New Jersey Appellate Division Holds That Absence of Emotional Distress Damages Award Does Not Preclude Consideration of Punitive Damages

The New Jersey Appellate Division recently held in Rusak v. Ryan Automotive, LLC that a plaintiff was entitled to further proceedings on her punitive damages claim following a jury verdict in her favor on her hostile work environment and retaliation claims even though the jury did not award her emotional distress damages and rejected her separate intentional infliction of emotional distress claim. Although the case involved unique circumstances that are unlikely to be present in future matters, the decision serves as a reminder that the absence of an emotional distress award does not preclude further proceedings on punitive damages.

Rusak, a sales representative for a BMW dealership, presented evidence that the general manager of the dealership screamed and cursed at her, called her a “dumb… stupid blonde,” asked her if she was menstruating and told her and another female employee graphic stories about his sexual exploits. In addition, when Rusak complained to the general manager about the inappropriate behavior of a male co-employee, the general manager ignored her complaint and told others of his plans to fire her. The jury found that the general manager had created a hostile work environment and retaliated against Rusak and awarded wage loss damages only.

Two specific jury interrogatories on the verdict sheet addressed Rusak’s alleged emotional distress, asking the jury whether “the acts of the [d]efendants constitute such willful, wanton and reckless conduct that you find for [plaintiff] on the legal theory of intentional infliction of emotional distress” and whether the plaintiff should be “awarded damages to compensate for her emotional pain and mental anguish.” In both instances, the jury answered “No,” thus denying Rusak’s intentional infliction of emotional distress claim and denying Rusak damages for emotional distress on the other claims for which the jury found liability. The trial judge viewed the jury’s response to these questions as an indication that the jury did not intend to award punitive damages and did not allow further proceedings on the punitive damages claim.

In a February 8, 2011 decision by Judges Graves, Messano and Waugh, the Appellate Division initially held that “[o]nce the jury awarded plaintiff compensatory damages as a result of defendants’ violation of the LAD, the particular conduct of defendants in this case warranted submission of the punitive damages claim to the jury.” Next, the court considered whether the jury’s response to the interrogatories on the verdict altered its initial impression. The Court noted that the jury interrogatory concerning the intentional infliction of emotional distress claim incorporated language that was not even an essential element of that cause of action. Defendants argued that the language, which was more closely akin to the standard for an award of punitive damages under the Punitive Damages Act (the PDA), N.J.S.A. § 2A:15-5.9 to -5.17, was intended as a “bridge question” and was “designed to incorporate within its terms the requisite state of mind necessary to support an award of punitive damages.” According to Defendants, “the jury’s negative answer to [the question] means that plaintiff had failed to prove defendants had acted with ‘actual malice or. . .wanton and willful disregard’ of potential harm so as to support any award of punitive damages.” The Court rejected this argument, finding it both “confusing and unpersuasive” and holding that the jury’s response to the interrogatory “cannot be interpreted as a factual finding that defendants did not act with the requisite mental state to support an award under the PDA.”

At first glance, this case appeared more significant than is actually the case. The unique circumstances presented, and particularly the poorly worded jury interrogatory, clearly guided the outcome, and it seems unlikely that the same set of facts would occur in future matters. While the case stands for the proposition that the absence of an emotional distress award does not in and of itself preclude further proceedings on punitive damages, it remains within the province of the Court to dismiss a claim for punitive damages based on the facts presented at trial, even when the jury finds liability. From the Court’s decision, it appears that this has always been the law and remains the law today.

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