Date: 1988-07-13

St. Louis Post-Dispatch

CHICAGO (AP) - A federal appellate court has upheld $190,000 of a $200,000 judgment awarded to an adoption agency two years ago after a jury found that the agency had been harassed by a former employee and by state officials.

The 7th U.S. Circuit Court of Appeals upheld the jurors' finding in 1986 that state officials had conspired to withhold the operating license of the agency, called Easter House, Judge Richard Cudahy said in the court's opinion Monday.

The appellate court reduced by $5,000 each the punitive damages assessed against two officials of the Illinois Department of Children and Family Services.

Easter House is part of an international network of adoption agencies controlled by Seymour Kurtz, a lawyer in Chicago.

In a suit filed in 1976, Kurtz said Easter House's former executive director, Millicent Smith, had set up a rival agency after leaving Easter House in 1974. He said she then had enlisted the aid of state officials to help her agency and hurt his.

Evidence brought out in the trial showed that Easter House had lost its license for three months after Smith left, because the state agency requires adoption agencies to have an executive director.

Kurtz contended that when he regained his license, agency officials conspired with Smith to help her capture his clients and destroy his business.

The trial jury ordered Smith and three agency officials or former officials to pay Kurtz $150,000 in compensatory damages. It also ordered Smith to pay him $25,000 in punitive damages; an agency employee, Joan Satoloe, was ordered to pay $5,000.

Thomas Felder of the agency's licensing division was ordered to pay Kurtz $10,000 in punitive damages, but the appellate court reduced that sum to $5,000 on Monday.

The appeals court also reduced to $5,000 the $10,000 in punitive damages originally sought from Florence McGuire, a former employee of the agency who since has retired.


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