                    United States Court of Appeals
                          FOR THE EIGHTH CIRCUIT
                                   ___________

                                   No. 99-4012
                                   ___________

Delores Stephens,                    *
                                     *
                     Appellant,      *
                                     *
     v.                              * Appeal from the United States
                                     * District Court for the Western
                                     * District of Arkansas.
Rheem Manufacturing Company,         *
                                     *
                     Appellee.       *
                                ___________

                             Submitted: May 8, 2000
                             Filed: August 11, 2000
                                  ___________

Before RICHARD S. ARNOLD and HEANEY, Circuit Judges, and
      MAGNUSON,1 District Judge.
                              ___________

MAGNUSON, District Judge.

     Delores Stephens appeals a jury verdict in favor of her employer Rheem
Manufacturing Company. She contends that the District Court2 erred in excluding


      1
        The Honorable Paul A. Magnuson, Chief Judge, United States District Court
for the District of Minnesota, sitting by designation.
      2
         The Honorable Jimm L. Hendren, United States District Judge for the Western
District of Arkansas.
certain evidence and in denying her Motion for a New Trial. For the reasons stated
below, we affirm the District Court’s rulings.

I.    BACKGROUND

      Appellant Delores Stephens (“Stephens”) has been an employee of Appellee
Rheem Manufacturing Company (“Rheem”) since April 5, 1993. For the first three
years of her employment, Stephens worked directly for and closely with Dennis
Roberson (“Roberson”). Although their working relationship was initially quite
professional, by the close of 1993 Roberson had begun to regularly compliment
Stephens on her appearance and to make sexually suggestive comments in her
presence. He would also frequently blow into her ear or on her hair, shake her chair
from behind, and try to lift her skirt with a back-scratcher. Stephens even became
aware that Roberson offered $100 to any male employee who could sleep with her and
provide proof of the assignation.

        On June 19, 1996, Stephens complained to Rheem about Roberson’s conduct.
Roberson was immediately placed on administrative leave pending an investigation into
the matter. During the investigation, those interviewed uniformly remarked that
Roberson was infatuated with Stephens, that he treated her more favorably than other
employees, and that he showered her with an unusual amount of attention, usually of
a sexual nature. During his interview, Roberson admitted that he had engaged in the
aforementioned conduct, however, he explained that his relationship with Stephens was
consensual, and that she–with rare exception–responded playfully to his behavior.
Roberson’s version of events was corroborated at trial by several witnesses who
testified that the relationship between Stephens and Roberson was flirtatious in nature
and appeared to be consensual.

      Roberson was ultimately placed on disciplinary suspension for one week without
pay, permanently stripped of his supervisory authority, and transferred to another

                                          -2-
department. Although Roberson and Stephens have had only brief and incidental
contact since the investigation, Stephens was displeased that he was not
fired or transferred to a different facility. She sued Rheem and Roberson in Arkansas
circuit court alleging sexual harassment in violation of Title VII of the Civil Rights Act
of 1964 and the Arkansas Civil Rights Act, and various violations of Arkansas common
law.3 Rheem promptly removed the case to the United States District Court for the
Western District of Arkansas.

       On March 16, 1998, the District Court granted Rheem’s Motion for Summary
Judgment in full. On December 23, 1998, this Court reversed and remanded in light
of the Supreme Court’s intervening rulings in Burlington Indus., Inc. v. Ellerth, 524
U.S. 742, 765 (1998) and Faragher v. Boca Raton, 524 U.S. 775, 807 (1998). On
remand, Rheem once again filed for summary judgment. The District Court denied the
Motion as to Stephens’ Title VII and Arkansas Civil Rights Act counts, and granted
summary judgment on the remaining common law counts.

       The case finally proceeded to trial on August 30, 1999. On September 1, 1999,
the jury returned a verdict in favor of Rheem on all counts. Stephens then filed a
Motion for New Trial, arguing that the verdict was against the weight of the evidence
and that significant new evidence had been discovered. The District Court denied
Stephens’ Motion, and this appeal followed.




      3
         On September 8, 1997, the Title VII and Arkansas Civil Rights Act claims
against Roberson were dismissed. The remaining state law claims against him were
remanded to Arkansas circuit court.
                                           -3-
II.   DISCUSSION

      A.     Exclusion of Evidence.

       Prior to trial, Rheem filed a motion in limine asking the District Court to exclude
rumors of sexual affairs among Rheem management and employees. The District Court
excluded the evidence under Fed. R. Civ. P. 403, finding that its probative value was
substantially outweighed by the danger of unfair prejudice. On appeal, Stephens argues
that this evidence should have been admitted notwithstanding the threat of prejudice
because it would have effectively rebutted Rheem’s Faragher defense and would have
conclusively established that Roberson’s conduct was unwelcome.

       We review a district court’s exclusion of evidence for a clear abuse of discretion.
See Adams v. Fuqua Indus., Inc., 820 F.2d 271, 273 (8th Cir. 1989). Only when the
evidence excluded is of such a critical nature that there is “no reasonable assurance that
the jury would have reached the same conclusion had the evidence been admitted” has
a district court so abused its discretion. Id. No such abuse has occurred in this case.



       We fully agree with the District Court that the admittance of such salacious
rumor-based evidence could have unduly prejudiced the jury against Rheem, and that
this danger of prejudice greatly outweighed the limited probative value of the evidence.
Even if we did not agree, however, we are convinced that admission of the evidence
would not have affected the jury’s verdict.

      Stephens advances two uses for the rumor evidence. She first argues that the
evidence should have been admitted for the purpose of refuting Rheem’s Faragher
defense, for which Rheem was required to establish that Stephens’ failure to report
Roberson sooner was unreasonable. See Faragher, 524 U.S. at 807; Ellerth, 524 U.S.
at 765. This argument requires little discussion because the verdict was quite clearly

                                           -4-
based on Stephens’ failure to establish the existence of a sexually hostile work
environment, not on Rheem’s Faragher defense. (See J.A. 704-6.) Therefore, if used
for this purpose, the evidence would not have led to a different result, and cannot now
serve as a basis for reversal.

       Stephens next argues that the evidence should have been admitted for the
purpose of establishing that Roberson’s conduct was unwelcome. Stephens explains
that her willingness to tolerate Roberson’s behavior for so long was not because it was
welcome, but because the rumors led her to believe that she had no recourse. Even if
true, we are not persuaded that the evidence would have affected the verdict.
       First, Stephens presented ample evidence from which the jury could have
concluded that Roberson’s conduct was unwelcome, rendering any additional evidence
in this regard merely cumulative. Second, and perhaps most importantly, the rumor
evidence does not necessarily establish that Stephens found the conduct unwelcome.
Indeed, because consensual affairs and unwelcome sexual harassment are entirely
separate exploits, with distinct motivations and underlying conduct, the jury could have
reasonably concluded that the rumor evidence was wholly irrelevant.
Accordingly, the District Court’s decision to exclude the rumor evidence was not an
abuse of discretion.

      B.     Denial of Motion for a New Trial: Sufficiency of the Evidence.

       Following the verdict, Stephens summarily moved for a new trial, stating only
that “[t]he verdict of the jury is clearly contrary to the preponderance of the evidence
and the law.” (J.A. at 719.) With somewhat more detail, Stephens now appeals the
District Court’s denial of her Motion, arguing that because Roberson admitted that he
regularly directed sexually suggestive comments and actions towards her, the jury could
not have rationally found for Rheem.

      A district court’s denial of a motion for a new trial based on the sufficiency of

                                          -5-
the evidence is “virtually unassailable on appeal” and will be disturbed only upon a
finding of a clear abuse of discretion. Czajka v. Black, 901 F.2d 1484, 1485 (8th Cir.
1990). We are certain that no such abuse occurred in this case. Indeed, the verdict can
easily be reconciled with the evidence presented at trial.

       The jury heard numerous witnesses testify that Stephens appeared to enjoy
spending time with Roberson notwithstanding his overtly sexual overtures. Although
the jury also heard Stephens testify to the contrary, the jury was free to disbelieve her
testimony. See DiCarlo v. Keller Ladders, Inc., 211 F.3d 465, 468 (8th Cir. 2000).
Even if we could second-guess the jury’s measure of credibility, we are not so inclined.
See United States v. Anderson, 78 F.3d 420, 422-23 (8th Cir. 1996).

       Further, Rheem’s concession that Roberson’s conduct was objectively
inappropriate did not, as Stephens argues, mandate a verdict in her favor. Rather, an
employer’s inappropriate conduct is only one facet of a successful sexual harassment
claim. The plaintiff must also establish that the conduct was unwelcome and
subjectively inappropriate. See Schmedding v. Tnemec Co., Inc., 187 F.3d 862, 864
(8th Cir. 1999). As previously discussed, the jury reasonably rejected such a finding
in this case. The District Court’s denial of Stephens’ Motion for New Trial was
therefore wholly appropriate and did not approach an abuse of discretion.

      C.     Denial of Motion for New Trial: Newly Discovered Evidence.

       Stephens next argues that she was entitled to a new trial on the basis of newly
discovered evidence. First, Jack Dempsey (“Dempsey”), a former Rheem employee,
disclosed that Roberson had openly expressed his intention to actively pursue Stephens
from the start of her employment with Rheem. Second, an anonymous individual
revealed that his relative had seen Roberson in a compromising position with another
Rheem employee.


                                           -6-
       A district court’s denial of a motion for new trial on the basis of newly
discovered evidence will be disturbed only upon a finding of a clear abuse of discretion.
See Baxter Int’l, Inc. v. Morris, 11 F.3d 90, 92 (8th Cir. 1993). In order to qualify for
a new trial on the basis of newly discovered evidence, the movant must establish that:
1) the evidence in question was discovered after trial; 2) she exercised due diligence
to discover the evidence before the end of trial; 3) the evidence is material and not
merely cumulative or impeaching; and 4) a new trial at which the evidence is
introduced would probably result in a verdict for the movant. See id.

      The District Court held, and we agree, that the Dempsey evidence does not
mandate a new trial. Dempsey’s statement merely confirms Roberson’s undisputed
longstanding infatuation with Stephens, something not really in issue at trial.
Additionally, because the case turned upon Roberson’s conduct and its effect on
Stephens rather than on Roberson’s subjective intent, the evidence is of questionable
relevance. Even if Dempsey’s statement could somehow be classified as material and
non-cumulative, the District Court’s failure to make such a finding was certainly not
an abuse of discretion.

       Stephens’ reliance on the information provided by the anonymous caller is
similarly unavailing. First, putting aside the obvious problems given the anonymity of
the caller, the vagueness of the information he provided, and the fact that the statement
is pure hearsay, the evidence is of questionable relevance. It establishes only that
Roberson engaged in a consensual affair with another adult, not that Stephens’ work
environment was impermissibly hostile. Second, because the District Court expressly
excluded testimony regarding intra-office affairs, the evidence would have been
inadmissible even if known at the time of trial. Third, even if the statement could be
used for impeachment purposes, merely impeaching evidence cannot serve as the basis
for a new trial. See id.

      Finally, Stephens contends that the information provided by the anonymous

                                           -7-
caller would have established that her decision to wait three years before reporting
Roberson was reasonable. This argument quite clearly bears on Rheem’s Faragher
defense. As previously noted, however, the jury based its decision on Stephens’ failure
to establish an unwelcome hostile work environment, not on Rheem’s Faragher
defense. Therefore, evidence explaining Stephens’ hesitation in reporting Roberson
would not have affected the verdict, and cannot now serve as the basis for a new trial.



III.   CONCLUSION

       The District Court did not err in excluding evidence regarding alleged intra-office
affairs or in denying Stephens’ Motion for New Trial. Accordingly, the judgment and
the District Court’s denial of a new trial is affirmed.

       A true copy.

             Attest:

                      CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.




                                           -8-
