State of Arizona v. ASARCO, No. 11-17484 (9th Cir. 2013)
Annotate this CaseArizona filed suit against ASARCO on behalf of Angela Aguilar and the state. Aguilar later filed her own suit, alleging sexual harassment, retaliation, and constructive discharge. These proceedings were consolidated and removed to federal court. The jury found ASARCO liable on the sexual harassment claims only and the jury did not find any compensatory damages for Aguilar, instead awarding her one dollar in nominal damages for the sexual harassment claim. The jury also awarded Aguilar $868,750 in punitive damages. The district court subsequently ordered that the punitive damages be reduced to $300,000, which was the statutory maximum under Title VII for an employer of ASARCO's size. The court concluded that the punitive damages award was outside of constitutional limits and must be vacated. The court concluded that the requirement of a reasonable relationship between compensatory and punitive damages suggested that these damages should be reduced. However, given ASARCO's highly reprehensible conduct and the presence of a comparable civil penalty in the form of the Title VII damages cap, the court concluded that the Constitution did not bar the imposition of a substantial punitive award. Therefore, on remand, the district court could reorder a new trial unless plaintiff accepted a remittitur of $125,000.
Court Description: Employment Law / Punitive Damages. The panel vacated the district court’s award of punitive damages in a Title VII sexual harassment suit where the jury awarded no compensatory damages and only one dollar in nominal damages. The panel held that although the degree of reprehensibility of the defendant’s conduct supported a substantial punitive damages award, and the district court’s $300,000 award matched the Title VII damages cap, the award was constitutionally excessive in light of the fact that the ratio of punitive to compensatory damages was 300,000 to 1. The panel held that the highest punitive award supportable under due process was $125,000 because it was the highest award that maintained the required “reasonable relationship” between compensatory and punitive damages, and nonetheless was on the order of the damages cap in Title VII and proportional to the reprehensibility of the defendant’s conduct. The panel ordered that on remand, the district court could order a new trial unless the plaintiff accepted a remittitur to $125,000. Concurring in part and dissenting in part, Judge Hurwitz agreed with the majority that the defendant’s conduct was reprehensible and warranted punitive damages. He also agreed with the majority that a single-digit ratio between punitive and compensatory damages was not constitutionally mandated. Judge Hurwitz wrote that he nonetheless would affirm the district court’s judgment in its entirety because the punitive damages award fell within the statutory cap on damages in Title VII.
The court issued a subsequent related opinion or order on February 28, 2014.
The court issued a subsequent related opinion or order on December 10, 2014.
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