2d Circuit sustains $250,000 Title VII retaliation verdict (with a catch)

This case must be the most complex Title VII decision of the year. The Court of Appeals hands down a 78-page decision containing a smorgasbord of rulings that favor both sides in this discrimination case from the City of Syracuse.

The case is Lore v. City of Syracuse, decided on February 2. Lore was Public Information Officer for the City Police Department. She was removed from that position in 1999 and assigned elsewhere without a reduction in pay. In 2000, she discovered that she was receiving fewer overtime assignments than male officers. She photocopied their paycheck stubs (the department had them out in the open for all to see) and filed an EEOC charge alleging both discrimination and retaliation because she was assigned less desirable positions because of her discrimination complaints. When Lore used the paycheck photocopies at her internal arbitration hearing on her unfair assignment grievance, the City attorney's office threatened her with criminal prosecution for making these photocopies but said it would not press criminal and administrative charges if she withdrew her discrimination complaints. She refused to withdraw her discrimination charges, and was suspended for using the copy machine for personal use. Then, the City's Corporation Counsel, Rick Guy, told the news media that Lore was a bad employee and that she had "stolen" employee paychecks. The case went to trial, and the jury awarded Lore $100,000 for harm to her reputation and $150,000 for emotional distress as a consequence of the City's retaliation against Lore for asserting her rights under Title VII, i.e., offering to forgo criminal and administrative charges if she dropped her discrimination charge and suspending her for 10 days and seeking a criminal investigation into her photocopying.

So that's the background. Let's start with the City's challenge to the reputational and emotional injury claim, which won Lore $250,000 in damages. The Second Circuit says that the $100,000 in damages were justified because the EEOC has long recognized damages for reputational injury, Lore was shunned by her fellow police officers and civilians had approached her about Guy's allegation that she had stolen officer paychecks. The $150,000 in damages for emotional distress may be a little high considering Lore was not fired and some of her emotional distress predated any of the City's retaliation, but the Second Circuit sustains it because it does not materially deviate from damages in comparable cases. Here are the damages that she endured:

Lore's evidence of her pain, suffering, and emotional distress ... included her own testimony and the testimony of her mother, that Lore had suffered, inter alia, tension headaches, abdominal pain, insomnia, anxiety, and depression. They testified that whereas Lore had been a gregarious and vivacious person before the events of 2000 and 2001, she thereafter suffered from stress, had stomach problems, and became reclusive. Her mother testified that Lore looked like a ghost, "wouldn't talk" to anyone, and "cried and cried and cried." In addition, Lore received medical treatment, the physical side effects of which included vomiting and diarrhea. Her medical records showed, inter alia, that her physician insisted that she remain out of work for a period in June 2001 to receive treatment for her depression.

In addition, "[s]ufficient evidence to support the jury's awards against the City of $100,000 for reputational injury and $150,000 for emotional distress, however, is found in the publicity in which Guy participated, making Lore's suspension public and casting it in a way that allowed the jury to infer that members of the public were left with the false impression that Lore had stolen other officers' paychecks."

Here is what makes this case unique. On the summary judgment motion, the district court dismissed Lore's discrimination claim arising from her removal as Public Information Officer. This discrimination claim predicated Lore's follow-up retaliation claim, which alleged she suffered reprisal from speaking out against the underlying discrimination. The Court of Appeals reinstates the discrimination claim, reasoning that the jury could deem as discriminatory her removal as Department spokeswoman in 1999 because (1) she was replaced by a male and the Mayor said that "a woman should be seen and not heard" and (2) although she did not lose any salary, her removal was an adverse employment action because she lost prestige in working elsewhere in the department. On the adverse action, the Second Circuit's ruling is consistent with its longstanding rule that there is more to life than money in cases like this:

in the PIO position, Lore was assigned to the office of the chief of police, dealt with the media, and was the spokesman for the Department. When she was removed from that position, her duties for several weeks entailed merely doing "odds and ends in the chief's office"; she was then reassigned to Technical Operations.  Shortly thereafter, she was again reassigned, this time to supervise the uniformed patrol units; and in little more than half a year, she herself was required to wear a uniform while serving in a community relations unit in which none of the male sergeants was required to wear a uniform. We conclude that a rational juror could find that, even though Lore's rank and salary were not reduced, a reasonable police officer could easily view the change from the position of public information officer in the office of the chief of police, to that of general factotum in that office and thence to equipment, patrol, and uniformed positions, as materially adverse changes. Accordingly, Lore's HRL claims for gender discrimination based on her removal from the PIO position should not have been summarily dismissed on the ground that she failed to proffer sufficient proof of a materially adverse employment action.

So the discrimination claim is reinstated. So is an unrelated state law retaliation claim against Corporation Counsel Guy, who disparaged Lore in the press after she pressed her discrimination claims. The Court of Appeals notes, however, that the $250,000 damages award that it sustained is a little high, and that the parties did make reference during trial to Lore's underlying discrimination claim arising from her removal as Department spokeswoman (even though the judge kept telling the lawyers to back off this strategy). The Court of Appeals thinks the jury may have given Lore more money than she deserved out of sympathy for the discrimination that she endured in the removal of Public Information Officer position, even though the jury was not asked to rule on that claim because it was dismissed on summary judgment.

What it all means is that if the revived discrimination claims goes to trial by themselves (the Court of Appeals having sustained the verdict in other respects) the next jury may award her damages for those claims, damages that might overlap with the money that the jury has already awarded Lore for the discriminatory and retaliatory maltreatment that she successfully litigated in the first trial. To avoid that result, the Court of Appeals says that the revived discrimination claims are conditionally reinstated for trial if and only if Lore agrees to a retrial on her successful Title VII retaliation claim as well. The City gets a second bite at the apple on claims that it already lost in the first trial, but this approach ensures that Lore is not unjustly enriched in the second trial with damages that the first jury may have already given her out of sympathy for the discrimination claim that was never even properly before the jury in the first instance. Here is how the Court of Appeals (Kearse, Sack and Lynch) puts it:

It is indisputable here that there was considerable discussion at trial as to Lore's complaints of discrimination, in part necessitated by the fact that the acts of retaliation were alleged to have been motivated by Lore's complaints of discrimination. For example, as background for her allegations of retaliation, Lore was allowed to testify to her appointment in 1996 as public information officer for the Department, serving as SPD's liaison with the media, working directly for the chief of police, and having an office of her own in the chief's office. She testified to being removed as PIO and filing grievances thereafter, alleging gender discrimination. But the testimony and arguments went well beyond the mere fact that Lore had filed complaints of discrimination. Lore also testified to the differences between her duties as PIO and her duties after reassignment, for example, being reassigned to the Department's technical operations section, in which her duties were to "overs[ee] telephones, cell phones, pagers, portable radio[s]" and other communication devices. She testified that she was replaced in the PIO position by a male, and said, "To get denied because I am a woman, dead wrong."

Defendants, for their part, argued not only that there was no retaliation, but also that Lore had not been the victim of discrimination. ...

As indicated above, although we do not conclude that the district court abused its discretion in rejecting the City's contention that the jury's award of $250,000 in compensatory damages was excessive, that award for reputational injury and emotional distress caused by the retaliatory acts the jury found to have occurred in September, November, and December of 2000 strikes us as large. And it is entirely possible that the jury, while heeding the court's instructions not to concern itself with the merits of Lore's discrimination claims, was influenced in the direction of generosity by the evidence as to Lore's underlying claims of gender discrimination with respect to her removal from the prestigious PIO position and her transfer to positions involving supervision of cell phones and patrol cars.

Thus, it is not clear to us that a trial limited to Lore's claims of discrimination based on her removal from the PIO position might not result in an award that in part overlaps the generous $250,000 verdict already returned by the jury on her claims of retaliation. Accordingly, to prevent the injustice of a duplicative award, we conclude that if Lore's discrimination claims against Bernardi and the City are to be tried, there should also be a retrial of her retaliation claims against the City and Guy (the latter claims themselves being intertwined as discussed in Part IV above), so that a single jury may consider the circumstances of all of those claims and render a verdict that appropriately compensates Lore with respect to all of the claims it finds proven.

Nonetheless, since we have found no reversible error in the judgment against the City, and since Lore may wish to forgo a trial on her discrimination claims against Bernardi and the City in order to retain the damages, attorneys' fees, and costs awarded in the present judgment, we will make our order for a new trial conditional: We will give Lore the option of either having the present judgment in her favor vacated and having a new trial encompassing both the discrimination claims against Bernardi and the City and the retaliation claims against the City and Guy, or forgoing a trial of those discrimination claims and retaining the benefits of the present judgment.

If Lore elects to proceed to trial, the judgment awarding her damages, attorneys' fees, and costs will be vacated. Her eventual entitlement to those monetary awards will depend on the outcome of the new trial.

This is an extraordinary remedy, one that I have not seen before. Maybe this is why it took the Court of Appeals over a year to issue a ruling. My guess is that Lore will forgo the second trial rather than risk losing the Title VII retaliation verdict on the second go-round. As the district court awarded Lore's counsel $168,000 in attorneys' fees, there is a lot of money on the table, $418,000 in all. The Court of Appeals did issue other rulings in this case, to be blogged upon tomorrow.