Cases brought under the New Jersey Law Against Discrimination [LAD] are known as "fee-shifting" cases. This means that — contrary to the usual rule that each party pays her own attorney's fees — the prevailing party can ask the court to order that the losing party pay the winner's legal expenses. Thus, the responsibility for legal fees "shifts" from the winner to the loser.
We usually think of fee shifting awards as requiring that the unsuccessful defendant pay the attorney's fees of a successful plaintiff. But the law is broader than that and is written in such a way as allow a successful defendant to attempt to shift responsibility for its fees to an unsuccessful plaintiff. As a practical matter this seldom happens for policy reasons that are beyond the scope of this post. In the right case, however, fees can be awarded in favor of a defendant that has been put to the expense of defending a case that has been brought in bad faith, that is, with "a reckless disregard or purposeful oliviousness of known facts."
Michael v. Robert Wood Johnson University Hospital was such a case. The plaintiff claimed that she was a victim of age discrimination and a hostile work environment. Apparently her proofs were lacking, however. The trial court dismissed the case, and the Appellate Division affirmed on appeal. The defendant then sought an award of counsel fees, which the trial court set at $130,000.
In reviewing the fee award, the Appellate Division noted that the unsuccessful plaintiff's ability (or lack of ability) to pay should have been taken into account. The court noted the strong policy in New Jersey against unduly inhibiting the ability of plaintiff's to file civil rights actions because of their importance. The court was concerned that plaintiffs not be deterred by the threat of fee awards from bringing valid claims.
The defendant has promised an appeal to the Supreme Court. The message for now, however, seems clear. The courts will continue the policy of allowing fee awards against losing LAD plaintiffs only in the most compelling circumstances.