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A woman who waited 12 years for New York’s backlogged state Division of Human Rights to resolve her sex discrimination claim is entitled to prejudgment interest, the New York Court of Appeals said Thursday in reversing a downstate appellate panel. The judges in Albany, N.Y., agreed unanimously that while prejudgment interest on a discrimination claim is not automatic, the denial of that benefit can constitute an abuse of discretion — as it did here. Coincidentally, the case arises just a week after New York State Comptroller and Democratic gubernatorial hopeful H. Carl McCall and Sen. Richard A. Dollinger, D-Rochester, held a press conference to criticize the Division of Human Rights (DHR) for failing to resolve expeditiously more than 9,000 pending complaints. Thursday’s ruling suggests that delays could prove costly. Matter of Aurecchione v. New York State Division of Human Rights involves a woman who filed a sex discrimination claim after she was fired in 1987 for asking her employer, a charter bus company, for a raise. Carol Aurecchione’s claim was filed with DHR in February 1988, hearings were held in 1995 and 1996, and in 1999 the division found that the claimant had been paid less than men performing essentially the same job. DHR awarded Aurecchione $21,500 in backpay and $1,500 for mental anguish, plus the statutory 9 percent interest running from the date of the final determination in April 1999. On appeal, Aurecchione argued that the denial of interest for the 12 years her case was pending amounted to an “interest-free loan” to her former employer, Classic Coach. She said the company, by not paying prejudgment interest, would save enough money due to the delay to cover the entire cost of her award. “Put more plainly,” attorney Edward Cherney of Port Jefferson argued for Aurecchione, “if prejudgment interest is not granted, Classic will pay Aurecchione’s award with Aurecchione’s money.” Thursday, the Court of Appeals agreed with Cherney and reversed the Appellate Division, 2nd Department. Writing for the court, judge Carmen Beauchamp Ciparick said that while the Human Rights Law makes no mention of pre-determination or prejudgment interest, a “liberal reading of the statute” is required to advance the statute’s objective. “Classic contends that it should not be penalized, by the imposition of interest, for the Division’s delay and inefficiency,” judge Ciparick said. “We have, on numerous occasions, rejected such arguments.” Judge Ciparick reiterated that interest is not a penalty, but a cost imposed for the use of another person’s money for certain period of time. “Here, the Division determined that Classic wrongfully withheld payment of wages otherwise due Aurecchione,” she said. “As a result, Aurecchione was deprived of the use of money at the time of the discrimination.” However, the court rejected the argument that prejudgment interest is required in every case as a matter of law. It said the Commissioner of the Division of Human Rights “is afforded some discretion.” Here, the court said, there was no justification for the denial of pre-determination interest. It urged DHR to calculate interest within 30 days. Appearing on the appeal were Cherney for Aurecchione; Michael K. Swirsky of the Bronx as in-house counsel for DHR; and Martin Gringer of Franklin & Gringer in Garden City for Classic Coach.

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