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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Mitchell v. Teck Cominco Alaska, Inc. (09/26/2008) sp-6310
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,
e-mail corrections@appellate.courts.state.ak.us.
THE SUPREME COURT OF THE STATE OF ALASKA
| MAURICE MITCHELL, | ) |
| ) Supreme Court No. S- 12530 | |
| Appellant, | ) |
| ) Superior Court No. 2KB-05- 00103 CI | |
| v. | ) |
| ) O P I N I O N | |
| TECK COMINCO ALASKA | ) |
| INCORPORATED, | ) No. 6310 September 26, 2008 |
| ) | |
| Appellee. | ) |
| ) | |
Appeal from the Superior Court of the State
of Alaska, Second Judicial District,
Kotzebue, Richard H. Erlich, Judge.
Appearances: Kenneth W. Legacki, Kenneth W.
Legacki, P.C., Anchorage, for Appellant.
Sean Halloran, Hartig Rhodes Hoge & Lekisch,
PC, Anchorage, for Appellee.
Before: Fabe, Chief Justice, Eastaugh,
Carpeneti, and Winfree, Justices. [Matthews,
Justice, not participating]
WINFREE, Justice.
I. INTRODUCTION
Teck Cominco Alaska Incorporated is the operator of the
Red Dog Mine (Mine), which is remotely located in the Kotzebue
area on lands owned by NANA Regional Corporation, Inc. Teck
Cominco fired Maurice Mitchell from his job as a warehouse
supervisor at the Mine after concluding that Mitchell had
sexually harassed a contractors employee and lied during the
ensuing investigation. Mitchell sued Teck Cominco, asserting a
statutory claim for race-based discrimination and contract claims
for breach of the covenant of good faith and fair dealing and
wrongful discharge.
Teck Cominco immediately moved to dismiss Mitchells
discrimination claim, and the superior court later converted the
dismissal motion into a summary judgment motion. Mitchell filed
affidavit testimony and requested additional time to conduct
planned discovery to further contest summary judgment. Teck
Cominco did not oppose the request or otherwise submit any
evidence to support its converted motion. The court never ruled
on Mitchells continuance request, but six months later, while the
parties were still conducting discovery, the court granted the
converted motion for summary judgment on Mitchells discrimination
claim. Mitchell then asked the assigned judge to disqualify
himself because the judges wife is a NANA shareholder; the judge
did not disqualify himself. The court granted Teck Comincos
subsequent motion for summary judgment on Mitchells claim for
breach of the covenant of good faith and fair dealing and
simultaneously denied Mitchells cross-motion on that claim and on
his wrongful discharge claim. The court entered final judgment
and awarded Alaska Civil Rule 68 attorneys fees to Teck Cominco.
Mitchell appeals.
We vacate the grant of summary judgment for Teck
Cominco on Mitchells discrimination claim because the superior
court should have granted Mitchells request for additional time
to oppose it. We reverse the grant of summary judgment for Teck
Cominco on Mitchells good faith and fair dealing claim because
material issues of fact precluded summary judgment, and we affirm
the denial of summary judgment to Mitchell on both contract
claims for the same reason. In light of these rulings, we vacate
the final judgment and the award of attorneys fees in favor of
Teck Cominco and remand for further proceedings on all of
Mitchells claims. Finally, we remand for renewed consideration
of the judicial disqualification issue.
II. FACTS AND PROCEEDINGS
A. Facts
Maurice Mitchell is an African-American who had worked
for Teck Cominco at the Mine for fifteen years before he was
fired in May 2005. In early 2005 Mitchell noticed L.B., an
employee of a contractor at the Mine; he wanted to meet her and
have a personal relationship with her. Mitchells friend Carla W.
knew L.B., and he asked Carla to approach L.B. to see if L.B.
might be interested in getting to know him. Carla and Mitchell
exchanged suggestive e-mails about L.B., and in one of them
Mitchell mentioned summer work in the warehouse and the
possibility that he might be able to help L.B. if she needed
work.
Carla talked to L.B. in April 2005. According to
Carla, she told L.B. that Mitchell was interested in meeting her
and that Teck Cominco hired people for the summer. Carla later
maintained that she did not link the possible employment and a
relationship with Mitchell; she made sure [L.B.] knew it was
separate. L.B. interpreted the job possibility and relationship
with Mitchell as linked, although she later acknowledged that
Carla did not express a linkage. L.B. did not respond to Carlas
inquiries on Mitchells behalf and did not apply for a job with
Teck Cominco.
Mitchell continued to be interested in L.B. and again e-
mailed Carla about her. In May 2005 Carla wrote a note to L.B.
about Mitchell: He wanted to know if you were interested and I
told him he would have to talk to you. . . . [I]f you decide to
get involved or not with that situation, could you please let him
know? Or if you want me to tell him something, let me
know. . . . His name is Maurice Mitchell and he is the warehouse
supervisor. Carla signed the note Carlitta and left it at L.B.s
dormitory. L.B. complained to her supervisor after seeing the
note. L.B. and her supervisor then spoke with Jim Somers in Teck
Comincos human resources department. L.B. was asked to write a
statement summarizing her complaint.
Somers and Jeff Sheardown, a Teck Cominco
superintendent, then met briefly with Mitchell as he was about to
fly home from the Mine at the end of his regular work rotation.
The parties dispute what happened at the meeting; no one took
notes or recorded the conversation. Mitchell asserts that no one
told him he had been accused of offering a job in exchange for
sex. The parties agree that Mitchell was shown a copy of the
note Carla wrote to L.B. and that Mitchell asked who Carlitta
was. Mitchell stated in an affidavit that during the meeting he
denied having anything to do with writing the note; Somers
testified at a deposition that Mitchell denied asking Carla to
approach L.B. on his behalf about possibilities of a summer job
and of hooking up.
Teck Cominco continued its investigation after Mitchell
left the Mine on rotation. Company e-mails between Mitchell and
Carla were reviewed. Carla was interviewed about whether
Mitchell had asked her to offer L.B. a job in exchange for sex.
Carla prepared a short written statement at Somerss request,
reflecting Carlas position that her discussion with L.B. about a
summer warehouse position was separate from her discussion about
Mitchells personal interest in L.B. Teck Cominco did not contact
Mitchell again during its investigation.
Robert Scott, then Teck Comincos general manager at the
Mine, decided to terminate Mitchells employment based on the
conclusion that Mitchell had offered L.B. a job in exchange for
sex and had lied about it during the investigation. In its
May 25, 2005, termination letter to Mitchell, Teck Cominco
informed Mitchell that: (1) allegations that he tied a job offer
to a personal relationship had merit; (2) he had been
considerably less than candid when asked about the allegations;
and (3) even if the allegations were not true, his willingness to
misrepresent facts to the detriment of [his] employer would have
been cause for discipline. Teck Cominco also stated that its
reasons for firing Mitchell were exacerbated by his abuse of
company e-mail and non-solicitation policies.
B. Proceedings
In late July 2005 Mitchell sued Teck Cominco in
superior court, alleging race-based disparate treatment, breach
of the implied covenant of good faith and fair dealing, and
wrongful termination. In August 2005 Teck Cominco filed an
answer to Mitchells complaint and moved to dismiss Mitchells
discrimination claim for failure to state a claim upon which
relief could be granted.1 At the same time, Teck Cominco served
Mitchell with an Alaska Civil Rule 68 Offer of Judgment in the
amount of twelve dollars. Mitchell opposed the motion to
dismiss, supporting his opposition with an affidavit denying that
he had offered a job in exchange for sex and stating that he knew
of numerous individuals who were not African-American who had
sexually harassed employees but had not been terminated. Teck
Cominco replied in September 2005 without submitting any
evidence.
The superior court held a scheduling conference on
October 17, 2005. Mitchell told the court that he had filed a
discrimination complaint with the federal Equal Employment
Opportunity Commission and would advise the court within thirty
days whether he would proceed with the lawsuit. Mitchell later
advised that he would proceed with the lawsuit. In January 2006
the court converted Teck Comincos dismissal motion into a motion
for summary judgment because it intended to consider Mitchells
affidavit. The court gave Mitchell twenty days to submit
additional opposition to the converted motion and gave Teck
Cominco five days thereafter to file a reply.2
Mitchell filed supplemental opposition arguing both
that summary judgment was premature because discovery had not
been completed and that his second affidavit (filed with the
supplemental opposition) contained additional facts sufficient to
defeat summary judgment. Mitchell provided material to the
superior court referencing an upcoming deposition schedule and
asked the court to hold the summary judgment motion in abeyance
until discovery was complete. Although Mitchell did not make a
separate motion under Alaska Civil Rule 56(f),3 he cited and
discussed the rule in his supplemental opposition. Teck Cominco
did not oppose Mitchells request for a Rule 56(f) continuance and
filed nothing further in connection with the converted motion for
summary judgment.
On July 7, 2006, without having ruled on Mitchells
request to hold the motion in abeyance pending completion of the
scheduled discovery, the superior court granted Teck Comincos
converted motion for summary judgment. The court concluded that
Mitchell had not made a prima facie case of discrimination
because he had not presented admissible evidence that Teck
Cominco had treated him less favorably than other similarly
situated employees outside his protected class. The court stated
in a footnote that Mitchell had not filed a Rule 56(f)
continuance motion and had not filed any supplemental briefing
based on depositions that had been conducted in February 2006.
Mitchell requested reconsideration, noting that he had
asked for a Rule 56(f) continuance to oppose summary judgment but
that the court had not ruled on it, and attaching some deposition
transcripts and other discovery material reflecting his discovery
efforts. The court denied reconsideration, stating that it had
ruled on the summary judgment motion five months after Mitchell
filed his supplemental opposition and that plaintiff could have
requested [that the court] take notice of any supplemental
discovery [he] wished to file between January 30 and July 7,
2006.
Shortly thereafter, Mitchell advised assigned Superior
Court Judge Richard H. Erlich that he recently had become aware
that Judge Erlichs wife owned stock in NANA Regional Corporation
and that under a case this court decided in 2002,4 she therefore
had a financial interest in the outcome of litigation involving
the Mine. Mitchell indicated this probably required Judge
Erlichs disqualification. Judge Erlich declined to disqualify
himself, finding that although his wife was a NANA shareholder,
her annual NANA dividend of $200 to $300 was de minimis and did
not justify his recusal. Judge Erlich also considered whether
his wifes stock ownership could cause his impartiality to
reasonably be questioned and concluded that it could not. He
requested review of his decision, as required by AS 22.20.020(c),5
and Superior Court Judge Michael I. Jeffery reviewed and affirmed
Judge Erlichs decision.
Teck Cominco then filed a motion for summary judgment
on Mitchells contract claim for breach of the covenant of good
faith and fair dealing. Mitchell filed a cross-motion for
summary judgment on that claim and on his contract claim for
wrongful termination. Teck Cominco argued that it was entitled
to judgment as a matter of law because (1) it had conducted an
investigation, there were no minimal contractual or legal
standards specifying how the investigation needed to be
conducted, and Mitchells termination was the result of the
conclusions drawn from that investigation; and (2) the court had
already ruled that Mitchell had not been subjected to disparate
treatment. Mitchell argued that he was entitled to judgment as a
matter of law because (1) he in fact had not engaged in the
conduct of which he was accused, making his termination per se
unlawful; (2) Teck Cominco did not conduct a fair and impartial
investigation of the allegations against him, in violation of its
personnel policies; and (3) Teck Cominco treated Mitchell more
severely than other employees who had violated its sexual
harassment policy.
The court granted Teck Comincos motion for summary
judgment and denied Mitchells cross-motion. The court determined
that Mitchells conduct violated Teck Comincos sexual harassment
policy because of the note Carla had written to L.B. after L.B.
had ignored her first overture, stating: If there had been . . .
no subsequent contact and [L.B.] made no response to the offer
that had been communicated all right there would have been no
case. The court found that because Mitchell was confronted with
Carlas note, Mitchell had clear indication of what the issues
were . . . prior to the termination. As to disparate treatment,
the court decided that the two incidents factually closest to
Mitchells situation (and supporting Mitchells arguments) were not
relevant, one occurring too long before Mitchells termination and
the other occurring after the termination. Apparently
considering Mitchells contract claim for wrongful termination
dismissed along with the contract claim for breach of the
covenant of good faith and fair dealing, the court later entered
final judgment and, based on Teck Comincos nominal Rule 68 offer
of judgment, awarded Teck Cominco Rule 68 attorneys fees.
Mitchell appeals the summary judgment rulings, Judge
Erlichs refusal to recuse himself, and the award of Rule 68
attorneys fees based on the nominal offer of judgment.
III. STANDARD OF REVIEW
A Rule 56(f) decision is reviewed for an abuse of
discretion.6 An abuse of discretion exists when we are left with
the definite and firm conviction that a mistake has been made.7
We review a grant of summary judgment de novo.8
Summary judgment is proper if there is no genuine factual dispute
and the moving party is entitled to judgment as a matter of law.9
When factual disputes exist, the non-movants version of the facts
must be accepted as true and capable of proof, and we make no
attempt to weigh the evidence or evaluate witness credibility.10
All reasonable inferences to be drawn from the facts presented
must be drawn in favor of the non-moving party.11
A trial judges decision not to recuse is reviewed on
appeal for abuse of discretion.12 We will not overturn a judges
decision unless it is plain that a fair-minded person could not
rationally come to that conclusion on the basis of the known
facts.13 Interpretation of a statute is a question of law to
which we apply our independent judgment, interpreting the statute
according to reason, practicality, and common sense.14 When
interpreting a statute, we consider the meaning of the statutes
language, its legislative history, and its purpose.15
IV. DISCUSSION
A. The Superior Court Should Have Granted Mitchells Civil
Rule 56(f) Request for Additional Time to Conduct
Discovery and Respond to Teck Comincos Motion.
Teck Comincos dismissal motion was filed within a month
of Mitchells complaint. Our civil rules contemplate that
dismissal motions will be filed early in litigation because they
generally are decided on the pleadings; indeed, to expedite the
resolution of litigation some dismissal motions may be filed
before a pleading.16 Summary judgment motions, on the other hand,
may require that parties spend considerable time and effort
discovering and developing facts necessary for a full
presentation, and for this reason courts must give the parties a
reasonable opportunity to present all pertinent material after
converting a Rule 12(b)(6) motion into a Rule 56 motion.17
Rule 56 itself permits a party opposing summary
judgment to request additional time to gather and submit evidence
to support its opposition.18 We have repeatedly held that
requests made under Rule 56(f) should be granted freely because
Rule 56(f) provides a safeguard against premature grants of
summary judgment. 19 A request for a Rule 56(f) continuance need
not be made in a separate motion,20 but to receive a continuance a
party (1) must unambiguously request relief on Rule 56(f)
grounds, although Rule 56(f) itself need not be specifically
mentioned; (2) must not have been dilatory during discovery; and
(3) must provide adequate reasons why additional time is needed.21
Mitchell met all three requirements and was entitled to a
continuance.
First, Mitchell unambiguously requested Rule 56(f)
relief in his supplemental opposition, specifically requesting
that the court hold the motion in abeyance so he could gather
more information during planned discovery, and specifically
citing Rule 56(f) and a case construing it. Mitchells proposed
order expressly stated that the court would hold the summary
judgment motion in abeyance pending completion of discovery and
additional briefing, and set a briefing schedule to begin twenty
days after the scheduled July 20, 2006, close of discovery.
Second, Mitchell had not been dilatory with discovery.
When the court converted the motion on January 10, 2006, the case
was less than six months old. The pretrial scheduling conference
had been conducted about three months earlier, but proceedings
apparently then went on informal hold for the next thirty days
while Mitchell decided whether to proceed with the lawsuit or
seek remedies through the Equal Employment Opportunity
Commission. Mitchells decision to proceed with the lawsuit came
about forty-five days before the courts conversion of the motion,
and by then the parties had already been in contact about a
discovery schedule. Discovery was set to close on July 20, 2006.
Third, Mitchell provided adequate reasons why he needed
additional time to oppose summary judgment. He noted that the
conversion of the dismissal motion came before discovery had been
completed, advised the court that the parties were in the process
of setting up a deposition schedule, and even described some of
the information he was trying to discover. It is noteworthy that
in conformance with his representations to the court, Mitchell
then conducted at least nine depositions between February and May
2006 and participated in others that Teck Cominco conducted.
Teck Cominco asserts that the court had no reason to
grant the Rule 56(f) request because Mitchell had ample
opportunity to submit additional evidence during the time the
court had the summary judgment motion under advisement. But
without an order from the trial court authorizing or setting a
deadline for additional filings, Mitchell had no way of knowing
when the court would rule on the motion or whether the court
would accept more filings in addition to those it had already
authorized. By failing to promptly rule on Mitchells Rule 56(f)
request, the superior court left the parties without guidance
about whether supplemental filings would be permitted or when
they would be due.
Teck Cominco also argues that the courts error, if any,
is moot or harmless. According to Teck Cominco, Mitchell
presented the evidence of inconsistent discipline which he would
have relied on to show disparate treatment in his discrimination
claim when the parties filed cross-motions for summary judgment
on the covenant of good faith and fair dealing claim, and the
court still entered judgment against Mitchell, making the issue
moot. But the courts error is neither harmless nor moot in light
of our reversal of the courts later summary judgment ruling,
discussed in the next section of this opinion. Moreover, the
legal standards for the two claims are different and require the
evaluation of evidence in light of both standards.22 Finally, in
the course of discovery Mitchell obtained evidence that appears
to support his claim that Teck Cominco treated persons outside
his protected class more favorably than it treated Mitchell.
In connection with the later cross-motions for summary
judgment on his contract claims, Mitchell presented newly
discovered evidence that a white supervisor at Teck Cominco
sexually harassed a female employee of a contractor but only
received a disciplinary letter in his personnel file instead of
termination. The superior court indicated that it did not
consider the evidence relevant because the incident occurred
after Mitchells termination. But the fact that the more lenient
discipline happened after Mitchell was fired does not necessarily
make it irrelevant to Mitchells claims. Federal courts have
compared a Title VII plaintiffs discipline to discipline that
happened after the plaintiffs termination.23 Thus the superior
courts failure to grant Mitchells Rule 56(f) request actually
prejudiced Mitchell.24
Based on the foregoing, we are left with a definite and
firm conviction that the superior court made a mistake in failing
to grant Mitchells Rule 56(f) request, and we vacate the entry of
summary judgment and remand for further proceedings on Mitchells
race-based disparate treatment claim.25 On remand, the superior
court must identify the appropriate comparison group for
Mitchells claim. The superior court previously determined that
employees who are situated similarly to Mr. Mitchell are non-
African-American supervisors or managers determined by Cominco to
have violated the companys sexual harassment policy. This is
unduly narrow; under this standard an employer could engage in
blatant discrimination by never determining that a class of
employees violated company policy, but always escape a finding of
discrimination on that basis. For persons to be similarly
situated for a comparison in a Title VII case, the plaintiff must
establish that he was treated differently from similarly situated
persons whose conduct was comparable in all material respects.26
This requires that members of the comparison group engage in
similar conduct, not that the employer finds they have done so.27
In disparate treatment discipline cases, the offenses do not need
to be identical, but they should be of comparable seriousness.28
Thus in further proceedings after remand, the superior court
should evaluate whether the conduct of the persons to whom
Mitchell compares himself is of comparable seriousness to the
conduct he committed, and then evaluate Teck Comincos response to
that conduct.
B. The Superior Court Should Not Have Granted Summary
Judgment to Teck Cominco on Mitchells Claim for Breach
of the Covenant of Good Faith and Fair Dealing.
At-will employment contracts in Alaska include an
implied covenant of good faith and fair dealing.29 The covenant
does not have a precise definition but generally requires
employers to treat like employees alike and act in a manner that
a reasonable person would regard as fair.30 The covenant has both
a subjective and an objective component: the subjective
component prohibits an employer from terminating an employee for
the purpose of depriving the employee of the contracts benefits,
and the objective component prohibits the employer from dealing
with the employee in a manner that a reasonable person would
regard as unfair.31 Mitchells claim for breach of the covenant is
under the objective component because he contends that Teck
Cominco treated him unfairly in its investigation of the sexual
harassment allegations and disciplined him more severely than it
did other employees.
Teck Cominco based its summary judgment motion on its
contentions that (1) it conducted an investigation that was
legally sufficient to meet its obligation under its policies and
procedures; (2) based on the facts available through its
investigation, it reasonably could have concluded that Mitchell
had offered a job to L.B. in exchange for sex, making his denial
of wrongdoing irrelevant; and (3) the courts grant of summary
judgment on Mitchells discrimination claim was a determination
that it had not treated Mitchell disparately.
Teck Cominco agrees that under its policies and
procedures, it was required to investigate the sexual harassment
allegations against Mitchell before firing him. At oral argument
before us Teck Cominco conceded that the implied covenant
requires some minimal level of fairness to the employee during an
employers investigation. Mitchell testified that his interview
lasted no more than five minutes and that he was never told that
he was accused of offering a woman a job in exchange for sex or
that he was being investigated for sexually harassing L.B.
Somers testified that it would be reasonable to ask an employee
being investigated to tell his side of the story and acknowledged
that he had not given Mitchell this opportunity. If even this
limited testimony is accepted and viewed in the light most
favorable to Mitchell, it shows that Teck Cominco never advised
him of the allegations against him and never gave him a fair
opportunity to present his side of the story. This creates a
triable issue of fact of whether, considering all of the
circumstances, Teck Cominco conducted a fair and reasonable
investigation.32
Mitchell also created a triable issue of fact about
whether he was disparately treated. Mitchell presented evidence
of several Teck Cominco employees who apparently violated the
companys sexual harassment policy but were disciplined less
severely than Mitchell. Teck Cominco did not assert that
Mitchells factual allegations were inaccurate, but rather argued
that Mitchells disparate treatment claim under the covenant of
good faith and fair dealing was the same as under his already
dismissed race discrimination claim. As noted above, the legal
standards for the two claims are different33 an employer can
breach the covenant of good faith and fair dealing when it treats
members of the same class disparately.34 At a minimum, Mitchells
example of the white supervisor who sexually harassed a
contractors employee and whose discipline consisted of a letter
of warning created a triable issue of fact about whether Teck
Cominco treated Mitchell disparately. The fact that this
incident happened after Mitchells firing does not make it
irrelevant.35
We therefore vacate the superior courts entry of
summary judgment for Teck Cominco on Mitchells contract claims.36
C. Material Issues of Fact Precluded Summary Judgment on
Mitchells Cross-Motion.
Mitchell asked the superior court to grant him summary
judgment on his contract claims that Teck Cominco violated the
covenant of good faith and fair dealing and wrongfully terminated
his employment. He offered evidence that Teck Cominco had not
disciplined or terminated other employees for sexual harassment,
and Teck Cominco did not dispute his evidence. Mitchell also
argued that because he did not engage in quid pro quo sexual
harassment as a matter of fact or law, Teck Cominco breached its
employment contract with him as a matter of law. Finally, he
argued that as a matter of law Teck Cominco breached the covenant
of good faith and fair dealing because it did not give Mitchell
an opportunity to tell his side of the story during the
investigation. Mitchell asks us to reverse the courts denial of
his summary judgment motion.
We conclude that the superior court properly denied
Mitchells summary judgment motion because disputed factual issues
prevented entry of summary judgment on his claims. A party is
not entitled to summary judgment simply because the non-moving
party does not oppose summary judgment,37 so the fact that Teck
Cominco did not dispute some of the evidence Mitchell presented
about other employees who engaged in sexual harassment does not
mean that he is automatically entitled to summary judgment on
that issue.
Accepting and viewing the evidence in the light most
favorable to Teck Cominco, as we must do when we evaluate
Mitchells motion: (1) Carla, at Mitchells request, discussed
both a summer job with Teck Cominco and a personal relationship
with Mitchell, thus implicitly linking the two when she talked to
L.B.; (2) Teck Cominco promptly and reasonably investigated L.B.s
complaint; (3) Teck Cominco reasonably concluded that Mitchells
conduct violated its sexual harassment policy; and (4) Teck
Cominco reasonably terminated Mitchell because of his underlying
conduct, his lack of candor during the investigation, and his
abuse of company e-mail. This precludes the grant of Mitchells
cross-motion for summary judgment on his contract claims.
D. We Remand for Further Consideration of Judicial
Disqualification.
By letter dated July 27, 2006, Mitchells counsel
advised Second Judicial District Presiding Judge Michael I.
Jeffery and Judge Erlich that it had recently come to [his]
attention that Judge Erlich may have a conflict and probably
should disqualify himself from the case under Alaska Code of
Judicial Conduct Canon 3E(1)(c)(i).38 Specifically, counsel
referenced Judge Erlichs wifes ownership of NANA stock and Reich
v. Cominco Alaska, Inc.39 In Reich, we upheld a trial courts
decision to exclude NANA stockholders as jurors in an employment
discrimination case against Teck Cominco because NANA had a
direct financial interest in the outcome of the case that could
be imputed to its shareholders, even though NANA was not a party
to the case.40 Former Alaska Civil Rule 47(c)(12)41 permitted
challenges for cause for jurors with a financial interest . . .
in the outcome of the case. We adopted a per se rule
disqualifying as jurors shareholders of a non-party corporation
that has a financial interest in the outcome of the litigation.42
In Mitchells case, Judge Erlich held a hearing on
August 2, 2006, and indicated that he would consider the letter
as a motion for disqualification. He later denied the motion in
a written order. Judge Erlich noted that his wife owned two
hundred shares of NANA stock and received a dividend of between
$200 and $300 per year, but that she was not a director or
officer or employed by [NANA]. Judge Erlich stated that his wife
was otherwise employed and received a salary in the range of
$60,000 to $70,000 per year. Judge Erlichs salary as a superior
court judge is in excess of $152,760 per year.43 Thus, the impact
of the NANA dividends on the Erlich family annual income was
perhaps one-tenth of one percent of the Erlichs salaries. Judge
Erlich first determined that his wifes interest was de minimis
under the Code of Judicial Conduct. He then considered whether
he should be disqualified under the Codes mandate that he
disqualify himself if his impartiality could be reasonably
questioned or under AS 22.20.020(a)(9), which prohibits a
judicial officer from acting in a matter when he or she feels a
fair and impartial decision cannot be given. He determined that
he could be both objectively and subjectively impartial.
Pursuant to AS 22.20.020(c), Judge Jeffery was
appointed to review Judge Erlichs decision. Judge Jeffery agreed
that the NANA dividends were de minimis under the Code of
Judicial Conduct and that Judge Erlich could be, and could be
seen as, impartial. But he also considered AS 22.20.020(a)(4) as
another possible basis for Judge Erlichs disqualification.
Subsection .020(a)(4) provides that a judicial officer may not
act in a matter in which the judicial officer or his or her
spouse has a direct financial interest in the matter.44 Judge
Jeffery decided that the Code of Judicial Conducts de minimis
exception was an appropriate limitation on subsection .020(a)(4)
and did not infringe on the substantive right to have a judicial
officer who is actually impartial and who also appears to be
impartial. Judge Jeffery distinguished Reich on the basis that
the court rule for juror disqualification does not have a de
minimis exception, while the Code of Judicial Conduct does.
Judge Jeffery affirmed Judge Erlichs decision.
Mitchell argues to this court that subsection
.020(a)(4) requires Judge Erlichs disqualification in his case,
relying chiefly on federal cases construing the federal judicial
disqualification statute to require recusal even when the judges
interest is extremely small. Mitchells reliance on federal cases
is misplaced. The federal counterpart to subsection .020(a)(4)
has stricter language than does the Alaska statute the federal
law requires disqualification when the judicial officer or spouse
has a financial interest, however small, in the subject matter of
the litigation or in a party to the proceeding.45 Because the
federal statute explicitly states that any financial interest is
reason for disqualification and the Alaska statute does not, the
federal cases are not truly analogous.
The Alaska Code of Judicial Conduct establishes
standards for ethical conduct of judges and provides a structure
for regulating conduct through disciplinary agencies.46 It is to
be applied consistently with constitutional requirements,
statutes, other court rules and decisional law and in the context
of all relevant circumstances.47 Because a de minimis financial
interest does not conflict with the right to have a judicial
officer who is actually unbiased and who appears unbiased,48 we
agree with Judge Jeffery and hold that AS 22.20.020(a)(4) does
not impose a more stringent standard for disqualification than
does the Code when a judicial officer or spouse has a de minimis
financial interest in the matter before the court.
Teck Cominco argues that nothing in the record supports
the proposition that the relationship between NANA and Teck
Cominco is the same now as it was at the time of Reich and,
therefore, that Mitchells allegations of financial conflict
cannot be sustained. This argument is moot in light of our
resolution of the recusal issue.49 However, we take judicial
notice of a January 2007 affidavit by the vice-president and
general counsel of NANA in connection with another case50 that has
reached this court.51 This affidavit describes the relationship
between NANA and Teck Cominco in the same manner reflected in
Reich and notes the significant employment and related financial
impact of the Mine on NANA shareholders and the Northwest Arctic
Borough. The affidavit further provides that (1) Mine royalties
to NANA for 2008 are projected to exceed $250 million, over four
times the 2007 royalties, although (2) sixty-two percent of the
royalties are shared with other entities under the Alaska Native
Claims Settlement Act. This suggests that the future stream of
NANA shareholder dividends, as well as the value of NANA stock
(notwithstanding current restrictions on transfer52), may increase
substantially as a direct result of NANAs investment in the Mine.
Canon 3E(1) requires disqualification when the judges
impartiality might reasonably be questioned . . . . While this
requires disqualification when a judge or spouse has more than a
de minimis interest in the outcome of a case, financial or
otherwise,53 that does not mean that such a de minimis interest
can never give rise to a reasonable question about a judges
impartiality. In light of the information about greatly
increased royalties from the Mine and the Mines significant
financial impact on NANA shareholders and the Northwest Arctic
Borough, we remand for Judge Erlichs renewed consideration of
Mitchells request that he disqualify himself from this case. On
remand Judge Erlich should consider and indicate whether his
wifes ownership of NANA stock has a financial or other impact on
the Erlich household, de minimis or not, that would reasonably
call into question his ability to serve as the trial judge in
this case.54
V. CONCLUSION
We REVERSE the superior courts implicit denial of
Mitchells Rule 56(f) request for a continuance because Mitchell
met all of the requirements of the rule, and we therefore VACATE
the grant of summary judgment ruling to Teck Cominco on Mitchells
discrimination claim. Because there are genuine issues of fact
about the reasonableness of Teck Comincos investigation and
differences in discipline for sexual harassment, we also REVERSE
the grant of summary judgment to Teck Cominco on Mitchells
contract claims and AFFIRM the denial of summary judgment to
Mitchell on those claims. We VACATE the final judgment and award
of attorneys fees and costs to Teck Cominco and REMAND to the
superior court for further proceedings consistent with this
opinion, including renewed consideration of Mitchells request for
judicial disqualification.
_______________________________
1 See Alaska R. Civ. P. 12(b)(6).
2 Cf. Alaska R. Civ. P. 12(b) which provides, in part:
If, on a motion asserting the defense
numbered (6) to dismiss for failure of the
pleading to state a claim upon which relief
can be granted, matters outside the pleading
are presented to and not excluded by the
court, the motion shall be treated as one for
summary judgment and disposed of as provided
in Rule 56, and all parties shall be given
reasonable opportunity to present all
material made pertinent to such a motion by
Rule 56.
3 Alaska R. Civ. P. 56(f) provides:
When Affidavits Are Unavailable. Should it
appear from the affidavits of a party
opposing the motion that the party cannot for
reasons stated present by affidavit facts
essential to justify the partys opposition,
the court may refuse the application for
judgment or may order a continuance to permit
affidavits to be obtained or depositions to
be taken or discovery to be had or may make
such other order as is just.
4 See Reich v. Cominco Alaska, Inc., 56 P.3d 18, 23-25
(Alaska 2002) (NANA shareholders have imputed direct financial
interest in the outcome of litigation involving the Mine and are
excluded as jurors under former Alaska R. Civ. P. 47(c)(12)).
5 AS 22.20.020(c) provides, in relevant part:
If a judicial officer denies disqualification
the question shall be heard and determined by
another judge assigned for the purpose by the
presiding judge of the next higher level of
courts or, if none, by the other members of
the supreme court. The hearing may be ex
parte and without notice to the parties or
judge.
6 Hymes v. DeRamus, 119 P.3d 963, 965 (Alaska 2005)
(quoting Kessey v. Frontier Lodge, Inc., 42 P.3d 1060, 1062
(Alaska 2002)).
7 Dougan v. Aurora Elec. Inc., 50 P.3d 789, 793 (Alaska
2002) (citing Morgan v. State, Dept of Revenue, 813 P.2d 295, 297
n.4 (Alaska 1991)).
8 Miller v. Safeway, Inc., 170 P.3d 655, 658 (Alaska
2007) (citing DeNardo v. Bax, 147 P.3d 672, 676 (Alaska 2006)).
9 Id.
10 Sykes v. Melba Creek Mining, Inc., 952 P.2d 1164, 1167
n.3 (Alaska 1998).
11 Id.
12 Amidon v. State, 604 P.2d 575, 577 (Alaska 1979)
(citing United States v. Halderman, 559 F.2d 31, 139 (D.C. Cir.
1976)).
13 Id.
14 State v. Jeffery, 170 P.3d 226, 229-30 (Alaska 2007).
15 Catholic Bishop of N. Alaska v. Does 1-6, 141 P.3d 719,
722 (Alaska 2006) (quoting Marshall v. First Natl Bank of Alaska,
97 P.3d 830, 834 (Alaska 2004)).
16 See Alaska R. Civ. P. 12(b).
17 See Demmert v. Kootznoowoo, Inc., 960 P.2d 606, 611-12
(Alaska 1998); Alaska R. Civ. P. 12(b).
18 See supra note 3.
19 Hymes, 119 P.3d at 965 (quoting Ball v. Birch, Horton,
Bittner & Cherot, 58 P.3d 481, 489 (Alaska 2002)).
20 Id. (quoting Parson v. Marathon Oil Co., 960 P.2d 615,
618 (Alaska 1998)).
21 Id. (quoting Parson, 960 P.2d at 618).
22 Compare Charles v. Interior Regl Hous. Auth., 55 P.3d
57, 62-63 (Alaska 2002) (noting that covenant of good faith and
fair dealing requires that employer treat like employees alike),
with Haroldsen v. Omni Enters., Inc., 901 P.2d 426, 430 (Alaska
1995) (setting out three-part test for racial discrimination
claims).
23 See Bio v. Fed. Express Corp., 424 F.3d 593, 594-95,
598 (7th Cir. 2005) (holding that plaintiff in Title VII case
could not show less favorable treatment when other employee,
fired five months after plaintiff, was fired after receiving same
number of disciplinary notices); Lynn v. Deaconess Med. Ctr. W.
Campus, 160 F.3d 484, 485-88 (8th Cir. 1998) (comparing
discipline of plaintiff in Title VII case to discipline of
similar employee whose discipline happened four months after
plaintiffs forced resignation).
24 A detailed showing of prejudice is not necessary for
reversal of a wrongful dismissal of a Rule 56(f) motion. See
Demmert, 960 P.2d at 612 (holding it is inappropriate to require
a detailed showing of prejudice from a party who has not had a
reasonable opportunity to oppose a motion for summary judgment
due to the courts failure to grant a Rule 56(f) continuance).
25 Although we vacate the superior courts summary
disposition of Mitchells discrimination claim on Rule 56(f)
grounds, we also note that the effect of the courts conversion
order was to stand summary judgment procedure on its head. Teck
Cominco did not submit any evidentiary materials with its
original Rule 12(b)(6) motion or with its Rule 12(b)(6) reply
memorandum. After the court converted the dismissal motion into
a summary judgment motion and gave Teck Cominco the opportunity
to file a reply to Mitchells supplemental opposition, Teck
Cominco filed nothing at all. The court then ruled that Mitchell
had failed to present sufficient admissible evidence to establish
a prima facie case for discrimination under his disparate
treatment theory and summarily dismissed his claim.
But a party seeking summary judgment has the initial
burden of proving, through admissible evidence, that there are no
disputed issues of material fact and that the moving party is
entitled to judgment as a matter of law. Shade v. Co & Anglo
Alaska Serv. Corp., 901 P.2d 434, 437 (Alaska 1995) (noting that
courts should be mindful of burdens of proof to avoid premature
grant of summary judgment). When the moving party does not meet
its burden, the non-moving party need not present any opposing
evidence at all. See Weaver Bros. v. Chappel, 684 P.2d 123, 126
(Alaska 1984). Only when the moving party establishes a prima
facie case for summary judgment is the non-moving party required
to come forward with contradictory evidence to prevent the entry
of summary judgment. Preblich v. Zorea, 996 P.2d 730, 733
(Alaska 2000) (quoting Jennings v. State, 566 P.2d 1304, 1309
(Alaska 1977)).
Here, Teck Cominco obtained summary judgment on a
factual issue without submitting any admissible evidence
whatsoever, relying only on assertions of fact in its memoranda.
Cf. Brock v. Rogers & Babler, Inc., 536 P.2d 778, 783 (Alaska
1975) (assertions of fact in pleadings and legal memoranda cannot
be relied upon for summary judgment purposes). When converting a
dismissal motion to a summary judgment motion, trial courts must
ensure that the appropriate parties bear the burdens of proof and
persuasion.
26 Raymond v. Ameritech Corp., 442 F.3d 600, 610 (7th Cir.
2006); Graham v. Long Island R.R., 230 F.3d 34, 39 (2d Cir.
2000).
27 See Graham, 230 F.3d at 40.
28 Id.; see also Lynn, 160 F.3d at 488 (noting requirement
that employee engage in exact same offense could result in
scenario in which treatment of employee who committed more
serious offense could never be relevant to proof of
discrimination).
29 Id. at 1013 (citing Luedtke v. Nabors Alaska Drilling
, Inc., 834 P.2d 1220, 1223-24 (Alaska 1992)).The reasonable
ness of any investigation is a fa
30 Id. at 1012-13.
31 Id. at 1013 (citing Luedtke v. Nabors Alaska Drilling,
Inc., 834 P.2d 1220, 1223-24 (Alaska 1992)).
32 The reasonableness of any investigation is a fact-
dependent question and may depend on the strength of the evidence
of the underlying infraction. Here, Mitchell strenuously denies
that he offered L.B. a job in return for sex and contends he was
fired for something he never did. An unreasonable or unfair
investigation may lead to an unreasonable conclusion, although
this is not always the case. But having concluded that there is
a triable issue of fact about the fairness and reasonableness of
Teck Comincos investigation, the reasonableness of Teck Comincos
conclusion is also a triable issue of fact.
33 See supra note 22.
34 See Charles, 55 P.3d at 62.
35 The superior court also discounted another of Mitchells
examples because, according to the trial court, the incident
happened seventeen years prior to Mitchells termination.
Mitchell contends that the record does not support this finding,
and our review of the record did not reveal when that incident
happened.
36 Having vacated the superior courts entries of summary
judgment in favor of Teck Cominco, we also vacate the final
judgment and the award of attorneys fees and costs in favor of
Teck Cominco. We therefore do not need to decide whether Teck
Comincos Rule 68 offer of judgment was valid.
37 Morris v. Rowallan Alaska, Inc., 121 P.3d 159, 164
(Alaska 2005).
38 Alaska Code of Judicial Conduct Canon 3E provides in
part:
E. Disqualification.
(1) Unless all grounds for disqualification
are waived as permitted by Section 3F, a
judge shall disqualify himself or herself in
a proceeding in which the judges impartiality
might reasonably be questioned, including but
not limited to instances where:
. . . .
(c) the judge knows that he or she,
individually or as a fiduciary, or the judges
spouse, parent, or child wherever residing,
or any other member of the judges family
residing in the judges household:
(i) has an economic interest in the subject
matter in controversy . . . .
Alaska Code of Judicial Conduct Canon 5 Commentary,
Terminology defines economic interest as follows:
Economic interest means ownership of a more
than de minimis legal or equitable interest
or a relationship as an officer, director,
advisor, or other legal participant in the
affairs of a party . . . .
39 Reich, 56 P.3d at 18.
40 See id. at 23-25. The record in that case reflected
that NANA owned the Mine, that Teck Cominco operated it under a
development agreement, that under the agreement NANA and Teck
Cominco shared net profits, and that under the agreement the net
profits to be shared could be reduced by litigation expenses and
the payment of judgments in the absence of a finding that Teck
Cominco was liable for gross negligence or willful misconduct.
See id. at 20.
41 Now Alaska R. Civ. P. 47(c)(13).
42 Reich, 56 P.3d at 23.
43 See AS 22.10.190.
44 AS 22.20.020(a)(4).
45 28 U.S.C. 455(b)(4), (d)(4) (2006). Alaskas former
Code of Judicial Conduct mirrored this language. See former
Alaska Code of Judicial Conduct Canon 3C(1)(c) (1973).
46 Alaska Code of Judicial Conduct Preamble.
47 Id.
48 See Amidon, 604 P.2d at 577 (citing Keel v. State, 552
P.2d 155, 156 (Alaska 1976)) (holding that AS 22.20.020 embodies
right to impartial tribunal).
49 Teck Cominco also argues that Mitchells efforts to
disqualify Judge Erlich below were untimely, that having failed
below to rely on AS 22.20.020(a)(4) he cannot rely on it on
appeal, and that Mitchell lacks standing to appeal the denial of
recusal. In light of our resolution of the recusal issue, we
need not address these arguments.
50 See Drake v. Wickwire, 795 P.2d 195, 197 n.1 (Alaska
1990) (noting court may take judicial notice of pleadings filed
in another case).
51 Council of Alaska Producers v. Parnell, Supreme Court
Nos. S-13059/S-13060, Superior Court Case No. 4FA-07-02696 CI.
52 See 43 U.S.C. 1606(h) (2006) (restricting alienation
of Alaska Native Claims Settlement Act common stock and all
inchoate rights, including rights to dividends and
distributions); AS 13.16.705 (providing inheritance mechanism for
ANCSA common stock while federal law against alienation is in
existence).
53 See Alaska Code of Judicial Conduct Canon 3E(1)(c)(i),
(iii), (explaining circumstances requiring disqualification);
Alaska Code of Judicial Conduct Terminology (defining de minimis
interest).
54 The commentary to Canon 3E(1) provides that a judge
should disclose on the record information that the judge believes
the parties or their lawyers might consider relevant to the
question of disqualification, even if the judge believes there is
no real basis for disqualification. Alaska Code of Judicial
Conduct Canon 3E(1) cmt. Alaska Statute 22.20.020(b) likewise
provides that a judge shall disclose reasons for disqualification
at the commencement of the action. This strongly suggests that
Judge Erlich should have disclosed his wifes NANA stock at the
inception of this case, and his consideration of disqualification
on remand should consider whether his prior non-disclosure has a
bearing on whether his impartiality might reasonably be
questioned.
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