to Clarke’s tenure

was based in Chicago. The jury might have thought that the

agency would be flexible about the official duty station of a

Caucasian, but not of an African-American. In addition,

King had told Clarke that he believed that the agency was

discouraging minority applicants by basing the job in

Springfield. King expressed concerns about moving to

Springfield because of the lack of support he had received

from Clarke in the past. Under all the circumstances, the

24 Nos. 02-3501 & 03-1416

jury was entitled to conclude that geography had nothing to

do with OBRE’s choice of Kaufmann over King, and that the

reason was once again racial discrimination.

Finally, the jury found that King had been retaliated

against on his 1997 performance evaluation. The protected

conduct that forms the basis of this claim is the memo-

randum King sent to Clarke on May 7 alleging that the

agency’s promotion practices were discriminatory. The

following day, Clarke gave King a lower salary adjustment,

which contrasted dramatically with King’s earlier record of

receiving the highest amounts possible.

At trial, Clarke’s testimony on this claim raised substan-

tial credibility questions. As our earlier discussion illus-

trates, his explanation of what happened in response to King’s

memorandum is riddled with contradictory or unsupported

statements. He changed his story at least three times and

was impeached with prior inconsistent statements. His

“failure to express consistent explanations at trial or dep-

osition could compel a jury to find that his proffered reasons

. . . were pretextual for something much more invidious.”

Hasham, 200 F.3d at 1047.

Once again, we find that there was substantial evidence

supporting the jury’s determination on King’s retaliation

claim. As we explained in another case dealing with a Rule

50 motion: “The relevant facts were fully aired before the

jury, and it fell to the jury to sort out which side’s version

was more likely true. . . . The jury in this case resolved the

credibility questions and competing inferences posed by the

trial evidence in [the plaintiff’s] favor, and we have no

reason to disturb its assessment of the facts.” Appelbaum,

340 F.3d at 581. The district court’s denial of OBRE’s mo-

tion for judgment as a matter of law on King’s three claims

was also correct.

Nos. 02-3501 & 03-1416 25

III

OBRE also argues that even if it is not entitled to judg-

ment as a matter of law, the district court nonetheless

should have ordered a new trial on damages, because the

jury’s verdicts were excessive. We review the district court’s

refusal to grant a new trial on the grounds of excessive

damages for an abuse of discretion. Tullis v. Townley Eng’g

& Mfg. Co., Inc., 243 F.3d 1058, 1066 (7th Cir. 2001). We

have typically looked at three factors when we review

compensatory damages awards: (1) whether the award is

monstrously excessive; (2) whether there is no rational

connection between the award and the evidence; and (3)

whether the award is roughly comparable to awards made

in similar cases. Lampley v. Onyx Acceptance Corp., 340

F.3d 478, 483-84 (7th Cir. 2003) (citing EEOC v. AIC Sec.

Investigations, Ltd., 55 F.3d 1276, 1285 (7th Cir. 1995)). In

AIC Security, we acknowledged that the “monstrously ex-

cessive” inquiry is a vague one that may simply be another

way of asking whether there is a rational connection be-

tween the award and the evidence. Id. at 1285 n.13.

In this case, the jury heard detailed and specific testi-

mony from several witnesses about how OBRE’s conduct

affected Harvey and King. Harvey testified to stomach

problems and other physical ailments that he claims arose

from his discriminatory treatment at work. The jury heard

that Harvey suffered from depression and sought counsel-

ing. Harvey’s co-workers told the jury how frustrated and

upset Harvey became on numerous occasions as a result of

the agency’s actions. The record contains many examples of

the humiliation that Harvey suffered at the hands of his

superiors. Brennan required Harvey to keep his door open

at work, even though he occupied a high level management

position. When Harvey came into the office over the week-

end on one occasion, Brennan asked Assistant Commissioner

McAuliffe to review the entry log and security cameras

because she was worried that Harvey had been in her office.

26 Nos. 02-3501 & 03-1416

McAuliffe determined that Harvey had followed proper

procedures for entering the building after hours and

conceded that Brennan’s request was “out of bounds of

normal business conduct.” Copley was “shocked” to learn

that Harvey made nearly $30,000 less than he did because

Harvey had been at the agency longer and had done

essentially the same jobs. Copley told the jury that he and

Harvey both were given the toughest assignments in the

agency and that he learned a great deal from working with

Harvey over the years.

King likewise testified to a series of continuing mental

and physical ailments arising from his problems at work,

including depression. He began taking medication for high

blood pressure in 1995, the same time Clarke became his

supervisor. King’s brother testified that King began to

behave unusually because of the stress he was experiencing

at work. He suffered some memory loss and kept more to

himself than he had in the past. King’s family began to

bring him meals. Further, King constantly complained to

his family of his frustration at being passed over for

promotions that he believed he deserved. In his testimony,

King recounted how the discriminatory actions by OBRE

had severely affected his motivation: “I spend a lot of hours,

I work a lot of overtime, although I don’t get paid for it. And

this makes you wonder, is it worth it after going through

these same circumstances.” Based on the evidence, the jury

could have reasonably concluded that awards in the range

of $50,000 to $150,000 were necessary to compensate

Harvey and King.

We note that these damages awards are not out of line

with other Title VII cases in this circuit. See Tullis, 243

F.3d at 1067-68 (upholding $80,000 in damages for emo-

tional distress where plaintiff felt “degraded” and “back-

stabbed” by the employer). As we observed in Lampley,

“[a]wards in other cases provide a reference point that as-

sists the court in assessing reasonableness; they do not

Nos. 02-3501 & 03-1416 27

establish a range beyond which awards are necessarily

excessive. Due to the highly fact-specific nature of Title VII

cases, such comparisons are rarely dispositive.” 340 F.3d at

485.

Finally, the district court awarded Harvey $30,000 in

backpay, stating that this amount “is a modest estimate of

the salary loss that Mr. Harvey suffered because of the

discrimination that the jury found directed against him.”

The district court kept the amount this low because it was

reluctant to take an action that would effectively reclassify

Harvey as an SPSA or lift the salary cap on his PSA po-

sition. The record reveals that the district court carefully

considered OBRE’s objections to the damages awards and

decided to reject them in light of the overwhelming evidence

presented at trial. We find no abuse of discretion in the

court’s rulings. “It is within the jury’s province to evaluate

the credibility of witnesses who testify to emotional dis-

tress, and we shall not disturb those credibility determina-

tions on appeal.” Bruso v. United Airlines, Inc., 239 F.3d

848, 857 (7th Cir. 2001). The jury was able to observe

testimony regarding the harm Harvey and King endured

and found this testimony to be sufficient to convince them

that the plaintiffs merited the awards.

IV

For these reasons, we AFFIRM the judgment of the district

court.

A true Copy:

Teste:

________________________________

Clerk of the United States Court of

Appeals for the Seventh Circuit

USCA-02-C-0072—7-26-04