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Appeals court to revisit harassment case against Ralphs

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NORTH COUNTY —— A state Supreme Court decision Wednesday may mean there won't be a third trial in a nearly 10-year-old sexual harrassment lawsuit in which six women were awarded more than $30 million from Ralphs, where they worked.

The women alleged that their supervisor at a Ralphs supermarket in Escondido sexually harassed them. The chairman of the California Employment Lawyers Association said earlier this year that he did not know of any sexual harassment cases with a larger overall verdict than the $30 million in the Ralphs case, which has been the subject of two trials and two appeals already.

The state's highest court told the 4th District Court of Appeal in San Diego on Wednesday to reconsider a decision it made in April that ordered another trial with additional evidence for four of the women. Two of the women accepted smaller amounts of money than the verdicts required, and are no longer part of the lawsuit.

The appeals court also had denied Ralphs' request for the appeals court to decide how much Ralphs should pay in punitive damages and set that amount at $750,000 without a new trial.

The legal wrangling that led to Wednesday's Supreme Court action began on Aug. 1, 1996, when six woman filed a lawsuit alleging that Roger Misiolek, who supervised them in 1995 and 1996, inappropriately touched them, verbally abused them, shoved one woman into a chair that rolled across the floor, and in some cases, threw items such as phones at them. The lawsuit alleged Ralphs took no action to stop the conduct.

Court documents have said that Misiolek denied any wrongdoing.

At the first trial of the case in 1998, a Superior Court jury decided that Misiolek sexually harassed the women and that Ralphs failed to take "all reasonable steps" to prevent the harassment. Jurors awarded the women a combined total of $550,000 for emotional distress and more than $3.3 million in punitive damages.

Superior Court Judge Joan Weber set aside that punitive damages verdict because of jury misconduct and ordered a new trial on that issue alone. In 2000, a state appeals court upheld the $550,000 verdict and Weber's decision.

A separate jury heard a second trial in 2002 and ordered Ralphs to pay $30 million in punitive damages —— $5 million to each of the six women.

Superior Court Judge Michael Anello, who presided over the 2002 trial, later ruled the $30 million verdict was excessive. Anello gave the women the option of accepting less money or having him grant Ralphs' request for a new trial. Two of the women accepted the smaller amounts.

The state appeals court in April upheld Anello's decision to grant a new trial regarding the other four women and to deny Ralphs' request for a judgment awarding the women a smaller amount despite the jury's verdict.

In addition to ordering the appeals court to reconsider its decision about a third trial, the Supreme Court directed the court to an unrelated case the Supreme Court decided last month in which justices discussed the proper ratio of punitive damages to economic damages and ruled that an appeals court can decide punitive damages without another trial.

In that case —— Simon v. San Paolo U.S. Holding Co., a business dispute —— the Supreme Court lowered a punitive damages award to 10 times the economic damages the jury had awarded, but left open the possibility that a higher ratio could be constitutional under certain circumstances.

In the lawsuit against Ralphs, the total punitive damages award of $30 million was almost 55 times the $550,000 in economic damages a jury had awarded the six women.

John W. Dalton, an attorney for the women, said the "reprehensibility" of the conduct in the Ralphs case justifies a higher punitive damages award and that he does not view the Supreme Court's action Wednesday as a setback.

"I believe the Supreme Court is trying to avoid a third trial," Dalton said. "I think Simon is a very good case. I think an analysis from Simon should result in justice for the plaintiffs if the court of appeal does a proper analysis."

Ralphs' attorney, Helene Wasserman, said the Supreme Court gave Ralphs what it had asked for, and that the Simon case allows appeals courts to decide punitive damages and follows a 10-to-1 ratio of punitive damages to economic damages.

"I'm pleased with this turn of events," Wasserman said.

Contact staff writer Scott Marshall at (760) 631-6623 or smarshall@nctimes.com.

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