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Citing a lack of evidence and recent limits on punitive damages, a court of appeal panel filleted an $18.5 million award in a psychiatric disability case against McKesson Corp. and a supervisor on Tuesday. The appeals court halved the compensatory award, and said that the jury’s $15 million award of punitive damages had to be reduced to about $2 million, saying that was about as much as the U.S. Constitution will allow under recent precedents. That left the award for longtime McKesson employee Charlene Roby at about $4.1 million. Roby, a former customer service agent at the company’s West Sacramento distribution center, sued McKesson and supervisor Karen Schoener after she was fired for missing work due to a psychiatric disability. Roby filed three discrimination claims against McKesson, plus a harassment claim against Schoener, who among other things called body odor and other symptoms related to Roby’s panic disorder “disgusting.” Writing for the court, Justice M. Kathleen Butz found that the jury had awarded damages based on alternate theories of liability, and said an award for harassment wasn’t supported by the evidence. “Neither cold indifference nor lack of sensitivity toward a disabled employee can be alchemized into a claim of hostile work environment,” Butz wrote. “If such were the case, virtually every case of disability discrimination could be parlayed into a supplementary damage claim for harassment.” An attorney for McKesson said the ruling is a rare example of an appellate court finding that the jury lacked evidence to reach its decision. “I don’t usually make such an argument, because I know it’s a very steep hill for an appellant to climb,” said Jerome Falk Jr., of Howard, Rice, Nemerovski, Canady, Falk & Rabkin. McKesson also challenged the punitive damages as unsupported by the evidence, but the panel said a reasonable jury could conclude McKesson’s conduct was “a deliberate plan to rid itself of the inconvenience of accommodating a mentally disabled employee.” Though the original ratio of punitive to compensatory damages was almost 5-to-1, Butz said that given “the shifting, complex mosaic of elements at play in this case, we conclude that a punitive damage award of $2 million reaches the constitutional frontier,” noting that it left the ratio at 1.42 to 1. A ratio higher than 1-to-1 was justified, Butz wrote, because McKesson “is an exceptionally wealthy corporation” whose conduct “wreaked havoc” on the plaintiff’s life. Christopher Whelan, a Gold River-based attorney who represented Roby, could not be reached for comment. The full text of Roby v. McKesson, C047617, will appear in Thursday’s California Daily Opinion Service.

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