Rudnicki v. Farmers Insurance Exchange et al.

Wrongful Termination

Los Angeles County

Superior Court Judge Ruth Ann Kwan

$155.4 Million

Plaintiffs Attorneys: Shegerian & Associates, Carney R. Shegerian, Anthony Nguyen, Leonard E. Livshits, Mahru Madjidi,Griselda S. Rodriguez

Defense Attorneys: Orrick Herrington & Sutcliffe Llp, Lynne C. Hermle, Joseph C. Liburt, Anjali Priya Vadillo, Geoffrey G. Moss

Carney R. Shegerian

Andrew M.P. Rudnicki had been an in-house lawyer at Farmers Insurance for 37 years. He was a senior vice president in charge of claims litigation when the company fired him in retaliation for testimony he was preparing to give for the plaintiffs in a class action over pay for Farmers' female lawyers.

Jurors took 40 minutes to award Rudnicki $150 million in punitive damages. Earlier they gave him $5.4 million in compensatory damages. The trial took 19 days. It was the biggest win of his career, Carney R. Shegerian said. Rudnicki v. Farmers Insurance Exchange, Farmers Group Inc., BC630158 (L.A. Super. Ct., filed Aug. 10, 2016).

The jurors voted for $5.4 million in compensatory damages and $150 million in punitives. "Numbers-wise, this was the biggest case we've had in 31 years in practice," Shegerian said. He rated it the highest in Los Angeles County and the third highest in California for cases alleging similar claims.

"It's a healthy warning to corporations and entities in California that they can't treat employees poorly; they're not going to get away with it all the time."

He added that he'd always known the case had potential. "They made up a bunch of fake reasons for his termination, and that made it a powerful case. The highlight for me was watching Leo [Livshits] and Tony [Nguyen] handle the closing arguments for punitives. They were super powerful. Both just got it right."

Post-trial motions have yet to get under way. After the jury announced the award in December, Farmer's spokesman Luis Sahagun said, "We disagree with and are disappointed by the verdict, and we are considering options available to us."

"They have nothing to appeal," Shegerian said. "The evidence supports the award, and the sum is less than 2 percent of Farmer's net worth. Farmer's top executives were involved here."

The insurer's motive for firing Rudnicki was his expected future testimony on behalf of former in-house attorney Lynne M. Coates in the pay discrimination class action she filed on behalf of herself and about 100 other Farmers female attorneys. That suit alleged that Farmers kept women lawyers in lower pay grades and promoted them less than men. The matter settled for $5 million.

Farmers' defense attorneys at Orrick, Herrington & Sutcliffe LLP were unavailable for comment.

- John Roemer