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Seventh Circuit Affirms Retaliation Jury Verdict - Labor and Employment Law News

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Labor and Employment Law News

Posted on: Dec 7, 2016

By Ryan P. Sink, Fox Williams & Sink LLC

The Seventh Circuit, in Gracia v. Sigmatron International, Inc., 2016 WL 6958643 (7th Cir. Nov. 29, 2016), affirmed a jury’s verdict in favor of an employee on her claim of retaliation. Maria Gracia sued her employer alleging sexual harassment and retaliation. Gracia prevailed on her retaliation claim, and the jury awarded her $57,000.00 in compensatory damages and $250,000.00 in punitive damages. The District Court remitted the compensatory number down to $50,000.00, but did not reduce the punitive damages award. In affirming the jury’s verdict and the District Court’s remittitur, the Seventh Circuit penned a good primer on damages for employment discrimination cases.  

With respect to compensatory damages, the evidence appeared thin and based solely on the following testimony: “It was hard. I was just depressed. I have always been working.” Id. at * 7. Nevertheless, the Seventh Circuit applied an abuse of discretion standard of review, affirmed, and held that “brevity and self-control in a judicial proceeding need not be interpreted as a weak case.” Id. The test is whether “the award is ‘monstrously excessive,’ whether there is a rational connection between the award and the evidence, and whether the award is roughly comparable to awards made in similar cases.” Id. The Seventh Circuit noted that compensatory damages may be based solely on plaintiff’s testimony, the jury has substantial discretion in deciding the amount, and an award of $50,000.00 was roughly comparable to numerous other cases (string cited by the Court). Id.  

With respect to punitive damages, the Seventh Circuit applied an abuse of discretion standard of review and affirmed the $250,000.00 award, in spite of counsel for plaintiff only asking for a total of $200,000.00 in compensatory and punitive damages. Id. at * 8. The test of punitive damages is set forth by three guideposts: “[1] the degree of reprehensibility of the defendant’s conduct; [2] the disparity between the harm suffered by the plaintiff and the punitive damages award; and [3] the difference between the award in this case and the penalties imposed in comparable cases.” Id.  

First, the Seventh Circuit found sufficient evidence to satisfy the initial two prongs (malice or reckless indifference) to justify punitive damages. Id. at * 9. Next, the Seventh Circuit addressed the issue of ratios between compensatory and punitive damages, and held that “a ratio of 5:1 is well within the range we have approved in other cases.” Id. The Seventh Circuit stated, in multiple occasions, that an award of damages within the statutory cap suggests that the award is not outlandish. Finally, the Seventh Circuit held that it was “aware of no rule prohibiting a jury from awarding more in damages than a plaintiff requests and SigmaTron cites no authority for this claim.” Id.

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