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Era Aviation, Inc. v. Lindfors (11/24/00) sp-5335

     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.


             THE SUPREME COURT OF THE STATE OF ALASKA

ERA AVIATION, INC.,           )
                              )    Supreme Court No. S-9062/9072
          Appellant and       )
          Cross-Appellee,     )    Superior Court No.
                              )    3AN-95-10086 CI
     v.                       )
                              )
SHERRI LEE LINDFORS,          )    O P I N I O N
                              )
          Appellee and        )    [No. 5335 - November 24, 2000]
          Cross-Appellant.    )
                              )


          Appeal from the Superior Court of the State of
Alaska, Third Judicial District, Anchorage,
                      Dan A. Hensley, Judge.


          Appearances:  Thomas M. Daniel, Helena L. Hall
and Marja E. Selmann, Perkins Coie, LLP, Anchorage, for
Appellant/Cross-Appellee.  Natasha M. Summit and Randall G.
Simpson, Jermain, Dunnagan & Owens, and George T. Freeman,
Anchorage, for Appellee/Cross-Appellant.


          Before: Matthews, Chief Justice, Eastaugh,
          Bryner, Justices. [Fabe and Carpeneti,
Justices, not participating.]


          BRYNER, Justice.


I.   INTRODUCTION

          A jury awarded Sherri Lindfors $50,000 in damages for
emotional distress and $725,000 in punitive damages after finding
that Era Aviation, her former employer, had passed her over for
promotion because she was a woman and retaliated against her for
filing a complaint with the Alaska Human Rights Commission.  Era
appeals, arguing that the superior court incorrectly instructed the
jury that it could find Era liable for discrimination if it relied
on Lindfors's gender as simply one factor, rather than as the
determinative factor, in deciding not to promote her.  We conclude
that any error in the jury instructions was harmless, and affirm
the verdict.  But we find that the jury's award of punitive damages
was excessive, and order a remittitur to an award of $500,000.
II.  FACTS AND PROCEEDINGS
          Sherri Lindfors worked for Era Aviation, Inc., from 1988
to mid-1995, first as a dispatcher and then as a co-pilot.  In
March 1995 Lindfors filed a complaint with the Alaska Human Rights
Commission alleging, among other things, that James Vande Voorde,
a vice president at Era, had failed to promote her because of her
sex.  Eight months later, after resigning, Lindfors sued Era,
alleging that it had discriminated against her because of her sex
in sixteen different promotions or upgrades [Fn. 1] and had
retaliated against her for filing a complaint.  Lindfors claimed
that Era's conduct created such an intolerable work environment
that her resignation amounted to constructive discharge.
          Lindfors based her retaliation claim primarily on
evidence that Era rescinded her June 1995 paychecks while she was
out sick with an ear infection; manufactured obstacles that made it
impossible for her to pass her annual proficiency check, causing
her commercial flight qualification to expire; and placed negative
information in her personnel file that destroyed her job prospects
as a commercial pilot. 
          Lindfors also presented evidence that Era generally
tolerated a work environment that was demeaning to women.  Era
employees testified that photographs of nude women and their
genitals were posted in the cockpits of Convair planes, and that
Era was unresponsive to complaints about the photos.  Other female
employees testified to offensive sexual remarks or proposals by
members of Era's top-level management, including Vande Voorde and
Jack Birmingham, Era's counsel and equal employment opportunities
(EEO) officer. 
          The jury concluded that Era had discriminated against
Lindfors in the most recent employment decision she challenged by
promoting a less qualified male applicant to Twin Otter captain in
Bethel.  The jury also found that Era had retaliated against
Lindfors after she filed her human rights complaint.  The jury
awarded her $50,000 in emotional distress damages and $725,000 in
punitive damages.  The jury found against Lindfors on her
constructive discharge claim and awarded her no back or front pay.
It also awarded her no overtime pay, concluding that she was an
exempt professional under the Alaska Wage and Hour Act.
III. DISCUSSION
          
     A.   The Superior Court's Error in Instructing the Jury     Was
          Harmless. [Fn. 2]

          The Alaska Human Rights Act, which mirrors Title VII of
the Federal Civil Rights Act of 1964, [Fn. 3] bars discrimination
in employment "because of" a person's sex. [Fn. 4]  Era argues that
the superior court erred in instructing the jury that Lindfors
could prevail on her discrimination claim if she proved that "Era
intentionally relied upon her sex as a factor in deciding not to
promote or upgrade her." [Fn. 5]  Because there was only
circumstantial evidence of discrimination, Era argues, the jury
should have been instructed that Lindfors was required to establish
by a preponderance of the evidence that she was held back "because
of" her sex -- that is, that her sex was a decisive, or but-for,
factor in Era's employment decision.  In essence, Era argues that
the court erred by not instructing the jury in accordance with the
distinction between "pretext" and "mixed-motive" cases that we have
adopted from the federal courts.
          We look to decisions under Title VII in interpreting
Alaska's anti-discrimination laws, [Fn. 6] and have, in large part,
endorsed the federal approach to analyzing claims of disparate
treatment. [Fn. 7]  We agree with Era that in cases, such as this
one, in which there is no direct evidence of discriminatory intent,
we apply the "pretext" framework. [Fn. 8]  The aim of a pretext
instruction is to assist the jury in determining, on the basis of
circumstantial evidence, which explanation more likely accounted
for the challenged employment decision: the plaintiff's claim of
discrimination, or the defendant's assertion that it was motivated
by legitimate factors.  As we explained in Haroldsen v. Omni
Enterprises, Inc.:
          The U.S. Supreme Court adopted the three-part
          [pretext] analysis for Title VII cases because
it is usually impossible for an employee to directly prove that the
employer acted with a discriminatory intent.  Instead, the employee
is allowed to prove such animus inferentially by challenging the
employer's stated justifications [i.e., the employer's pretext] for
taking the adverse action.[ [Fn. 9]]
Under this three-part analysis, the plaintiff first must establish
a prima facie case [Fn. 10] of discrimination to "eliminate[] the
most common nondiscriminatory reasons for the plaintiff's
rejection." [Fn. 11]  If the plaintiff succeeds, the burden of
production, but not persuasion, shifts to the employer, who must
articulate a legitimate, non-discriminatory reason for the
employment decision. [Fn. 12]  Once that occurs, the burden shifts
back to the employee to prove that the employer's stated reason was
a pretext for discrimination. [Fn. 13]  Then, "the trier of fact
proceeds to decide the ultimate question: whether [the] plaintiff
has proven 'that the defendant intentionally discriminated against
[her]'" because of her sex. [Fn. 14]  The superior court need not
instruct the jury on each part of this burden-shifting analysis,
but only on the plaintiff's ultimate burden of proof. [Fn. 15] 
          In cases where there is direct evidence of
discrimination, we instead apply a mixed-motive analysis, which
recognizes that discriminatory employment decisions may not be
motivated solely by a prohibited characteristic such as race or
sex, but may be "based on a mixture of legitimate and illegitimate
considerations." [Fn. 16]  Under the mixed-motive framework, once
the plaintiff has cleared the initial hurdle of presenting direct
evidence of discriminatory intent, the plaintiff's ultimate burden
of proof is somewhat relaxed: the jury is instructed that the
plaintiff can prevail in a claim of discrimination by showing that
gender was simply "a motivating factor," as opposed to the
determinative factor, in the adverse employment decision. [Fn. 17] 
Still, gender must be a determinative cause, but the burden shifts
to the employer on this point.  The employer must show that it
would have made the same decision even absent considerations of
gender. [Fn. 18]  Although the plaintiff may pursue mixed-motive
and pretext claims simultaneously, if the jury finds no direct
evidence of discrimination, it must find the defendant liable, if
at all, under a pretext framework. [Fn. 19] 
          Lindfors contends that there was direct evidence of
discrimination and that the trial court properly instructed the
jury under a mixed-motive analysis. [Fn. 20]  She points to her own
testimony that Vande Voorde, the head of the fixed-wing division,
told her she "had no fucking business being a blankety-blank
captain in Bethel.  No more than the man on the moon."  She also
refers to testimony that Danny Purvis, Era's check airman, said
Lindfors would "never be a captain at Era."  But under even the
most liberal interpretation of direct evidence followed in Title
VII cases, these statements cannot be construed as direct evidence
that sex was a factor in Era's decision not to promote Lindfors.
[Fn. 21]  Both statements are ambiguous -- they can be interpreted
in a discriminatory or benign way -- and do not reflect directly on
Era's discriminatory animus. [Fn. 22]
          Moreover, the record below makes clear that the case was
argued as a pretext case and that the parties and the court viewed
Jury Instruction No. 6 as a pretext instruction.  Thus, the
question is whether the court properly instructed the jury under
the pretext framework. 
          We conclude that the superior court erred by instructing
the jury that Lindfors's ultimate burden was to show that sex was
"a factor" in Era's decision not to promote her.  The jury should
have been instructed, in line with the weight of federal authority,
that Lindfors, in order to prevail on her discrimination claim,
must demonstrate that an impermissible factor "'played a role in
the employer's decision-making process and that it had a
determinative effect on the outcome of that process.'" [Fn. 23]  
          The court's error is understandable, given that it issued
its opinion before our decision in VECO, which indicated for the
first time our inclination to adopt the distinction between pretext
and mixed-motive frameworks followed by the federal circuit courts.
[Fn. 24]  The court's error was also harmless when the jury
instructions are viewed as a whole. [Fn. 25] 
          Jury Instruction No. 6 permitted the jury to find that
Era had violated the Alaska Human Rights Act if it found that Era
"intentionally relied upon [Lindfors's] sex as a factor in deciding
not to promote or upgrade her." [Fn. 26]  But the instruction then
elaborated on the causation component by requiring Lindfors to
present either direct evidence of "a discriminatory motive" or
circumstantial evidence "that sex was a motive" in Era's decision.
Jury Instructions Nos. 9 and 10, [Fn. 27] read together, further
directed the jury that it could award damages to Lindfors only if
Era's wrongful conduct was a "substantial factor" [Fn. 28] in
bringing about her loss.   Further, if two or more factors combined
to cause the loss, one of which was inculpatory, the inculpatory
factor would only be considered a legal cause if, by itself, it
would have been sufficient to cause the loss and if the conduct was
"so important in bringing about the loss that a reasonable person
would regard it as a cause and attach responsibility to it."  This
causation standard in these damages instructions is essentially
equivalent to the standard that Era requested in its proposed
causation instruction, which would have required Lindfors to prove
that Era "intentionally discriminated against her because of her
sex." [Fn. 29] Although the appropriate causation standard also
should have appeared in the jury instruction on liability, the
instruction on damages nevertheless ensured that Lindfors would
receive no award unless her gender was an independent legal cause
of Era's decision not to promote her.  We disagree with Era's
assertion that the different causation standards expressed in the
liability and damages instructions were likely to confuse the jury. 
"Jurors are presumed to understand and follow the jury instructions
. . . ." [Fn. 30]
          The jury's special verdict form further promoted a
correct application of the law by permitting the jury to find Era
liable only if Era discriminated against Lindfors "on the basis of
sex."  Jury Instruction No. 5, reiterated this language, along with
the text of Alaska's anti-discrimination law, which makes it
unlawful to discriminate in employment "because of a person's 
. . . sex." [Fn. 31]  Reading the instructions as a whole, then, a
reasonable jury could not have found Era liable for discrimination
if sex played only a minor, non-determinative role in Era's
discriminatory employment decision.  Even if the jury might have
reached that conclusion on liability, the damages instruction
explicitly barred it from awarding damages on that basis. 
Furthermore, the only compensatory damages the jury awarded
Lindfors -- $50,000 for emotional distress -- most likely were
compensation for Era's acts of retaliation, not discrimination.  In
closing argument, Lindfors's counsel stressed that Lindfors's claim
of emotional distress stemmed from Era's conduct after she filed
her human rights complaint.  Era has not challenged the court's
instruction to the jury on Lindfors's retaliation claim.
          An erroneous statement of law in a jury instruction is
not reversible error unless it actually prejudices one of the
parties. [Fn. 32]  We conclude that Jury Instruction No. 6 could
not have misled the jury to award damages to Lindfors based on an
erroneous understanding of the law.  The jury instructions that
addressed Lindfors's discrimination claim, when read as a whole,
are at least as favorable to Era as those Era requested.  We thus
conclude that the improper wording in Jury Instruction No. 6 was
not reversible error.
     B.   The Superior Court Did Not Err By Separately Submitting
the Discrimination, Retaliation, and Constructive Discharge Claims
to the Jury. [Fn. 33]

          Era argues that Lindfors's case hinged on proof of
constructive discharge, and that the trial court erred by proposing
a special verdict form and jury instructions that allowed the jury
to award damages for other acts of retaliation and discrimination.
Era then argues that the trial court erred by submitting claims to
the jury that Lindfors had not previously raised.
          This claim is without merit.  Era had ample notice that
Lindfors might raise discrimination and retaliation as grounds for
relief apart from her constructive discharge claim. In her
complaint and amended complaint, Lindfors pled and presented facts
in support of each cause of action.  At trial, Lindfors argued that
Era's discrimination and retaliation amounted to constructive
discharge -- not that its constructive discharge amounted to
discrimination and retaliation.  Thus, Lindfors did not abandon any
of these causes of action, and the jury's rejection of Lindfors's
constructive discharge claim did not defeat her discrimination and
retaliation claims. [Fn. 34] 
          Moreover, Era has not persuasively shown how it might
have tried the case differently had it realized in advance that the
court would submit the discrimination and retaliation claims to the
jury as separate causes of action, rather than as mere evidence
supporting Lindfors's claim for constructive discharge. The
superior court found that Era "aggressively defended each separate
claim."  The record supports this finding.  We thus conclude that
the court acted within its discretion in instructing the jury on
each of Lindfors's claims.
     C.   The Superior Court Did Not Err in Admitting Cheryl
Erickson's Testimony. [Fn. 35]  

          Era also contends that the superior court erred in
admitting testimony by flight attendant Cheryl Erickson that Jack
Birmingham, Era's corporate counsel and EEO officer, made offensive
racial and sexual comments.
          Erickson testified that Birmingham, while intoxicated,
told her late one night when she was at Era that "you look really
nice. I'd like for you to have my babies."  Birmingham then told
Erickson, who is African American, that he had "adopted a black
baby in Fairbanks."  When Erickson asked if there was a need for
the adoption of black babies in Fairbanks, he said: "ah, I got ya.
I adopted this black Labrador retriever in Fairbanks."  Birmingham
then followed Erickson to the elevator, remarking, evidently in
reference to his anatomy, "mine is this long."  Erickson testified
that she complained directly to Vande Voorde, who reported the
incident to Era's president, Chuck Johnson.  According to Erickson,
Johnson spoke to her about Vande Voorde's report and asked Erickson
if she "start[ed] it . . . were you playing with Jack, too?" 
Erickson testified that she answered in the affirmative, but only
because she needed her job.  Erickson further testified that, soon
after this incident, Johnson and others convinced Birmingham to
enter an alcohol rehabilitation program. 
          The superior court denied Era's motion to exclude
Erickson's testimony, reasoning:
          The evidence regarding the Erickson/Birmingham
incident is relevant.  It is probative of Vande [Voorde's] state of
mind concerning whether (1) his actions allegedly leading to
Lindfors' Human Rights Commission complaint would be investigated
thoroughly by Birmingham and (2) the related question of whether
Vande [Voorde] could retaliate against Lindfors without fear of
suffering employment consequences himself. The evidence will also
be relevant if Era puts in issue its general policy or practices
regarding compliance with the Human Rights Act or its commitment to
equal opportunity employment.
          Era argues that Erickson's testimony concerning
Birmingham's comments was irrelevant because Birmingham was not
involved in the employment decisions that Lindfors contested. 
There is authority for Era's position. [Fn. 36]  But there was
sufficient circumstantial evidence for a reasonable jury to infer
that Birmingham was one of the decisionmakers in Era's retaliation
against Lindfors. [Fn. 37]  Birmingham was Era's in-house legal
counsel and EEO officer when Lindfors filed her complaint with the
Human Rights Commission.  Although Lindfors's discrimination
complaint was turned over to outside counsel, Birmingham testified
that he directed Purvis, Era's check airman, to prepare a memo
detailing why Lindfors had failed to pass her annual proficiency
check -- conduct prominent in Lindfors's retaliation claim.  Vande
Voorde also testified that Birmingham advised him to have the
personnel director present when he met with Lindfors to discuss her
schedule and incomplete proficiency check. 
          Furthermore, Era's trial counsel affirmatively portrayed
Vande Voorde as "someone who has probably promoted more women to
positions of authority at Era Aviation than any other manager
there."  Yet the evidence of Era's response to Birmingham's
conduct, and Vande Voorde's willingness to leave Birmingham in the
EEO officer position, could support an inference that Vande Voorde
did not take Erickson's complaint seriously.  It also could support
an inference that, with Birmingham as Era's EEO officer, Vande
Voorde knew he could retaliate against Lindfors without adverse
consequences.  
          Era separately argues that Birmingham's racial remarks
should have been excluded because they were prejudicial and had no
conceivable bearing on Lindfors's claim of gender discrimination.
But while it may be that Birmingham's inappropriate racial comments
had no independent relevance to Lindfors's claim of sexual
discrimination, [Fn. 38] those comments were inextricably linked to
his sexual remarks.  Because the entire conversation including the
racial comments had inappropriate sexual overtones, the court did
not abuse its discretion by allowing the jury to consider the full
context of Birmingham's and Erickson's dialogue. [Fn. 39]
     D.   The Punitive Damages Award Was Excessive. [Fn.
          40]
          Era contends that the $725,000 in punitive damages the
jury awarded Lindfors is excessive in light of prior awards in
similar cases, the amount of Era's annual earnings, and the jury's
rejection of Lindfors's constructive discharge claim.
          Given the jury's finding that Lindfors suffered no
special damages and its modest award for emotional damages, we
agree that Era's conduct does not justify the jury's punitive
damages award.  In an analogous case, Norcon, Inc. v. Kotowski, we
recently concluded that flagrant sexual harassment warranted an
award of no more than $500,000. [Fn. 41]  In some respects, the
conduct in Norcon was more serious than Era's: [Fn. 42] the
plaintiff in Norcon was subjected to unwanted sexual touching and
was fired when she complained; this treatment was part of an
ongoing pattern of harassment that was tolerated by Norcon's
management. [Fn. 43]  Era, by contrast, was found to have
discriminated against Lindfors in connection with only one
promotion decision; Lindfors alleged no physically assaultive or
discriminatory conduct.  In other respects, the conduct here seems
more serious than Norcon's: the sexual harassment in Norcon, while
more reprehensible, lasted only a few days. [Fn. 44]  In contrast,
Lindfors suffered harassment over a longer period of time. 
Moreover, after she complained of sexual discrimination, Era
retaliated by revoking her June paychecks, frustrating her efforts
to pass her annual flight proficiency exam, which caused her to
lose her commercial flight status, and compiling a personnel record
that prevented her from getting another job as a commercial pilot. 
          On balance, however, we find that the magnitude and
flagrancy of the misconduct in this case is, in broad terms,
comparable to and, at worst, does not significantly exceed the
misconduct at issue in Norcon.  Nor is the present case readily
distinguishable from Norcon in other relevant respects. [Fn. 45] 
Since we find these two cases similar, our decision concerning the
maximum sustainable punitive damages award in Norcon compels us to
conclude that the maximum justifiable punitive damage award here is
$500,000.  Accordingly, we remand with directions to order a
remittitur to this amount. [Fn. 46]  Alternatively, Lindfors may
request a new trial on the issue of punitive damages. [Fn. 47] 
     E.   The Superior Court Did Not Err in Allowing the Jury to
Decide if Lindfors Was a Professional Under the Alaska Wage and
Hour Act. [Fn. 48]
          In addition to her other claims, Lindfors also asserted
a claim for overtime pay under the Alaska Wage and Hour Act (AWHA). 
The jury rejected this claim.  Lindfors argues on cross-appeal that
the superior court erred by allowing the jury to decide if she was
a professional exempt from overtime pay under the AWHA.  Lindfors
in effect claims that the court should have granted her motion for
a directed verdict on this issue.  The superior court concluded
that a reasonable jury could find that Lindfors was an exempt
professional because as a commercial airline pilot, she had
participated in hundreds of hours of training in mathematics,
aerodynamics, weather, and navigation and was entrusted with the
lives of commercial passengers.
          The AWHA requires an employer to pay overtime
compensation unless it proves that the employee is "employed in a
bona fide . . . professional capacity." [Fn. 49]  The employer's
classification of the employee is not dispositive. [Fn. 50] 
Rather, an employee is an exempt professional if four factors are
met: "1) the employee's primary duty is to perform work requiring
knowledge of an advanced type; 2) the work requires consistent
exercise of discretion; 3) the work is predominantly intellectual
and varied; and 4) the work is compensated on a fee basis." [Fn.
51]  
          Lindfors argues that the superior court should have held
as a matter of law that she was not an exempt professional because
Era did not demonstrate that there were material facts in dispute.
She relies on this court's ruling in Dayhoff v. Temsco Helicopters,
Inc. that a helicopter pilot was not an exempt professional under
the AWHA. [Fn. 52]  But our decision in Dayhoff was limited to the
specific facts of that case.  Dayhoff was primarily self-educated: 
He obtained his commercial helicopter license through self-study
and obtained his flight instructor certificate following only ten
hours of formal instruction. [Fn. 53]  Moreover, he did not
exercise the type of discretion that would characterize him as a
professional:  He claimed he spent sixty-two percent of his time on
non-aviation duties, and had no authority over flight assignments
and routes. [Fn. 54]

          In contrast, Era presented sufficient evidence for a
reasonable jury to conclude that Lindfors was an exempt
professional.  Lindfors did not assert that she spent time on non-
aviation duties.  Moreover, Era's pilots were far more extensively
trained than the helicopter pilot in Dayhoff.  Dale Ferguson, Era's
director of training for the fixed-wing division, testified that a
commercial pilot's certificate required a private pilot's license
and up to 250 hours of additional flying time.  For Twin Otter
pilots, Era further required a multi-engine rating, an instrument
rating, three to four days of ground school, and up to seven hours
of flight training.  To fly the Convair, pilots needed up to 1,200
hours of flying time on the Twin Otter, an additional eighty hours
of ground school training and twenty hours of flight training.
There was evidence that both pilots and co-pilots exercised
considerable discretion.  And Lindfors and other Era pilots
testified that they viewed themselves as professionals.
          In American Restaurant Group v. Clark, we made clear that
"the question of the nature of the activities performed" for
purposes of determining if an employee is a professional under the
AWHA "should be decided by the trier of fact." [Fn. 55] Viewing the
evidence in the light most favorable to Era, reasonable jurors
could differ on the issue of whether Lindfors was a professional
employee.  The court thus did not err in denying Lindfors's motion
for a directed verdict and allowing the issue of overtime pay to go
to the jury.
     F.   The Superior Court Did Not Err in Failing to Apply a Risk
Enhancement or Lodestar Multiplier to Lindfors's Attorney's Fees.
[Fn. 56]
          Lindfors also argues on cross-appeal that she should have
been awarded enhanced attorney's fees under the lodestar method
because discrimination cases are often taken on a contingency fee
basis and have limited financial benefits. [Fn. 57]  She argues
that a contingent risk multiplier is necessary to ensure that
competent counsel are available to take such cases.
          The superior court denied Lindfors's motion for enhanced
or lodestar attorney's fees, reasoning that there was no basis for
departing from the Alaska Civil Rule 82 schedule for attorney's
fees because the litigation was not unreasonably complex or lengthy
given the size of the award; a substantial portion of the
plaintiff's efforts were directed towards claims on which she did
not prevail; and the defendant did not engage in vexatious conduct.

          We agree with the superior court.  Rule 82 provides an
adequate mechanism for the court to grant enhanced fee awards in
appropriate cases. [Fn. 58]  This court has affirmed lodestar or
risk- enhanced fees only in exceptional circumstances, when there
was a strong public interest involved, or the attorneys stood to
receive no compensation other than the fees granted by the court.
[Fn. 59] 
          Lindfors argues that sex discrimination cases are like
class action, worker's compensation, and public interest cases, and
that the superior court as a policy matter should have awarded
enhanced fees.  But Lindfors does not establish the factors this
court has found compelling in prior cases: that she is a public
interest plaintiff; [Fn. 60] that her attorneys stand to receive no
compensation beyond the fees awarded by the court; [Fn. 61] or that
her case is of the type that would make it difficult to attract
capable counsel without the potential of enhanced fees. [Fn. 62] 
Instead, she argues that a multiplier should be applied simply
because of the risk involved in contingent fee cases. [Fn. 63]  
          We agree that "[c]ivil rights cases, including those
where only money damages are sought, may have a public value which
cannot be measured economically." [Fn. 64]  But contingency fee
cases do not involve the same risk of discouraging capable counsel
presented by cases in which we have endorsed risk enhancement.  "An
attorney operating on a contingency-fee basis pools the risks
presented by his various cases: cases that turn out to be
successful pay for the time he gambled on those that did not." [Fn.
65]
          Moreover, in this case, the contingency fee arrangement
does not threaten to deprive Lindfors of the compensation to which
she is entitled, because the bulk of her award is in the form of
punitive damages.  Punitive damages are not intended to compensate
the victim, but to punish the defendant; thus they are, "from the
plaintiff's standpoint, a windfall." [Fn. 66]   
IV.  CONCLUSION
          The jury's verdict that Era is liable for discrimination
and retaliation is AFFIRMED.  The superior court's decisions to
allow the issue of overtime pay to go to the jury and to deny
enhanced attorney's fees are also AFFIRMED. 
          Because the punitive damages award is excessive, we order
a remittitur to $500,000.  If Lindfors does not accept this award,
a new trial shall be held on the issue of punitive damages.


                            FOOTNOTES


Footnote 1:

     Seven of these claims were time-barred.


Footnote 2:

     Whether a jury instruction is erroneous is a question of law
to which we apply our independent judgment. See Power Constructors,
Inc. v. Taylor & Hintze, 960 P.2d 20, 29 (Alaska 1998).  An
instruction that incorrectly states the law will be reversed if it
results in actual prejudice.  Id.  In evaluating whether there has
been prejudice, we put ourselves "in the position of the jurors and
determine if the error probably affected their judgment."  Vincent
by Staton v. Fairbanks Mem'l Hosp., 862 P.2d 847, 851 (Alaska
1993).  A special verdict form is subject to this same standard of
review.  See Manes v. Coats, 941 P.2d 120, 125 n.5 (Alaska 1997).


Footnote 3:

     Adams v. Pipeliners Union 798, 699 P.2d 343, 347 n.4 (Alaska
1985).


Footnote 4:

     AS 18.80.220(a) provides that "it is unlawful for . . . an
employer to refuse employment to a person, or to bar a person from
employment, or to discriminate against a person in compensation or
in a term, condition, or privilege of employment because of the
person's . . . sex . . . ."


Footnote 5:

     (Emphasis added.)  Jury Instruction No. 6 provides in relevant
part:

               To prevail on her claim for
discrimination in upgrades and promotions, Ms. Lindfors must prove
that it is more likely than not true that:

               1. She was qualified for the positions
she sought, and

               2. That ERA intentionally relied upon her
sex as a factor in deciding not to promote or upgrade her.

               Ms. Lindfors is not required to prove
that sex was the only factor.

               Ms. Lindfors may prove her claim of
discrimination by direct or indirect evidence. Direct evidence
would include oral or written statements showing a discriminatory
motive for ERA's treatment of Ms. Lindfors. Indirect evidence would
include proof of a set of circumstances that would allow one to
reasonably believe that sex was a motive in ERA's treatment of Ms.
Lindfors.


Footnote 6:

     See VECO, Inc. v. Rosebrock, 970 P.2d 906, 912 (Alaska 1999);
Moody-Herrera v. State, Dep't of Natural Resources, 967 P.2d 79, 83
(Alaska 1998); French v. Jadon, Inc., 911 P.2d 20, 28 n.8 (Alaska
1996).


Footnote 7:

     See VECO, 970 P.2d at 920-21; Haroldsen v. Omni Enters., Inc.,
901 P.2d 426, 430 (Alaska 1995).


Footnote 8:

     See VECO, 970 P.2d at 918; Haroldsen, 901 P.2d at 430.


Footnote 9:

     901 P.2d at 431 (footnote omitted).


Footnote 10:

     A prima facie case is established when the plaintiff shows:
(1) he or she is a member of a protected class under Title VII; (2)
the plaintiff applied and was qualified for a position or promotion
for which the defendant-employer was seeking applicants; (3) the
plaintiff was denied the position or promotion despite these
qualifications; (4) the employer continued to seek applicants
consisting of similarly qualified persons.  See McDonnell Douglas
Corp. v. Green, 411 U.S. 792, 802 (1973). 


Footnote 11:

     Texas Dep't of Community Affairs v. Burdine, 450 U.S. 248,
253-54 (1981).


Footnote 12:

     See St. Mary's Honor Ctr. v. Hicks, 509 U.S. 502, 506-07
(1993); see also Thomas v. Anchorage Tel. Util., 741 P.2d 618, 623-
24 (Alaska 1987) (adopting federal approach of placing burden of
production, but not persuasion, on defendant).


Footnote 13:

     See Burdine, 450 U.S. at 256.


Footnote 14:

     Hicks, 509 U.S. at 511 (quoting Burdine, 450 U.S. at 253).


Footnote 15:

     See Cabrera v. Jakabovitz, 24 F.3d 372, 382 (2d Cir. 1994).


Footnote 16:

     VECO, Inc. v. Rosebrock, 970 P.2d 906, 920-21 (Alaska 1999)
(quoting Price Waterhouse v. Hopkins, 490 U.S. 228, 241 (1989)).


Footnote 17:

     Id. at 920-21.


Footnote 18:

     See id. at 920.


Footnote 19:

     See id. at 921.


Footnote 20:

     Lindfors also argues that the instructions, viewed together,
more than adequately instructed the jury under a pretext analysis. 
This argument is addressed below.


Footnote 21:

     See Fernandes v. Costa Bros. Masonry, Inc., 199 F.3d 572, 580,
582 (1st Cir. 1999).


Footnote 22:

     See id. at 583 (explaining that inherently ambiguous
statements cannot supply strong evidence demanded as prerequisite
to mixed-motive analysis, regardless of which federal circuit
definition of "direct evidence" is followed). 


Footnote 23:

     Woodson v. Scott Paper Co., 109 F.3d 913, 932 (3d Cir. 1997)
(quoting Miller v. CIGNA Corp., 47 F.3d 586, 588 (3d Cir. 1995));
see also Watson v. Southeastern Pa. Transp. Auth., 207 F.3d 207,
215, 220 (3d Cir. 2000) (using a pretext analysis, the jury must
conclude that consideration of the impermissible factor was a
"determinative factor" in order to find for the plaintiff); Susan
K. Grebeldinger, Instructing the Jury in a Case of Circumstantial
Individual Disparate Treatment: Thoroughness or Simplicity? 12 Lab.
Lawyer 399, 415-17 (1997) (noting that juries are typically asked
if the plaintiff's protected status was "a determining" or "a
determinative" factor in the adverse employment action in most
federal district courts; but some district courts use "but for" or
"because of" language.  Instructing the jury that the plaintiff's
status must be "the" or "the sole" determining factor could lead to
reversal on appeal).


Footnote 24:

     See VECO, 970 P.2d at 920. 


Footnote 25:

     See generally Hout v. NANA Commercial Catering, 638 P.2d 186,
190 (Alaska 1981) (explaining that jury instructions should be
evaluated in light of evidence and considering instructions as a
whole).


Footnote 26:

     (Emphasis added.)


Footnote 27:

     Jury Instruction No. 9 provided:

               Ms. Lindfors seeks an award of damages
for injuries she claims were caused by ERA's allegedly wrongful
conduct.  The damages claimed by Ms. Lindfors include back pay
(sometimes called past wage loss), front pay (sometimes called
future wage loss) and emotional distress.

               You may not assume that because I list an
item of damages or explain how to measure those damages that you
are required to make an award for that item.  For each item of
damages claimed, Ms. Lindfors must prove that it is more likely
than not true that:

               1.   She had such a loss or is reasonably
likely to have such a loss in the future, and

               2.  That the loss was legally caused by
the conduct of ERA that forms the basis of your verdict.

               I will now define the term "legal cause"
and explain how to evaluate the items of loss claimed by Ms.
Lindfors.

          Jury Instruction No. 10 provided:

               I will now define legal cause for you.  A
legal cause of a loss is an act which is a substantial factor in
bringing about the loss.  There can be more than one legal cause of
a loss.  If a loss is caused by a combination of (1) discrimination
or retaliation or both, and (2) other factors, and each factor by
itself was sufficient to cause the loss, then discrimination or
retaliation was a legal cause if it was so important in bringing
about the loss that a reasonable person would regard it as a cause
and attach responsibility to it.


Footnote 28:

     (Emphasis added.)


Footnote 29:

     (Emphasis added.)


Footnote 30:

     Whiteaker v. State, 808 P.2d 270, 277 (Alaska App. 1991).


Footnote 31:

     AS 18.80.220(a)(1).


Footnote 32:

     See Grimes v. Haslett, 641 P.2d 813, 818 (Alaska 1982).


Footnote 33:

     The superior court has broad discretion to determine whether
to give instructions specially tailored to the case at hand.  See 
Power Constructors, Inc. v. Taylor & Hintze, 960 P.2d 20, 29
(Alaska 1998).


Footnote 34:

     Cf. VECO, Inc. v. Rosebrock, 970 P.2d 906, 917-18 (Alaska
1999) (affirming trial court's decision to allow plaintiff to amend
her pleading after trial to include complaint for wrongful
termination because pleadings placed defendant on sufficient notice
of this claim).


Footnote 35:

     We review a trial court's decision to admit evidence for abuse
of discretion.  See Hiibschman v. City of Valdez, 821 P.2d 1354,
1365-66 (Alaska 1991).  An abuse of discretion is found when we are
"left with a definite and firm conviction, after reviewing the
whole record, that the trial court erred in its ruling."  Peter Pan
Seafoods, Inc. v. Stepanoff, 650 P.2d 375, 378-79 (Alaska 1982).


Footnote 36:

     See Chambers v. American Trans Air, Inc., 17 F.3d 998, 1004
(7th Cir. 1994) (deciding that affidavits showing general gender
discrimination at ATA did not establish a prima facie case of
discrimination where there was no link between this information and
employment decisions involving plaintiff); Goff v. Continental Oil
Co., 678 F.2d 593, 597 (5th Cir. 1982), overruled on other grounds
in Carter v. South Cent. Bell, 912 F.2d 832 (5th Cir. 1990)
(upholding trial court's exclusion of evidence concerning
discrimination in other departments at hands of other supervisors
where evidence fell short of that required to prove pattern or
practice of company-wide discrimination).


Footnote 37:

     Cf. Abrams v. Lightolier, Inc., 50 F.3d 1204, 1214-15 (3d Cir.
1995) (upholding admission of evidence of discriminatory remarks by
corporate executive where there was sufficient evidence from which
jury could conclude that he was decisionmaker for purposes of
plaintiff's discharge).


Footnote 38:

     Cf. Rauh v. Coyne, 744 F. Supp. 1181, 1183 (D.D.C. 1990)
(noting that there is "little reason in common experience to infer
that an employer who discriminates against blacks is also likely to
discriminate against women").  But see Clark Freshman, Note, Beyond
Generalized Discrimination: Use of Acts of Discrimination Against
"Other" Minorities to Prove Discriminatory Motivation Under Federal
Employment Law, 43 Stan. L. Rev. 241, 249-50 (1990).


Footnote 39:

     Cf. Dulier v. State, 511 P.2d 1058, 1061 (Alaska 1973)
(affirming admission of prior uncharged offenses because they
"completed the picture and set the stage for the offense being
tried").


Footnote 40:

     The superior court's decision on a motion for a remittitur or
new trial on the issue of punitive damages is reviewed for an abuse
of discretion.  See International Bhd. of Elec. Workers, Local 1547
v. Alaska Util. Constr., Inc., 976 P.2d 852, 855, 857 (Alaska
1999).  "In order for us to hold that the trial judge has abused
his discretion, we would have to be left with the definite and firm
conviction on the whole record that the judge made a mistake in
refusing to order a remittitur or grant a new trial in response to
appellant's motion."  International Bhd. of Teamsters, Local 959 v.
King, 572 P.2d 1168, 1178 (Alaska 1977) (emphasis removed) (quoting
National Bank of Alaska v. McHugh, 416 P.2d 239, 244 (Alaska
1966)). 


Footnote 41:

     971 P.2d 158, 177 (Alaska 1999).


Footnote 42:

     In reviewing punitive damages, we take the view that is most
favorable to the successful claimant.  See Johnson & Higgins of
Alaska, Inc. v. Blomfield, 907 P.2d 1371, 1374 (Alaska 1995).


Footnote 43:

     See Norcon, 971 P.2d at 172, 176.


Footnote 44:

     See id. at 176.


Footnote 45:

     Other relevant factors in determining the appropriateness of
a punitive damage award include the importance of the policy
violated, the relationship between the punitive and compensatory
damages, and the defendant's wealth.  See Norcon, 971 P.2d at 175. 
Here, the importance of Era's policy violation is roughly
equivalent to Norcon's.  Though Lindfors's punitive damage award
vastly exceeds her compensatory damages (a ratio of punitive to
compensatory damages of almost 15 to 1), this imbalance is not as
pronounced as the one that existed in Norcon (a post-remittitur
punitive-to-compensatory-damages ratio of approximately 48 to 1). 
See id. at 174.  Moreover, here, as in Norcon, we find no reason to
consider this factor, by itself, dispositive.  See id. at 176.  The
last relevant factor -- the defendant's wealth -- also seems
roughly comparable.  Over a four-year span, Norcon reported pre-tax
profits ranging from a high of almost $20 million to a low of $809
thousand, and equity fluctuating from $20 million to approximately
$6 million.  See id. at 174-75 n.20.  By comparison, over a five-
year period Era reported more modest annual operating profits (a
high of $6.5 million, with an average of approximately $1.5
million), but its net worth remained consistently higher than
Norcon's, ranging from $49 to $60 million. 


Footnote 46:

     See Exxon Corp. v. Alvey, 690 P.2d 733, 742 (Alaska 1984)
(determining that the amount of remittitur should be the maximum
the jury could have awarded which would not be excessive).


Footnote 47:

     See Norcon, 971 P.2d at 178.


Footnote 48:

     We exercise our independent judgment in determining if the
issue of whether an employee is a professional for purposes of the
Alaska Wage and Hour Act is a question of fact for the jury or a
question of law for the court.  See generally Guin v. Ha, 591 P.2d
1281, 1284 n.6 (Alaska 1979) (questions of law reviewed de novo). 
Whether an employee meets the criteria of a professional under the
Alaska Wage and Hour Act is a factual question.  In reviewing the
denial of a motion for a directed verdict, "this court asks
whether, viewing the evidence in the light most favorable to the
non-moving party, reasonable jurors could differ in their
assessment of [that] issue."  Power Constructors, Inc. v. Taylor &
Hintze, 960 P.2d 20, 40-41 (Alaska 1998).


Footnote 49:

     AS 23.10.055(9).


Footnote 50:

     See Dayhoff v. Temsco Helicopters, Inc., 848 P.2d 1367, 1372
(Alaska 1993). 


Footnote 51:

     See id. at 1371 (citing 8 AAC 15.910(a)(11)).


Footnote 52:

     See id. at 1372.


Footnote 53:

     See id.


Footnote 54:

     See id.


Footnote 55:

     889 P.2d 595, 599 (Alaska 1995).


Footnote 56:

     The trial court has broad discretion in awarding attorney's
fees and this court finds no abuse of discretion "absent a showing
that the award was 'arbitrary, capricious, manifestly unreasonable,
or . . . stem[med] from an improper motive.'"  Power Constructors,
Inc. v. Taylor & Hintze, 960 P.2d 20, 44 (Alaska 1998) (quoting
Bohna v. Hughes, Thorsness, Gantz, Powell & Brundin, 828 P.2d 745,
766-67 (Alaska 1992)).


Footnote 57:

     Under the lodestar/multiplier method, courts calculate the
"'lodestar' by multiplying the reasonable hours expended by a
reasonable hourly rate.  The court may then enhance the lodestar
with a 'multiplier,' if necessary, to arrive at a reasonable fee." 
See In re Washington Pub. Power Supply Sys. Secs. Litig., 19 F.3d
1291, 1294 n.2 (9th Cir. 1994) (citations omitted).


Footnote 58:

     See Alaska R. Civ. P. 82(b)(3).


Footnote 59:

     See Municipality of Anchorage v. Gentile, 922 P.2d 248, 265
(Alaska 1996) (remanding so trial court could consider risk-
enhanced fees in class action case); Wise Mechanical Contractors v.
Bignell, 718 P.2d 971, 975 (Alaska 1986) (affirming enhanced fees
in worker's compensation case); Thomas v. Bailey, 611 P.2d 536,
539, 541-43 (Alaska 1980) (finding public interest plaintiff
entitled to lodestar fees, but not risk-enhanced fees).


Footnote 60:

     See Thomas, 611 P.2d at 539.


Footnote 61:

     See Wise Mechanical, 718 P.2d at 975.


Footnote 62:

     See Gentile, 922 P.2d at 264-65.


Footnote 63:

     This court has rejected contingency fee risk enhancements in
the context of civil rights cases brought under 42 U.S.C.
sec. 1988. 
See Singh v. State Farm Mut. Auto. Ins. Co., 860 P.2d 1193, 1202
(Alaska 1993) (citing City of Burlington v. Dague, 505 U.S. 557
(1992)).


Footnote 64:

     Singh, 860 P.2d at 1204 (Matthews, J., dissenting in part).


Footnote 65:

     Dague, 505 U.S. at 565.


Footnote 66:

     Alaska Hous. Fin. Corp. v. Salvucci, 950 P.2d 1116, 1123
(Alaska 1997).