A temporary contract employee [Plaintiff] at a CUNY institution, was notified that a student at another CCNY institution had accused him of sexual harassment. A CCNY Title IX Coordinator investigated the student's claim and substantiated several of the allegations. Plaintiff was advised that the Coordinator's findings had been accepted and that he "was terminated effective immediately, thirteen business days before his contract was to expire.
Plaintiff initiated an arbitration proceeding seeking a fact-finding or "name clearing" hearing as to whether Plaintiff had
violated CUNY’s sexual harassment policy. On the eve of the arbitration CCNY notified Plaintiff that his termination was rescinded and that he would be paid "for the remaining thirteen business days of his term of employment". In addition, Plaintiff was advised that CUNY would remove any reference to the incident from Plaintiff's personnel file.
Based on these actions,
CUNY moved to dismiss the arbitration as moot. CCNY's motion was granted by the arbitrator, who concluded that CUNY’s actions resolved Plaintiff’s grievance and that he was not entitled
to a name-clearing hearing because he had no constitutionally protected property interest in his
temporary position.
Plaintiff then initiated the instant 42 U.S.C. §1983 action in a federal district court naming CUNY and certain named individuals [herein after CCNY] as defendants, alleging violations of his Fourteenth Amendment right to due process. In an amended complaint, Plaintiff sought more than
$45 million in compensatory and punitive damages, a name-clearing hearing, and vacatur of the
arbitration award.
A federal district court granted CCNY's motion for summary on all but
one of Plaintiff's claims, Plaintiff's “stigma-plus”* claim against CUNY.
At trial Plaintiff sought over $4 million in damages. A jury determined that Plaintiff had been unlawfully denied a name-clearing hearing but awarded him only $1 in nominal
damages. The district court entered a final judgment in that amount, $1.00", whereupon Plaintiff sought attorney’s fees totaling nearly $120,000.
The
district court awarded Plaintiff $75,000 in fees, reasoning that Plaintiff was “entitled to a significant
part of his attorney’s fees,” in part due to CUNY’s “questionable behavior” in “moot[ing] [Plaintiff's] right to have the legitimacy of his termination decided in his arbitration proceeding,” which forced
him to engage in “protracted and costly litigation.”
CCNY appealed and the Circuit Court of Court vacated the award because "the district court had failed to adequately explain its
decision based on the considerations identified in the governing fee-award cases, particularly view of other nominal damages cases cited by the Circuit Court in its decision and remanded the matter to the district court with instructions "to reconsider its decision in light of those cases".
On remand, the district court acknowledged that certain of the cases cited by the Circuit Court "strictly limit the circumstances in which fees may be awarded in nominal damages cases and that this case did not meet any of the recognized bases for awarding such fees," but "reasoned that a fee
award was warranted because CUNY acted in 'bad faith' in mooting the arbitration rather than
allowing Plaintiff to pursue a name-clearing hearing." CCNY appealed the district court's ruling.
The Circuit Court vacated the judgment of the district court and remanded the matter to it with instructions to deny Plaintiff's application for attorney’s fees, explaining that it concluded that the district court abused its discretion in relying on CUNY’s alleged bad faith in its conduct giving rise to the lawsuit as a basis for awarding fees.
The Circuit Court's decision noted the decisions it earlier cited did not "identify a party’s bad faith in the underlying conduct which was the subject of the litigation as justifying an award of fees under §1988 to a prevailing plaintiff who recovers only nominal damages" nor was it aware of any Second Circuit decision holding an award of attorney’s fees is appropriate under §1988 based on pre-litigation conduct although bad faith can be a basis for an award of attorney’s fees as a sanction for litigation-related conduct, citing Rossbach v. Montefiore Med. Ctr., 81 F.4th 124.
In the words of the Circuit Court: "The mere fact that CUNY sought to moot the arbitration proceedings is insufficient to support the [district] court’s finding on this point. What the [district] court characterized as a 'mootness gambit' .... could just as well have been a tactical decision by CUNY to resolve its dispute with [Plaintiff] rather than engage in a potentially protracted arbitration. The jury obviously concluded that CUNY thereby deprived [Plaintiff] of a name clearing hearing to which he was entitled, but [the Circuit Court said it is] not aware of any basis for concluding that CUNY proceeded with deliberate intent to violate [Plaintiff's] constitutional rights."
* Citing DiBlasio v. Novello, 344 F.3d 292, 302 (2d Cir. 2003), the Circuit Court of Appeals noted "A 'stigma-plus' claim involves an alleged injury to one’s reputation (the stigma) coupled with the
deprivation of some ‘tangible interest’ or property right (the plus), without adequate process”.
Click HERE to access the Circuit Court's decision posted on the Internet.