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The New York Court of Appeals has been asked to settle the question of whether punitive damages are recoverable against a municipality under New York City’s Human Rights Law. The question was certified Monday to New York’s highest court by the 2nd U.S. Court of Appeals in Krohn v. New York City Police Department, 01-7827, a sexual harassment case in which a $1 million punitive damages award to a New York City Police Department civilian employee was overturned by a federal judge. Should the Court of Appeals decide to accept the question, it would be the fifth case this year the court received from the 2nd Circuit. Pro se plaintiff Alli Katt filed a complaint in 1995 charging sexual harassment and a sexually hostile work environment. She sought relief under federal, state and city anti-discrimination and civil rights laws. Katt retained counsel for her 2000 trial on claims under 42 U.S.C. � 1983, the New York State Human Rights Law, Exec. Law Sec. 290, and � 8-502 of the New York City Human Rights Law. At the close of trial, the jury awarded her $400,000 in compensatory damages against the city defendants, including her supervisor Lt. Anthony DePalma, and $1 million in punitive damages against New York City alone. Southern District Judge Gerard Lynch granted the city’s motion to set aside the punitive damages award, saying he was surprised that the availability of punitive damages against a municipality under the Human Rights Law had never been decided. Katt made a motion for reconsideration that included a letter from attorney Craig Gurian, who was involved in the drafting of part of the law. Gurian said it was the intention of the drafters to allow punitive damages against the city. Lynch denied the motion to reconsider. A panel of senior judges — Wilfred Feinberg, Ellsworth Van Graafeiland and Fred I. Parker, who died in Vermont earlier this month — heard the appeal at the 2nd Circuit. Parker was the author of the opinion released late Monday. Parker said his panel found the wording of the statute “inconclusive,” because “nowhere in the statute do we find an overt indication of intent to subject municipalities to punitive damages awards.” The Human Rights Law makes it unlawful for an employer, an employee or agent thereof to discriminate, but Parker said the statute does not define the term “employer.” And while the statute defines the terms “covered entity” and “person” to include governmental bodies and agencies, he said, “neither term is used to define potential defendants subject to punitive damages.” “Thus, while one might reasonably read the language as including municipalities, even accepting that reading, it is not at all clear whether such an interpretation constitutes the clear derogation of sovereign immunity that New York law requires,” he said. While the Court of Appeals has indicated that a “clear showing of legislative intent” might allow a plaintiff to pursue punitive damages against a municipality, Parker said, “that court has not yet found sufficient legislative intent in any law to override the presumption against a waiver of implied immunity.” Since the question raises “significant public policy concerns” and noting that the Court of Appeals has written that the “twin justifications for punitive damages — punishment and deterrence — are hardly advanced when applied to a government unit,” it made sense for the state’s highest court to resolve the issue, Parker said. Assistant Corporation Counsel Scott Shorr represented New York City. Scott Samay of Kirkland & Ellis represented Paul A. Krohn, the bankruptcy trustee for Katt.

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