Originally Posted 6/9/03 – Terrible ruling by Nevada Supreme Court

The Bear Growls: Terrible ruling by Nevada Supreme Court

June 9, 2003

Nevada has long been known as a state where casinos control most of the government. It now appears that even our Supreme Court is capable of ridiculous rulings when casino interests are involved. From

a news article in the Las Vegas Sun:

The court ruled that the Gold Coast casino in Las Vegas was not liable for $372,000 in punitive damages awarded in the case of a black man who was severely beaten by security officers and victimized by racial comments while the sergeant-in-charge looked on. The ruling was the result of a 4-3 decision, and three justices who dissented had strong objections to the ruling.Justice Bob Rose said the ruling was bad law and poor public policy. In the dissenting opinion, Rose wrote that: “At a time when we have seen many illegal and outrageous acts committed by corporate America, it is not appropriate to reduce corporate responsibility for such egregious action.”

There was testimony at the trial that the hotel-casino has a progressive-force policy and that Malloy (the supervisor of the guards) was charged with implementing this policy and ensuring the guards followed it.The court upheld all the judgments except the punitive damages assessed the Gold Coast, saying Malloy had supervisory responsibilities but not policy making authority.Supreme Court Justice Miriam Shearing, wrote: “There is no evidence that Malloy had the authority to deviate from the established policy or that he had any discretion or could exercise his independent judgment.” She said Malloy was a supervisor but not a managerial agent. “Therefore, he (Malloy) would not be classified as a managerial agent so as to subject the Gold Coast to liability for punitive damages for his actions or inactions on the night in question,” said Shearing.

Apparently, to four members of the Nevada Supreme Court, a casino (or any other Nevada business) can have a policy of “progressive force” that is obviously abused by their employees (“severely beaten”), while their supervisor stands by and does nothing, and yet somehow the employer escapes punitive damages, because the supervisor is not a “managerial agent.” In this case, according to the record, the supervisor was totally in charge of the Gold Coast’s security on the night of the beating.

This ruling doesn’t pass the “common sense test” or the “smell test.” It appears ridiculous on the face of it. Supreme Court Chief Justice Deborah Agosti, Justice Nancy Becker, Justice Mark Gibbons, and Justice Miriam Shearing should be ashamed of themselves for throwing out the $372,000 in punitive damages awarded by the jury. At least the Gold Coast did not escape liability entirely, as the Supreme Court upheld the jury’s award of $198,000 in compensatory damages, and denied the Gold Coast’s attempt to gain a new trial.


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