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Compensatory or nominal damages are not a prerequisite to an award of punitive damages in an employment discrimination action under federal civil rights law, the 2nd U.S. Circuit Court of Appeals has ruled. Clarifying the standard in the circuit for recovery of punitive damages under Title VII of the Civil Rights Act of 1964, the court said that a plaintiff’s showing that an employer engaged in discrimination was sufficient for an award, even where the finder of fact refuses to award actual damages. The ruling came in Cush-Crawford v. Adchem Corp., 00-7617, where a jury awarded a woman the statutory maximum of $100,000 in punitive damages on her claim of sexual harassment stemming from a hostile work environment. Adchem Corp. laboratory technician Tonia Cush-Crawford had sued the company because of the behavior of supervisor Collin Mars, who allegedly tied her work performance to taking trips with him. Cush-Crawford also charged that Mars made several passes at her, and warned she could be fired if she did not comply. The decision will be published Wednesday. At the trial before Eastern District of New York Judge Arthur D. Spatt, a jury ruled in Adchem’s favor on Cush-Crawford’s claim that the company retaliated against her for complaining about Mars. But the jury ruled in Cush-Crawford’s favor on her claim of a hostile work environment. The jury declined to award Cush-Crawford actual damages, but gave her the $100,000 statutory maximum she sought for punitive damages. Spatt then denied Adchem’s motion to set aside the verdict and the award. The judge also granted Cush-Crawford $54,052 in attorneys’ fees, but rejected her motion for a new trial. Before the 2nd Circuit, Adchem argued that compensatory or nominal damages must be awarded in order to recover punitive damages under Title VII, which prohibits employment discrimination based on race, color, religion, sex and national origin. Judge Pierre N. Leval said that the 2nd Circuit had yet to decide the issue, and that “uncertainty as to the availability of punitive damages was apparent in the districts court’s treatment of the issue.” Judge Spatt, he said, initially instructed the jury that punitive damages could be awarded “only if you should first unanimously award” actual damages. He then reversed course, finding there is no such prerequisite in 42 U.S.C. � 1981a(b)(1). “In our view, Judge Spatt’s second approach was correct,” Leval said. Leval noted that “The plain language of the statute does not expressly state whether punitive damages are available absent an award of actual damages, and the Courts of Appeals that have considered the question have reached different results.” NO ONE RULE Despite Adchem’s argument to the contrary, Judge Leval said, there is “no one common law rule,” on the issue. One concern that has driven some courts to bar punitive awards absent regular damages, he said, has been the fear that juries would start assessing punitive damages “where the wrongs are insubstantial. …” But it was significant, he said, that � 1981a(b)(3) provides for a sliding-scale cap on punitive damages that ranges from $50,000 to $300,000, depending on the size of the company. “To the extent that courts worried about unleashing juries to award limitless punitive damages in cases where no harm had occurred, this concern is eliminated by the imposition of the statutory caps,” Judge Leval said. And Leval said that the objectives of compensatory damages differ from those of punitive damages. “There is some unseemliness for a defendant who engages in malicious or reckless violations of legal duty to escape either the punitive or deterrent goal of punitive damages merely because either good fortune or a plaintiff’s unusual strength or resilience protected the plaintiff from suffering harm,” he said. And nominal damages, he added, “are generally no more than symbolic.” “The need for such a symbol of opprobrium in the absence of compensatory damages disappears where the fact finder has signified its opprobrium by making an express award of punitive damages,” he said. “And to make enforcement of the jury’s award of punitive damages turn on whether the jury also awarded purely symbolic nominal damages carries a likelihood of defeating the jury’s intention as the result of confusion.” Therefore, Judge Leval said, regardless of a jury’s decision not to award compensatory or nominal damages, punitive damages may be awarded within the limits of the statutory caps where a jury finds a defendant “engaged in the prohibited discrimination” and is shown “to have acted with a state of mind that makes punitive damages appropriate.” Senior Judge Jon O. Newman and Judge Robert D. Sack joined in the opinion. Ira G. Rosenstein, Siobahn A. Handley and Cathleen O’Donnell of Orrick, Herrington, & Sutcliffe’s New York office represented Adchem. Charmaine M. Stewart and Nadira Stewart of Elmont, N.Y., represented Cush-Crawford.

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