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Employment Law Blog: Declined Invitation - The Iowa Supreme Court Holds its Ground on Punitive Damages - June 25, 2013

The Iowa Supreme Court declined an invitation to reverse itself and find that the Iowa Civil Rights Act allows recovery of punitive damages. The Court ruled Iowa’s civil rights laws have never allowed recovery of punitive damages, and will not change that position now. The Court originally ruled on this issue 27 years ago. Since the Iowa Supreme Court’s initial holding in 1986, hopeful litigants have invited Courts, both state and federal, to circumvent this general rule and recover punitive damages. According to the Court, the inability to recover punitive damages is “ingrained” in Iowa’s legal culture. However, the plaintiffs in Friday’s case, Ackelson v. Manley Toy Direct, L.L.C., pointed out, in reality, whether a plaintiff recovers punitive damages varies considerably. Some Iowa courts allow plaintiffs to recover punitive damages when that plaintiff’s civil rights are violated by an employer—others don’t.

Plaintiffs urged that the law was unsettled and deserved reexamination.  The plaintiffs believed that it was time for the law to change, particularly since the Court’s 2005 decision to let plaintiffs try their cases to juries. The plaintiffs argued that if a jury is allowed under Iowa’s Civil Rights Act, then punitive damages should be too. The Court rejected this argument, criticizing the plaintiffs’ suggestion that the 2005 decision was a “knockout blow” to the existing, settled principles of law.

The Court, examining the precise words chosen by Iowa lawmakers, found no support for the recovery of punitive damages. This is the same analysis taken 27 years ago. The Court reminds Iowans that since 1986, the Iowa Legislature has amended Iowa’s civil rights laws, but did not contradict the Court on the issue of punitive damages. The Legislature chose to take no action, even though the recovery of punitive damages in civil rights case has received broad national attention. The Court ruled that the many years of silence by the Legislature is evidence of approval.

As a result, Plaintiffs who sue for violations of their civil rights, under Iowa law, remain limited to compensatory damages.