Runaway Juries: Single-Plaintiff L&E Litigation Producing Massive Awards

By Kevin Hylton | LexisNexis Practical Guidance

In April 2023, a federal jury in San Francisco awarded nearly $3.2 million in damages to a former Tesla worker who prevailed in a trial that held the company liable for failing to protect him from racial abuse. And yet many legal experts following the case breathed a sigh of relief over what could have been a far more costly jury award.

The April decision replaced a previous jury award of $137 million after U.S. District Judge William Orrick tossed out that award as excessive and “unconstitutionally large.”

The judge’s actions reflect a broader trend of courts using their discretionary power to rein in so-called “nuclear” eight-figure jury verdicts, according to legal experts who spoke to Law360.

“The size and frequency of massive jury verdicts — known as ‘nuclear verdicts’ and described generally as being worth $10 million or more — are increasing,” says a report from the U.S. Chamber of Commerce Institute for Legal Reform.

The report highlights recent large verdicts, such as a Texas jury’s $325 million award, including $317 million in non economic damages, to a former Houston airport worker who was paralyzed on the job. And last year, an Oregon jury awarded $4.4 million to a Walmart shopper who sued for being racially profiled by a loss prevention employee.

“Since the pandemic, there has been a significant uptick in large jury verdicts against employers in L&E litigation,” said Anthony J. Oncidi, partner in the Los Angeles office of Proskauer, who represents employers and management in all aspects of labor relations and employment law. “We’re now recording here in California jury verdicts that are often in excess of $10 million — and some even more eye-popping verdicts of more than $100 million — for single-plaintiff employment cases.”

Oncidi, the co-chair of Proskauer’s Labor and Employment Law Department and head of the firm’s West Coast Labor & Employment group, noted that “runaway jury” awards in employment cases have accelerated over the past five years, especially since 2021.

“These are not class action or collective action verdicts, where you have hundreds or even thousands of employees involved,” said Oncidi. “This is a single person who has filed a lawsuit against his or her employers and is claiming often some form of discrimination, harassment or that they have been a victim of retaliation.”

Oncidi highlighted the components of most single-plaintiff employment discrimination lawsuits:

1. Lost wages

The employee will rely on testimony of experts to seek all past wages they have lost — up to the time of the trial — as well as future lost wages, in the event they have been unable to find gainful employment since departing the organization.

2. Emotional distress damages

In each and every one of the cases, the plaintiff will seek damages for emotional distress caused by the alleged bad acts from the employer. This claim is driven by the testimony of friends and loved ones, as well as testimony from forensic psychologists who will make the argument that the employee was severely impacted by the alleged incident(s).

3. Punitive damages

The jury is asked when resolving the cases whether they believe there was sufficient “malice, oppression or fraud” that was proven by the plaintiff with clear and convincing evidence. If the jury is sufficiently upset with the behavior of the employer and they return an answer in the affirmative, they will then hear evidence and deliberate as to whether punitive damages should be heaped on top of the lost wages award and the emotional distress award. There are reasonable limits for how high these punitive damages can be (generally 2X to 3X of the previous damages), but jurors are not told about these “caps” and therefore are free to award whatever monetary penalties they determine in deliberations — setting the stage for judges to set aside excessive damages, as what happened in the Tesla case.

Oncidi advises that employers need to understand there are a number of key stages of defending single-plaintiff employment discrimination cases. A practice note published by Lexis Practical Guidance explores best practices for managing these cases that are brought under federal anti-discrimination statutes, including Title VII of the Civil Rights Act, the Americans with Disabilities Act, the Age Discrimination in Employment Act, the Genetic Information Nondiscrimination Act and the Equal Pay Act. The resource addresses all stages of single-plaintiff employment discrimination litigation, from pre-complaint procedure and initial pleadings all the way through trial.

The Lexis Practical Guidance team has also assembled an Employment Litigation Resource Kit, which provides employment litigators with links to practice notes, templates, checklists, presentations and videos that provide an important starting point in preparing for various types of employment litigation — including discrimination lawsuits and other L&E cases.

“These runaway jury awards in employment litigation are no longer black swan events,” said Oncidi. “They are happening with greater frequency than most of us could have expected.”

Oncidi is a contributor to Lexis Practical Guidance, including the publication of several articles related to employment litigation and two recent practice videos containing insightful tips on preparing for depositions in employment cases.

I had the privilege of interviewing Oncidi on the latest episode of our “Practical Guidance: Labor and Employment Series” podcast, where we invite experts to provide insights on timely employment law issues facing legal practitioners. Listen now or download this new episode regarding the recent trend of massive awards in single-plaintiff L&E litigation and some important conclusions that legal professionals can learn from these developments.