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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. City of Fairbanks v. Rice (3/17/00) sp-5253

City of Fairbanks v. Rice (3/17/00) sp-5253

Notice:  This opinion is subject to correction before publication in 
the Pacific Reporter.  Readers are requested to bring errors to the 
attention of the Clerk of the Appellate Courts, 303 K Street, 
Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878.


PULICE, and PATRICK B. COLE,	)	Supreme Court No. S-8469
		Appellants,		)	Superior Court No.
					)	4FA-95-1582 CI
v.					)		
					)	O P I N I O N
					)	[No. 5253 - March 17, 2000]
		Appellees.		)
		Cross-Appellant,	)	Supreme Court No. S-8470
v.					)
		Cross-Appellees.	)
		Appellant,		)	Supreme Court Nos. S-8479/8489
v.					)
		Appellees.		)

Appeal from the Superior Court of the State of 
Alaska, Fourth Judicial District, Fairbanks,
	Mary E. Greene, Judge.

Appearances:  John M. Eberhart and  Paul J. 
Ewers, Deputy City Attorneys, Fairbanks, for 
City of Fairbanks, Patrick B. Cole, and 
Michael Pulice.  Edward R. Niewohner, 
Niewohner & Associates, P.C., and Kenneth P. 
Ringstad, Paskvan Law Offices, P.C., 
Fairbanks, for Jimmy Rice.  Thomas R. 
Wickwire, Fairbanks, for Lee DeSpain.  

Before: Matthews, Chief Justice, Eastaugh, 
Fabe, Bryner, and Carpeneti, Justices.  

EASTAUGH, Justice.

Jimmy Rice and Lee DeSpain sued the City of Fairbanks 
(their former employer) and two city employees alleging violations 
of the Alaska Whistleblower Act resulting in their constructive 
discharge, and violations of their civil rights under 42 U.S.C.  
1983 of the federal Civil Rights Act.  A jury returned verdicts for 
Rice and DeSpain.  The city and its employees appeal; Rice and 
DeSpain cross-appeal.  We affirm because sufficient evidence 
supports the verdicts, because the city was not entitled to 
qualified immunity on the Whistleblower Act claim, and because the 
superior court did not err in rejecting the defendants' claim that 
Rice and DeSpain failed to exhaust their administrative remedies. 
 We find no prejudicial error in the parties' other appeal and 
cross-appeal issues. 

Jimmy Rice and Lee DeSpain were firefighters employed by 
the City of Fairbanks, Department of Public Safety (fire 
department).  Both were members of the Fairbanks Fire Fighters 
Association, affiliated with the International Association of Fire 
In 1994 DeSpain and Rice reported that Michael Pulice, 
the city's Director of Public Safety and their indirect supervisor, 
was overstating his "comp" time.  The Fairbanks City Council 
discussed the report on February 13, 1995.  The next day Pulice 
telephoned Fairbanks attorney Brett Wood, knowing that Wood had 
represented Rice and DeSpain.  According to Wood, Pulice threatened 
during the telephone conversation to retaliate against DeSpain and 
Rice for their report and other activities unrelated to their 
employment, and insinuated that he might "set them up" or entrap 
them.  Wood informed City Manager Patrick Cole of the call and 
asked that Rice and DeSpain be placed on administrative leave until 
the issue was resolved.  Cole declined to do so.
Three other circumstances contributed to animosity 
between Rice and DeSpain and the city: the city and Pulice 
allegedly tried to weaken or discredit the fire fighters' union, 
Rice and DeSpain engaged in surveillance of Pulice, and Rice told 
then City Manager Mark Boyer that Pulice had had an extra-marital 
affair with Pulice's administrative assistant.
Rejecting the city's recommendation to submit the issue 
to dispute resolution, DeSpain and Rice resigned, claiming that 
they were concerned about retaliation and "intolerable" working 
conditions.  When they resigned, DeSpain and Rice had each been 
employed for at least twenty years with the fire department.

Rice and DeSpain sued the city, former City Manager Cole, 
and Public Safety Director Pulice.  They claimed in their various 
complaints that the city, Cole, and Pulice had violated the Alaska 
Whistleblower Act,1  resulting in the plaintiffs' constructive 
discharge and the loss of a promotion for Rice, and that Cole and 
Pulice had violated the plaintiffs' federal constitutional rights 
of free speech.2   DeSpain also sued Pulice for defamation, alleging 
that Pulice had told attorney Wood that DeSpain was involved in an 
extramarital affair. 
The case was tried before a jury.  The superior court 
effectively dismissed the Whistleblower Act claims against Pulice 
and Cole individually when it allowed the jury to consider those 
claims only against the city.  The court instructed the jury to 
consider the  1983 claims against Pulice and Cole.
The jury found for DeSpain on his civil rights claims 
against Cole and Pulice, on his Whistleblower Act claim against the 
city, and on his defamation claim against Pulice.  It awarded 
DeSpain damages of $142,901 on his  1983 and Whistleblower Act 
claims and damages of $8,050 on his defamation claim.  The jury 
found for Rice on his civil rights claims against Cole and Pulice, 
and on his Whistleblower Act claim against the city.  It awarded 
Rice damages totaling $353,001.3 

The superior court granted Cole's motion for a judgment 
notwithstanding the verdict (JNOV), concluding that Cole was 
entitled to qualified immunity on the  1983 claims -- the only 
claims the jury considered against him.  The superior court 
concluded,  "[a]t worst, Cole failed to do as much as he could have 
to investigate the allegations.  However, reasonable people with a 
clear understanding of the law could not disagree that Cole could 
have reasonably believed his conduct was lawful."
As a prevailing party, Cole moved for attorney's fees; 
the superior court awarded him $5,139.  The court awarded Rice 
attorney's fees of $48,040.94 against the city and $346,739.25 
against Pulice.  It awarded DeSpain attorney's fees of $168,114.12 
against Pulice on DeSpain's successful  1983 claim.

The court entered judgments for Rice and DeSpain against 
the city and Pulice, and for Cole against Rice and DeSpain.  The 
city and Pulice (and Cole to the extent issues affect him) appeal 
from the denials of their motions for summary judgment, directed 
verdict and JNOV on the constructive discharge issue; denial of 
qualified immunity to the city on the Whistleblower Act claims; 
denial of summary judgment against Rice and DeSpain because they 
did not exhaust their administrative remedies; and denial of 
defendants' new trial motion.  They claim errors in the judgments; 
in awarding attorney's fees to Rice and DeSpain on their civil 
rights claims; in denying summary judgment and remittitur on the 
defamation claim; and in calculating Cole's award of attorney's 
fees.  The Fairbanks Office of the City Attorney represents the 
city, Cole, and Pulice on appeal, and unless context requires 
otherwise, we refer collectively to them as "the city."
DeSpain and Rice appeal the JNOV entered against them in 
favor of Cole on the civil rights claim; they also appeal being 
precluded from asserting a Whistleblower Act claim against Cole 
individually.  Rice appeals being precluded from asserting a 
Whistleblower Act claim against Pulice individually; he also 
appeals from evidentiary rulings and raises issues regarding 
mitigation of damages.  DeSpain also challenges trial time limits 
the superior court imposed and the denial of discovery master fees. 
1. The City's Appeal: S-8469
1. The constructive discharge issue

Rice and DeSpain asserted in their Whistleblower Act and 
 1983 claims that they had been constructively discharged.  The 
jury found that the fire department constructively discharged Rice 
and DeSpain.  The city argues that Rice and DeSpain's decisions to 
resign were unreasonable as a matter of law.  It asserts that the 
evidence does not support the constructive discharge finding and 
that the issue should have been dismissed on summary judgment, or 
by entry of a directed verdict or JNOV.4 

We review denial of a motion for summary judgment de 
novo.5   We will reverse denial of a motion for a directed verdict 
or JNOV only if the evidence, viewed in the light most favorable to 
the nonmoving party, is such that reasonable people could not 
differ in their judgment.6 
To prove constructive discharge,7  employees must show 
that reasonable persons in their position would have felt compelled 
to resign.8   The city argues that the employees' evidence does not 
support a finding that they reasonably felt compelled to quit.
To support their claims, Rice and DeSpain offered their 
own testimony and the testimony of attorney Wood and a former 
police officer.  Wood testified that Pulice called him shortly 
after they reported Pulice's comp time abuses and that Pulice told 
Wood he "had them set up," and that he was "well-versed in 
entrapment."  Wood testified:
Q.	Did [Pulice] use the words "set up" at 
any time?
A.	Excuse me.  Mr. Pulice told me that he 
had them set up.

Q.	Did he use that in the present tense, the 
past tense, the future tense; how was 
that used?
A.	Past tense.
Q.	That he had them set up?
A.	He had them set up.
Q.	What did you take that to mean?
. . . . 
A.	[I]n the context of the statements about 
being well versed in entrapment and 
statements -- well, he stated that he'd 
taken great pains to make a case against 
them.  And when he said that they had 
them set up -- you have to understand, 
Mr. Niewohner, this man is the chief of 
police of the City of Fairbanks.  He's a 
commissioned police officer.  I took it 
to mean that he had them set up for some 
sort of a crime or something like that. I 
mean, that was the way I took it.

Rice and DeSpain testified that they took the threat 
seriously.  Rice testified that, after the telephone call, he began 
imagining numerous ways in which he might be framed or otherwise 
edged out of his position.  He described ways in which he felt he 
was vulnerable to criticism from Pulice and how he could be set up 
on the job because of Pulice's access to the fire department and 
the police department evidence room.  His concerns were amplified 
because Pulice was the chief of police and Rice's boss, as well as 
the acting city manager at the time of the telephone call.  DeSpain 
also testified about ways he believed Pulice could entrap him or 
"set [him] up."

Rice and DeSpain supported the reasonableness of their 
interpretation of Pulice's words with the testimony of a former 
police officer, Mike Nielsen, who had worked closely with Pulice 
for over twenty years.  Nielsen stated that he had advised them to 
take Pulice's threats very seriously, and pointed out to them that 
Pulice had access to evidence which would easily enable him to 
frame them with a crime.  Nielsen testified: "He had the evidence 
key.  If he wanted to go down and get evidence, he could drop a 
baggy of marijuana in the back of their car and call an anonymous 
On appeal the city claims that this evidence supports 
only a subjective, unreasonable belief that conditions were so 
intolerable as to require resignation.  It also argues that such 
single, trivial, or isolated acts of misconduct are generally 
insufficient to support a constructive discharge claim.9 

We are unwilling to say that the evidence is insufficient 
as a matter of law to support a finding that the resignations were 
reasonable.  We assume for discussion's sake that an irrational and 
unsupported fear of framing would not support a finding of 
constructive discharge.  But fear created by an actual threat of 
framing and bolstered by evidence of means and will is sufficient 
to support the jury's verdict.  It was for the jury to evaluate the 
city's allegation that Rice and DeSpain's behavior was inconsistent 
with their claims and any weakness in plaintiffs' evidence.10   The 
superior court did not err in declining to grant the city summary 
judgment, a directed verdict, or a JNOV on this issue.
2. Cole's qualified immunity
Rice and DeSpain asserted claims against the city, Cole, 
and Pulice under the Alaska Whistleblower Act.11   The superior court 
allowed the jury to consider the Whistleblower Act claims against 
only the city, and not against Cole and Pulice.  The jury found the 
city liable. 
The Whistleblower Act claim against the city was based in 
part on the acts of former City Manager Cole.  Those acts also 
provided the factual basis for DeSpain's and Rice's  1983 civil 
rights claims against Cole.  The jury found Cole liable under  
1983 for those acts.  But after concluding that Cole was entitled 
to qualified immunity, the superior court granted Cole a JNOV on 
the  1983 claims.  The city argues that if Cole was entitled to 
immunity on the  1983 claims of retaliatory conduct, reasonable 
people likewise had to find that the city was entitled to immunity 
under the Alaska Whistleblower Act because the city acted through 

The city relies on AS 09.65.070(d)(2), which grants 
discretionary function immunity to municipalities.12   This immunity 
is qualified and does not bar liability for a municipality's 
discretionary act if that act is alleged to have violated a 
statute.13   The city requested a jury instruction on qualified 
immunity in context of the Whistleblower Act claims.  But the 
requested instruction was not given.
It is unnecessary to decide whether it was error in 
context of Cole's acts to reject the city's request for a qualified 
immunity instruction, because Pulice's acts provided an alternative 
basis for holding the city liable on the Whistleblower Act claim. 
 Pulice did not assert a qualified immunity defense, and the city 
does not argue on appeal that Pulice was entitled to immunity.  
Because the jury found Pulice liable for doing the same things 
which potentially made the city, as Pulice's employer, vicariously 
liable under the Whistleblower Act, Cole's possible immunity would 
not have excused the city.
3. Exhaustion of administrative remedies

The city argues that Rice and DeSpain failed to exhaust 
their administrative remedies under their collective bargaining 
agreement (CBA) with respect to their Whistleblower Act claims and 
the constructive discharge issue.  The city also argues that Rice 
failed to exhaust his administrative remedies as to his assertion 
that the city failed to promote him.  Rice and DeSpain argue that 
Whistleblower Act and  1983 claims do not require exhaustion of 
state administrative remedies, and that the city waived the 
failure-to-exhaust issue with respect to constructive discharge. 
The CBA required the parties to arbitrate disputes that 
could not be resolved through internal grievance procedures.14   Rice 
initially pursued a grievance but resigned before it was resolved. 
 The superior court ruled that exhaustion was not required and 
denied the city's motion for summary judgment.  We review for abuse 
of discretion a trial court's decision whether to require 
exhaustion of administrative remedies.15 

We first conclude that the exhaustion requirement does 
not apply to a damage claim under the Alaska Whistleblower Act.  
The city correctly argues that an employee must exhaust contractual 
or administrative remedies before pursuing direct judicial action.16  
 This general rule includes exhaustion of contractual remedies such 
as grievance procedures.17   But the Whistleblower Act provides for 
remedies that would not have been available under the city's CBA 
grievance procedure.18   We have previously held that arbitration 
does not afford an exclusive remedy where a statute provides for 
relief unavailable through arbitration.19 

The legislature intended to discourage and remedy 
retaliation against whistleblowers by authorizing them to bring 
civil actions.20   We therefore think it unlikely that the 
legislature intended to require that whistleblowing employees 
administratively exhaust their Whistleblower Act claims.  In Public 
Safety Employees Ass'n v. State,21  we held that employees' claims 
for failure to maintain fit premises and for harassment were 
arbitrable under a collective bargaining agreement, but claims for 
retaliatory rent and waiver of statutory rights were not 
arbitrable.22   Under the express provisions of that agreement, only 
claims involving interpretation or application of the agreement's 
terms were arbitrable.23   Having drawn this distinction between 
arbitrable and non-arbitrable claims, we concluded that the 
employees were not precluded from exercising their statutory 
remedies under the Uniform Residential Landlord-Tenant Act for even 
arbitrable claims because that act explicitly barred waiver of 
rights or remedies under the act, and afforded remedies that were 
 unavailable under the act.24 
Although a constructive discharge claim is arbitrable,25  
here the employees alleged constructive discharge only to support 
their Whistleblower Act and  1983 claims, not to support a 
wrongful termination cause of action.  The claims they asserted do 
not require exhaustion of administrative remedies.  And the facts 
underlying the Whistleblower Act claim and any constructive 
discharge intertwine.  We will not require employees to sever those 
issues and arbitrate one before proceeding judicially on the 
other.26   Likewise, Rice was not required to pursue a failure-to-
promote administrative claim because his assertion that he was not 
promoted is closely aligned with his Whistleblower Act and  1983 

State v. Beard (Beard IV) is not contrary.28   We there 
held that Beard's constructive wrongful discharge claim was 
foreclosed by his failure to exhaust his administrative remedies29  
and held that requiring exhaustion "promotes judicial efficiency by 
affording an institution an opportunity to correct its own errors, 
so as to render judicial action unnecessary."30   But a Whistleblower 
Act claim is not the equivalent of a constructive wrongful 
discharge claim.  The superior court correctly noted that to 
sustain Whistleblower Act claims, employees must show that they 
were discharged or deprived of employment benefits because of their 
whistleblower activities.  This additional showing of retaliation 
makes a Whistleblower Act claim more akin to a civil rights claim 
under  1983, to which no exhaustion requirement applies.  And by 
its very nature, because it is based on allegedly retaliatory 
conduct, a judicial Whistleblower Act claim is predictably less 
likely to be avoided by arbitration.  
Therefore, we hold that it was not an abuse of discretion 
to refuse to dismiss Rice's claims for failure to exhaust 
administrative remedies.  

4. New trial for alleged litigation misconduct
The city argues that because Rice and DeSpain and their 
counsel engaged in deliberate misconduct with respect to rules of 
evidence, trial procedure, protective orders, and evidentiary 
rulings, it was error to deny the city's new trial motion. 
The superior court denied the city's new trial motion 
because the city failed to move for a mistrial first; the court 
observed that the city chose to take its chances with the jury it 
The superior court agreed that Rice's attorney had 
engaged in misconduct at trial by repeatedly disregarding in limine 
orders and by failing to seek court permission before introducing 
"bad acts" evidence under Alaska Evidence Rule 404(b).  The court 
also observed that Rice and DeSpain "felt free to say anything they 
wanted on the stand and frequently violated court orders when doing 
so."  But these observations do not establish that the failure to 
grant a new trial was an abuse of discretion.

Reversal of a trial court's denial of a new trial motion 
is appropriate only in exceptional circumstances to prevent a 
miscarriage of justice.31   The city points to no misconduct which 
so prejudiced the city that a miscarriage of justice will result 
absent a new trial.  Instead, the city merely argues that although 
"no single incident, in and of itself, provided grounds for 
granting a new trial, the cumulative effect does."  The trial judge 
is in the best position to determine whether misconduct can be 
cured only by granting a new trial, and whether the failure to 
timely request lesser remedies indicates a tactical choice.  The 
superior court evidently believed that the city was content with 
the jury until it returned the verdict.  We are not convinced that 
the superior court erred in resolving the motion.  
5. Alleged errors in entering the judgments
The city next raises procedural issues.  It argues that 
the special verdict forms were ambiguous because they did not 
require the jury to specify which of three alternative grounds were 
the basis for finding that Pulice was liable.  It argues that 
ambiguities in the special verdict forms should be resolved in 
favor of the defendants.  But we do not find special verdict 
Interrogatory 4 or Interrogatory 8 to preclude entry of judgment 
against the city and Pulice.  Only three claims for relief were 
submitted to the jury: the Whistleblower Act claims, the  1983 
claims, and DeSpain's defamation claim.  Because the superior court 
did not allow the jury to consider Whistleblower Act claims against 
Pulice (or Cole), the jury's verdicts require us to conclude that 
the jury found against Pulice on the  1983 claims.  We perceive no 
6. Attorney's fees awarded to Rice and DeSpain

The jury awarded Rice and DeSpain each one dollar for 
noneconomic damages.  The city argues that these nominal awards 
were for their  1983 claims, and that it was therefore error to 
award Rice and DeSpain substantial attorney's fees under 42 U.S.C. 
This issue is so sparely briefed that it is effectively 
waived.32   The city's brief does not even squarely assert that the 
court granted any fees to Rice and DeSpain under  1988, or what 
amounts it granted.33   The city does not object to the manner in 
which Rice and DeSpain's fee awards were calculated, but asserts 
that the nominal damages awards precluded fee awards under  1988.34  
 Even if the city had not waived the issue, its argument would 
fail.  Rice and DeSpain's  1988 awards were justified by the 
jury's substantial damage verdicts.  These awards, totaling 
$353,001 for Rice and $142,901 for DeSpain, reflected damages 
arising from the defendants' retaliatory interference with the 
plaintiffs' rights of free speech.  Therefore, it was not error to 
grant them attorney's fees under  1988.

7. Defamation claim
DeSpain sued Pulice for defamation, alleging that Pulice 
made defamatory statements intimating that DeSpain had had an 
extramarital affair with a friend's wife.  The statements giving 
rise to this claim occurred during the Pulice-Wood telephone 
conversation which was also the basis for Rice and DeSpain's 
assertions that they had been constructively discharged.  Pulice 
told Wood that he had received a report from a private individual 
that DeSpain had an extramarital affair.  According to Wood, Pulice 
also implicitly threatened to repeat the rumor to third parties. 
The city argues that the superior court should have 
dismissed DeSpain's defamation claim on summary judgment because 
Pulice's call to attorney Wood, DeSpain's agent, was not a 
"publication."  Courts elsewhere are split on whether a defamatory 
communication to an agent is a "publication."35   But there is no 
evidence here that DeSpain had authorized Wood to act as DeSpain's 
agent for the purpose of receiving communications on the subject of 
Pulice's statements.  Absent any such evidence, we think the better 
rule is that a communication to an attorney can be a publication. 
 Because the city on appeal points to no evidence that Wood had 
authority to act as an agent to receive such communications, the 
city cannot prevail on this issue.  

The city next argues that DeSpain's defamation claim 
should have been dismissed absent evidence of special harm.  We 
conclude that the superior court did not err in holding that 
Pulice's statement to Wood was defamatory per se, obviating the 
need for proof of damages.  We have previously recognized that 
imputation of sexual misconduct is defamatory per se.36   The 
superior court concluded that allegations of marital infidelity 
were allegations of serious sexual misconduct.  We agree.  It was 
not error to deny the city's summary judgment motion on DeSpain's 
defamation claim.
The city finally contends that because DeSpain failed to 
establish any harm to his reputation, the superior court should 
have remitted the damages the jury awarded DeSpain for defamation. 
Remittitur is proper when a jury, without acting under 
the type of passion or prejudice that would warrant a new trial, 
nonetheless awards an amount that is unreasonable given the 
evidence.37   The appropriate measurement is the "maximum possible 
recovery" a reasonable jury could have awarded.38   

A defamed party may recover damages for harm to 
reputation, wounded feelings and humiliation, resulting physical 
ailments, and estimated future damages of the same kind.39   A wide 
range of damages is generally allowable, "running from six cents to 
$1,000,000 in compensatory damages with an additional $1,250,000 in 
punitive damages."40   In Alaska, defamation damages of $10,000 have 
been affirmed on appeal.41   We are not persuaded that the defamation 
award of $8,050 exceeds the maximum amount permissible for the 
intangible harms resulting from this defamation.
8. Attorney's fees awarded to Cole
The superior court awarded Cole attorney's fees of 
$5,139, divided between Rice and DeSpain.  Cole argues that the 
court abused its discretion by rejecting Cole's "methodology" and 
in undervaluing time spent by the city's staff attorneys.

As a prevailing party, Cole, through the city, moved for 
attorney's fees against Rice and DeSpain.42   His initial request was 
based on incurred fees which he claimed had a total value of 
$384,168.25.  This total valued the time of the city's staff 
attorneys at $75 per hour and the time of retained attorneys at 
their billed rates.  When the superior court ruled Cole could not 
recover fees on the  1983 claims and required him to segregate the 
fees "that apply solely to the state claims," Cole recalculated the 
base total as $290,396.43. 43   This figure valued the staff 
attorneys' time at $150 per hour, reduced the time of outside 
counsel by forty-five percent to compensate for the mix of state 
and federal claims, and deleted time spent solely representing 
other defendants. 
The superior court then ordered Cole "to properly 
segregate the fees spent solely in defense of state claims against 
him."  In response, Cole submitted affidavits establishing that 
attorney's fees totaling $17,130 had been incurred on his behalf on 
the state-law-only claims.  The superior court awarded Cole thirty 
percent, $5,139, of that amount.
Cole argued below and implicitly argues here that the 
common nature of the various claims made it "largely" impossible to 
segregate the time and that his approach of discounting fees by 
forty-five percent was reasonable and conservative.  We conclude 
that the superior court permissibly required segregation between 
federal and state-law claims.44   It properly declined to award fees 
based on services performed in defending the  1983 claims.  And we 
conclude that in limiting the award to services performed defending 
the state-law claims against Cole, the superior court did not abuse 
its discretion by rejecting Cole's apportionment scheme in 
preference for exact time records specifying the actual time spent 
defending Cole on state-law claims.

Cole next argues that it was error to value staff city 
attorney time at $75 per hour.  Cole's superior court filings 
established that for internal purposes the city attorney's office 
valued staff time at $75 per hour and his original calculation 
valued the staff attorneys' work at that rate.  Cole's revised 
calculation requested a "reasonable market value" of $150 per hour 
for the staff attorneys' time.  The court's award was based on a 
$75 hourly rate for staff attorneys, but valued the time of outside 
counsel at the rates they charged.  On appeal Cole tersely argues 
for "reasonable" fees but does not specify the rate he believes 
correct or address any of the policy questions this issue 
potentially raises.45   We conclude that it was not an abuse of 
discretion to rely on the city's internal $75 hourly rate in this 

The case the city cites in support, AMFAC Hotels v. 
State, Department of Transportation,46  does not require finding an 
abuse of discretion here.  We there held that it "was well within 
the trial court's discretion" to calculate the state's fees by 
substantially reducing the time spent by counsel for the state and 
applying an average private billing rate of $75 per hour.47   That 
opinion did not require trial courts to value staff counsel's time 
at private billing rates.
Accordingly, we discern no clear abuse of discretion.
2. Rice's and DeSpain's Appeals: S-8470/8479/8489
1. JNOV for Cole on qualified immunity
The jury determined that Cole was not entitled to 
qualified immunity; it found that Cole could not reasonably have 
believed that his conduct did not violate Rice's right to free 
speech.  The superior court, however, granted JNOV for Cole on this 
issue stating that "reasonable people would not disagree that Cole 
could have reasonably believed his conduct was lawful within the 
context of the information he knew and the actions he took."  The 
court explained that "Cole took no action which deprived Rice or 
DeSpain of any free speech right. . . .  At worst, Cole failed to 
do as much as he could have to investigate the allegations." 
"The standard of review for motions for directed verdict 
and judgment n.o.v. is 'to determine whether the evidence, when 
viewed in the light most favorable to the nonmoving party, is such 
that reasonable men could not differ in their judgment.'"48   

We agree with the superior court's analysis because it is 
consistent with principles underlying the application of qualified 
immunity.  Federal qualified immunity shields government officials 
from liability for civil damages "insofar as their conduct does not 
violate clearly established statutory or constitutional rights of 
which a reasonable person would have known."49   It is applied 
liberally to protect government officials who exercise discretion 
when making policy decisions or balancing competing 
considerations.50   If there is a "legitimate question" as to whether 
an official's conduct constitutes a constitutional violation, the 
official is entitled to immunity.51   "Officials are not liable for 
bad guesses in gray areas; they are liable for transgressing bright 
lines."52   Given Cole's limited role in the events giving rise to 
the constitutional violations, we agree with the superior court's 
reasoning and conclude that Cole was entitled to a JNOV.  
2. Dismissal of Whistleblower Act claims

The superior court dismissed the Whistleblower Act claims 
against Pulice and Cole; it allowed the jury to consider those 
claims only as against the city.53   After the trial ended, we ruled 
in another case that Whistleblower Act claims can be brought 
against individual defendants.54   Given that ruling, it was error 
to dismiss the Whistleblower Act claims against the individual 
defendants.  Rice claims that this error requires reversal as to 
both Cole and Pulice; DeSpain argues that the error requires 
reversal as to Cole, but does not raise the issue as to Pulice.  
The city concedes that dismissal was error, but argues that the 
error was harmless.
We conclude that the error was harmless as to both Cole 
and Pulice. In deciding whether an official is entitled to 
discretionary function immunity under AS 09.65.070(d)(2), we apply 
the federal standard for qualified immunity in  1983 claims.55   
Because we affirm the court's determination that Cole was entitled 
to qualified immunity under  1983, Cole also would have been 
entitled to discretionary function immunity under state law.  Thus, 
the error of dismissing the Whistleblower Act claims against Cole 
as an individual was harmless.

As to Pulice, the city argues that the  1983 and 
Whistleblower Act claims against him are identical, and that 
remanding the Whistleblower Act claims for trial could lead to a 
double recovery.  The jury found Pulice liable under  1983 for his 
retaliatory conduct and awarded Rice (and DeSpain) damages for lost 
past and future wages and benefits.  The Whistleblower Act claims 
were based on the same conduct and losses that resulted in the 
damages verdict for Rice under  1983.  Rice's recovery of that 
verdict establishes that the error of dismissing Rice's 
Whistleblower Act claim against Pulice individually did not 
prejudice Rice.
3. Time limits at trial
Although he prevailed at trial, DeSpain challenges time 
limits the superior court imposed on the presentation of his case. 
 The court allowed each side ten days to present its case.  DeSpain 
agreed that Rice, who was to address their common issues, should 
have six of their ten days.  At trial, DeSpain claimed his time was 
insufficient and requested four additional hours; the superior 
court gave him an extra half-hour.  DeSpain now argues that he was 
forced to curtail his cross-examination of two unspecified defense 
witnesses and his closing argument.
Although he agrees with the city that any error is 
harmless, DeSpain asks us to consider it because it presents an 
important and recurrent issue capable of evading review.56   We 
decline to consider it here.  The issue necessarily depends on the 
facts of each case.  We are not willing to condemn time limits in 
the abstract, and the issue can be raised by a party actually 
claiming prejudice.  Moreover, DeSpain's conclusory arguments that 
his case was curtailed do not establish error or prejudice.  They 
give us no basis for saying that these time limits were 
inappropriate, or for offering guidance to the trial courts.

4. DeSpain's discovery master fees
The superior court appointed a discovery master and 
ordered DeSpain to pay his portion of the master's fees.  After he 
prevailed at trial, DeSpain moved to recover the fees he had paid. 
 The superior court denied his motion on the ground that the 
parties' "unreasonable conduct" had required the appointment.  "Had 
counsel cooperated, no expense would have been incurred.  Each 
party must pay the master's expense; the court finds that it should 
not be a shifted expense under [42 U.S.C.]  1988."
Section 1988 awards are reviewed for abuse of discretion 
if grounded in factual findings57  and are reviewed de novo if they 
are grounded in statutory interpretation.58  
DeSpain does not claim that it was error to appoint the 
discovery master, only that it was an abuse of discretion not to 
shift to the city DeSpain's share of the master's expense.  But  
1988 does not mandate such an award, and DeSpain has not 
demonstrated that it was an abuse of discretion to deny his motion. 
 We affirm the denial.
5. Mitigation of Rice's damages

The jury found that Rice failed to mitigate his economic 
damages, and reduced his damage award.59   Rice does not deny that 
he had a duty to mitigate his damages, but he contends that he was 
only required to seek comparable employment, that the jury was 
erroneously instructed about what constitutes comparable 
employment, and that no evidence supported the jury's verdict on 
the mitigation issue. 
"The goal of contract damages is to place the 
nonbreaching party in as good a position as if 
the contract had been fully performed."  
Alyeska Pipeline Serv. Co. v. H.C. Price Co., 
694 P.2d 782, 787 (Alaska 1985).  In the case 
of wrongful discharge, this generally means 
that the employee "is entitled to the total 
amount of the agreed upon salary for the 
unexpired term of his employment, less what he 
could earn by making diligent efforts to 
obtain similar employment."  Skagway City 
School Bd. v. Davis, 543 P.2d 218, 225 (Alaska 
1975), overruled on other grounds, Diedrich v. 
City of Ketchikan, 805 P.2d 362, 366 (Alaska 

The jury was instructed that "an employee who is 
constructively discharged in violation of law has a duty to take 
steps to minimize the loss by making a reasonable effort to find 
other comparable employment."  The instruction also allowed the 
city to reduce any damages by proving that "it is more likely true 
than not true that the plaintiff could have avoided some losses in 
whole or in part with reasonable efforts and without undue risk, 
expense, hardship or embarrassment . . . ."  The parties seem to 
agree that "comparable employment" is the same as or analogous to 
"similar employment."
The propriety of a jury instruction is a question of law 
subject to our independent review.61   Rice objects to the court's 
instruction, contending that "[m]itigation based on a rule that 
plaintiff must accept employment that would not cause undue risk, 
expense, hardship or embarrassment is inconsistent with the duty 
imposed by 'comparable employment.'" 
We think the court adequately instructed the jury about 
the factors relevant to assessing Rice's ability to obtain 
comparable employment.  The instruction required the jury to 
consider whether the city had proved that the replacement 
employment would not involve "undue risk, expense, hardship or 
embarrassment."  The jury heard opposing testimony about Rice's 
employment prospects.  This testimony and the instruction offered 
sufficient information and guidance to the jury in evaluating 
whether the employment available to Rice was "similar" or 

Rice also argues that the evidence was insufficient to 
justify submitting the issue to the jury.  Submission of a question 
to the jury is appropriate when the evidence is such that 
reasonable people could differ in their conclusions.62   The 
testimony of Carl Gann, the city's vocational consultant, permitted 
an inference that a person with Rice's training who used reasonable 
efforts in seeking a substitute job could find work in the fire 
fighting or paramedic field in the vicinity of Fairbanks.  Counsel 
for Rice vigorously cross-examined Gann, and obtained admissions 
that many of the positions were not open to Rice.  But that cross-
examination did not foreclose any permissible inference that Rice 
could have obtained substitute employment that was sufficiently 
similar to require mitigation efforts.
We conclude that it was not error to submit the 
mitigation issue to the jury, and that the mitigation instruction 
adequately informed the jury of the factors relevant to this case. 
6. Exclusion of evidence of Pulice's conduct

Rice challenges the superior court's exclusion of 
evidence of alleged misconduct after Pulice telephoned Wood on 
February 14, 1995.  Rice claims that the evidence was relevant to 
prove the working conditions that caused his constructive 
discharge.  But February 14, 1995 was the watershed date on which 
Pulice made threats, and Rice has not explained on appeal what 
evidence was excluded, how any excluded evidence substantively 
differed from admitted evidence, and how the excluded evidence 
might have affected a jury that nonetheless awarded Rice 
substantial damages.  Rice has not demonstrated that the superior 
court abused its discretion or that the exclusion harmed him.  

7. Other evidentiary rulings
Rice raises five additional evidentiary rulings in his 
cross-appeal.63   Although he argues with respect to each that the 
superior court erred, he does not establish how exclusion of this 
evidence prejudiced him, whether the jury heard equivalent 
evidence, or what relief would be justified as to any of the 
alleged errors.  We perceive no prejudicial error that would 
require appellate relief for Rice on any of these rulings.  
For the reasons explained above, we AFFIRM the judgment 
and rulings below.


1 	AS 39.90.100 -.150.
2 	See U.S. Const. amend. I; 42 U.S.C.  1983.
3 	The jury did not segregate the damages it awarded on the 
 1983 and Whistleblower Act claims.
4 	The city cites the following cases to support its claim 
that isolated and trivial acts of misconduct and an employee's 
subjective perceptions do not create a claim for constructive 
discharge:  King v. AC & R Advertising, 65 F.3d 764, 767-69 (9th 
Cir. 1995); Calhoun v. Acme Cleveland Corp., 798 F.2d 559, 561 (1st 
Cir. 1986); Bristow v. Daily Press, Inc., 770 F.2d 1251, 1255 (4th 
Cir. 1985); Turner v. Anheuser-Busch, Inc., 876 P.2d 1022, 1026-27 
(Cal. 1994).  The city, arguing that an employee has an obligation 
to be reasonable and "not to assume the worst," cites Garner v. 
Wal-Mart Stores, Inc., 807 F.2d 1536, 1539 (11th Cir. 1987). 
5 	See Western Pioneer, Inc. v. Harbor Enters., Inc., 818 
P.2d 654, 656 n.3 (Alaska 1991).
6 	See Brinkerhoff v. Swearingen Aviation Corp., 663 P.2d 
937, 940 (Alaska 1983).
7 	Constructive discharge is not an independent cause of 
action, but merely satisfies the discharge element in a wrongful 
discharge claim.  We recognized the doctrine of constructive 
discharge in Beard v. Baum, 796 P.2d 1344, 1349-50 (Alaska 1990).
8 	See Cameron v. Beard, 864 P.2d 538, 547 (Alaska 1993).
9 	In support, the city cites King, 65 F.3d at 767-69, and 
Turner, 876 P.2d at 1023-26.
10 	See VECO, Inc. v. Rosebrock, 970 P.2d 906, 915-16 (Alaska 
1999) (declining to weigh evidence or assess witness credibility in 
reviewing JNOV on element of sexual harassment claim involving 
reasonableness of plaintiff's beliefs); see also Castle v. Sangamo 
Weston, Inc., 837 F.2d 1550, 1559-60 (11th Cir. 1988) (reversing 
JNOV for employer because reasonable jury could have concluded, 
applying objective reasonable person standard, that plaintiff felt 
compelled to resign).
11 	AS 39.90.100-.150.
12 	AS 09.65.070(d) provides:

An action for damages may not be brought 
against a municipality or any of its agents, 
officers, or employees if the claim . . . (2) 
is based upon the exercise or performance or 
the failure to exercise or perform a 
discretionary function or duty by a 
municipality or its agents, officers, or 
employees, whether or not the discretion 
involved is abused . . . . 
13 	See Integrated Resources Equity Corp. v. Fairbanks N. 
Star Borough, 799 P.2d 295, 301 (Alaska 1990). 
14 	See AS 23.40.070-.260.
15 	See State v. Beard (Beard IV), 960 P.2d 1, 5 (Alaska 
1998); Broeckel v. State, Dep't of Corrections, 941 P.2d 893, 896 
n.2 (Alaska 1997). 
16 	See Romulus v. Anchorage Sch. Dist., 910 P.2d 610, 615 
(Alaska 1996).  
17 	See Cozzen v. Municipality of Anchorage, 907 P.2d 473, 
477 (Alaska 1995).  
18 	See AS 39.90.120 (providing for punitive damages and 
civil penalties for whistleblower claims).
19 	See Public Safety Employees Ass'n v. State, 658 P.2d 769, 
774-75 & n.17 (Alaska 1983).  Accord Barrentine v. Arkansas-Best 
Freight Sys., Inc., 450 U.S. 728, 745-46 (1981); Bridgeton Educ. 
Ass'n v. Board of Educ., 334 A.2d 376, 378 (N.J. Super. 1975).
20 	See AS 39.90.120.  
21 	658 P.2d 769 (Alaska 1983).
22 	See PSEA, 658 P.2d at 774-75.  
23 	See id. at 772-73.
24 	See id. at 774-75.
25 	See Beard IV, 960 P.2d at 7-8.
26 	See PSEA, 658 P.2d at 775.
27 	The city raises this issue only as to Rice, not DeSpain. 
 DeSpain argues on appeal that the city did not raise the 
exhaustion defense as to any of DeSpain's claims.  Although the 
city argues in its appellate reply brief that DeSpain failed to 
exhaust his administrative remedies, the record citations in 
support establish that the city's superior court exhaustion motion 
related only to Rice, and not DeSpain.

It also appears that the city did not raise a failure-to-
exhaust defense in the superior court with respect to Rice's 
assertion that he was constructively discharged.  Rice argues on 
appeal that the city waived this issue by failing to raise it in 
the superior court.  The city does not address Rice's waiver 
argument in its reply brief.  The superior court addressed only the 
Whistleblower Act exhaustion issue and other issues not raised on 
28 	See Beard IV, 960 P.2d at 8.
29	See id.
30  	Id. at 5.  
31 	See State v. Municipality of Anchorage, 805 P.2d 971, 973 
(Alaska 1991).
32 	See Adamson v. University of Alaska, 819 P.2d 886, 896 
n.3 (Alaska 1991).
33 	The superior court awarded DeSpain attorney's fees 
against Pulice in the amount of $168,114 and awarded Rice 
attorney's fees against Pulice in the amount of $346,739.  Because 
 1983 was the only possible basis for the jury's verdict against 
Pulice, the court must have awarded those fees under authority of 
34 	In support, it cites Farrar v. Hobby, 506 U.S. 103, 115 
(1992) (affirming denial of fees to party who originally sought $17 
million and injunctive relief but received only nominal damages). 
 But see Brandau v. State of Kansas, 168 F.3d 1179, 1182-83 (10th 
Cir. 1999) (affirming attorney's fee award to plaintiff who 
originally sought $50,000 and lost wages but received only nominal 
35 	See W. Page Keeton et al., Prosser & Keeton on the Law of 
Torts  113, at 798-99 (5th ed. 1984).
36 	See French v. Jadon, Inc., 911 P.2d 20, 32 (Alaska 1996).
37 	See Exxon Corp. v. Alvey, 690 P.2d 733, 741 (Alaska 
38 	Id. at 742. 
39 	See Prosser & Keeton  112, at 794.
40 	Id. at 795.
41 	See Alaska Statebank v. Fairco, 674 P.2d 288, 294-96 
(Alaska 1983).
42 	The city had agreed to defend and indemnify Cole.
43 	A fee award for a prevailing party who recovers no money 
judgment is presumptively thirty percent of the total fees actually 
incurred.  See Alaska R. Civ. P. 82 (b)(2).  Cole sought an 
enhanced award under Rule 82(b)(3).
44 	See Balough v. Fairbanks N. Star Borough, __ P.2d __, Op. 
No. 5234 at 57-59 (Alaska, January 28, 2000) (superior court may 
award fees for state-law claims segregated from  1983 claims); 
Lyman v. State, 824 P.2d 703, 707 (Alaska 1992) (superior court may 
require party seeking costs to identify and segregate state-law 
claims from federal-law claims).
45 	Cole also asserts that it was error not to award him 
costs and prejudgment interest.  Because he totally fails to 
explain the nature of either alleged error, we deem these issues 
waived for purposes of appellate review.  See Adamson v. University 
of Alaska, 819 P.2d 886, 889 n.3 (Alaska 1991).
46 	659 P.2d 1189, 1194 (Alaska 1983), overruled on other 
grounds by Atlantic Richfield Co. v. State of Alaska, 723 P.2d 
1249, 1252 n.4 (Alaska 1986).  The state's attorneys there spent 
about 611 hours.  The superior court applied private rates of $75 
per hour, but reduced the hours to 250, and then awarded twenty 
percent of the total, for a fee award of $3,750.  See 659 P.2d at 
47 	Id.
48 	Bendix Corp. v. Adams, 610 P.2d 24, 27 (Alaska 1980) 
(quoting Holiday Inns of America, Inc. v. Peck, 520 P.2d 87, 92 
(Alaska 1974)).
49 	Harlow v. Fitzgerald, 457 U.S. 800, 818 (1982).
50 	See Benson v. Allphin, 786 F.2d 268, 276 (7th Cir. 1986).
51 	Wiley v. Doory, 14 F.3d 993, 995 (4th Cir. 1994).
52 	Maciarello v. Sumner, 973 F.2d 295, 298 (4th Cir. 1992). 
53 	See AS 39.90.120(a).  
54 	See Alaska Hous. Fin. Corp. v. Salvucci, 950 P.2d 1116, 
1124-25 (Alaska 1997).  
55 	See Integrated Resources Equity v. Fairbanks N. Star 
Borough, 799 P.2d 295, 301 (Alaska 1990) (applying "clearly 
established" law test to discretionary function immunity claim 
under AS 09.65.070(d)(2)); Breck v. Ulmer, 745 P.2d 66, 72 (Alaska 
1987) (adopting two-prong test articulated by Supreme Court in 
Harlow, 457 U.S. at 818-19).
56 	See Hayes v. Charney, 693 P.2d 831, 834 (Alaska 1985) 
(noting public interest exception to mootness doctrine).
57 	See United Steelworkers of Am. v. Phelps Dodge Corp., 896 
F.2d 403, 405-06 (9th Cir. 1990).  
58 	See id. at 407. 
59 	The jury calculated Rice's damages verdict of $353,000 by 
first finding Rice's total losses to be $1,716,700, and then 
subtracting $75,200 for "[a]ctual earnings or pension payments 
which would not have been earned," and also subtracting $1,288,500 
for the "[a]mount which should have been earned through reasonable 
and diligent efforts."
60 	Luedtke v. Nabors Alaska Drilling, Inc., 834 P.2d 1220, 
1226 (Alaska 1992).  
61 	See Anchorage Nissan, Inc. v. State, 941 P.2d 1229, 1240 
n.22 (Alaska 1997).  
62 	See Cummins v. King & Sons, 453 P.2d 465, 466-67 (Alaska 
63 	Rice appeals: the exclusion of evidence regarding 
Pulice's interview for the position of Director of Public Safety; 
the refusal of the discovery master to review a Fairbanks City 
Council Executive Session tape; the discovery master's refusal to 
compel the mayor of Fairbanks to answer deposition questions; the 
exclusion of expert opinions on Pulice's qualifications for his 
job; and the exclusion of testimony of prior acts of Pulice.

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