Baker v. National State Bank

Decision Date21 June 2002
PartiesAnn BAKER and Barbara Hausleiter, Plaintiffs-Respondents/Cross-Appellants, v. The NATIONAL STATE BANK, (a/k/a CoreStates, its Successor-In-Interest), Defendant-Appellant/Cross-Respondent, and Leo Ahern, as Regional Manager and individually, and Arthur Campbell, as Executive Vice-President, and individually, Defendants.
CourtNew Jersey Superior Court

David H. Ganz, Somerset, argued the cause for appellant/cross-respondent (Collier, Jacob & Mills, attorneys; Cynthia M. Jacob and Mr. Ganz, of counsel; Mr. Ganz, Alan G. Lesnewich and Sandra N. Fears, on the brief).

Patricia Breuninger, argued the cause for respondent/cross-appellant (Breuninger & Fellman, attorneys, Fawnwood; Ms. Breuninger, of counsel, Frederic J. Gross and Susan E. Babb, Mount Ephraim, on the brief).

Before Judges NEWMAN, FALL and AXELRAD. The opinion of the court was delivered by NEWMAN, J.A.D

In this employment discrimination action, on appeal for the second time before this court, defendant National State Bank (the Bank) (subsequently merged with CoreStates and then acquired by First Union National Bank) appeals from the trial court's remittitur of a punitive damages award. The trial court reduced the award of $4 million to $1.8 million. The Bank argues that the court erred in: (1) finding that the remitted award was not a violation of the Bank's constitutional, due process rights; (2) concluding that the unremitted award was not the result of passion, prejudice or mistake; and (3) awarding postjudgment interest on the punitive damages, accruing from the date of the jury verdict. Plaintiffs Ann Baker and Barbara Hausleiter cross-appeal the trial court's remittitur of the punitive damages award, contending that the $4 million award was not excessive. We now affirm both on the direct and cross-appeal.

We need not repeat the facts of this case which are set forth in our earlier opinion in Baker v. Nat'l State Bank, 312 N.J.Super. 268, 711 A.2d 917 (App.Div.1998). Our opinion was affirmed by the Supreme Court, except for a remand on the issue of punitive damages, remanding to the trial court to consider whether the punitive damages award violated due process, in light of the standards enumerated by the United States Supreme Court in BMW of N. Am., Inc. v. Gore, 517 U.S. 559, 116 S.Ct. 1589, 134 L.Ed.2d 809 (1996). 161 N.J. 220, 231, 736 A.2d 462 (1999).


We first address the standard of review to be applied by this court. In Cooper-Indus., Inc. v. Leatherman Tool Group, Inc., 532 U.S. 424, 121 S.Ct. 1678, 149 L.Ed.2d 674 (2001), the Supreme Court addressed this very issue. The Court held that a trial court's consideration of the three criteria outlined in BMW would be subject to de novo review because an award of punitive damages was not really a "fact tried by the jury." 532 U.S. at 437, 121 S.Ct. at 1686, 149 L.Ed.2d at 687 (internal quotations omitted). In a footnote, the Court added that it "of course remains true that Court of Appeals should defer to the District Court's findings of fact unless they are clearly erroneous." 532 U.S. at 440 n. 14, 121 S.Ct. at 1688, 149 L.Ed.2d at 689-90. See also Lockley v. Turner, 344 N.J.Super. 1, 27, 779 A.2d 1092 (App.Div. 2001)

(noting recent decision of Cooper and its holding that de novo standard of review applies), certif. granted, 172 N.J. 179, 796 A.2d 896 (2002).

In Cooper, the Supreme Court reasoned that independent review was required because punitive damages are designed to exact punishment and therefore should be subject to the same analysis as criminal penalties. 532 U.S. at 432, 121 S.Ct. at 1683, 149 L.Ed.2d at 684-86. The Court looked to a number of criminal cases involving whether the criminal sentence imposed (death penalty, life imprisonment, punitive forfeiture) was grossly disproportionate to the gravity of the offense, and noted that in each of those cases, the Court engaged in an "independent examination of the relevant criteria." Id. at 434, 121 S.Ct. at 1684, 149 L.Ed.2d at 686.

The Court also rejected the argument that a trial court possessed any advantage in reviewing a punitive damage award. Id. at 440, 121 S.Ct. at 1687-88, 149 L.Ed.2d at 689-90. Pointing to the three factors outlined in BMW, the Court maintained that a trial court only had a slight advantage over an appellate court in determining reprehensibility, that a trial and appellate court were equally capable of evaluating the ratio, and that an appellate court was more suited to analyzing the third factor, civil penalties imposed in comparable cases, because that "calls for broad legal comparison." Ibid.

Because de novo review means that no special deference will be accorded to a trial court's findings of fact and conclusions of law, the trial court's characterization of the evidence in support of the award of punitive damages is of little significance. See Zimmerman v. Direct Fed. Credit Union, 262 F.3d 70, 81 (1st Cir. 2001)

(holding that both extent of punitive damage award and sufficiency of evidence on which it was premised required de novo review).

De novo review means that a reviewing court may disagree with the lower court's findings and conclusions. See Goodman v. London Metals Exch., Inc., 86 N.J. 19, 28-29, 429 A.2d 341 (1981)

(stating that with de novo review, reviewing court may disagree with lower court's findings and rulings). In sum, no deference need be paid to the trial court's application of the BMW test.

We next focus on the three BMW guideposts. In BMW, the Supreme Court held that a punitive damages award may be so excessive as to violate substantive due process. 517 U.S. at 585-86, 116 S.Ct. at 1604, 134 L.Ed.2d at 832-33. There, the Court considered a $2 million punitive damages award for misconduct causing $4000 in compensatory damages, a ratio of 500 to 1. Id. at 567, 116 S.Ct. at 1595, 134 L.Ed.2d at 820-21. The Court concluded that the punitive damages award transcended "the constitutional limit" and remanded for consideration of three "guideposts" to determine whether the award comported with principles of fairness. Id. at 585-86, 116 S.Ct. at 1604, 134 L.Ed.2d at 832-33. Those guideposts required a consideration of: (1) the degree of reprehensibility of the conduct that formed the basis of the civil suit; (2) the disparity between the harm or potential harm suffered by the plaintiff and the plaintiff's punitive damages award; and (3) the difference between this remedy and other penalties authorized or imposed in comparable cases of misconduct. Id. at 575, 116 S.Ct. at 1598-99, 134 L.Ed.2d at 826.


The Bank contends that its conduct was not so reprehensible as to support even the remitted $1.8 million punitive damages award. Plaintiffs argue that the Bank's misconduct was extremely reprehensible, and the original jury award of $4 million was appropriate.

On remand in this case, in its analysis of the first prong of the BMW test, the trial court first quoted verbatim from this court's opinion discussing the Bank's egregious conduct:

"Indeed selecting plaintiffs for termination and subsequently searching for reasons to justify that selection is evil minded, intentional wrongdoing. The evidence supported a finding that this occurred. Ahern testified that Campbell told him `plaintiffs have to go.' When Ahern reported back to Campbell that Baker's file justified her selection but Hausleiter was questionable, Campbell and Ahern then obtained notes and placed them in Hausleiter's file."


"The evidence further supports the Judge's conclusion that defendant set about to trash the reputations of the plaintiffs. Defendants accused Baker of having bad loans and overdrafts, which was not true. Campbell said that Baker was chosen for termination because of the unsatisfactory performance of her branch, Perth Amboy, but admitted that she was assigned to manager [sic] that branch because of her ability and experience, and further admitted that the branch has [sic] improved in the time that she managed it."
Appellate Division went on to say the defendants also accused Hausleiter of problems with her loan portfolio was [sic] not true, which was not true. Ahern admitted that the notes did not criticize Hausleiter. The notes were not originally in Hausleiter's file, and there was no criticism in her performance appraisal. There was evidence that the other discharged employees were not replaced. Campbell was unable to identify any employees on the riff [sic] list besides the plaintiffs who were replaced.

The circumstances here are as egregious as those in RENDINE (phonetic) in which the Court approved punitive damages for two plaintiffs who were discharged from their employment when they sought to return after maternity leave despite defendant's promise that their positions would be available. Here, as in RENDINE, the defendant's conduct was devious and dishonest.

The trial court then discussed the evidence that it viewed to be indicative of the Bank's reprehensible conduct.

In addition to considering the Appellate decision in this regard, the Court finds evidence in support of a conclusion of reprehensibility supported by the fact that plaintiff Baker was blamed for poor conditions which she did not create, that she was terminated after 19 years of service for a younger male who survived only two months at that position. She was subjected to false and insulting allegations and her character and reputation impugned. That in part it was done after the fact in an effort to conceal the true reasons for her termination. That the defendants lied to the plaintiffs in that they were actually told their positions were eliminated, when unlike all the other terminations their positions were not.
When defendant Ahern asked defendant Campbell how to pick the 10 percent for the riff [sic], he was expressly told[,] Baker and Hausleiter have to go. No one else was singled out. The justifications

To continue reading

Request your trial
14 cases
  • Fasano v. Federal Reserve Bank of New York
    • United States
    • U.S. Court of Appeals — Third Circuit
    • August 3, 2006
    ...of nonpayment of a fee assumed by counsel" and apply a multiplier enhancement). LAD damages are uncapped. Baker v. Nat'l State Bank, 353 N.J.Super. 145, 801 A.2d 1158, 1165-66 (2002). The differences are also apparent with respect to CEPA. CEPA provides extremely "broad protections against ......
  • Davids v. Novartis Pharms. Corp.
    • United States
    • U.S. District Court — Eastern District of New York
    • October 9, 2013
    ...Zalewski v. Gallagher, 375 A.2d 1195, 150 N.J.Super. 360 (N.J.App.Div.1977)) (internal brackets omitted); Baker v. National State Bank, 801 A.2d 1158, 1167, 1177, 353 N.J.Super. 145, 159, 176 (N.J.App.Div.2002) (awarding prejudgment interest on the compensatory or actual damages, but only a......
  • McCarthy v. Care One Management, LLC
    • United States
    • New Jersey Superior Court — Appellate Division
    • July 12, 2021
    ...Such actions include a defendant's fabrication of legitimate reasons to terminate a plaintiff to justify a discrimination based firing. Id. at 156. an award of punitive damages is justified where there is proof of "actual participation in or willful indifference to the wrongful conduct on t......
  • Chiofalo v. State
    • United States
    • New Jersey Superior Court — Appellate Division
    • August 7, 2020
    ...the employee can prove that he or she "would have been promoted absent the unlawful discrimination" (quoting Baker v. Nat'l State Bank, 353 N.J. Super. 145, 158 (App. Div. 2002))); but see Donelson, 206 N.J. at 257-62 (explaining, in a discharge case based on mental unfitness, that in order......
  • Request a trial to view additional results
1 books & journal articles
  • Post Judgment Interest in Civil Actions in Connecticut
    • United States
    • Connecticut Bar Association Connecticut Bar Journal No. 92, 2019
    • Invalid date
    ...nor more than nine percent. [119] Bursik v. Levine, 63 N.J. 351, 361, 374, 307 A.2d 571 (1973). [120] Baker v. National State Bank, 353 N.J. Super. 145, 174, 801 A.2d 1158 (App.Div. 2002). [121] United Consumer Financial Services Co. v. Carbo, 410 N.J. Super. 280, 313, 982 A.2d 7 (2009) (tr......

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT