## Facts

- Elijah Turley, an African-American steelworker, worked for years at a steel plant in Lackawanna, New York.
- Over more than three years, co-workers subjected him to severe and escalating racial harassment, including repeated slurs, KKK references, comparisons of Black men to apes, intimidation, and death threats.
- Someone placed a noose dangling from Turley’s automobile.
- Turley repeatedly complained; management responses consisted largely of limited investigations and little corrective action, and supervisors at times appeared to condone or participate in the abuse.
- Turley experienced serious psychological harm.
- Turley sued under federal and state anti-discrimination laws for a racially hostile work environment and also asserted intentional infliction of emotional distress (IIED) under New York law.

## Issues

1. Whether the jury was properly instructed on employer liability for co-worker harassment and supervisor conduct in a hostile-work-environment case.
2. Whether the evidence permitted treating the operating entity and its parent as a single employer for liability purposes.
3. Whether the evidence satisfied New York’s stringent requirements for IIED (extreme and outrageous conduct causing severe emotional distress).
4. Whether the approximately $1.32 million compensatory damages award was excessive.
5. Whether punitive damages were warranted and, if so, what constitutional limit applied to the amount.

## Decision

- The Second Circuit affirmed liability for a racially hostile work environment and affirmed the IIED verdict.
- The court affirmed the finding that the operating entity and parent could be treated as a single employer.
- The court affirmed the approximately $1.32 million compensatory damages award.
- The court held punitive damages were justified but ruled that $5 million (after the district court’s remittitur from $24 million) remained unconstitutionally excessive.
- The court vacated the punitive-damages award in part and remanded with instructions to reduce punitive damages to no more than $2.5 million (a 2:1 ratio to compensatory damages).

## Legal Principles

- An employer may be liable for co-worker harassment when it knew or should have known of the harassment and failed to take reasonable remedial action.
- Related corporate entities may be jointly liable as a single employer when evidence supports interrelated operations, common management, centralized control of labor relations, and common ownership or financial control.
- Under New York law, IIED requires extreme and outrageous conduct that exceeds all bounds of decency and causes severe emotional distress; a sustained campaign of racist threats and intimidation, coupled with employer inaction, can satisfy this standard.
- Compensatory damages for emotional harm are reviewed for excessiveness and are upheld if supported by the evidentiary record and not so high as to shock the conscience.
- Punitive damages are constrained by due process; applying the reprehensibility/ratio/comparative-penalties guideposts, a punitive award may be reduced as “grossly excessive,” and on these facts a 2:1 punitive-to-compensatory ratio was the maximum permitted.

## Conclusion

The Second Circuit sustained the verdict holding the employer(s) liable for prolonged, severe racial harassment and for IIED, and it left intact a substantial compensatory award, but it required a further reduction of punitive damages to comply with constitutional due process limits, capping punishment at twice the compensatory damages.


Turley v. ISG Lackawanna, Inc., 774 F.3d 140 (2d Cir. 2014)