(FROM THE WALL STREET JOURNAL 11/19/14)
By Jacob Gershman
A federal jury in California ordered AutoZone Inc. to pay a
former female employee nearly $186 million in damages after ruling
that the auto-parts retailers mistreated her based on gender and
also demoted her after learning that she was pregnant.
The blockbuster verdict -- which is likely to be scaled back --
capped more than six years of litigation in a case that could test
the boundaries of awards in employment-discrimination cases.
A jury in San Diego awarded Rosario Juarez, a former AutoZone
sales manager, more than $800,000 in compensatory damages on Friday
after finding the company liable. Then Monday, the jury set
punitive damages at $185 million, more than 200 times larger than
the figure for economic losses.
Ms. Juarez's attorney, Sacramento workplace litigator Lawrance
Bohm, said within the universe of employment claims involving a
single worker, verdicts of such size are rare.
Plaintiffs often agree to settle tort litigation for a smaller
sum. But AutoZone says it's not making any deals. The auto-parts
retailer is going back to court next week to try to reduce the
award. "We believe this verdict could not be based on the evidence
or logic, and we plan to proceed with all legal remedies," a
company spokesman said.
The jury, consisting of five men and two women, was unanimous in
its decision Monday. A third female juror was dismissed from the
case Monday after the company's lawyers spotted her in the
courtroom embracing the plaintiff and sharing friendly words.
The award will almost certainly shrink on appeal, said Rachel M.
Janutis, a punitive damages expert at Capital University Law School
in Ohio.
The U.S. Supreme Court said in 2003 that as a general rule, the
ratio between punitive and compensatory damages shouldn't exceed 9
to 1. And the high court gave appellate courts wide latitude to
overrule jury verdicts.
"The circumstances in the AutoZone case don't seem to be the
type of circumstances that the Supreme Court recognized would
justify a larger punitive award," Ms. Janutis said.
Ms. Juarez, who started working at the company in 2000, claims
that after she was promoted to part sales manager, she "hit a glass
ceiling," according to her lawyer.
Mr. Bohm said in court papers Ms. Juarez felt that new male
store managers were treated more favorably and that when she told
her manager she was pregnant in 2005, her manager told her he felt
sorry for her. She alleged the manager started treating her meanly
and openly yelled at her, despite the fact that her sales team had
been meeting or beating sales targets, Mr. Bohm said.
She was demoted in 2006. After returning to work, she sued the
company for sex discrimination. AutoZone fired her in 2008,
according to court papers.
In court briefs, AutoZone argued that Ms. Juarez presented
flimsy evidence to support her claims, saying she twisted
ambiguously worded, stray remarks by her superiors into something
more malevolent.
Lawyers for the company said she was demoted for displaying
"managerial disloyalty" and getting a poor performance review. The
company said she was fired after she allowed $400 in cash to go
missing from the register one night.
Mr. Bohm said that while the nearly $186 million may not be the
final number, the figure sends a powerful message. "Verdicts
communicate the conscience of the community through a jury," he
said.
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