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A state corrections officer who in 1999 won the first reverse sexual discrimination verdict in New Jersey lost the major part of his winnings Friday, as the Appellate Division vacated the jury’s $3 million award of punitive damages. A three-judge panel found that the trial judge’s procedure and jury instructions that led to the record verdict were fatally flawed, and they remanded the case for a new trial on punitive damages. Lockley v. Turner, A-1783-99. The judges did affirm the $750,000 in compensatory damages award to Robert Lockley Jr., who claimed to have been sexually harassed by a co-worker, Ronda Turner, when he refused to have sex with her and that Department of Corrections officials failed to discipline her despite his complaints. The judges also affirmed an $855,350 fee for Lockley’s lawyers, Linda Wong and Daniel Fleming of Edison, N.J.’s Wong Fleming, which represented a record-high 60 percent fee enhancement: 40 percent because of the difficult nature of the case and another 20 percent because of the public interest served. But the loss of the $3 million punitive damages award is a major setback for the lawyers, who say they will appeal the reversal because there was no finding of “manifest injustice” — the standard for overturning a punitive damages award. The panel did not find the award excessive but rather found errors in the way Burlington County Superior Court Judge Jan Schlesinger, since deceased, brought the issue before the jury. For one thing, Schlesinger proceeded into the punitive damages phase of the trial right after the jury returned a verdict on liability and compensatory damages, refusing the state’s lawyers’ request for an adjournment until the afternoon so that an assistant attorney general could present the issue to the jury. “[W]e would hope that any litigant would be afforded a brief opportunity before plunging headlong into a question of this complexity and significance,” wrote Judge Dorothea Wefing, adding that “the issue of computing punitive damages against a public entity is fraught with complications, none of which, in our judgment, was adequately addressed.” The bigger problem the panel found was with the jury charge, regarding involvement by upper management and the state’s ability to pay the damages. Lockley claimed harassment principally by co-workers, whereas punitive damages against the state, under Cavuoti v. New Jersey Transit Corp., 161 N.J. 107 (1999), hinge on actual participation in or willful indifference to the wrongful conduct on the part of upper management. Wefing, joined by Judges Mary Cuff and Joseph Lisa, held that Schlesinger did not attempt to explain to the jury the “critically important” issue of what constitutes “upper management,” even though the “structured hierarchy” of the department made it “all the more important to identify those individuals who abused whatever trust and discretion had been vested in them” and whether they could be classed as upper management. The panel also said that none of the factors for upper management status identified in Cavuoti, decided a few months after Lockley, were presented to the jury. The instructions were also defective in mentioning that the state was able to pay any amount of punitive damages, through its ability to tax or to incur a deficit. The trial judge also did not provide the jury with enough guidance, said the panel, illustrating its point by listing five factors that it said were not necessarily determinative or exclusive, pertaining to the department budget, state deficits and whether a distinction should be drawn between the department and the state as a whole. Nor could such an “irredeemably tainted” award be saved by the fact that it did not exceed the five-to-one ratio with compensatory damages allowed under the Punitive Damages Act. Fleming says the trial judge charged the jury based on the law that all parties knew existed at that time, prior to Cavuoti, and that the state did not object. He notes that the state refused to put its budget on the record, as suggested by the appeals court, and thus waived its right to do so. Fleming notes that the appellate court did not mention the state’s refusal nor the fact that the hour’s delay sought by the state was for the purpose of arguing the constitutionality of awarding punitive damages against a public entity. “It is ridiculous to reverse a punitive damages award because the judge wouldn’t give a party extra time to make an argument that is frivolous,” says Fleming. Wong and Fleming say they are also worried about the lack of clear guidance on how to go about deciding punitive damages on remand. “Reading this opinion, I don’t know how a trial judge could put together a charge that would pass muster,” says Fleming. The state also challenged the award of compensatory damages, which was solely for emotional distress, as “grossly excessive,” arguing that this amounted to $225 for each day that Lockley and Turner were both at work. The appellate court rejected that analysis, saying “emotional turmoil” cannot be “turned on and off like a spigot” and physical separation did not obviate contact, especially with Turner’s friends joining in the harassment. Assistant Attorney General Allison Accurso, the attorney for the state, did not return a call requesting comment. Spokesman Chuck Davis says no decision has been made yet on whether to appeal and calls the fee and compensatory damage awards “outrageous.” The appeals panel found no abuse of discretion in the fee award, saying, “There is no doubt this case was hard-fought on both sides. No quarter was asked and none was given. The State was entitled to assert a vigorous defense and it did so. Fairness requires, however, that plaintiff’s counsel be compensated for seeing the matter through to a successful conclusion.” In upholding the $325 per hour rate on which the lodestar for the fee award was based, the court agreed with the state that the rate was “generous” but said “we are not blind to the sums paid to experienced counsel in other matters.”

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