In doing so, Eastern District of New York Magistrate Judge James Orenstein said that the $300,000 federal cap on punitive damages in the Americans with Disabilities Act would have little impact on changing the behavior of a "commercial titan" like Wal-Mart.
In Patrick S. Brady v. Wal-Mart Stores, CV 03-3843, plaintiff Patrick Brady, who suffers from cerebral palsy, sued Wal-Mart under the federal Americans with Disabilities Act and state law. In February, a Central Islip, N.Y., jury found that personnel at the store in Centereach, N.Y., violated federal and state laws by making a prohibited inquiry before giving Brady an employment offer.
The company also subjected Brady to adverse employment conditions by transferring him from the pharmacy to a more physically taxing position pushing carts in the parking lot, according to the verdict.
The jury awarded Brady $7.5 million in damages, including $5 million in punitive damages.
Orenstein modified the verdict, reducing it to $2.8 million. Most of the reduction came in dropping the punitive damage award to $300,000. The reduction did not take much deliberation from the judge as it was within the "plain meaning" of applicable federal statutes.
"The preceding ruling respects the law," Orenstein wrote, "but it does not achieve a just result."
Under federal anti-discrimination law, punitive damages are calculated according to the size of the employer.
"The statute calibrates its caps on punitive damages to reflect the size of the employer whose misconduct is to be punished -- a scheme that would appear designed to assure that the civil punishment imposed on a corporate offender is meaningful but not fatal," the magistrate judge held.
Violators with 15 to 100 employees would pay no more than $50,000, for instance. Those with 500 or more employees, like Wal-Mart, the world's largest retailer, would pay up to $300,000.
"There is no meaningful sense in which such an award can be considered punishment," Orenstein wrote, pointing out that Wal-Mart had $300,000 in sales every 37 seconds last year.
"In essence then," he continued, "most companies can be punished if they intentionally discriminate on the basis of disability … but the biggest companies that do so are effectively beyond the law's reach."
Orenstein said that Wal-Mart would not be deterred by the amount of punitive damages. He found that in dealing with Brady, the company had not adhered to a consent decree it entered into with the Equal Employment Opportunity Commission in 2001 requiring it to train managers and change hiring practices.
"The most generous conclusion I could draw … was that the Wal-Mart employees who testified are well-intentioned people whom the company willfully failed to provide with sufficient training to abide by the anti-discrimination law," Orenstein wrote.
"The result," he concluded, "was that Brady was subjected to the kind of discrimination against the disabled that both the law and the prior consent decree was designed to prevent."
The $300,000 punitive cap, he held, "appears unlikely ... to restrain Wal-Mart from inflicting similar abuses on those who may be doomed to follow in Brady's footsteps."
Douglas Wigdor of Thompson Wigdor & Gilly represented Brady. Joel Finger of Brown Raysman Millstein Felder & Steiner represented Wal-Mart.
