Racial Discrimination. Jury Awards $61 million to two Fed-Ex Drivers.

On May 24th of this year a California jury awarded $50 million in punitive damages and $11 million in compensatory damages to two Palestian Fed-Ex Drivers who complained of a hostile work environment based on race and national origin. Though this is not a gender discrimination case I wanted to share this information with you as it speaks to the possibilities of a runaway jury. These gentlemen complained to management of the treatment they were receiving and management ignored them. The jury came down with a heavy-handed verdict.

This case is particularly noteworthy due to both the damages awarded (seen as out-of-the-ordinary and excessive) and because the Manager of that particular Fed-EX terminal was held personally responsible for the discrimination and hostile environment. Under California law, an individual may be held personally responsible for workplace harrassment. This particular manager was ordered to pay $1,000,000 to the injured parties.

The problem with excessive awards is that it can continue to tie up the case for years in appeals. And that's exactly what Fed-Ex intends to do, appeal the verdict.

So, if the EEOC's intention is to eradicate discrimination in the workplace, what then makes a punitive damage award excessive? Well, for example, in April 2003 the Supreme Court decided to take on a case (State Farm vs. Campbell - this is not an EEO case, rather an insurance/personal injury case) where the damage award ratio was 56 to 1. Meaning, a Utah jury awarded $145 million in punitive damages and $2.6 million in compensatory damages. The award was upheld in the Utah Supreme Court and went on to the U.S. Supreme Court. The higher court favors a 1 to 1 ratio meaning instead of $145 million and $2.6 million, they'd prefer to see $2.6 million in punitive damages and $2.6 million in compensatory. The worst case scenario in this instance, according to the U.S. Supreme Court, would be a 9 to 1 ratio. Meaning, at worst, $23.4 million in punitive and $2.6 million in compensatory. I tell you this here so you can keep these ratios in mind should you take your case to court.

Another way attorneys approach juries for punitive damage awards is to show the jury the company's financial statement, show them the company's profit for the past year and ask for 1% or less of that profit. The idea being, the company makes millions of dollars a year. 1% is merely a token.

Just some things for you to think about. Again, I'm not an attorney so I cannot offer you any legal advice. I'm just here to share with you the information I find as I journey through the EEOC process.