Litigation

Los Angeles Jury Awards Piddling $7.5 Million For Punitive Damages In Employment Case Against Kaiser

By Bruce Nye

    I've been following with interest the case of Radiologist Dr. Martin Martinucci, who contended that Kaiser Hospital forced him to quit because he complained about the quality of its care.  As reported in the San Francisco Chronicle, Martinucci was hired in 2003 and resigned three years later after his supervisor and a human resources staffer accused him of being racist and making sexual advances toward a male technologist.  His suit was a "constructive termination case," a difficult form of employment case in which the employee who resigns must prove that the resignation was essentially a firing because working conditions were so intolerable that no reasonable employee would have stayed.  This was established by the California Supremes in Turner v. Anheuser-Busch, Inc. (1994) 7 Cal.4th 1238.

    As California Punitive Damages, an Exemplary Blog has reported, the jury found for Martinucci last Monday and awarded compensatory damages of $3.9 million.  Under California law, the question of whether the defendant has acted with malice, fraud or oppression (the prerequisites for a punitive damage award) are decided at the same time the jury decides liability and compensatory damages.  But the defendant is entitled to have bifurcation -- i.e., a second phase of trial -- on the question of whether punitive damages should be awarded and how much.  Most defendants exercise this right to a two-phase trial, and Kaiser did here.

    Here's where it gets interesting.  In phase two, Martinucci asked the jury for $1 billion in punitive damages.  Most of us would think that's a little on the aggessive side.  Conventional defense lawyer wisdom would have it that a request this high risks turning off the jury.  But I'm not so sure.  There's a very good, albeit rather ponderous study of punitive damages called "Punitive Damages, How Juries Decide," by Cass Sunstein and others.  I've read it, so you don't have to.  Sunstein and company found that the most significant predictor for a large punitive damages award is a large request.  And in fact, there is no limit -- it's like the more the plaintiff attorney asks for, the more he gets.  So by asking the jury for a billion bucks, the plaintiff attorney doesn't get a billion bucks.  But he gets more, all other things being equal, than he would if he asked for a mere, say $700 million. 

    And sure enough, Dr. Martinucci was not awarded $1 billion.  Only $7.5 million.  A verdict, as California Punitive Damages points out, that has a much better chance of sticking on appeal than one for a billion.

Full post as published by CalBizLit on December 15, 2008 (boomark / email).