Zweizig v. Rote

368 Or. 79

486 P.3d 763

Max ZWEIZIG, Plaintiff-Appellant,

v. Timothy C. ROTE, Defendant-Appellee,andNorthwest Direct Teleservices, Inc.; Northwest Direct Marketing of Oregon, Inc.; Northwest Direct Marketing, Inc. ; Northwest Direct of Iowa, Inc. ; Rote Enterprises, LLC; and Does 1 through 5, Defendants.

SC S067820

Supreme Court of Oregon, En Banc.

Submitted on the briefs December 23, 2020.

May 6, 2021

Shenoa Payne, Shenoa Payne Attorney at Law PC, Portland, filed the briefs for plaintiff-appellant. Also on the briefs was Joel Christiansen.

Timothy C. Rote, West Linn, filed the brief pro se.

James S. Coon, Thomas, Coon, Newton & Frost, Portland, filed the brief for amicus curiae Oregon Trial Lawyers Association.

NAKAMOTO, J.

We address a certified question from the United States Court of Appeals for the Ninth Circuit concerning whether a statutory damages cap applies to an award of noneconomic damages in an unlawful employment practice action. Plaintiff Max Zweizig brought this action in the federal district court in Oregon, alleging that corporate defendants had retaliated against him and that defendant Timothy C. Rote had aided and abetted the corporations in violation of Oregon statutes. The jury found for plaintiff and awarded him $1,000,000 in noneconomic damages. Over plaintiff's objection, the district court entered a judgment for only half that amount after applying the noneconomic damages cap set out in ORS 31.710(1) ("[I]n any civil action seeking damages arising out of bodily injury, including emotional injury or distress, death or property damage of any one person including claims for loss of care, comfort, companionship and society and loss of consortium, the amount awarded for noneconomic damages shall not exceed $500,000."). Defendant appealed, and plaintiff cross-appealed, challenging the reduction of the noneconomic damage award.

The Ninth Circuit certified the following question of state law to this court: "Does Oregon Revised Statutes § 31.710(1) cap the noneconomic damages awarded on an employment discrimination claim under Oregon Revised Statutes § 659A.030 ?" We accepted the question under ORS 28.200. Zweizig v. Rote , 366 Or. 762, 468 P.3d 948 (2020). The answer, in short, is no. The damages cap in ORS 31.710(1) does not apply to an award of noneconomic damages for an unlawful employment practice claim under ORS 659A.030 in which the plaintiff does not seek damages that arise out of bodily injury and instead seeks damages for emotional injury.

I. FACTS AND PROCEDURAL POSTURE

We take the facts, which are mainly procedural, from the Ninth Circuit's certification order. Plaintiff, a former employee of Northwest Direct Teleservices, Inc., brought an unlawful employment practice action against defendant in the United States District Court for the District of Oregon.¹ Plaintiff alleged that, in violation of ORS 659A.030(1)(g),² defendant aided and abetted retaliation against plaintiff for whistleblowing on his former employer, a practice prohibited by ORS 659A.030(1)(f).³ It is undisputed that plaintiff did not suffer any physical injury. A jury returned a verdict in favor of plaintiff, and it awarded him $1,000,000 in noneconomic damages.

Defendant sought a reduction in the amount of the award to be included in the judgment, arguing that the award was subject to the noneconomic damages cap in ORS 31.710(1). That statute provides that noneconomic damages may not exceed $500,000 "in any civil action seeking damages arising out of bodily injury, including emotional injury or distress, death or property damage * * *." ORS 31.710(1).

The district court applied the $500,000 damages cap to the jury's award. Zweizig v. Northwest Direct Teleservices, Inc. , 331 F. Supp. 3d. 1173 (D. Or. 2018). Examining the text of ORS 31.710(1) and focusing on the phrase "in any civil action seeking damages arising out of bodily injury," the court was persuaded that the legislature had intended emotional injury and distress to serve as examples of bodily injury. Id. at 1184. That reading, the court concluded, was consistent with the holding of the Oregon Court of Appeals that some claims for emotional distress can be considered as an injury to one's person. Id. (citing Rains v. Stayton Builders Mart, Inc. , 289 Or. App. 672, 687-88, 410 P.3d 336 (2018) (holding that a wife's loss of consortium claim stemming from her husband's physical injuries was considered an injury to the wife's person that was protected under the remedy clause of the Oregon Constitution)).

The district court also examined legislative history. The court observed that ORS 31.710(1) codified one of many sections of a bill aimed to stabilize insurance premiums and decrease tort litigation costs. Zweizig , 331 F. Supp. 3d. at 1184. The district court reasoned that a broad reading of the statute—to allow the cap to apply to damages arising out of purely emotional injuries—most closely conformed with the legislature's goal of reducing the costs of tort litigation. Id. On the flip side, the court rejected the narrower reading of the statute that plaintiff proposed, which would exclude some tort claims from the damages cap, as inconsistent with that legislative goal. Id. at 1184-85. In view of the "broad language of the statute and the legislative history" of ORS 31.710(1), the district court concluded that ORS 31.710(1) applies to unlawful employment practice claims involving purely emotional injuries. Id. at 1185.

Defendant appealed the judgment, and plaintiff cross-appealed, assigning error to the district court's imposition of the noneconomic damages cap in an unlawful employment practice case. The Ninth Circuit rejected defendant's arguments in a memorandum disposition. Zweizig v. Rote , 818 Fed Appx 645 (9th Cir.), cert. den. , ––– U.S. ––––, 141 S. Ct. 848, 208 L.Ed.2d 424 (2020). In a contemporaneously filed order, the Ninth Circuit certified the question that this court accepted: "Does Oregon Revised Statutes § 31.710(1) cap the noneconomic damages awarded on an employment discrimination claim under Oregon Revised Statutes § 659A.030 ?"

II. ANALYSIS

Whether the cap on noneconomic damages in ORS 31.710(1) applies to damages awarded solely for emotional injury caused by employment practices made unlawful by ORS 659A.030 is a question of first impression for this court and calls for the interpretation of ORS 31.710(1). As with other cases involving statutory interpretation, our methodology is to start by reviewing the text of the statute, in context, and considering any relevant legislative history. State v. Gaines , 346 Or. 160, 171-72, 206 P.3d 1042 (2009). The "paramount goal" of that process is "discerning the legislature's intent." Id. at 171, 206 P.3d 1042.

A. Alternative Views of the Text

In full, ORS 31.710(1) provides:

"Except for claims subject to ORS 30.260 and ORS chapter 656, in any civil action seeking damages arising out of bodily injury, including emotional injury or distress, death or property damage of any one person including claims for loss of care, comfort, companionship and society and loss of consortium, the amount awarded for noneconomic damages shall not exceed $500,000."

(Emphasis added.) The parties dispute how to parse the emphasized text, with each offering different views about both the extent of the participial phrase and the object that it modifies.

Plaintiff contends that the participial phrase is "including emotional injury or distress, death or property damage," which modifies "damages arising out of bodily injury." Thus, according to plaintiff, if, and only if, the damages arise out of bodily injury, then noneconomic damages for (1) emotional injury or distress, (2) death, or (3) property damage are subject to the $500,000 cap. But defendant contends that the object being modified is "bodily injury" and that the participial phrase is "including emotional injury or distress." In defendant's view, no showing of bodily injury is needed; rather, the cap applies to damages arising out of three types of harms: (1) bodily injury, which equates with emotional injury or distress; (2) death; or (3) property damage.

Because this court bears responsibility for correctly construing a statute, regardless of the parties’ proffered interpretations, Stull v. Hoke , 326 Or. 72, 77, 948 P.2d 722 (1997), we have considered a third reading of the text that neither party has addressed: that the phrase "including emotional injury or distress" modifies "damages arising out of bodily injury." With that view of the text, the noneconomic damages cap in ORS 31.710(1) would apply to claims seeking damages that arise out of (1) bodily injury, such as damages for emotional injury or distress suffered in connection with bodily injury; (2) death; or (3) property damage.

All three readings of the text of ORS 31.710(1) are plausible. But, based on the text, context, and legislative history of the statute, we conclude that the legislature most likely intended the third reading of the text rather than the interpretations that the parties have proffered.

B. Textual Analysis

As this court has often repeated, "the text of the statutory provision itself is the starting point for interpretation and is the best evidence of the legislature's intent." PGE v. Bureau of Labor and Industries , 317 Or. 606, 610, 859 P.2d 1143 (1993). The first part of the disputed text states that the cap applies "in any civil action." ORS 31.710(1) (emphasis added). Although the legislature exempted a narrow class of claims from the cap—"claims subject to ORS 30.260 to 30.300 [the Oregon Tort Claims Act] and ORS chapter 656 [the Workers’ Compensation Law]"—the legislature did not otherwise place subject-matter limitations on civil claims to which the cap might apply. Thus, unlawful employment practices claims are not exempt from the cap as a class.

Instead, whether the damages cap in ORS 31.710(1) applies to the claim in this case depends on the damages that plaintiff requested, because...