Spanking costs $1.7 million
Jury awards damages to former alarm saleswoman.
By Pablo Lopez / The Fresno Bee
A jury on Friday awarded $1.7 million to a former Fresno alarm systems saleswoman who quit her job after supervisors spanked and humiliated her in front of jeering co-workers.
Jurors in the Fresno County Superior Court civil trial against Alarm One Inc. found that Janet Orlando, 54, was sexually harassed and that her supervisors' hostile conduct forced her to quit her job as a field supervisor in February 2004 after four months.
Because the jury found that company supervisors acted with malice and oppression, it fined the company $1.2 million in punitive damages. Orlando will receive about $300,000 of that. She also was awarded an additional $10,000 in lost wages, $40,000 for future medical bills and $450,000 for past and future emotional distress.
After the verdict, jurors left the courtroom through a rear exit, bypassing a horde of reporters.
"This brought justice to a terrible situation," said Orlando's lawyer, Nicholas "Butch" Wagner, who rejected a $150,000 pre-trial settlement offer from Alarm One.
Orlando also praised the jury in Judge Wayne Ellison's courtroom. Since filing the lawsuit in December 2004, Orlando said, she has had trouble sleeping and eating and has lost 56 pounds.
"I'm glad it's over," Orlando said. "I need some rest."
The spankings occurred during sales staff meetings attended by teams of salespeople that competed against each other, according to court testimony. To motivate the teams, the losers were spanked on the buttocks with a rival company's yard sign while onlookers hooted and yelled lewd comments, court documents show.
Court records show that former Alarm One employees Jessica Dakin, Kristy Moren and Crystal Melendez, who also were subjected to spankings and abusive language, agreed to a settlement with the company earlier this year.
Defense attorney Katherine Hart said everyone agreed that the spanking sessions were juvenile. She said defending Alarm One was "a matter of damage control."
In addition to being sexually harassed, jurors determined, Orlando was a victim of sexual battery and the conduct of her supervisors was outrageous.
The jury of six men and six women deliberated about nine hours over two days before reaching its verdict.
A key issue in the punitive phase of the trial was the financial viability of Alarm One, which is based in Anaheim. The company's Web site says it has more than 300 employees who provide sales, installation, service and alarm monitoring to thousands of families across the United States.
Douglas Schultz, chief financial officer, testified Friday that since the lawsuit was filed, the company has downsized to 50 employees and has closed many of its branch offices, including the one in Fresno.
He said the company has about 21,000 customers who pay $40 a month for service for a monthly revenue of $840,000. The company also receives $66,000 in monthly revenue from another source.
Despite the $906,000 in monthly revenue, Schultz said, the company has a debt of $38.7 million and assets of about $16.6 million.
In awarding punitive damages, jurors singled out Alarm One employees Rondell Harris, former vice president of sales, and former supervisors Rob Harlan and Nina Correia.
Correia and Harlan were accused of spanking Orlando while inciting the sales teams to hoot and holler abusive language. Harris was accused of knowing about the spankings, yet doing nothing about it, Wagner said.
Jurors ruled that Alarm One was liable for $1 million; Harris was liable for $100,000; and Harlan and Correia must pay $50,000 apiece.
By law, the state of California will receive 75% of the punitive damage award; Orlando will get the remaining 25%, Wagner said.
Harris failed to show up to testify in the punitive phase of the trial. Harlan said he seldom works and that he has two girlfriends who take care of him. Correia said she also is unemployed because she is caring for a sick relative.
Harlan and Correia also left the courtroom through a rear exit.
Defense lawyer K. Poncho Baker said he understood the jury's reasoning for giving Orlando $10,000 in lost wages but was surprised by the rest of the verdict.
Wagner estimated that Orlando's future medical expenses were between $15,120 and $36,000, yet the jury gave her $40,000.
Baker said Orlando's emotional distress claim was unfounded because her Alarm One lawsuit was "strikingly similar" to a lawsuit that Orlando filed against another previous employer, Rodeo Nissan, a car dealership in Clovis.
Orlando reached a settlement in that case, which centered on a female employee who was accused of sexually harassing Orlando, court records stated.
In closing arguments, Baker showed the jury a court document in which Orlando was asked whether she had any other stressors in her life since she left the car dealership. The question was posed to her in November 2004, after she had already left Alarm One.
"I don't believe so at all," Orlando said, according to the court document.
Not long after that case concluded, Orlando filed suit against Alarm One.
Baker said the jury didn't buy his argument that Orlando was trying to make money off lawsuits.
Said Baker of the verdict: "I guess the jury hated Alarm One."
