Court OKs Punitive Damages Under NYC Anti-Bias Law

ALBANY, N.Y. (CN) – Answering a question from the Second Circuit in a pregnancy-bias case, the Empire State’s highest court ruled Monday that a New York City anti-discrimination law allows for punitive damages in cases involving gross negligence.

The New York Court of Appeals decision stopped short of allowing punitive damages in all discrimination cases brought under the city law, noting that such damages were designed to prevent “gross misbehavior” and require a heightened standard.

In its 6-1 ruling, the state’s high court determined that the New York City Human Rights Law grants punitive damages to plaintiffs in cases with “willful or wanton negligence” or where there is “a conscious disregard of the rights of others.”

The ruling stems from a 2009 discrimination complaint brought by physical therapy aide Veronika Chauca against Park Management Systems after the medical group fired her while she was on maternity leave.

During the trial, a federal judge denied Chauca’s request to instruct the jury as to punitive damages, citing a lack of malice or reckless indifference.

“They may have violated the law, which is what you are going to try to prove, but there is certainly no evidence of intent,” U.S. District Judge Eric Vitaliano said at the time, according to court records.

The jury awarded Chauca compensatory damages of $10,500 for lost pay and $50,000 for pain and suffering.

Chauca appealed, arguing that she was also entitled to have the jury consider punitive damages under the New York City Human Rights Law, abbreviated in court documents as the NYCHRL. She claimed any finding of liability under the Big Apple’s anti-discrimination law should result in punitive damages.

The medical group argued that the more restrictive standards for punitive damages under Title VII of the federal Civil Rights Act should apply instead.

Compensatory damages in discrimination cases include the loss of future wages. Punitive damages are sought to dissuade defendants from future conduct, and often involve far greater amounts than compensatory damages.

The Second Circuit originally took on the appeal, finding that the NYCHRL had no standard for awarding punitive damages. The federal appeals court ultimately passed the case off to the New York Court of Appeals, finding it was a state-centric issue. The state’s high court heard arguments last month.

In Monday’s 11-page decision, Judge Michael Garcia rejected Chauca’s broad view of punitive damages but also wrote that the federal standard for such damages does not apply to her case.

“Punitive damages represent punishment for wrongful conduct that goes beyond mere negligence and are warranted only where aggravating factors demonstrate an additional level of wrongful conduct,” Garcia wrote for the court’s majority.

Garcia noted that New York City lawmakers had amended the NYCHRL in 2005 and again in 2016 to liberally construe the law in favor of plaintiffs in discrimination cases to deter the “serious and destructive nature of the underlying discriminatory conduct” in such cases.

“Subjecting NYCHRL defendants to punitive damages…encourages nondiscriminatory behavior and the development and application of appropriate employment criteria,” the judge wrote. “We hold, therefore, that the standard for determining punitive damages under the NYCHRL is whether the wrongdoer has engaged in discrimination with willful or wanton negligence, or recklessness, or a ‘conscious disregard of the rights of others or conduct so reckless as to amount to such disregard.’”

In a dissenting opinion, Judge Rowan Wilson agreed with the majority that the Title VII punitive damages standard should not govern discrimination cases brought under the NYCHRL but also agreed with Chauca that all such discrimination cases proving liability should include punitive damages.

Citing previous revisions to the NYCHRL, Wilson wrote that the law’s punitive damages standard should be read in “the manner most favorable to discrimination plaintiffs” to both encourage anti-discrimination programs and punish overtly discriminatory companies.

“It would be far better to have the City Council tell us we have gone a bit too far than to have it admonish us a fourth time for standing in the way of its efforts to end discrimination,” Wilson wrote.

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