Published: May 19, 2010
The drug maker Novartis must pay $250 million in punitive damages for discriminating against thousands of female sales representatives over pay, promotion and pregnancy, a federal jury ruled on Wednesday.
The decision was announced federal court in Manhattan by a jury of five women and four men who ruled Monday that the company’s United States division, the Novartis Pharmaceuticals Corporation, engaged in a pattern of discrimination against women.
The $250 million in punitive damages is 2.6 percent of the company’s $9.5 billion 2009 revenue. The women had sought from $190 million to $285 million.
In the first part of its ruling, the jury awarded $3.3 million in compensatory damages to 12 of the women who testified.
Novartis, which for the last 10 years has been declared one of the 100 best companies by Working Mother magazine, showed a pattern of discrimination against women employees from 2002 through 2007, the jury found after a five-week trial and four days of deliberation.
The award to the 12 opens the door for 5,588 others who can also apply for compensatory damages. The damages will likely be determined on an individual basis by a court-appointed special master, said Katherine Kimpel, a lawyer for the plaintiffs.
Judge Colleen McMahon of United States District Court will determine a lump sum for back pay, lost benefits and adjusted wages that will be distributed to plaintiffs, lawyers said. They said they were seeking $37 million to cover back pay.
Novartis said after the verdict was returned on Monday that it would appeal.
Carol Evans, president of Working Mother Media, said in a statement Wednesday that the lawsuit had not barred Novartis from repeatedly winning its 100 best companies award because the magazine had a different role than the court system.
“We are disappointed that Novartis has engaged in discriminatory practices against women and mothers,” Ms. Evans added. “We applaud the court system for effectively finding redress for this discrimination.”
She said the magazine’s award was based on programs that Novartis had in place to support working mothers, like flextime, telecommuting and paid maternity leave.
“We hope that Novartis will not appeal the ruling against them and instead turn their efforts to making sure that the company has no further incidences of discrimination,” Ms. Evans said.
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