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MARFIA v. BANKASI

September 15, 1995

ANTONIO MARFIA, Plaintiff, against T.C. ZIRAAT BANKASI, NEW YORK BRANCH, Defendant, - and - OZER OZMAN, Individually and in his official capacity as General Manager of T.C. Ziraat Bankasi, New York Branch, Defendant.


The opinion of the court was delivered by: CHIN

 CHIN, D.J.

 On February 10, 1995, following a six-day trial in this employment case, the jury returned a verdict in favor of plaintiff Antonio Marfia ("plaintiff" or "Marfia") against defendant T.C. Ziraat Bankasi (the "Bank"), New York Branch, on his national origin discrimination, breach of contract and fraud claims. The jury awarded plaintiff $ 500,000 in back pay, $ 200,000 in front pay, and $ 100,000 for pain and suffering on the discrimination claim; $ 100,000 in damages on the breach of contract claim; and $ 700,000 in compensatory and $ 1,000,000 in punitive damages on the fraud claim. The jury found in favor of the Bank with respect to plaintiff's claim of age discrimination.

 Before the Court are the Bank's motion for judgment as a matter of law or for a new trial and plaintiff's motion for attorneys' fees, costs and prejudgment interest.

 For the reasons that follow, the Bank's motion is denied, except to the extent that the damages award will be clarified to avoid any double recovery, and plaintiff's motion is granted to the extent set forth below.

 Summary of the Facts1

 Marfia is a 53-year old man of Italian descent. (Tr. 55-56, 708). *fn2" He was employed by the Bank, which is headquartered in Turkey, in its New York Branch from January 1984 until May 29, 1987, when he was discharged. (Tr. 248, 709-10). At the time of his discharge, he held the title of Senior Vice President, was responsible for the treasury, retail banking, credit and operations departments of the New York Branch, and was "practically running" the New York Branch. (Tr. 192-94, 890; PX 10).

 When he commenced his employment with the Bank in January 1984, plaintiff was paid an annual salary of $ 58,000. His annual salary was increased to $ 70,000 in August 1985 and to $ 73,850 in January 1987. He also received bonuses of $ 4,060 in September 1985, $ 2,080 in January 1986 and $ 3,692 in December 1986. (Tr. 710).

 During his approximately three and a half years with the Bank, plaintiff performed his duties in more than a satisfactory manner. The operations of the New York Branch for which he was responsible made a profit of several million dollars. (Tr. 167-68, 195-202, 732). He received favorable performance reviews. (Tr. 93-94; PX 2, 3; see also PX 1). He was responsible for increasing the number of banks with which the New York Branch had correspondent relationships from 15 when he started to at least 50 within two years. (Tr. 87-88).

 When Marfia was hired by the Bank, the General Manager of the Bank was Michael Baldwin. Ozer Ozman, a Turkish national, succeeded Baldwin as General Manager, becoming the person in charge of the overall business and internal affairs of the New York Branch, who was "authorized and empowered in the name and on behalf of the Bank to execute, authorize, and conduct all business matters related to the operations of the New York Branch. (Tr. 709, 710).

 In June 1986, plaintiff received an offer of employment from the Iktisat Bankasi, a private bank in Istanbul. (Tr. 215-17). The offer was made in writing and provided for, among other things, a 30-month term, an annual salary of $ 65,000, plus living accommodations and a car for "business and private use." (PX 15). The offer was later improved to provide for a five-year term and a salary of $ 75,000 per year. (See PX 15; Tr. 217, 220).

 With the offer from Iktisat Bankasi in hand, Marfia resigned from the Bank on or about July 1, 1986, effective July 31, 1986. (Tr. 218-19; JX 3). Marfia spoke with Ozman about his resignation, however, and Ozman tried to dissuade Marfia from accepting the Iktisat job. (Tr. 218). Ozman promised Marfia that he could stay at the Bank "the rest of [his] professional life," that he would be promoted to senior vice president, and that he would be given the position of general manager of a "newly opened" branch of the Bank. (Tr. 218). Ozman said to Marfia that at the Bank he would "feel[] secure" for "the rest of [his] professional life" while he would be with the Iktisat Bankasi for only five years. (Tr. 220). "With us you are here to stay," he said to Marfia. (Id.).

 Ozman refused to accept Marfia's resignation. (Tr. 220). They continued the conversation at a social visit at Marfia's home that weekend. (Tr. 224-25). Ozman reiterated that "I'm not accepting this [resignation] letter, I had promised you that you will stay with us for your professional life." (Tr. at 225). Marfia believed Ozman, for Ozman "was the general manager. He was the power in the branch. Anything he had done up to then, recommended or proposed, had happened." (Tr. 225). On the basis of Ozman's promises and statements, Marfia rejected the offer from Iktisat Bankasi and remained with the Bank. (Tr. 218, 221-22; PX 16). *fn3"

 In May 1987, John Bush was hired as Assistant General Manager of the New York Branch. (PX 11). As a result, certain of Marfia's functions were taken away from him, including the responsibility for dealing with correspondent banks; Marfia went to talk to Ozman about these organizational changes. (Tr. 246-47). It was at that point that Ozman said to Marfia: "I wanted a more ethnically acceptable individual in that position." (Tr. 247).

 A few weeks later, Marfia was fired. Notwithstanding his excellent work record with the Bank over the years, Marfia was dismissed on May 29, 1987 by Ozman. (Tr. 710; JX 22). The reason articulated by the Bank was that Marfia had lost millions of dollars when he purportedly exceeded the New York Branch's foreign exchange trading limits in the fall of 1986. (Tr. 248-49). The jury was presented with substantial evidence, however, from which it could have reasonably concluded that the Bank's purported justification for dismissing plaintiff was pretextual.

 First, Marfia himself testified that he did not exceed the Bank's trading limits. (Tr. 164, 228). Second, the Bank was aware of Marfia's trades as he was making them. Marfia testified that he consulted with Ozman several times before making the trades in question; that Ozman received daily and weekly reports of the trades made by plaintiff; that the head office of the Bank received trading reports; and that Ozman directed plaintiff, contrary to plaintiff's advice, to close the positions in question, which resulted in the losses in question. (Tr. 95-103, 207-09, 230-33, 319, 440-41; PX 76; JX 12). Third, if Ozman had felt that plaintiff's trades were improper, he could have ordered plaintiff to close them much sooner than he did. (Tr. 942-43). Fourth, plaintiff's expert witness, Professor Ian Giddy, reviewed the trades in question and concluded (i) that the Bank had documentation relating to the trades as they were occurring and (ii) that the trades were not "spot" trades but were "forward" trades subject to a much higher trading limit, which plaintiff did not exceed. (Tr. 575, 578, 579, 603, 606-610).

 The jury was entitled to find that in fact the Bank fired plaintiff because of his national origin. In addition to the evidence of pretext, plaintiff presented evidence that throughout his tenure with the Bank, Ozman made discriminatory comments to him. For example, just before Ozman became General Manager of the New York Branch, he stated to Marfia that he thought Michael Baldwin had "established" a "Cosa Nostra shop" at the New York Branch because Baldwin had hired a number of Italian-Americans as officers. (Tr. 177). Shortly after Ozman became General Manager, he told Marfia that the New York Branch "had gotten a reputation in the Street of being a Mafia shop, again because of so many Italian-Americans in positions of authority." (Tr. 179; see also Tr. 247). On several occasions, Ozman said to Marfia, "I want to Americanize . . . the branch." (Tr. 183). Marfia also testified that Ozman said that "if he could run the branch with Turkish officers alone in the top positions, he would do so; since he could not run the bank with Turkish officers in top positions, because [there were not] enough of them, he wanted traditional Americans in those positions." (Tr. 254).

 Approximately a week after being fired, plaintiff tried to commit suicide. Plaintiff's son, who was 15 years old at the time, found his father holding a loaded gun, but succeeded in pulling it away from him. Plaintiff was taken to the hospital, where he spent approximately two weeks on "suicide watch." (Tr. Tr. 255-62, 458-64). He was released, and eventually found new employment, with the New York State Banking Department, where he was still employed at the time of trial. (Tr. 265-67, 274-75).

 Procedural History

 This case was commenced in May 1988 against both the Bank and Ozman. In 1989, Ozman failed to appear for his deposition and defendants failed to produce certain documents. Judge Duffy granted a motion to compel and ordered, among other things, Ozman to appear for his deposition. Ozman did appear for one day of his deposition, but he refused to complete it, and he also apparently destroyed certain documents. In October 1989, Judge Duffy entered a default against Ozman, "individually and in his official capacity as general manager of the bank." Thereafter, plaintiff moved for summary judgment against the Bank, relying on the default judgment entered against Ozman. Judge Duffy denied the motion.

 After the case was reassigned to me, plaintiff made an application to use the default judgment against the Bank at trial. Plaintiff took the position that the only issue for trial was whether the Bank was responsible for Ozman's actions. The Bank essentially argued that the default judgment was meaningless, even though it had been entered against Ozman in both his individual and official capacities. I granted plaintiff's application in part, permitting certain "admissions" deemed to have been made by Ozman to be presented to the jury at trial, and instructing the jury to give the admissions as much weight, if any, as it deemed appropriate and requiring plaintiff to prove that the Bank had discriminated. See Marfia v. T.C. Ziraat Bankasi, 874 F. Supp. 560 (S.D.N.Y. 1994).

 At trial, the admissions were read to the jury. (Tr. 729-35). The jury was instructed that Ozman was "deemed to have admitted" the facts in question because he had "defaulted on his obligations in the lawsuit." (Tr. 730). The jury was further instructed to consider the "admissions" as evidence together with the other evidence in the case and to give the "admissions" "as much weight, if any," as it deemed "appropriate." (Tr. 730-31). The jury was cautioned that it still had to find that plaintiff had proven his claims ...


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