Veronika Chauca, Appellant,v.Jamil Abraham, et al., Respondents.BriefN.Y.December 14, 2016CTQ-2016-00003 COURT OF APPEALS OF THE STATE OF NEW YORK __________ VERONIKA CHAUCA Plaintiff-Appellant, v. JAMIL ABRAHAM, Individually, PARK MANAGEMENT SYSTEMS, LLC, AKA Park Health Center, ANN MARIE GARRIQUES, Individually, Defendants-Respondents. __________ ON APPEAL FROM THE CERTIFIED QUESTION BY THE UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT IN DOCKET NO. 15-1777-CV BRIEF OF AMICUS CURIAE ANTI-DISCRIMINATION CENTER, INC. CRAIG GURIAN ANTI-DISCRIMINATION CENTER, INC. 1745 Broadway,17th Floor New York, New York 10019 212-537-5824 (telephone) 646-786-3951 (fax) Counsel for Amicus Curiae Anti-Discrimination Center, Inc. Dated: August 30, 2017 i TABLE OF CONTENTS TABLE OF CONTENTS ......................................................................................... iii TABLE OF AUTHORITIES ................................................................................... iii INTERESTS OF AMICUS CURIAE ....................................................................... 1 SUMMARY OF ARGUMENT ................................................................................ 1 ARGUMENT ............................................................................................................ 2 POINT I AMPLE GUIDANCE EXISTS FOR HOW TO INTERPRET EACH AND ALL OF THE CITY HRL’S PROVISIONS. .............................................. 2 POINT II THE PRINCIPLE OF LEGISLATIVE OVERRULE EMBODIED IN THE RESTORATION ACT IS NOT LIMITED BY SUBJECT; LIKEWISE, THE RESTORATION ACT WAS INTENDED TO MAKE CLEAR THAT, IN LIGHT OF REVISED SECTION 8-130, THE CITY COUNCIL HAD NO NEED TO AFFIRMATIVELY REWORK AN EXISTING PROVISION TO DEPART FROM AN INTERPRETATION OF A COMPARABLE STATE OR FEDERAL PROVISION. ........................... 7 POINT III FARIAS FAILED TO ENGAGE IN THE ANALYSIS REQUIRED FOR CITY HRL PURPOSES; A LIMITATION OF PUNITIVE DAMAGES TO CIRCUMSTANCES WHERE A RECKLESS DISREGARD FOR THE RISK OF VIOLATING THE CITY HRL HAS BEEN SHOWN IS TOO NARROW A STANDARD; ALTERNATIVES THAT BETTER FULFILL THE UNIQUELY BROAD PURPOSES OF THE CITY HRL ARE AVAILABLE. ...................... 10 A. Structural considerations ............................................................................. 11 B. Accomplishing the purposes of the City HRL ............................................ 15 C. An alternative formulation .......................................................................... 24 ii TABLE OF CONTENTS (CONT.) POINT IV THERE IS NO REASON TO BELIEVE THAT THE STANDARD FOR AWARDING PUNITIVE DAMAGES WHERE LIABILITY IS DETERMINED DIRECTLY IS ANY MORE STRINGENT THAN WHERE LIABILITY IS DETERMINED VICARIOUSLY .................................................................................................. 26 CONCLUSION ....................................................................................................... 28 CERTIFICATION .................................................................................................. 29 LEGISLATIVE MATERIALS APPENDIX .......... (Appended in Separate Volume) iii TABLE OF AUTHORITIES CASES Albunio v. City of New York, 16 N.Y.3d 472 (N.Y. 2011) ................... 2, 5, 7, 13, 20 Bennett v. Health Mgmt. Sys., Inc., 92 A.D.3d 29 (1st Dep’t 2011) .................................................................. 2, 4, 7, 9, 15, 17, 20-23 Chauca v. Abraham, 841 F.3d 86 (2d Cir. 2016) ............................ 3, 6-7, 17-18, 25 Farias v. Instructional Sys., Inc., 259 F.3d 91 (2d Cir. 2001) ..................................................................... 1, 4, 7, 9-11, 23-25, 28 Forrest v. Jewish Guild for the Blind, 3 N.Y.3d 295 (N.Y. 2004) ............................................................................................................ 8 Kolstad v. Am. Dental Ass’n, 527 U.S. 526 (1999) ............................... 11-12, 16, 18 Levin v. Yeshiva Univ., 96 N.Y.2d 484 (N.Y. 2001) ................................................ 8 McGrath v. Toys “R” Us, Inc., 3 N.Y.3d 421 (N.Y. 2004) ................................... 8-9 Priore v. New York Yankees, 307 A.D.2d 67 (1st Dep’t 2003) .......................... 8, 27 Williams v. N.Y.C. Hous. Auth., 61 A.D.3d 62 (1st Dep’t 2009) ................................................................ 2, 4, 6-12, 15-22, 24, 27 Zakrzewska v. New School, 14 N.Y.3d 469 (N.Y. 2010) .................................. 17, 26 FEDERAL STATUTE 42 U.S.C. § 1981a ................................................................................................... 11 NEW YORK CITY LAW Admin. Code § 8-101 .............................................................................................. 19 Admin. Code § 8-107(1)(a) ..................................................................................... 27 iv NEW YORK CITY LAW (CONT.) Admin. Code § 8-107(13)(a) ................................................................................... 17 Admin. Code § 8-107(13)(b) ............................................................................ 17, 26 Admin. Code § 8-107(13)(d) ................................................................ 14, 17, 19, 26 Admin. Code § 8-107(13)(e) ....................................................................... 14, 17, 26 Admin. Code § 8-107(13)(f) ............................................................................. 14, 26 Admin. Code § 8-107(17) ....................................................................................... 12 Admin. Code § 8-126(a) ......................................................................................... 15 Admin. Code § 8-130 ...................................................................................... 5, 7, 10 Admin. Code § 8-130(b) ................................................................................ 6, 13-14 Admin. Code § 8-130(c) ........................................................................................... 2 Admin. Code § 8-502 .............................................................................................. 13 Admin. Code § 8-502(a) ........................................................................ 12-13, 17, 20 Local Law 39 of 1991 (“1991 Amendments”) ....... 1, 5, 13-14, 16-17, 21, 23, 26-27 Local Law 85 of 2005 (“Restoration Act”) .................... 1, 5, 7-10, 17, 20, 23-24, 27 Local Law 35 of 2016 ........................................................................ 1, 2, 5-8, 13, 15 COMMITTEE REPORTS AND LOCAL LAW MEMORANDA Local Law Memoranda of the City of New York, Pre-1991 and Local Law 39 of 1991 Comparison (“Side-by-Side Comparison”) ............................................................................. 26 v COMMITTEE REPORTS AND LOCAL LAW MEMORANDA (CONT.) New York City Council Committee on General Welfare, Committee Report on Local Law 39 of 1991 (“1991 Committee Report”) ................................................................................ 13 New York City Council Committee on General Welfare, Committee Report on Local Law 85 of 2005 (“2005 Committee Report”), Aug. 17, 2005 ................................................... 4, 21 New York City Council Committee on Civil Rights, Committee Report on Local Law 35 of 2016 (“2016 Committee Report”), Mar. 8 2016 .............................. 2-3, 5-6, 9-11, 21-22 LAW JOURNAL ARTICLES Craig Gurian, A Return to Eyes on the Prize: Litigating Under the Restored New York City Human Rights Law (“Eyes”), 33 Fordham Urb. L.J. 255 (2006) ........................................................ 6, 18, 25, 27 TESTIMONY AND OFFICIAL REMARKS Remarks of Mayor David Dinkins on Local Law 39 of 1991, June 18, 1991 ....................................................................................................... 27 Testimony of ADC Executive Director Craig Gurian on Local Law 85 of 2005 (“ADC Testimony”), Apr. 14, 2005 ............... 17-18, 24-25 1 INTERESTS OF AMICUS CURIAE The Anti-Discrimination Center (“ADC”) has as a central part of its mission the robust use and interpretation of the New York City Human Rights Law (“City HRL”). ADC is frequently consulted on City HRL questions. Its executive director was the principal author for the Human Rights Commission of the comprehensive 1991 Amendments to the City HRL; was the principal author of the 2005 Restoration Act; and was the principal author of Local Law 35 of 2016, a law that clarified both the purposes of the City HRL and the tools that should be used to interpret it. SUMMARY OF ARGUMENT Contrary to still-popular myth, there is ample guidance for how to interpret the City HRL’s provisions. That guidance, drawing on the uniquely broad purposes of the City HRL, all points in the direction of maximizing exposure of defendants to the full panoply of remedies and punishments for discriminatory acts. Application of that guidance, as well as attention to the structure of the City HRL, makes it clear that the Farias standard for the imposition of punitive damages is too restrictive, and that punitive damages are intended to be available for consideration by a jury in, at the very least, a much wider range of cases. 2 ARGUMENT POINT I AMPLE GUIDANCE EXISTS FOR HOW TO INTERPRET EACH AND ALL OF THE CITY HRL’S PROVISIONS. The idea that the City HRL is somehow lacking in guidance in how to apply its distinctive liberal construction provision is demonstrably false. The idea hangs on only because of the misguided notion that guidance is not guidance unless it provides a specific answer to a specific interpretive problem. That is not how the City HRL is designed to work; the most recent evidence of this is set out plainly in Local Law 35 of 2016 (“LL-35”), LMA-1-2,1 and in the accompanying Committee Report (“2016 Committee Report”), LMA-3-18. LL-35, inter alia, identified Albunio, Bennett, and the majority opinion in Williams2 as among the “[c]ases that have correctly understood and analyzed the liberal construction requirement . . . and that have developed legal doctrines accordingly that reflect the broad and remedial purposes of this title . . . .” LL-35(adopting Admin. Code § 8-130(c)), LMA-2. According to the 2016 Committee Report, “[h]ighlighting these cases (1) would reaffirm that courts must apply the liberal construction provisions in every 1 Numbers preceded by “LMA-” refer to pages of the Legislative Materials Appendix, submitted together with this brief. 2 Albunio v. City of New York, 16 N.Y.3d 472 (N.Y. 2011), Bennett v. Health Mgmt. Sys., Inc., 92 A.D.3d 29 (1st Dep’t 2011), and Williams v. N.Y.C. Hous. Auth., 61 A.D.3d 62 (1st Dep’t 2009). 3 case and with respect to every issue; (2) would illustrate best practices when engaging in the required analysis; (3) would endorse the legal doctrines where they were developed pursuant to liberal construction analyses; and (4) would accelerate the process by which other doctrines inconsistent with the commands of [the] Restoration Act are abandoned.” 2016 Committee Report, LMA-10-11. Having explained that the cases “illustrate best practices when engaging in the required analysis,” the Council was then even more explicit that it intended courts to use these cases as tools in the resolution of all interpretative problems: These cases do not just establish specific ways in which the HRL differs from its federal and state counterparts; they also illustrate a correct approach to liberal construction analysis and then develop legal doctrine accordingly. It is therefore important for courts to examine the reasoning of the cases—including their extensive discussions of why the U.S. Supreme Court’s analysis can be inadequate to serve the purposes of the HRL—and then for courts to employ that kind of reasoning when tackling other interpretative problems that arise under the HRL. 2016 Committee Report, LMA-15. Strikingly, the Second Circuit in Chauca v. Abraham, 841 F.3d 86 (2d Cir. 2016) ignored the command to use the relevant doctrines of the ratified cases, and ignored the command to use an analogous process of reasoning and analysis as that used in the above-listed cases to determine the appropriate standard for the imposition of punitive damages. Even more remarkably, respondents ignore these commands, too, making absolutely no attempt to engage in the required analysis. 4 This brief, on the other hand, will do so directly in Point III, infra, and demonstrate that the Farias v. Instructional Sys., Inc., 259 F.3d 91, 101-102 (2d Cir. 2001), standard, whereby an actor must have at least proceeded with reckless disregard of risk of violating rights protected by the City HRL, is too narrow in light of the structure and purposes of the City HRL. First, however, it is important to describe the substantial additional guidance that must be applied to any interpretative problem under the City HRL. Williams explains that the City Council, in passing the Restoration Act, had directed courts “to the key principles that should guide the analysis of claims brought under the City HRL: ‘discrimination should not play a role in decisions made by employers, landlords and providers of public accommodations; traditional methods and principles of law enforcement ought to be applied in the civil rights context; and victims of discrimination suffer serious injuries, for which they ought to receive full compensation’ ([2005] Committee Report, 2005 NY City Legis Ann, at 537).” Williams, 61 A.D.3d at 68. Bennett references another important concern of the Council in 2005: “The Committee Report on the Restoration [Act] noted that acts of discrimination cause ‘serious injury, to both the persons directly involved and the social fabric of the City as a whole, which will not be tolerated’ ([2005 Committee Report], 2005 NY City Legis Ann, at 537).” Bennett, 92 A.D.3d at 38 n.10. In other words, acts of discrimination must be understood as causing serious injury to the 5 City itself. More broadly, as the Council underscored, Albunio teaches that Admin. Code § 8-130 – which establishes that the purposes of the City HRL are “uniquely broad and remedial” – requires that “the anti-retaliation provision contained in the HRL had to be construed, ‘like other provisions of the City’s Human Rights Law,’ ‘broadly in favor of discrimination plaintiffs, to the extent that such a construction is reasonably possible.’” 2016 Committee Report, LMA-11 (emphasis added) (quoting Albunio, 16 N.Y.3d at 477-78). This ratified doctrine is consistent with a theme expressed again and again: the law must be given the broadest reach and be interpreted to achieve maximum deterrence and minimum evasion. For example, LL-35 states directly that its purpose is to “provide additional guidance for the development of an independent body of jurisprudence for the New York city human rights law that is maximally protective of civil rights in all circumstances.” LL-35, § 1, LMA-1 (emphasis added). The 2016 Committee Report explains the Council has persistently tried to protect the City HRL from being narrowly construed by Courts, particularly in connection with the 1991 Amendments3 and 2005 Restoration Act, LMA-19-26, and that “[t]hese actions have expressed a very specific vision: a Human Rights Law designed as a law enforcement tool with no tolerance for discrimination in public life.” 2016 3 Local Law 39 of 1991, LMA-41-79. 6 Committee Report, LMA-10. LL-35 added a new subdivision “b” to Admin. Code § 8-130 by which courts are directed that “[e]xceptions to and exemptions from the provisions of this title shall be construed narrowly. . . .” LL-35, LMA-2. Why? “[I]n order to maximize deterrence of discriminatory conduct.” Id. Williams explained that: There is significant guidance in understanding the meaning of the term “uniquely broad and remedial.” For example, in telling us that the City HRL is to be interpreted “in line with the purposes of the fundamental amendments to the law enacted in 1991,” the Council's committee [in the 2005 Committee Report] was referring to amendments that were “consistent in tone and approach: every change either expanded coverage, limited an exemption, increased responsibility, or broadened remedies. In case after case, the balance struck by the Amendments favored victims and the interests of enforcement over the claimed needs of covered entities in ways materially different from those incorporated into state and federal law.” Williams, 61 A.D.3d at 68 (footnote omitted) (citations omitted).4 The 2016 Committee Report specifically referenced the finding in Williams that “the HRL’s text and legislative history represent a legislative desire that the HRL ‘meld the broadest vision of social justice with the strongest law enforcement deterrent.’” 2016 Committee Report, LMA-13 (citing Williams, 61 A.D.3d at 68). 4 The quotation that begins “consistent in tone and approach” is from Craig Gurian, A Return to Eyes on the Prize: Litigating Under the Restored New York City Human Rights Law (“Eyes”), 33 Fordham Urb. L.J. 255 (2006). A review of both Williams and of citations in the 2016 Committee Report show that both treated Eyes as an authoritative source. Gurian was the Restoration Act’s “principal drafter . . . .” Chauca, 841 F.3d at 92. 7 The City HRL’s focus on law enforcement, deterrence, and having no tolerance for acts of discrimination is, indeed, unique; interpretation of the law’s provisions must proceed with both that distinct approach and with the need to analogize to reasoning and analysis in keeping with that used in Williams, Bennett, and Albunio. The need to do so can no longer be questioned in the face of the reinforcement of Restoration Act principles and the ratification of key cases that was effected by LL-35. POINT II THE PRINCIPLE OF LEGISLATIVE OVERRULE EMBODIED IN THE RESTORATION ACT IS NOT LIMITED BY SUBJECT; LIKEWISE, THE RESTORATION ACT WAS INTENDED TO MAKE CLEAR THAT, IN LIGHT OF REVISED SECTION 8-130, THE CITY COUNCIL HAD NO NEED TO AFFIRMATIVELY REWORK AN EXISTING PROVISION TO DEPART FROM AN INTERPRETATION OF A COMPARABLE STATE OR FEDERAL PROVISION. The Second Circuit’s certification decision suggests that it is important that Farias was not among the decisions “expressly identified by the Council” as having misconstrued the City HRL. Chauca, 91 F.3d at 91-92. The Circuit’s presentation is misleading, and it ignores now-ratified case law from Williams. Williams explains that the “City’s Council debate on the [Restoration Act] made plain the Restoration Act’s intent and consequences,” citing a statement on the floor of the Council during the Council’s consideration of the Restoration Act that 8 was made by a member of the Committee that had brought the legislation to the floor: Insisting that our local law be interpreted broadly and independently will safeguard New Yorkers at a time when federal and state civil rights protections are in jeopardy. There are many illustrations of cases, like Levin on marital status, Priore[,] McGrath and Forrest that have either failed to interpret the City Human Rights Law to fulfill its uniquely broad purposes, ignore [sic ] the text of specific provisions of the law, or both. With [the Restoration Act], these cases and others like them, will no longer hinder the vindication of our civil rights. Williams, 61 A.D.3d at 67 (emphasis added) (quoting Council Member Annabel Palma).5 It could not be more clear that the cases cited were meant to be illustrative, not comprehensive, and that it was not only the cited cases that would “no longer hinder the vindication of our civil rights,” but also “others like them.” In any event, the 2016 Amendments ratified Williams, including its broad doctrine that the “Restoration Act notified courts that (a) they had to be aware that some provisions of the City HRL were textually distinct from its state and federal counterparts, (b) all provisions of the City HRL required independent construction to accomplish the law’s uniquely broad purposes, and (c) cases that had failed to respect these differences were being legislatively overruled.” 2016 Committee 5 The cases referenced in Council Member Palma’s floor statement are Levin v. Yeshiva Univ., 96 N.Y.2d 484 (N.Y. 2001); Priore v. New York Yankees, 307 A.D.2d 67 (1st Dep’t 2003); McGrath v. Toys “R” Us, Inc., 3 N.Y.3d 421 (N.Y. 2004); and Forrest v. Jewish Guild for the Blind, 3 N.Y.3d 295 (N.Y. 2004). 9 Report, LMA-12-13 (emphasis added) (quoting Williams, 61 A.D.3d at 67-68). The command is that precedential weight must not be given to any case that fails to take into account textual distinctions between the City HRL and its state and federal counterparts and/or fails to engage in independent construction designed to accomplish the City HRL’s uniquely broad purposes. That Farias is one such case will be made clear in Point III, infra. The Restoration Act also rejected the idea that the Council was required to rework a specific provision of law to escape from a narrow federal interpretation of a comparable provision. “Indeed, the Restoration Act had among its explicit purposes the rejection and overruling of the doctrine in McGrath v Toys “R” Us, Inc. (3 NY3d 421, 433-434 [2004]), which indicated that the City Council would need to amend the City HRL to specifically depart from a federal doctrine if it wanted to do so (see Williams, 61 AD3d at 73-74).” Bennett, 92 A.D.3d at 35. Williams stated that, “Importantly, the way that the Council responded to McGrath was not by dealing with the specific topic of the case (the availability of attorney's fees in circumstances where only nominal damages are awarded), but by changing the method of analysis applicable to all provisions of the law,” Williams, 61 A.D.3d at 74 n.18, and pointed out that McGrath was one of the illustrations in Council Member Palma’s statement of cases that would “no longer hinder the vindication of our civil rights.” Id. (quoting Council Member Palma). It was thus puzzling to the 10 Williams court that it would be argued that the Council could have made a particular change to a specific provision or doctrine of the law when that argument was “already specifically rejected by the Restoration Act.” Id. According to Williams: The Council saw the change to section 8-130 as the means for obviating the need for wholesale textual revision of the myriad specific substantive provisions of the law. While the specific topical provisions changed by the Restoration Act give unmistakable illustrations of the Council's focus on broadening coverage, section 8-130's specific construction provision required a “process of reflection and reconsideration” that was intended to allow independent development of the local law “in all its dimensions . . . .” Id. at 74 (citation omitted) (quoted by 2016 Committee Report, LMA-13). POINT III FARIAS FAILED TO ENGAGE IN THE ANALYSIS REQUIRED FOR CITY HRL PURPOSES; A LIMITATION OF PUNITIVE DAMAGES TO CIRCUMSTANCES WHERE A RECKLESS DISREGARD FOR THE RISK OF VIOLATING THE CITY HRL HAS BEEN SHOWN IS TOO NARROW A STANDARD; ALTERNATIVES THAT BETTER FULFILL THE UNIQUELY BROAD PURPOSES OF THE CITY HRL ARE AVAILABLE. Farias, a case decided prior to the passage of the Restoration Act, failed entirely to conduct an independent analysis of whether the federal standard fulfilled the purposes of the City HRL. Farias, 259 F.3d at 101-102. It likewise failed to take account of the structural differences between Title VII and the City HRL. Id. As such, it can have no precedential weight and is, for City HRL purposes, 11 legislatively overruled. See Williams, 61 A.D.3d at 67-68; 2016 Committee Report, LMA-12-13.6 Farias relied on Kolstad v. Am. Dental Ass’n, 527 U.S. 526 (1999), a Title VII case. Kolstad itself had no reason to analyze the appropriateness of the “reckless indifference to the federally protected rights” standard because that standard was explicitly written into Title VII. Kolstad, 527 U.S. at 529-30; see 42 U.S.C. § 1981a(b)(1). A. Structural considerations The Kolstad case is useful in highlighting how structurally dissimilar Title VII is from the City HRL, a dissimilarity that reflects different priorities and different policy choices: The very structure of § 1981a suggests a congressional intent to authorize punitive awards in only a subset of cases involving intentional discrimination. Section 1981a(a)(1) limits compensatory and punitive awards to instances of intentional discrimination, while § 1981a(b)(1) requires plaintiffs to make an additional “demonstrat[ion]” of their eligibility for punitive damages. Congress plainly sought to impose two standards of liability – one for establishing a right to compensatory damages and another, higher standard that a plaintiff must satisfy to qualify for a punitive award. 6 None of the cases cited by defendants-respondents, whether decided before or after the Restoration Act, engage in the distinctive liberal construction analysis required under the City HRL. 12 Kolstad, 527 U.S. at 534. In other words, it was explicit congressional limitation of damage awards to instances of intentional discrimination and then explicit congressional imposition of a separate and additional burden of persuasion for punitive damages (a demonstration of defendant’s maliciousness or reckless disregard of the risk of violating federally protected rights) that led to the Supreme Court’s conclusion that punitive damages were authorized only in a subset of cases involving intentional discrimination. The City HRL, by contrast, does not limit either compensatory damages or punitive damages to cases of intentional discrimination. See Admin. Code § 8- 107(17) (setting forth the standards for disparate impact without any limitation on remedy); Admin. Code § 8-502(a) (creating a private right of action for “damages, including punitive damages,” without limiting the availability of such punitive damages to intentional discrimination cases). Likewise, the City HRL does not require a separate demonstration of mental state in order for punitive damages to be awarded. See id. In other words, the factors that the Supreme Court believe pointed to an intent to limit punitive damages to a subset of cases are missing in the City HRL context. These are precisely the kinds of differences in statutory language that Williams confirms must be taken into account in the interpretative process. Rather than presuming that the Council engaged in an unaccountable omission, it is more 13 plausible to interpret the absence of a separate standard for punitive damages liability for court actions as a decision by the Council to make all violations of the statute subject to jury consideration as to whether and to what extent punitive damages should be imposed. Indeed, the 1991 Committee Report that accompanied the 1991 Amendments, LMA-80-130, explained flatly that an individual who files a City HRL claim in court pursuant to Admin. Code § 8-5027 “would be able to recover all costs, attorney’s fees and punitive damages.” 1991 Committee Report, LMA-88.8 Per Albunio, 16 N.Y.3d at 477-78, the punitive damages provision, like other City HRL provisions, must be interpreted “broadly in favor of discrimination plaintiffs, to the extent that such a construction is reasonably possible.” The conclusion that a violation of the statute is enough to trigger jury consideration of punitive damages is bolstered further by the clarification in the 2016 Amendments that “[e]xceptions to and exemptions from the provisions of this title shall be construed narrowly in order to maximize deterrence of discriminatory conduct.” LL-35 (adding Admin. Code § 8-130(b)), LMA-2. The Council in 1991 had decided that it would not require a “safe harbor” from punitive damages in any 7 The private right of action, an action “for damages, including punitive damages, and for injunctive relief and such other remedies as may be appropriate” was introduced into the City HRL by the 1991 Amendments as Admin. Code § 8-502(a). See Local Law 39 of 1991, § 2, LMA-75. 8 The Section-by-Section Analysis of the Committee Report says of Admin. Code § 8-502(a) that “an aggrieved person could seek equitable relief and any appropriate damages including punitive damages.” LMA-127. 14 circumstance; it only permitted the Commission on Human Rights to establish by rule those policies, programs, and procedures to prevent and detect discrimination, which, if implemented, would shield employers from punitive damages if their liability for those damages had arisen solely from the conduct of employees or agents. Admin. Code § 8-107(13)(f). In more than 25 years, the Commission has never elected to establish such rules. What the Council mandated instead in 1991 was a system where employers could plead and prove specified factors in mitigation of punitive damages – again, only if the employer’s liability was “based solely on the conduct of an employee, agent, or independent contractor . . . .” Admin. Code § 8-107(13)(d);9 see also Admin. Code § 8-107(13)(e). To create a new safe harbor provision judicially – imposing a state-of-mind requirement to shield some violators of the City HRL from any punitive damages when the Council did not do so – is the opposite of Admin. Code § 8-130(b)’s command to construe exceptions and exemptions narrowly in order to maximize deterrence. Finally, the reflexive belief that the Council could not really have been prepared to see violators punished if they were “innocent” of a specified mental state 9 The limitation to cases where the employer’s liability is “based solely on the conduct of an employee, agent or person employed as an independent contractor” makes sense only if what underlies the mitigation and safe harbor provision is the fact that employers are vicariously liable, including for punitive damages, based solely on the conduct of their employees. 15 must yield to the fact that, for administrative actions, the Council did not make the existence of a particular mental state a threshold that had to be met before civil penalties were permitted. Instead, the Council treated the existence of willfulness, wantonness, or maliciousness as an aggravating factor; that is, a factor that permitted a higher level of civil penalties than would otherwise be allowed. Admin. Code § 8- 126(a). Civil penalties up to $125,000 can be imposed “to vindicate the public interest,” with no showing of willfulness or other mental state required. Id. In other words, the Council did intend that a violation of the statute was enough by itself to support the imposition of a civil penalty; there is no reason to believe that the Council wanted those who chose the newly-created private cause of action in court to face a higher hurdle in connection with punitive damages. B. Accomplishing the purposes of the City HRL LL-35 intended that, inter alia, the analysis of Williams and Bennett would serve as a model for solving other interpretative problems. Williams observed that the federal “severe or pervasive” standard in sexual harassment cases was created out of the desire to take a “middle path” between “making actionable any conduct that is merely offensive and requiring the conduct to cause a tangible psychological injury . . . .” Williams, 61 A.D.3d at 75 (citation omitted). Doing so – and allowing a significant spectrum of conduct that treated 16 women less well than men – was not consistent with a City HRL that was “now explicitly designed to be broader” than its federal counterpart. Id. at 76. Williams noted in particular that it is a different approach – one that “maximiz[es] deterrence” – that incorporates “traditional methods and principles of law enforcement” that is required by the Restoration Act. Id. (citation omitted). The solution of Williams was to detach the questions of severity and pervasiveness from the question of exposure to liability, but to permit consideration of those factors when considering the amount of damages. Id. As with “severe or pervasive,” so, too, with punitive damages. The Supreme Court again took a “middle path,” rejecting an “egregiousness” requirement, Kolstad, 527 U.S. at 537-39, but failing even to consider either the possibility of a no mental-state requirement or of a mental-state requirement less restrictive than reckless disregard of the risk of violating federal rights because Congress had explicitly legislated that state-of-mind requirement into the law. Id. at 534-35. More generally, Kolstad failed to explore the value of expanding exposure to punitive damages, instead focusing on limiting exposure even more than is effected by the limitation of principles of agency that, it said, Congress had wanted to remain in place. This included Kolstad’s judicial creation of a broad “good faith” safe harbor. Id. at 541-46. The Council took an entirely different path in amending the City HRL in 1991, 17 one focused more on exposing covered entities to liability. It created far broader vicarious liability, Admin. Code § 8-107(13)(b), see generally Zakrzewska v. New School, 14 N.Y.3d 469 (N.Y. 2010);10 did not specify a mental-state requirement for punitive damages, Admin. Code § 8-502(a); did not limit punitive damages to cases of intentional discrimination, id.; did not cap the amount of punitive damages, id.; and put into force a mitigation regime rather than a mandatory safe harbor regime, Admin. Code §§ 8-107(13)(d) and (e). It is a mistake to assume that the very different federal and local paths would lead to identical requirements for the imposition of punitive damages. Moreover, a requirement that the person committing the underlying discriminatory act must have at least recklessly disregarded the risk of violating the City HRL would run counter to what Williams identified as the Restoration Act’s principle of maximizing deterrence. Williams, 61 A.D.3d at 76; see also Bennett, 92 A.D.3d at 43. As noted in testimony on the Restoration Act, the federal reckless disregard standard “gives discriminators an incentive to plead ignorance of the law.” Testimony of ADC’s Executive Director on the proposed Restoration Act, April 14, 2005 (“ADC Testimony”), LMA-34. See also Chauca, 841 F.3d at 92 (quoting the 10 Vicarious liability in the housing and public accommodations contexts is even broader: an employer’s liability for the conduct of an employee or agent is absolute. Admin. Code § 8- 107(13)(a). 18 testimony).11 That a reckless disregard standard could give discriminators such an incentive was also noted in Kolstad. Quoting from an employer-side amicus brief, Kolstad pointed to the concern that employers who had made efforts to familiarize themselves and their employees with the requirements of Title VII would then be treated as having acted with reckless indifference if a violation occurred. Kolstad, 527 U.S. at 544-45. As such, the Court believed, allowing liability for punitive damages to the extent allowed by agency principles would create “perverse incentives” for employers to hide their heads in the sand (and not educate their employees). Id. at 545. Because that reckless indifference standard was baked into Title VII, Kolstad’s solution was to narrow agency principles and create a broad safe harbor to incentivize employers to have anti-discrimination education and prevention programs. Id. at 545. For City HRL purposes, however, there is an enforcement-maximizing, evasion-deterring solution that was not available federally: having no mental-state requirement at all. Under such a regime, employers would know that they would always be exposed to the possibility of some level of punitive damages. With 11 This testimony was described on the floor of the Council session at which the Restoration Act was passed as “an excellent guide to the intent and consequences of [the] legislation we pass today.” Williams, 61 A.D.3d at 68 n.7 (quoting Council Member Palma). See also Eyes, 33 Fordham Urb. L.J. at 318-20 for further discussion of punitive damages. 19 ignorance not available as a safe harbor, the incentive to learn the City HRL’s proscriptions (including those that are less well known) would be maximized. The incentive to have policies and procedures that are effective in preventing those violations would be maximized, too. The motivation is obvious: since anyone in the workplace engaging in any discriminatory conduct could give rise to the award of punitive damages, the employer would want to do everything possible to prevent such violations. This is, as required, the traditional law enforcement approach; but it is important to note, too, that the greater incentive to be effective in preventing violations would also operate as a “carrot” for employers. The more they did to avoid the greater exposure to punitive damages liability, the more likely they would be able to reduce or eliminate such damages because of: (a) the mitigation measures they had put in place; and (b) the reduced frequency of violations in the workplace (both being Admin. Code § 8-107(13)(d) factors). This course is very much like the path taken in Williams: increase exposure to liability so as to bring the City HRL closer to a zero-tolerance regime (i.e., one where discrimination plays “no role,” Admin. Code § 8-101); but recognize that the damages to be awarded will vary on a case-by-case basis. Williams, 61 A.D.3d at 76. Consistent with this, appellant’s proposed charge language makes clear to a jury 20 that mitigating factors are to be considered.12 By refraining from judicially creating a mental-state requirement, this Court would avoid the problem of creating a subset of defendants who – despite the Restoration Act principle that discrimination should play no role in the public life of the city and that “discrimination injuries are per se ‘serious injuries’” Williams, 61 A.D.3d at 76-77 (citation omitted) – would not be punished at all.13 Bennett was a case where the Supreme Court’s consideration of the import of a defendant offering false, incomplete, or misleading reasons for its conduct was found to be insufficient to meet the “uniquely broad and remedial” purposes of the City HRL. Bennett, 92 A.D.3d at 41-42. Whatever was true for federal law purposes, for the City HRL the offering of those reasons presents, inter alia, important evidence of consciousness of guilt. Id. at 42. In addition, only by penalizing employers for covering up their actual motivations in the course of court proceedings can “the maximum deterrent effect sought by the City HRL . . . be achieved . . . .” Id. at 43. Bennett, in other words, was giving a factor (consciousness 12 In our view, such a charge should also include aggravating factors that a jury may permissibly consider (including the presence of any culpable state of mind), as well as the instruction that a defendant’s resources are a relevant consideration because punitive damages, to achieve their deterrent effect, are intended to be of an amount sufficient to “sting.” 13 It is worth reiterating the fact that the City HRL does not require an act to be intentional at all (let alone motivated by animus) to be a cause of action for “damages, including punitive damages . . . .” Admin. Code § 8-502(a). To square that fact with a requirement of evil motive or its equivalent would require the Court to interpret the punitive damages provision narrowly in favor of discrimination defendants, the opposite of the teaching of Albunio, 16 N.Y.3d at 477-78. 21 of guilt) more weight for City HRL purposes than it had been given for federal law purposes, and, in doing so, Bennett was selecting the interpretation that gave maximum incentive to avoid and prevent violations of the local statute. This is the same process that must be followed here. It is certainly true that permitting consideration of the award of punitive damages in the case of all violations is far broader than either the rules applicable under other statutes or the rules applicable under common law. But the Council’s doing so is entirely consistent with the pattern of its dramatic 1991 rewrite of the City HRL. “In case after case, the balance struck by the [1991] Amendments favored victims and the interests of enforcement over the claimed needs of covered entities in ways materially different from those incorporated into state and federal law.” Williams, 61 A.D.3d at 68 (citation omitted). If the subject were any other area of law enforcement, no one would be surprised by a policy choice reflecting the belief that the way to maximize deterrence was to increase exposure to penalties for non- compliance. It is only because civil rights laws have not typically been understood as part of the law-enforcement world that this enforcement-centric policy chosen by the Council is startling to some. But that was the choice that the Council expressly made: “traditional methods and principles of law enforcement ought to be applied in the civil rights context,” 2005 Committee Report, LMA-28; the City HRL was “designed as a law enforcement tool with no tolerance for discrimination in public 22 life,” 2016 Committee Report, LMA-10; the City HRL represents the melding of the “broadest vision of social justice with the strongest law enforcement deterrent,” Williams, 61 A.D.3d at 68 (citation omitted) (cited by 2016 Committee Report, LMA-13). Maximizing exposure to jury consideration of a defendant’s conduct is a continuing theme in both Williams and Bennett. For example, Williams cited the concerns of advocates that, for example, “women who have been sexually harassed are routinely thrown out of court without getting a chance to have a jury hear their claims . . . .” Williams, 61 A.D.3d at 77-78 (citation omitted). In Bennett, the importance of allowing an issue to get to the jury was emphasized even more strongly. Specifying that acts of discrimination cause “serious injury, to both the persons directly involved and the social fabric of the City as a while, which will not be tolerated,” Bennett, 92 A.D.3d at 38 n.10 (citation omitted), Bennett insisted that courts limit grants of summary judgment under the City HRL because the purposes of the law demand that courts “maximize the ability to ferret out . . . discrimination, not create room for discriminators to avoid having to answer for their actions before a jury of their peers.” Id. at 38. Bennett goes on to say that it recognized that “there has been a growing emphasis on using summary judgment in discrimination cases to promote ‘judicial efficiency.’” Id. at 44 (citation omitted). That tendency, however, cannot be 23 countenanced because a “central purpose” of the Restoration Act was to “resist efforts to ratchet down or devalue the means by which those intended to be protected by the City HRL could be most strongly protected . . . .” Id. (citation omitted). In this case, the appellant was not permitted to have the jury consider the question of punitive damages. Preventing that consideration does indeed ratchet down the means by which to provide maximum protection under the City HRL. It fails to recognize that punitive damages (of some amount) – even in the absence of reckless disregard of the known risk of violating the City HRL – could be necessary to achieve deterrence against a particular defendant, or could enhance general deterrence. It also fails to recognize that an action or failure to act could be blameworthy without reckless disregard of the risk of violating the City HRL. This might occur, for example, when a defendant intentionally or recklessly causes harm to another (as when a defendant had pregnancy as a motivating factor in a decision not to rehire a plaintiff).14 And application of the Farias standard fails to recognize that the introduction of the reckless disregard standard does incentivize defendants – including individual employees whose conduct is the basis of their employers’ 14 See JA-499 (the jury’s answers to question 3). The Council’s view that all discrimination injuries are per se serious injuries is consistent with the view that all acts of discrimination, even in the absence of recklessness of any sort, are acts for which serious consequences must attend. The Council, after all, in the very same 1991 Amendments that introduced civil penalties and punitive damages, focused on enhancing the responsibility imposed for any discriminatory act: it acted both to make each actor responsible for his own conduct, and, through the country’s most stringent vicarious liability regime, responsible for the actions of employees. 24 vicarious liability – to claim ignorance of the law. To conclude this section, we return to the unique enforcement-centric, no- tolerance-of-discrimination vision of the City HRL and the task of any court to determine what interpretation “best fulfills” the City HRL’s purposes. Williams, 61 A.D.3d at 75 n.21. A result that leaves open the possibility of any discriminatory conduct being subject to punishment, if a jury determines that punishment is warranted, achieves that vision far better than a standard that categorically excludes some defendants from any punishment at all. C. An alternative formulation If the Court is unwilling to accept that the City Council would allow for punitive damages to be available in all circumstances, it is important to recognize that the Farias test is neither the only alternative standard nor the proper alternative standard. A better option would be to add “reckless disregard of the risk of causing harm” as an alternative and sufficient mental-state showing. ADC’s testimony on the Restoration Act supported using reckless disregard of the risk of causing harm as a standard: “Where a discriminator recklessly disregards the possibility that his conduct may cause harm, that discriminator ought 25 to be subject to punitive damages . . . .” ADC Testimony, LMA-34.15 Recklessly disregarding the possibility that one’s conduct may cause harm is, without question, blameworthy. It is difficult to argue in general – and impossible in the context of the City HRL – that blameworthy conduct should not be punished. This standard also allows for a narrow carve-out in the disparate impact context where the violator neither recklessly disregarded the risk of violating the statute nor recklessly disregarded the risk of causing harm (it is hard to imagine intentional violations where there is not at the least the presence of the latter type of recklessness). This standard would, almost to the extent of a regime under which no particular mental state is required, incentivize the development of the least discriminatory alternatives. And, finally, this standard, while not achieving the level of deterrence that is achieved with no mental-state requirement, still comes closer than does the Farias standard. 15 Because the Second Circuit used an ellipsis to excerpt the testimony, Chauca, 841 F.3d at 92, it missed the fact that the testimony was declaratively setting forth this differently-oriented version of reckless disregard as a standard. Cf. ADC Testimony, LMA-34. See also Eyes, 33 Fordham Urb. L.J. at 318-20. 26 POINT IV THERE IS NO REASON TO BELIEVE THAT THE STANDARD FOR AWARDING PUNITIVE DAMAGES WHERE LIABILITY IS DETERMINED DIRECTLY IS ANY MORE STRINGENT THAN WHERE LIABILITY IS DETERMINED VICARIOUSLY. As noted previously, the mitigation provisions of Admin. Code § 8-107(13) – that is, subparagraph (d) and, if it were in force, subparagraph (f) – contemplate that punitive damages may be imposed solely on the basis of the conduct of an employer’s employee or agent. Indeed, the specific mitigation or safe harbor factors articulated are only applicable in the pure vicarious liability scenario. There is no exception set out. Admin. Code § 8-107(13)(b) states that an employer “shall be liable for an unlawful discriminatory practice based upon the conduct of an employee . . .”; it does not say “shall be liable, except insofar as punitive damages are concerned, based on the conduct of an employee.” Admin. Code §§ 8- 107(13)(d) and (e) presume that the employer is already liable in punitive damages based on the employee’s conduct, and that the demonstration of various factors can mitigate that liability. The side-by-side contemporaneous comparison between the pre-1991 version of the City HRL and the City HRL as amended in 1991, cited by this Court in Zakrzewska, 14 N.Y.3d at 480, is further proof of this (see discussion of “Liability of employers for acts of employees and agents” at LMA-145). As in the statute itself, liability for civil penalties or punitive damages is imputed 27 vicariously, not from a separate and independent showing about the employer’s own conduct; mitigation proceeds from the already-existing liability. There may, however, be circumstances where an employer’s own action or inaction might make it more blameworthy (for example, where, in addition to meeting the conditions for strict vicarious liability, the employer actively ratified the discriminatory conduct, or where the employer recklessly ignored conduct brought to its attention). In those fact-specific circumstances, a jury ought to be instructed that it can consider these or other aggravating factors in terms of the amount of punitive damages to award. Beyond vicarious liability, there are a host of circumstances where there is direct liability. This might occur where the conduct involved is a quintessential employer act like hiring or firing. Or it might be the case where an individual actor has been found guilty of a discriminatory practice.16 There is no reason to believe that a more stringent punitive damages standard would apply to direct liability. Certainly there is no statement in the City HRL to this effect. Moreover, the principal of maximum deterrence applies in the direct liability context: all actors 16 In 1991, the Council amended § 8-107(1)(a) to expand liability in the employment context to “employers or an employee or agent thereof . . . .” Local Law 39 of 1991 at LMA-48. As Mayor Dinkins stated, “The new law takes the fundamental step of making all people responsible for their own discriminatory conduct.” Remarks of Mayor David Dinkins on 1991 Amendments to City HRL, June 18, 1991, LMA-134. Priore v. New York Yankees, 307 A.D.2d 67 (1st Dep’t 2003), which attempted to undo this provision, is discussed extensively in Eyes, 33 Fordham Urb. L.J. at 272-75, and was one of the specific illustrations of cases to be legislatively overruled identified in Restoration Act Council proceedings. See Williams, 61 A.D.3d at 67. 28 have the greatest incentive to learn what is proscribed by the City HRL and to avoid running afoul of the law if violation exposes them in all cases to the possibility of having a punitive damages award imposed. Finally, especially in light of the Council’s view that acts of discrimination cause serious injury to the City, it is inconceivable that those who directly cause those injuries would be allowed to escape punishment altogether when those who are vicariously liable cannot. CONCLUSION The Farias standard for punitive damages should not be imported into the City HRL. Instead, the Court should recognize that punitive damages are available and may be considered by a jury in any case where the law has been violated. In the alternative, if the Court believes that a mental-state finding is required, the only such finding that should be required is that the person or persons directly liable for the discriminatory conduct have at least exhibited reckless disregard for the possibility that the victim of the discriminatory conduct would be harmed by the conduct. Dated: August 30, 2017 New York, New York _____________________________ Craig Gurian Anti-Discrimination Center, Inc. 1745 Broadway, 17 Floor New York, New York 10019 212-537-5824 Craig Gurian 29 CERTIFICATION Pursuant to Court Rule 500.13(c)(1), I certify that this brief contains 6,965 words. _________________________ Craig Gurian Craig Gurian