In Dusel v. Factory Mutual Insurance Company, 52 F.4th 495 (1st Cir. Nov. 1, 2022) – an age discrimination case – the court, inter alia, held that the lower court did not abuse its discretion in finding that evidence of pornographic and sexually explicit materials discovered within employee’s paper files after he was terminated qualified as after-acquired evidence which could be admitted to assess damages.
In sum (and in relevant part), and according to the court, defendant FM Global terminated plaintiff on the grounds of violations of the company’s code of conduct and misappropriation of company services and property. After plaintiff’s termination, defendant found that plaintiff had amassed a considerable physical and electronic collection of sexually explicit materials in his office, all in violation of FM Global policy. Plaintiff admitted in a deposition to accessing adult materials using company servers.
The district court denied plaintiff’s motion to exclude this evidence, and the First Circuit affirmed.
From the decision:
Dusel’s second evidentiary argument concerns the same cache of pornographic and sexually explicit materials described above. At the district court, Dusel moved to exclude this evidence, arguing that it was discovered after his termination and is therefore irrelevant and presented a risk of unfair prejudice. The district court rejected this argument, finding that the evidence qualified as after-acquired evidence which could be admitted to assess damages but not liability.
On appeal, Dusel again argues that the evidence was irrelevant as it was discovered after he was terminated and therefore is not relevant to the reasons for his termination. He also argues that the district court improperly classified the evidence as after-acquired evidence.
Where an employer seeks to rely upon after-acquired evidence of wrongdoing, it must first establish that the wrongdoing was of such severity that the employee in fact would have been terminated on those grounds alone if the employer had known of it at the time of the discharge. Such evidence, however, is not relevant to the employer’s liability but is only admissible to determine damages, as certain remedies for improper termination may be limited based on after-acquired evidence. We agree with FM Global and the district court that, based on the facts of the instant case, the threshold showing of severity has been met. We see no abuse of discretion in the admission of the after-acquired evidence as its admission was not plainly wrong. Further, because no claims survive summary judgment and FM Global has voluntarily dismissed any counterclaims, there is no prejudice to Dusel as this case will not reach the damages portion of adjudication.
[Cleaned up.]
This decision is, as such, instructive as to the formulation and application of the “after acquired evidence” rule in employment discrimination cases.