Based on a consideration of these factors, I find that prejudgment interest is warranted in this action. Plaintiff was deprived of money that she otherwise would have earned but for defendant's violation of her First Amendment rights.
Plaintiff is entitled to prejudgment interest here for the same reasons others who have been terminated on account of discrimination have been awarded prejudgment interest. See Saulpaugh, 4 F.3d at 145. Plaintiff has been without her lost pay for several years because of the discriminatory acts of defendant. The purpose of back pay is to make her whole and that can only be accomplished if she receives compounded, prejudgment interest. An award of prejudgment interest is necessary to fully compensate plaintiff, is not inequitable and would not create a windfall for plaintiff.
The jury awarded plaintiff $ 142,170.00 back pay to cover her pay loss after the improper firing from 1986 to 1993. Plaintiff requests interest, compounded annually at a rate of 7.22% per year, for a total of $ 46,292.97 and $ 37.80 per day from the date of the jury verdict until the date of entry of judgment. Defendant has not challenged the calculations or the rate of interest.
In general, district courts have discretion in deciding what interest rate to use in awarding prejudgment interest. Cefali v. Buffalo Brass Co., 748 F. Supp. 1011, 1025 (W.D.N.Y. 1990). The Second Circuit has not expressly endorsed any particular prejudgment interest rate. Id. Courts in this and other circuits have used various interest rates including the postjudgment interest rate provided in 28 U.S.C. § 1961(a) [the treasury bill rate], statutory interest rates, or market rates. See Katsaros v. Cody, 744 F.2d 270, 281 (2d Cir.), cert. denied, 469 U.S. 1072 (1984) (using the rate of prime plus one percent); Dependahl v. Falstaff Brewing Corp., 653 F.2d 1208, 1219-20 (8th Cir.), cert. denied, 454 U.S. 968, 70 L. Ed. 2d 384, 102 S. Ct. 512 (1981) (using the Missouri statutory rate); Foltz v. U.S. News & World Report Inc., 613 F. Supp. 634, 648-49 (D.C.D.C. 1985) (using the District of Columbia statutory rate); River Oaks Marine, 1992 WL 373533 at *7 (using the adjusted prime rate); Cefali, 748 F. Supp. at 1025 (using the postjudgment rate).
Plaintiff suggests that the Court use 7.22% as the prejudgment interest rate based solely on the fact that the Second Circuit in Saulpaugh used that rate in discussing whether or not straight interest or compound interest was required. 4 F.3d at 145. In Saulpaugh, the Second Circuit was not, as suggested by plaintiff, endorsing the use of 7.22% as the prejudgment interest rate on back pay awards. The Second Circuit did not offer any explanation as to the source of this interest rate and was merely using that figure to demonstrate the result of compounding the interest. The Second Circuit did not calculate the interest but remanded the case to the District Court.
I decline to award prejudgment interest at the 7.22% rate, without further clarification of its source, and instead award prejudgment interest at the postjudgment, treasury bill rate, provided in 28 U.S.C. § 1961(a), which is now 4.5%. Plaintiff is, therefore, entitled to an award of prejudgment interest in the amount of $ 31,438.00 on her back pay award of $ 142,170.00. as of May 2, 1994.
After a jury finds § 1983 liability in a loss-of-employment case, the Court must attempt to make plaintiff whole, while avoiding granting plaintiff a windfall. Standley v. Chilhowee R-IV School Dist., 5 F.3d 319, 322 (8th Cir. 1993). Reinstatement of plaintiff to her former position is an available remedy under § 1983 and is appropriate when plaintiff has been denied a right to continued employment. Petrella v. Siegel, 843 F.2d 87, 89 (2d Cir. 1988).
Reinstatement is an equitable remedy which is to be exercised in the discretion of the district court. Versarge v. Township of Clinton N.J., 984 F.2d 1359, 1368 (3d Cir. 1993); Williams v. Roberts, 904 F.2d 634, 639 (11th Cir. 1990); Rosario-Torres v. Hernandez-Colon, 889 F.2d 314, 321 (1st Cir. 1989).
While some courts view reinstatement in § 1983 cases as a presumptive remedy, see e.g., Williams, 904 F.2d at 639 (plaintiff discriminated against in an employment context is "normally entitled to reinstatement and back pay, absent special circumstances"), Allen v. Autauga County Bd. of Educ., 685 F.2d 1302, 1305 (11th Cir. 1982) (reinstatement required "except in extraordinary cases") and Jackson v. City of Albuquerque, 890 F.2d 225, 233 (10th Cir. 1989) (reinstatement "is ordinarily to be granted"), others view reinstatement as an appropriate remedy only after the court has weighed and balanced the equities of a given case. Rosario-Torres, 889 F.2d at 322; Banks v. Burkich, 788 F.2d 1161, 1164 (6th Cir. 1986) ("An unconstitutionally discharged employee does not have an absolute right to reinstatement").
Regardless of how the remedy is viewed, however, because of the equitable nature of reinstatement, a court must consider, in the exercise of its discretion, whether reinstatement is appropriate in light of all the surrounding circumstances. The Court must weigh and balance all of the equities and circumstances in an attempt to determine if reinstatement is the appropriate remedy for that particular case.
In weighing and balancing the equities in an attempt to determine if reinstatement is an appropriate remedy, Rosario-Torres instructs the district court to consider the following:
Reinstatement in unlawful-discharge cases often will place some burden on the [governmental] agency: there will likely be tension (even hostility) between the parties when forcibly reunited; employees who have assumed duties previously performed by the fired worker will have to be displaced when he or she returns; and as a result the public's business may be conducted somewhat less efficaciously.