Judge must revisit reduction of punitives vs. city of Boston.

Byline: Kris Olson

The Appeals Court on Oct. 31 vacated a Superior Court judge's decision to reduce a $10 million award of punitive damages against the city of Boston in a racial discrimination and retaliation case to $2 million.

The court stressed that it was not taking the position that such an 80 percent reduction in the punitive damages award would be an abuse of discretion, but said that Judge Elizabeth M. Fahey's "brief analysis contained some errors."

The court added that lower courts and parties would "benefit from some additional guidance with respect to claims that punitive damages are excessive."

The plaintiff in the case, Chantal F. Charles, is a black woman who has worked as a senior administrative assistant in the trust office of the city's treasury department since 1986.

Charles sued her supervisor, Vivian Leo, and the city for racial discrimination and retaliation in violation of G.L.c. 151B. A jury found the defendants liable on both claims, and awarded Charles $10 million in punitive damages, along with nearly $900,000 in compensatory damages, more than $100,000 for front pay, a little over $250,000 for retirement benefits and $500,000 for emotional distress.

Fahey, who the Appeals Court noted is an "experienced trial judge," permissibly had confined her analysis of whether the punitive damages award was excessive to the three factors outlined by the U.S. Supreme Court's 1996 decisionBMW of N. Am., Inc. v. Gore: the "degree of reprehensibility" of the defendant's conduct, the ratio of punitive damages to the actual harm inflicted on the plaintiff, and a comparison of the punitive damages award with the civil or criminal penalties that could be imposed for comparable misconduct.

Under the first factor, Fahey had gonebeyond making a reasonable judgment about the degree of reprehensibility of the unlawful conduct and had takenthe additional step of comparing the award with punitive damages awards in what she determined were more reprehensible cases, the Appeals Court noted.

While doing so is "permissible" as part of an excessiveness analysis, a judge is required to go further than Fahey had, the court concluded.

"A proper comparison of punitive damages awards in different cases requires an analysis not only of reprehensibility and of the amounts of the awards, but of the relationship of the punitive award in each case to the compensatory award, and of the financial circumstances of the defendants in each case, something the...