Anthony C. Mathis v. Phillips Chevrolet, Inc.

In the
United States Court of Appeals
For the Seventh Circuit
No. 00-1892
Anthony C. Mathis,
Plaintiff-Appellee,
v.
Phillips Chevrolet, Inc.,
Defendant-Appellant.
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 97 C 2723--Warren K. Urbom, Judge./*
Argued December 4, 2000--Decided October 15, 2001
Before Flaum, Chief Judge, and Diane P.
Wood and Williams, Circuit Judges.
Diane P. Wood, Circuit Judge. Anthony
Mathis is a 59-year-old African-American
man with over 24 years of experience in
car sales. Notwithstanding that
background, when he applied for a job as
a salesman at Phillips Chevrolet, Inc.
("Phillips"), Phillips never even
interviewed him. Instead, it hired seven
younger, white salespeople--a move that
prompted Mathis to sue the dealership for
age and race discrimination. A jury found
for Phillips on the race discrimination
claim, but it found for Mathis on the age
discrimination claim and awarded him
$50,000 in compensatory damages. The jury
also found that the dealership’s
violation of the Age Discrimination in
Employment Act, 29 U.S.C. sec. 621 et
seq., was willful, and so the trial court
assessed an additional $50,000 in
liquidated damages. Phillips has
appealed, arguing that the district court
erred in excluding certain evidence and
that the evidence did not justify sending
the question of willfulness to the jury.
We affirm the judgment of the district
court.
I
According to Mathis’s trial testimony,
in May 1996, Mathis applied for a sales
job at Phillips Chevrolet in response to

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a newspaper ad. No one at Phillips was
available to interview him at the time he
applied, and so he left his application
with the cashier. A few weeks later he
returned, not having heard from Phillips,
and left a second application with the
cashier. The application form asked for
the date of his discharge from the
military; Mathis indicated that he was
discharged in May 1959. Mathis’s theory
at trial was that this information
alerted Phillips to the fact that he was
well over 40 years old. Phillips never
interviewed Mathis for the sales
position, but after he applied, it hired
seven new salespeople, all younger than
Mathis.
Although Phillips’s managers testified
that they never received Mathis’s
application, the jury did not believe
them. Furthermore, Mathis presented
evidence that suggested the managers were
disposed to discriminate on the basis of
age. Mathis established at trial that
Jamie Pascarella, the general manager of
Phillips and the person with
ultimatehiring authority at the
dealership, often noted the ages of
employment applicants by hand on their
applications, in a section of the
application that he admittedly used to
make notes of information he considered
relevant to his hiring decision.
Pascarella testified that he was not
aware that it was illegal to consider age
in making hiring decisions. A second
Phillips manager, Henry Rhodes, admitted
at trial that he looked for applicants
who were "bright, young, and aggressive."
Phillips’s basic point on appeal is that
the jury’s credibility determination was
made on incomplete evidence, because of a
key evidentiary ruling the district court
made before the trial. Phillips had
vigorously denied that it had ever
received Mathis’s application. Several
Phillips managers who were involved in
the hiring process testified that if they
had seen Mathis’s application, they would
have interviewed him. Phillips’s theory
of the case was that either Mathis was
lying about having dropped off
applications with a Phillips cashier, or,
if Mathis was not lying, then the
applications had somehow been misplaced
before anyone with hiring authority saw
them.

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In order to bolster its theory, Phillips
tried to introduce evidence that Mathis
had sued at least six other car
dealerships for discrimination after they
failed to hire him during roughly the
same time period as his application to
Phillips. According to an offer of proof
Phillips made just before the trial
began, there were significant
irregularities in Mathis’s applications
at these other dealerships. In one case,
when the dealership offered Mathis an
interview, Mathis left and never
returned. In three other cases, the
dealership alleged that Mathis filled out
an application but took it home with him
and never submitted it. In other cases
Mathis lied on his applications.
According to Phillips, although Mathis
had worked as a car salesman for many
years, his career had deteriorated in
recent years. In the late 1980’s and
early 1990’s, Mathis’s sales had
diminished considerably, and he had
become increasingly belligerent and even
violent towards co-workers. His last
several jobs had been short-lived, and
none of his former employers was willing
to act as a reference.
It was Phillips’s theory that Mathis
blamed his misfortunes on a conspiracy
among Chicago-area car dealerships and
that, as a result, Mathis had set out to
harass members of the Chicago Automobile
Trade Association by manufacturing false
discrimination claims against them. As
part of his plan, Phillips argued, Mathis
took a Phillips application home and
filled it out, but never returned the
completed application to Phillips. After
several weeks, he filed this
discrimination claim, using a copy of the
supposed application as evidence that he
applied to Phillips but was not
interviewed. Phillips sought to introduce
evidence of Mathis’s improper
applications and ensuing lawsuits against
other dealerships to show that the
supposed applications to Phillips were
part of Mathis’s plan or scheme to attack
car dealerships.
In response to Phillips’s pretrial offer
of proof and Mathis’s motion in limine to
exclude this evidence, the district court
found that Phillips’s evidence of the
other lawsuits seemed to be merely "an
effort to show bad character on the part
of the plaintiff." Noting that the

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parties were not there to judge Mathis’s
motive for filing the lawsuit, the court
held that the evidence would not be
admitted to show that Mathis was
litigious or that he had a "campaign
against car dealerships," although the
court did allow Phillips to introduce the
lies on Mathis’s other applications for
the purpose of attacking his credibility
on cross-examination. After the judge’s
pre-trial ruling, Phillips did not offer
(or try to offer) any evidence of the
prior lawsuits during the trial. After a
three-day trial, the jury found for
Mathis on his age discrimination claim
and awarded $50,000 in compensatory
damages. In answers to special
interrogatories, the jury found that
Mathis had applied to Phillips and that
Phillips’s violation of the ADEA was
willful.
II
Phillips’s primary argument on appeal is
that the district court erred in
excluding the evidence of Mathis’s
lawsuits against other car dealerships.
As an initial matter, we must determine
whether Phillips properly preserved this
issue for appeal. Although Phillips
brought its evidence of Mathis’s other
lawsuits to the attention of the court in
various pre-trial motions, it did not
seek to introduce the evidence at trial.
In Wilson v. Williams, 182 F.3d 562, 565-
67 (7th Cir. 1999) (en banc), we held
that, although a district court judge’s
"definitive" pre-trial ruling on the
admissibility of evidence adequately
preserves the issue for appeal, if the
district court indicates that a final
ruling must await developments at trial,
then the party must offer the evidence at
trial in order to preserve the issue for
appeal. Following that holding, Mathis
argues that the district court in this
case never made a definitive pre-trial
ruling on the admissibility of testimony
about his applications to and lawsuits
against other car dealerships. It is true
that the district court’s first pre-trial
ruling on this question denied Mathis’s
motion in limine to exclude the evidence.
At that time, the district court ordered
that specific rulings on the
admissibility of the evidence would have
to await an offer of proof at trial. If
this were all that had happened, we would
agree with Mathis that the district court

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never made a definitive ruling on the
admissibility of Phillips’s proffered
evidence.
Other indicia, however, point to the
conclusion that the district court had
made up its mind not to admit the
evidence--at least not for the purposes
for which Phillips wanted it admitted.
Even in its order denying Mathis’s motion
in limine, the district court stated that
"[i]f the proposed evidence is designed
primarily to show that the plaintiff is a
litigious person or has a campaign
against car dealerships, I shall forbid
the use of that testimony." Phillips
raised this potential use for the
evidence again on the morning of the
trial by presenting the district court
with a lengthy offer of proof detailing
the evidence and stating Phillips’s
belief that it was admissible as evidence
of "plaintiff’s intent, motive, scheme,
plan, design, bias, and motivation for
attacking the automobile industry." In
ruling on this portion of the offer of
proof, the district court stated: "[I]t
gives every impression of being an effort
to show bad character on the part of the
plaintiff. And the rules clearly
specifically prohibit that. . . .
Although [defense counsel] argues that
Phillips Chevrolet is just one in a long
line of victims, that’s not sufficient to
bring into evidence." At the same time,
the district court ruled that the
evidence could come in for other
purposes, such as to attack
Mathis’scredibility, and Phillips did
introduce some of it for that purpose.
When the district court’s rulings are
considered together, it is clear that the
court ruled definitively that Phillips
would not be permitted to introduce
evidence of Mathis’s other applications
and lawsuits to demonstrate a plan or
scheme to harass car dealerships. This is
the only use of the evidence that
Phillips addresses in this appeal, and we
find that the issue was adequately
preserved.
We therefore turn to the merits of
Phillips’s appeal. Under Rule 404(b),
evidence of Mathis’s applications to and
lawsuits against other dealerships would
not have been admissible to show Mathis’s
propensity to file discrimination
lawsuits or to suggest that, because
Mathis had lied about applications in the

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past, he was likely to be doing so in
this case. Nonetheless, such evidence may
have been admissible for other purposes,
such as proof of a plan, scheme, or modus
operandi. Fed. R. Evid. 404(b). This cir
cuit has developed a four-part test to
determine whether evidence of prior acts
is admissible: "(1) the evidence must be
directed toward establishing something at
issue other than a party’s propensity to
commit the act charged; (2) the other act
must be similar enough and close enough
in time to be relevant to the matter at
issue; (3) the evidence must be such that
the jury could find that the act occurred
and the party in question committed it;
and (4) the prejudicial effect of the
evidence must not substantially outweigh
its probative value." Gastineau v. Fleet
Mortgage Co., 137 F.3d 490, 494-95 (7th
Cir. 1998). In this case, the pattern of
Mathis’s false applications to the other
dealerships was very similar to what
Phillips alleged occurred in this case,
and the other applications and suits all
occurred around the same time as Mathis’s
application to and suit against Phillips.
Therefore, Phillips’s proffered evidence
satisfied the second prong of the test.
The district court found that Phillips’s
proffered evidence was not relevant to
establish anything other than Mathis’s
propensity to file possibly false
lawsuits and that, even if the evidence
did have some marginal relevance, its
probative value was outweighed by the
danger of unfair prejudice inherent in a
charge of litigiousness. We review the
district court’s decision to exclude the
evidence for abuse of discretion, giving
great deference to the district court’s
balancing of the probative value of the
evidence against its possible prejudice.
Gastineau, 137 F.3d at 495.
Bearing these standards in mind, to the
extent the district court ruled that the
evidence of Mathis’s prior lawsuits was
not relevant to show anything other than
a propensity to file baseless
discrimination suits, we cannot agree
with the district court’s assessment.
Although evidence of Mathis’s other
lawsuits could have been used for the
forbidden purpose of suggesting that
because Mathis had filed frivolous
discrimination claims in the past, he was
likely doing so again in this case, it
could also have been used (with a proper
limiting instruction) to show that Mathis

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was engaged in a plan or scheme to harass
Chicago-area car dealerships, and that
his methods or modus operandi in the
prior suits were very similar to the
approach he employed in this case.
But the district court’s finding was not
only that the relevance of the evidence
was questionable, but also that any
relevance the evidence had was outweighed
by the prejudice the evidence would cause
Mathis. The district court’s concern was
a reasonable one. As the Second Circuit
has noted, "a plaintiff’s litigiousness
may have some slight probative value, but
that value is outweighed by the
substantial danger of jury bias against
the chronic litigant." Outley v. City of
New York, 837 F.2d 587, 592 (2d Cir.
1988); accord Gastineau, 137 F.3d at 496.
Although both the Second Circuit in
Outley and this court in Gastineau
recognized that the danger of unfair
prejudice from a charge of litigiousness
might be minimized if the defendant could
show that the plaintiff had a history not
merely of filing numerous lawsuits, but
of filing fraudulent ones, see Gastineau,
137 F.3d at 496; Outley, 837 F.2d at 592,
the merits of Mathis’s prior suits were
contested here. Managers from the other
dealerships would have testified that
Mathis fabricated the prior claims, but
Mathis disputed those allegations, and
the district court was understandably
reluctant to plunge into a series of
mini-trials on the merits of each of the
prior suits. Ultimately, the district
court was faced with an offer of evidence
that had some permissible uses but that
could also have given rise to the
impermissible inference that, because
Mathis was given to filing frivolous
lawsuits, the jury should not credit his
claims in this suit. When "the same
evidence has legitimate and forbidden
uses, when the introduction is valuable
yet dangerous," the district court has
great discretion in determining whether
to admit the evidence. United States v.
Beasley, 809 F.2d 1273, 1278 (7th Cir.
1987). The district court acted within
the scope of that discretion, and we will
not disturb its judgment.
III
Phillips also contends that, even if the
jury properly awarded compensatory
damages against it, the evidence was

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insufficient to support the jury’s
determination that its violation of the
ADEA was willful, and thus the district
court should not have assessed liquidated
damages. It made that point before the
district court in a motion for judgment
as a matter of law on the issue of
willfulness, which the court denied. We
will reverse that decision only if the
evidence presented at trial, combined
with all reasonable inferences that may
be drawn from it and viewed in the light
most favorable to Mathis, was
insufficient to support the jury’s
determination. Molnar v. United Tech.
Otis Elevator, 37 F.3d 335, 337 (7th Cir.
1994).
Under the ADEA, courts are required to
assess liquidated damages in the same
amount as the compensatory damages if the
employer’s violation of the statute was
"willful." 29 U.S.C. sec. 626(b). A
violation is considered "willful" if "the
employer knew or showed reckless
disregard for the matter of whether its
conduct was prohibited by the ADEA."
Hazen Paper Co. v. Biggins, 507 U.S. 604,
614 (1993), cited with approval in
Kolstad v. American Dental Ass’n, 527
U.S. 526, 537 (1999) (applying similar
standard for punitive damages under Title
VII). Once a plaintiff demonstrates that
the employer’s conduct was willful, the
plaintiff need not additionally show that
the employer’s conduct was outrageous, or
provide direct evidence of the employer’s
motivation. Hazen Paper, 507 U.S. at 617.
A defendant’s negligent mistake
concerning the lawfulness of her conduct
does not suffice to make that conduct
"willful," but a reckless mistake, in the
criminal law sense of indifference to
whether the conduct violates the law,
does. Price v. Marshall Erdman & Assoc.,
966 F.2d 320, 324 (7th Cir. 1992).
Phillips makes several arguments why its
conduct in this case should not have been
considered willful. The problem is that
many of these arguments are nothing more
than a renewed attack on the finding that
Phillips violated the ADEA in the first
place, rather than reasons for rejecting
the finding that the established
violation was willful. For example,
Phillips argues that, even assuming
Mathis dropped off the application as he
said he did, there was no direct evidence
that anyone with hiring authority

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atPhillips ever saw it. But this went to
the question of whether anyone at
Phillips ever made a conscious decision
not to interview Mathis because of
Mathis’s age; the jury necessarily
decided that it did make such a decision
when it found Phillips liable. Phillips
has not challenged the sufficiency of the
evidence that it violated the ADEA, and
so it has conceded that the jury
reasonably could have found that someone
at Phillips saw the application and
decided not to interview Mathis.
Similarly, Phillips argues that the jury
could not have found that its violation
of the ADEA was willful because Mathis
could not show which manager at Phillips
made the decision not to interview
Mathis. As the Court in Hazen Paper made
clear, however, the jury was free to
infer willfulness from the circumstances
of the case. Mathis was not required to
provide direct evidence of discriminatory
intent. Hazen Paper, 507 U.S. at 617.
With its violation of the ADEA
unchallenged, Phillips offers very little
reason to suggest that the violation was
not willful. Phillips never raised any
suggestion that, if it did have a
discriminatory policy, the policy was
justified because the age requirement was
a bona fide occupational qualification or
fell under a statutory exception to the
ADEA. Compare Hazen Paper, 507 U.S. at
616. Phillips’s general manager did
testify that he was not aware that it was
illegal to discriminate on the basis of
age, but as this circuit has held,
leaving managers with hiring authority in
ignorance of the basic features of the
discrimination laws is an "extraordinary
mistake" for a company to make, and a
jury can find that such an extraordinary
mistake amounts to reckless indifference.
See Price, 966 F.2d at 323-24. Finally,
Phillips notes that its employment
applications stated that the ADEA
"prohibits discrimination on the basis of
age with respect to individuals who are
at least 40 years of age" and argues that
this boilerplate proves Phillips made a
good-faith attempt to comply with the
ADEA. However, this evidence appears more
harmful to Phillips than helpful, because
the jury could easily have concluded that
printing this statement on the
application but then making no effort to
train hiring managers about the ADEA
shows that Phillips knew what the law

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required but was indifferent to whether
its managers followed that law.
For the foregoing reasons, the judgment
of the district court is Affirmed.
FOOTNOTE
/* The Honorable Warren K. Urbom, United States
Senior District Judge for the District of
Nebraska, sitting by designation.

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