Davey v. Lockheed Martin Corp.

Susan Davey (plaintiff) sued Lockheed Martin Corp. (LMC) (defendant) for employment discrimination and retaliation under Title VII of the Civil Rights Act of 1964. The original pretrial order was filed a year and a half before trial. The parties agreed to make several amendments and filed a new pretrial order on August 20, 1999, the Friday before trial was set to begin. LMC had moved to amend the order to include a new affirmative defense of good faith compliance with Title VII based on the ruling in Kolstad v. American Dental Assoc., 527 U.S. 526 (1999), which was handed down by the Supreme Court of the United States two months before. If successful, the defense would have barred a punitive damage award against LMC. Davey objected, and the district court refused to allow LMC to present evidence related to the defense on the ground that allowing LMC to raise the issue would be “fundamentally unfair” to Davey. The court reasoned that permitting the defense would be prejudicial to Davey, who had not had an opportunity to conduct discovery on the issue. The jury found in favor of Davey on one of the retaliation claims. In addition to compensatory damages and damages for lost wages and attorneys fees, Davey was awarded $200,000 in punitive damages. LMC appealed to the United States Court of Appeals for the Tenth Circuit, asserting that the district court erred in refusing to permit LMC to present its Kolstad defense.