$3 Million Do-Over

The Iowa Supreme Court threw out a $3 million jury award granted to a former graduate student and ordered a retrial because, it said, she did not check all the necessary boxes in her original sexual discrimination complaint.

Julie McElroy, a former Ph.D. candidate in Iowa State University’s College of Education, filed a sexual harassment claim with the Iowa Civil Rights Commission in 1997. The complaint form has a series of boxes where one checks off the type of discrimination experienced. McElroy checked “sex,” but did not check “retaliation.” Still, a jury awarded her $3 million, $2.5 million of which was for emotional distress, on the basis of both sexual discrimination and retaliation.

Because retaliation was not part of the original complaint, the Iowa Supreme Court found that McElroy had not "exhausted her administrative remedies" under Title VII of the Civil Rights Act of 1964. So the court, unable to tell what part of the award was given for sexual discrimination, and what part for retaliation, threw out the whole thing, and ordered a new trial.

The trouble for McElroy began shortly after she enrolled at Iowa State in 1994. She claimed she was touched and spoken to inappropriately by Lynn Glass, a professor and her academic adviser. On a business trip to Russia in 1995, according to court proceedings, Glass blew up at McElroy when she demanded a separate hotel room, rather than two beds in the same room that he had arranged. She said Glass told her to "kiss her Ph.D. goodbye."

After the trip, McElroy complained to the department chair and Glass, who admitted to some of the bad behavior, was removed as McElroy’s adviser. But the harassment continued, and McElroy filed a complaint with Iowa State's Affirmative Action Office. An investigator determined that Glass had created a hostile work environment, and he was suspended for a year.

Iowa State’s president tried to fire Glass, a tenured professor, but dropped the proceedings when he became terminally ill with the cancer that killed him in May 1997, according to the Supreme Court. However, McElroy’s lawyer said that the president testified that he had no intention of firing Glass.

Shortly after Glass’s death, McElroy sued the state and Iowa State for sexual harassment. She argued that they failed to protect her from continuing harassment, and retaliated for her complaint to the Affirmative Action Office by reassigning her from temporary instructor to graduate assistant, where she made less money. The university disputes the idea that it did anything wrong. “We feel the university acted appropriately, and responded to all her claims,” said George Carroll, assistant attorney general in Iowa, who represented the university. “She was immediately removed from the relationship, and [Glass] was suspended.”

Because she had not alleged retaliation in her original complaint to the Iowa Civil Rights Commission, the Iowa Supreme Court found that “she therefore failed to exhaust her Title VII [administrative remediation] remedies with respect to alleged retaliation-in-employment.” Thus, the court said, lower courts should not have considered any retaliation claim, “because allowing a plaintiff to pursue them in court would circumvent the statutory scheme which requires the use of administrative proceedings.” Because the trial jury did not distinguish what part of the $3 million was awarded for sexual discrimination, and what part erroneously, in the court's view, for retaliation, the whole trial needs to be a do-over.

“We think it’s awful, unfair, unjust and ridiculous to require that a lay person know what the law is and check all the proper boxes,” said Roxanne Conlin, McElroy’s lawyer.

“We realize that these are lay people that are filing complaints, so we ask questions and do an investigation under any protected characteristics, whether alleged or not,” said Mary Cowdrey, administrative law judge for the civil rights commission. “You can amend the charge, if there may be another basis, such as retaliation.” But, according to the decision, retaliation was never alleged, and only appeared in the trial in district court, creating a kink that traveled all the way up to Iowa’s top court.

“You would think this would have been caught earlier when it appeared in trial,” said Leslie Annexstein, director of the American Association of University Women’s Legal Advocacy Fund.

Conlin will file a petition for rehearing by the Iowa Supreme Court, and is considering appealing to the U.S. Supreme Court. “I’m stunned. I’ve never seen anything like it, and I’ve been doing this for 40 years,” said Conlin, who noted that McElroy never got her Ph.D. and suffers from post-traumatic stress disorder and is unable to work.

Conlin believes the court made a mistake in throwing out the award. “The jury decided Title VII and Title IX claims,” she said. Title IX of the Education Amendments of 1972, which provides protection for discrimination in schools and colleges that receive federal funds, unlike Title VII, requires no administrative process. Conlin said that, despite the Title VII technicality, the trial verdict should stand under Title IX, which she said has been extended to employment.

She pointed to a recent case in which she said the U.S. Supreme Court ruled that an Alabama high school basketball coach should be allowed to sue a school board for retaliation under Title IX after he complained of sex discrimination on behalf of his athletes. The Iowa Supreme Court ruling acknowledges the case in a footnote, but said that “reversal is still required in this case."

The Iowa court misinterpreted the Supreme Court’s decision by not focusing on the Title IX claim, Conlin said. "The court can throw out Title VII, but not Title IX,” she said.

But Iowa State officials say that the state Supreme Court made a proper distinction.

“We disagree with that view in that the jury made one single award,” said Paul Tanaka, university counsel for Iowa State. “So it’s not possible to divide off any part of the award.”

The court agreed, saying a retrial was warranted because “the special verdict form” from the trial “does not specify” which damages were awarded under which law. “She didn’t allege retaliation originally, but it was included in the award,” said Sheldon E. Steinbach, vice president and general counsel for the American Council on Education.  “So some of it needs to be extricated. Here they have to throw it out. Judges can’t go to a crystal ball and figure out what was awarded for what reason.”