## Facts

- Edna Johnson worked for the University of Wisconsin–Milwaukee (UWM) from 1965 until her discharge on September 17, 1981, when she was 59 and held a payroll and benefits counseling position.
- UWM asserted it discharged Johnson for performance-related reasons, including inability to complete assignments, avoiding work, and incorrect work.
- Johnson contended the stated performance reasons were not the true basis for discharge and maintained her age was a determinative factor; she also asserted UWM acted in retaliation for a lawsuit brought by her son, a former UWM employee.
- Through contractual grievance arbitration, an arbitrator found no discharge based on age, handicap, retaliation for her son’s litigation, or nepotism, but also found no “just cause” for discharge; the arbitrator ordered reinstatement, back pay, and imposed a ten-week unpaid suspension as the appropriate discipline.
- In a contested state unemployment proceeding, a Wisconsin appeal tribunal found Johnson was not terminated for statutory “misconduct” and therefore qualified for unemployment benefits; the examiner criticized aspects of UWM’s disciplinary campaign as “specious or contrived,” without finding age bias.
- Johnson filed an ADEA action in federal court; a jury found age was not a determinative factor in her discharge, and judgment was entered for UWM.
- After trial, Johnson sought JNOV or a new trial, arguing issue preclusion from the earlier proceedings and error in excluding evidence tied to the son-lawsuit retaliation theory; the district court denied relief.

## Issues

1. Whether prior contractual arbitration and a state unemployment decision collaterally estopped UWM from asserting legitimate, non-discriminatory reasons for Johnson’s discharge in the ADEA case.
2. Whether the district court abused its discretion by excluding the state unemployment decision and retaliation-related testimony offered to show UWM’s performance justification was pretextual in the ADEA trial.
3. Whether the post-trial denial of JNOV or a new trial should be reversed based on the evidentiary record and the challenged rulings.

## Decision

- The Seventh Circuit affirmed the denial of JNOV and a new trial, leaving the defense verdict intact.
- The court held UWM was not collaterally estopped because neither the arbitration nor the unemployment proceeding necessarily decided the ADEA question whether age was a determinative factor in the discharge.
- The court held the district court did not abuse its discretion in excluding the unemployment decision and retaliation-based testimony as irrelevant or likely to confuse the jury by injecting an alternative motive theory into an age-discrimination trial.
- Viewing the evidence in the light most favorable to the verdict, the court found sufficient support for the jury’s finding that age did not determine the discharge.

## Legal Principles

- Collateral estoppel applies only when the identical issue was actually litigated and necessarily decided; determinations about contractual “just cause” or unemployment “misconduct” are not the same as whether age was a determinative factor under the ADEA.
- Prior administrative or arbitral findings that discipline was unwarranted, unfair, or non-culpable do not, without more, resolve or preclude litigation of federal discrimination elements.
- Trial courts have broad discretion to exclude evidence whose probative value on the pleaded discrimination theory is limited and whose admission risks jury confusion, undue distraction, or relitigation of collateral proceedings.
- In reviewing JNOV or a new trial denial, appellate courts defer to the jury’s verdict if supported by evidence when viewed favorably to the prevailing party.

## Conclusion

The Seventh Circuit held that earlier arbitration and unemployment determinations did not bar the university from defending an ADEA claim on performance grounds and that excluding retaliation-themed evidence offered as pretext proof was within the trial court’s discretion; the jury’s finding that age was not a determinative factor therefore stood.


Johnson v. Univ. of Wis.-Milwaukee, 783 F.2d 59 (7th Cir. 1986)