Jury orders Novartis to pay $250 million for sex discrimination
May 21st, 2010 by Kurt Niland
Pharmaceutical drug manufacturer Novartis must pay $3.3 million in compensatory damages and $250 million in punitive damages for systemically discriminating against thousands of female employees, a federal jury in Manhattan ruled on Wednesday.
Twelve female Novartis employees filed the lawsuit, alleging they received less pay than their male counterparts, were promoted less frequently, and had to endure a hostile work environment. The women sought damages from $190 million to $285 million, calculated as two to three percent of the company’s $9.5 billion revenues it made in 2009.
The jury, comprised of five women and four men, agreed, opening the door for more than 5,500 other female employees of Novartis’ United States operations. The multinational company is based in Basel, Switzerland.
Additional employees applying for compensation under the ruling will likely be processed by a court-appointed special master, who will determine their damages on an individual basis. U.S. District Court Judge Colleen McMahon will decide a lump sum for back pay, lost benefits, and adjusted wages that will distributed to the plaintiffs. Attorneys handling the case said they were seeking $37 million to cover back pay.
During testimony, an attorney for the original plaintiffs told jurors that “to Novartis, discrimination is one big joke.”
“There was an old boys’ network at Novartis running rampant. The discrimination continues to this very day. Absolutely nothing was ever done to help women at Novartis,” the attorney said.
Evidence brought before the court included the behavior and actions of one district manager who plaintiffs claimed was especially abusive. The man would show them pornographic pictures and ask them to sit on his lap, yet he wasn’t fired until two years after the complaint was filed in 2004.
“He wasn’t that bad a manager. He was just terrible with women,” said Novartis attorney Richard Schnadig – a phrase that helped the jury see that the company and its attorney still had no clue what it had done wrong.
Yet Schnadig urged the jury not to react with emotion after hearing damaging testimony.
“The company is taking everything you said to heart and is going to change,” he said. “Be fair to us.”
Novartis attorneys say they will appeal the verdict.