Employment Law Case Notes

• Jurisdiction: United States,Federal,California
• Author: By Anthony J. Oncidi
• Publication year: 2015
• Citation: Vol. 29 No. 2

Employment Law Case Notes

By Anthony J. Oncidi

Anthony J. Oncidi is a partner in and the Chair of the Labor and Employment Department of Proskauer Rose LLP in Los Angeles, where he exclusively represents employers and management in all areas of employment and labor law. His telephone number is (310) 284-5690 and his email address is aoncidi@ proskauer.com. (Tony has authored this column without interruption for every issue of this publication since 1990.)

$300,000 in Punitive Damages Upheld in Sexual Harassment Case Despite Nominal Damages Award

State of Arizona v. ASARCO LLC, 773 F.3d 1050 (9th Cir. 2014) (en banc)

Angela Aguilar, who worked in a copper mine for approximately eleven months, claimed she was sexually harassed, retaliated against, subjected to intentional infliction of emotional distress, and constructively terminated from her employment. After an eight-day trial, the jury found ASARCO liable on Aguilar's sexual harassment claims—a violation of Title VII of the Civil Rights Act of 1964—but not on her constructive termination or retaliation claims. The jury awarded Aguilar $1 in nominal damages and $868,750 in punitive damages. The district court reduced the award to $300,000 based on the statutory cap in 42 U.S.C. § 1981a(b)(3)(D).

ASARCO argued in this appeal that the 300,000-to-1 ratio of punitive to compensatory damages violated its due process rights under BMW of N. Am., Inc. v. Gore, 517 U.S. 559 (1996). Although conceding that "Gore is undeniably of some relevance in this context," the United States Court of Appeals for the Ninth Circuit distinguished Gore on the ground that Aguilar (unlike the plaintiff in Gore) "asserted a claim under a statute, Title VII, which includes a carefully crafted provision, § 1981, that imposes a cap on punitive damages" and, therefore, the due process issues raised in Gore do not apply to employment discrimination claims brought under Title VII. The court also noted that the district court instructed the jury that it could not award more than $1 in nominal damages to Aguilar, and that because nominal damages measure neither damages nor severity of the conduct, it is not appropriate to examine the ratio of a nominal damages award to a punitive damages award. Finally, the court found no error in the district court's admission of evidence of sexually explicit graffiti found in the bathrooms that was similar to the graffiti directed at Aguilar, and affirmed an award to Aguilar of $350,902.75 in attorney's fees and costs.

Employee Who Was Sued by Former Employer Collects $271,000 From Employer

Pacific Corp. Group Holdings, LLC v. Keck, 232 Cal. App. 4th 294 (2014)

PCGH sued its former employee, Thomas Keck, to collect on an unpaid promissory note. Keck defended against the action by claiming that any money he owed PCGH was offset by monies PCGH owed him for unpaid bonus and severance payments due under two employment agreements he had with PCGH. In a special verdict, the jury found that PCGH owed Keck $270,547.95 under the terms of a 2006 employment agreement. PCGH filed a motion for judgment notwithstanding the verdict or for new trial, and Keck filed a motion for additur or in the alternative for a new trial on damages, on the ground that the jury had awarded him inadequate damages. The trial court granted Keck's motion and issued an additur and a conditional order granting a new trial on damages, to which PCGH refused to consent. Both parties filed motions for attorneys' fees, which the trial court denied. Both parties filed appeals, but because the trial court's order granting a new trial on damages resulted in a vacatur of the underlying judgment, the court of appeal concluded that it lacked appellate jurisdiction to consider the parties' appeals and, thus, affirmed the trial court's orders and remanded the matter to the trial court with directions to conduct a new trial on damages.

School Teacher With Breast Cancer Could Proceed With Disability Discrimination Lawsuit

Swanson v. Morongo Unified Sch. Dist., 232 Cal. App. 4th 954 (2014)

Lauralyn Swanson was a teacher for the Yucca Valley Elementary School who was diagnosed with breast cancer and underwent a mastectomy. After the district's board of education voted not to renew Swanson's contract, Swanson sued for discrimination based on medical condition, denial of reasonable accommodation, and...