Rendine v. Pantzer
648 A.2d 223, 276 N.J. Super. 398 (1994)
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Rule of Law:
New Jersey's Law Against Discrimination (LAD) prohibits employment discrimination based on pregnancy, treating it similarly to other disabilities, and permits the use of a contingency fee multiplier to enhance attorney's fee awards in successful discrimination cases to ensure access to competent counsel, notwithstanding contrary federal Supreme Court rulings.
Facts:
- Candy Rendine was hired as an assistant controller by Edward Pantzer, owner and president of Pantzer Management Company, in 1983; during her interview, Pantzer asked if she planned to marry and have children.
- Bernadette Lorestani was hired as a staff accountant in 1984; during her interview, Pantzer also asked about her marital status and plans to have children.
- In 1986, Steve Weinerman, the controller, stated at an executive committee meeting that a new staff accountant should be male because Rendine and Lorestani were of child-bearing age and their 'biological clocks were ticking to have children.'
- In early 1987, both Rendine and Lorestani announced their pregnancies to management and stated their intentions to return to work after maternity leave, receiving assurances their jobs would be held.
- Lorestani began maternity leave in June 1987; upon attempting to return in August 1987, Weinerman informed her that there was no longer a place for her and she was fired.
- Rendine began maternity leave in July 1987; upon her return in November 1987, she found her duties diminished, her desk isolated and unclean, and management, including Pantzer and Weinerman, cold and uncommunicative.
- Weinerman discharged Rendine shortly after her return, following a contentious meeting where he accused her of a bad attitude and insubordination, refusing to listen to her explanations.
- Pantzer Management's unwritten policy for maternity leave differed from sick leave, requiring employees on maternity leave to specify a return date, while male employees on extended sick leave were not required to do so and returned to their same positions and responsibilities.
Procedural Posture:
- Plaintiffs Candy Rendine and Bernadette Lorestani filed a complaint on June 27, 1989, in state trial court against Edward Pantzer, d/b/a Pantzer Management Company, alleging sex discrimination, retaliation, wrongful discharge, breach of contract, and wage discrimination.
- Defendant's pretrial motion for separate trials for the two plaintiffs was denied by the assignment judge.
- Before trial, the judge ruled that Rendine's discrimination claim could proceed, despite an adverse unemployment benefits decision, but her claims that her discharge was without cause or a breach of contract were precluded.
- Plaintiffs later withdrew their claims for retaliation, wrongful discharge in violation of public policy, and severance pay before trial.
- A jury trial was held before Judge Meehan and a jury from March 9 through March 24, 1992.
- At the close of plaintiffs' case, defendant's motions to dismiss Rendine's and Lorestani's discrimination claims were denied.
- At the close of all evidence, the judge granted defendant's motion to dismiss Lorestani's unequal pay claim due to insufficient evidence.
- The jury found unlawful discrimination was a substantial contributing factor in the termination of both Rendine and Lorestani, awarding Rendine $210,000 in compensatory damages and $250,000 in punitive damages, and Lorestani $225,000 in compensatory damages (including $45,000 for breach of contract) and $250,000 in punitive damages.
- On April 8, 1992, Judge Meehan entered a judgment in favor of Rendine ($460,000 total) and Lorestani ($475,000 total), plus prejudgment interest, attorneys' fees, and costs.
- Defendant moved for a new trial, remittitur, or judgment notwithstanding the verdict, while plaintiffs moved for calculation of interest, attorneys' fees, and injunctive relief.
- The judge denied defendant's post-trial motions, upheld the compensatory and punitive damage awards, and accepted plaintiffs' attorneys' lodestar sum for prejudgment counsel fees, applying a contingency fee multiplier of two to the pretrial and trial aspects.
- Defendant moved for reconsideration of the attorneys' fee award, which the judge denied in a written opinion, choosing to apply the dissent's analysis from City of Burlington v. Dague.
- On September 3, 1992, a supplemental final judgment was entered, including the enhanced attorneys' fees, prejudgment interest, and costs.
- Edward Pantzer, d/b/a Pantzer Management Company, (defendant/appellant-cross-respondent) appealed this judgment to the Superior Court of New Jersey, Appellate Division, and Candy Rendine and Bernadette Lorestani (plaintiffs/respondents-cross-appellants) cross-appealed regarding dismissed claims.
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Issue:
1. Was the joint trial of two plaintiffs' sex discrimination claims an abuse of discretion? 2. Were the jury instructions regarding pregnancy discrimination and the burden of proof erroneous? 3. Were the awards for emotional distress and punitive damages justified? 4. Does the New Jersey Law Against Discrimination (LAD) permit a contingency fee multiplier to enhance attorney's fee awards, despite federal precedent limiting such enhancements?
Opinions:
Majority - King, P.J.A.D.
No, the joint trial of the two plaintiffs' sex discrimination claims was not an abuse of discretion. The court found that the claims arose from the same series of transactions or occurrences, based on a company-wide policy of discrimination against pregnant employees, and involved common questions of law and fact, justifying joinder under R. 4:29-1(a). The trial judge properly instructed the jury to consider each plaintiff's case separately, and any potential for prejudice was speculative, especially since evidence of other acts of discrimination or fair treatment would have been admissible on the issue of motive and intent even if the cases had been severed. No, the jury instructions regarding pregnancy discrimination and the burden of proof were not erroneous. The judge's use of 'substantial contributing factor' interchangeably with 'determinative factor' was not misleading, especially given defendant's request for 'substantial' in interrogatories. The charge adequately conveyed that pregnant women are entitled to the same rights and disability leave as employees disabled for other reasons, thus requiring the jury to compare treatment. The burden of proof instruction correctly outlined the shifting burdens under Burdine and Price Waterhouse, clarifying that the ultimate burden of persuasion remained with the plaintiff, but the burden shifted to the defendant to prove its affirmative defense of mixed motives, with any minor misstatement immediately corrected and the charge as a whole being clear. No, the awards for emotional distress and punitive damages were justified. The Legislature's amendment to N.J.S.A. 10:5-3 specifically permits recovery for emotional distress in discrimination cases, regardless of whether the plaintiff sought treatment or presented expert testimony. The jury's compensatory awards for lost wages and emotional suffering were not 'excessive' or 'shocking to the conscience,' especially given the significant economic and emotional hardship endured by both plaintiffs, who were unable to find comparable employment. Punitive damages were justified because there was credible evidence of Edward Pantzer's personal involvement and intentional, malicious actions, demonstrating a wanton and willful disregard for the plaintiffs' rights, which satisfies the 'evil-minded act' standard for punitive damages, especially considering his pervasive involvement in management details and awareness of the discriminatory scheme. Yes, the New Jersey Law Against Discrimination (LAD) permits a contingency fee multiplier to enhance attorney's fee awards, despite federal precedent in City of Burlington v. Dague abolishing such enhancements. The court explicitly adopted the reasoning of the dissent in Dague, finding it more consistent with the liberal construction mandated by the LAD and the strong state policy against gender discrimination. Unrefuted evidence from attorney affidavits demonstrated that plaintiffs faced substantial difficulties finding competent counsel without such an enhancement, indicating it is essential to attract competent legal representation in contingent employment law cases in New Jersey. The multiplier was appropriately applied only to prejudgment fees, where the risk of loss was significant.
Dissenting - Rodriguez, J.S.C.
No, the punitive damage awards were not justified. While defendant Pantzer's conduct was reprehensible and actionable under the LAD, justifying compensatory damages for the plaintiffs' losses and suffering, there was no evidence of malicious conduct or 'evil motive' aimed at harming Rendine and Lorestani 'for harm's sake.' The proofs suggested Pantzer's motivation was primarily self-interest, such as saving business costs and avoiding the inconvenience of employing women of child-bearing age. The foreseeable damage, primarily the loss of employment and its financial and emotional consequences, was fully redressed by the jury's compensatory damage award. Absent evidence of 'evil motive' or 'reckless disregard for the consequences of his actions to others' beyond the discriminatory act itself, the legal foundation for punitive damages was lacking, and the judge should have directed a verdict against this claim.
Analysis:
This case is significant because it firmly establishes the New Jersey judiciary's commitment to the robust enforcement of the LAD, particularly concerning pregnancy discrimination, by diverging from federal jurisprudence on attorney's fee enhancements. The court's explicit rejection of the U.S. Supreme Court's Dague ruling on contingency multipliers underscores New Jersey's unique policy in civil rights litigation to ensure access to competent counsel. This ruling incentivizes attorneys to take on challenging discrimination cases, especially those where plaintiffs have limited financial resources, thereby strengthening the LAD's remedial purpose and potentially making New Jersey a more favorable jurisdiction for plaintiffs in such claims compared to federal courts. It highlights the importance of state law in areas where federal and state interpretations of similar statutes diverge on remedial issues.
