1978 case citation wins punitive damages in precedent, attorney says

The children of a woman who died of cancer after being fired obtained a punitive damages award 33% higher than the economic damages she suffered in the first ruling of its kind in more than 40 years, said the attorney representing the plaintiffs.

"We're extremely pleased with the court's ruling because I do think that it establishes precedent," Marina del Rey plaintiffs' attorney V. James DeSimone said. "You hadn't had a case that addressed this issue for 40 years. The case that we're relying on was from 1978."

Traditionally, the ratio of punitive damages to economic damages should not exceed single digits, DeSimone said in an interview after a 2nd District Court of Appeal panel upheld his client's wrongful discharge award on Thursday.

By relying on Neal v. Farmers Ins. Exchange, 21 Cal. 3d 910 (1978), DeSimone successfully argued that it made sense to weigh the punitive damages in light of what the compensatory damages would likely have been if his client, Maria Lopez, had not died.

"They've [the company] already received a windfall by not being held accountable for the noneconomic damages," DeSimone said of the defendant company. "If their conduct is truly reprehensible as the court found here, why shouldn't they be liable and accountable for the full amount of punitive damages? That's the law."

Lopez worked as a sales representative for CIA Wheel Group when she was diagnosed with cancer in 2012. She went on medical leave and returned in 2013 but had to continue her chemotherapy treatment, according to the court documents.

Her boss started making negative comments about her and took credit for her sales numbers, according to the court documents, and when she complained to the human resources department, they did not bring it up with her supervisor but instead fired her.

Lopez sued CIA Wheel Group in 2014, but her death resulted in a mistrial in 2017. Her three children were substituted in as plaintiffs, leaving the economic damages award at $15,057.

Los Angeles County Superior Court Judge Randolph Hammock found that Lopez would have been awarded compensatory damages in the $100,000 to $150,000 range if she had lived, and took that into account when making the $500,000 punitive award.

CIA Wheel Group appealed the decision, calling it unconstitutional, but the appellate panel affirmed on Thursday. Rubio et al. v. CIA Wheel Group et al., 2021 DJDAR 3534 (Cal. App. 2nd Dist., filed Apr. 15, 2021).

Pillsbury Winthrop Shaw Pittman LLP represented CIA Wheel Group but could not be reached for comment.

Justice Maria E. Stratton wrote the appellate opinion, also signed by Justices Tricia A. Bigelow and John S. Wiley.

"Given the medium high level of CWG's reprehensibility, and the unusual situation where plaintiffs could not recover for Lopez's emotional distress, we have no difficulty in concluding the $500,000 is constitutionally permissible," Stratton wrote. "Lopez's actual harm was in the $115,057 to $165,057 range. Taking the midpoint of $140,057 results in a multiplier of 3.5. That is not excessive in light of CWG's despicable conduct toward a seriously and ultimately terminally ill woman."

DeSimone commented, "I hope that this case sends a message to corporations and businesses that when people become ill, they have an obligation to reasonably accommodate them and not wrongfully terminate them."