## Facts

- Neil Sooroojballie worked for the Port Authority of New York and New Jersey under supervisor Gary Frattali.
- After resigning, Sooroojballie sued the Port Authority and Frattali in federal court under Title VII and 42 U.S.C. § 1981, alleging a hostile work environment based on race and national origin.
- At trial, Sooroojballie testified that Frattali directed racially discriminatory remarks at him on three occasions.
- Sooroojballie also testified that Frattali engaged in other harassment, including falsely accusing him of sabotaging a Port Authority boiler.
- Sooroojballie testified that the work environment caused stress leading to insomnia, anxiety, and depression, for which he obtained medical treatment and medication.
- He attended therapy while employed and for several sessions immediately after resigning.
- The record did not show long-term psychological or physical harm attributable to his Port Authority employment or continued employment-related treatment after he started a new job.
- A jury found for Sooroojballie on hostile work environment liability and awarded $2,160,000 in compensatory damages for emotional distress against the Port Authority and Frattali, plus $150,000 in punitive damages against Frattali.
- The defendants appealed, challenging (among other rulings) the Port Authority’s § 1981 liability and the size of the compensatory and punitive awards.

## Issues

1. Whether the Port Authority should be treated like a municipal entity for § 1981 purposes such that Monell’s policy-or-custom requirement applies, requiring dismissal absent proof of a policy or custom.
2. Whether the compensatory award for emotional distress was so excessive that it required remittitur (or a new trial on damages).
3. Whether the punitive-damages award against Frattali was excessive.

## Decision

- The Second Circuit held that the Port Authority stands in the shoes of a municipality for purposes of § 1981 liability, so Monell’s policy-or-custom requirement applies.
- Because Sooroojballie did not present evidence that a Port Authority policy or custom caused the § 1981 violation, the court vacated the judgment against the Port Authority on the § 1981 claim and remanded for entry of judgment consistent with that ruling (leaving Title VII as the basis for employer liability).
- The court held that the $2,160,000 emotional-distress award was excessive in light of the proof and comparable awards, and ordered remittitur reducing compensatory damages to $250,000 (or, if not accepted, a new trial limited to compensatory damages).
- The court concluded that the $150,000 punitive-damages award against Frattali was excessive and vacated that award for reduction on remand.
- The judgment was affirmed in part, vacated in part, and remanded for further proceedings consistent with the order.

## Legal Principles

- For § 1981 claims against entities treated as municipal actors, a plaintiff must satisfy Monell by proving that the injury was caused by an official policy, practice, or custom; respondeat superior is not enough.
- An appellate court may review a purely legal ruling made at summary judgment even if the issue was not renewed in a Rule 50 motion at trial.
- Emotional-distress damages in employment-discrimination cases must be supported by the record and be in line with awards in comparable cases; absent proof of enduring or medically documented harm, very large awards may be remitted.
- Punitive damages must be proportionate to the defendant’s misconduct and the compensatory award; an excessive punitive award may be vacated and reduced on remand.

## Conclusion

The Second Circuit ruled that Monell applies to § 1981 claims against the Port Authority and vacated the Port Authority’s § 1981 liability for lack of policy-or-custom proof, while also finding the jury’s damages awards excessive and remanding for entry of an amended judgment that remitted emotional-distress damages to $250,000 and reduced punitive damages against Frattali.


Sooroojballie v. Port Authority of New York, 816 F. App’x 536 (2020)