Jottings By An Employer's Lawyer

Friday, July 21, 2006

$11M Verdict in the Nutmeg State

The General Electric p.r. guys are earning their money this week. First, one of the more widely publicized bounced checks in history, General Electric CEO bounces check, followed by this, Ex-GE employee wins $11m suit. The first one is a lot easier to explain as Chairman Jeffrey Immelt apparently wrote the check to a political campaign on an account he did not know had been closed. The other headline, as they say in East Texas, may take some more "splaining."

The jury verdict followed a five day trial before a federal jury in Bridgeport, Connecticut on Hermant K. Mody's discrimination and retaliation complaints. Among his allegations according to the story in the Connecticut Post:
Since joining the company in 1998 he watched younger, white males pass him by in job promotions and management positions. He said GE has not contributed to its pension fund since 1987 and is able to do so by maintaining a young work force, and laying off or terminating employees as they become older. On July 22, 2002, he sent a memo to Tom Lavalle, GE's human resources manager, outlining his claims of discrimination and unfair treatment... Once he complained of the discrimination, he charged GE treated him unfairly, assigning him to menial tasks.
Something clearly upset the jury as in addition to a backpay award of $591,000 the jury awarded $500,000 for compensatory damages. Mody, an engineer with a PhD has been out of work since his termination in March 2003. Those two damage elements alone would have hit the MDV standard, but the jury topped it off with $10 million in punitive damages.

From the limited details provided in the story it is clear there were a number of issues involved, including that Mody had taken a leave of absence for kidney problems which required dialysis and was terminated within a couple of weeks of his return.

This has the earmarks of the type of situation which occur more often than you would think. An employee situation that can be seen from two totally different perspectives -- legitimate employment action or terribly wronged employee. Sometime the dividing line between the two is truly a matter of viewpoint -- but having the "wrong" viewpoint can be very expensive.

Update (11/2/07): The District Court has now entered a judgment affirming the decision, but requiring plaintiff to accept a reduction of the $10 million punitive damage to $5 million or face a retrial on that issue alone. According to CNN, Dr. Mody's lawyer was quoted as saying, "It's hard to say you're happy when a judge eliminated $5 million from a jury verdict, but I am happy with it." I would guess so, since that leaves in excess of $7 million.

The opinion also dealt with another issue I have often wondered about, but never researched. What happens if the plaintiff dies? The answer, at least according to Judge Eginton's ruling which can be found here is that it goes to the estate. That includes the award of more than $700,000 in front pay, notwithstanding the argument of the defendant that it constitutes a windfall. Here Dr. Mody's teen age children will be the recipients if the judgment survives appeal as his wife also died after the trial but before the resolution of post-trial motions.

This update also allowed me to correct the spelling of Dr. Mody's last name in the main entry. I had erroneously spelled it Moody. Since the link to the original story from the Connecticut Post is now dormant, I can't tell whether it was my error (quite possibly) or the paper's.


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