4 N.Y.3d 333 (2005)
Under New York law, a municipality is immune from punitive damages unless there is express legislative authorization to the contrary, and general references to punitive damages in a statute are insufficient to waive that immunity.
Summary
Alii Katt sued the City of New York and a police lieutenant, alleging sexual harassment and a hostile work environment. After a jury verdict in her favor that included punitive damages against the City, the District Court struck the punitive damages award. The Second Circuit certified the question of whether punitive damages could be recovered from the City under the New York City Human Rights Law (NYCHRL). The New York Court of Appeals held that the NYCHRL did not contain a sufficiently explicit waiver of the City’s immunity from punitive damages. The court emphasized the need for clear legislative intent to waive such immunity and found the general language of the NYCHRL insufficient for that purpose.
Facts
Alii Katt, a civilian employee of the New York City Police Department, alleged she was subjected to sexual harassment and a hostile work environment by her supervisor, Police Lieutenant Anthony DiPalma. Katt sued the City and DiPalma under federal and state law, including the New York City Human Rights Law (NYCHRL).
Procedural History
The United States District Court for the Southern District of New York initially entered judgment on a jury verdict in favor of Katt, which included compensatory and punitive damages. The District Court subsequently struck the punitive damages award against the City, finding no clear legislative intent to waive the City’s immunity. The Second Circuit Court of Appeals affirmed the denial of a new trial but certified to the New York Court of Appeals the question of whether the NYCHRL allows for punitive damages against the City.
Issue(s)
Whether a person claiming gender-based employment discrimination can recover punitive damages from the City of New York under section 8-502(a) of the New York City Human Rights Law, N.Y.C. Admin. Code § 8-502(a)?
Holding
No, because the NYCHRL does not contain an unambiguous expression of legislative authorization to subject the City to liability for punitive damages.
Court’s Reasoning
The Court of Appeals relied on the principle that a municipality is immune from punitive damages unless there is express legislative authorization to the contrary. Citing Sharapata v. Town of Islip, 56 N.Y.2d 332 (1982), the court emphasized that a statute in derogation of sovereignty must be strictly construed, and waiver of immunity by inference is disfavored. While the NYCHRL expressly references punitive damages, it does not specifically mention municipalities. The court reasoned that the phrase “[e]xcept as otherwise provided by law” in the NYCHRL suggests an intent to preserve the common-law principle of municipal immunity. The court also noted the lack of legislative history indicating the City Council considered the issue of punitive damages against the City. The court found that the general statements that the provision was intended to give “enhanced protection against discrimination” did not conclusively show that the City Council intended to abrogate the longstanding common-law principle. The court stated, “we must presume that the City Council was aware of the common-law rule and abrogated it only to the extent indicated by the clear import of its enactment” (quoting Juarez v Wavecrest Mgt. Team, 88 NY2d 628, 646 [1996]). The court also pointed to the Fiscal Impact Statement, which did not include potential punitive damages in its estimated impact on expenditures. Finally, the court reasoned that it made little sense for the City Council to cap civil penalties paid into a city fund while allowing for open-ended punitive damages liability to be paid to a plaintiff.