Shell Must Pay $5.3 Million in Gay Bias Case : Workplace: A judge awards damages to a San Francisco man who contended that he was wrongfully terminated.

A San Francisco man who contended that he was wrongfully fired by Shell Oil Co. because he is gay has been awarded $5.3 million by a Superior Court judge in Alameda County.

Paul Freud Wotman, an attorney for Jeffery Collins, described it as the largest verdict ever handed down in a wrongful termination case involving sexual orientation. At a news conference Monday, Wotman said the verdict sends employers the message that they cannot fire workers because they are gay or lesbian.

Judge Jacqueline Taber issued her verdict Thursday after a two-week trial, agreeing with Collins that he had been fired “for private homosexual conduct occurring away from his employment” and not for unsatisfactory job performance.

“This is a very sad case,” the judge wrote, noting that the firing and the lawsuit created “a lasting schism” between Collins and his father, Allen, a career Shell employee who retired about 20 years ago.

The judge added that “this case presents the relatively new issue of how far a corporation may go in demanding that its managerial staff, in their respective private lives, deport and conduct themselves in a manner acceptable to and meeting the corporation’s concept of propriety.”

Holly Hutchins, a spokesman for Shell Oil Co. in Houston, said the company is “looking at our legal options” and is not certain whether it will appeal. “We’re disappointed,” he said. “And we continue to deny the claims in Collins’ suit.” He said Shell, an operating company of Royal Dutch Shell Group, has a written policy stating that sexual orientation is not a consideration in the company’s hiring or other employment practices.

At the time of his firing in late 1985, Collins, who has a doctorate in veterinary medicine, was director of therapeutic products at Triton Biosciences, a Shell subsidiary in Alameda County, east across the bay from San Francisco. In that role, he managed a $10-million annual budget and oversaw a staff of 23 whose mission was to develop drugs that could potentially battle cancer, AIDS and other diseases.

Collins, 47, had joined Shell in 1967 in Modesto with a starting salary of $13,900 but was promoted rapidly and eventually transferred to Houston. In 19 years at Shell, the judge wrote, he was given consistently high marks for performance. He was promoted nine times, including his 1983 shift to Triton, a fledgling biotechnology venture. (Triton was sold last November to a U.S. arm of Schering, a German company.)

Before his firing, Collins was earning more than $115,000 in salary and benefits. He now makes about $25,000 annually as a manager at a pet shipping company.

One Sunday in October, 1985, Collins prepared a party invitation on his office computer establishing “house rules” for a gay party that he planned to attend. The rules were intended to ensure that gay men at the party would know that only safe sexual practices would be permitted.

The next day, Collins’ secretary found a copy of the invitation that Collins had mistakenly left in the company’s duplicating room, according to court papers. She passed it on to the personnel director in Alameda, who forwarded it to Shell in Houston.

Several days later, Richard Love, president of Triton and Collins’ superior, received a copy of the invitation from Shell headquarters. Four days later, Love fired Collins, faulting his job performance and contending that no one would follow Collins’ leadership after learning of his off-the-job activities. Later, the judge noted in her decision, Shell and Triton “created out of whole cloth” a reason for dismissal based on a “reevaluation” of Collins’ performance that contradicted 19 years of favorable reviews.

Collins filed suit in April, 1986, claiming breach of contract, discrimination based on sexual orientation, violation of his right to privacy and intentional infliction of emotional distress. Of the $5.3 million awarded by Taber, $2 million is to cover punitive damages for emotional distress, $2.5 million is for lost wages and $800,000 is for firing because of sexual orientation.

This is Wotman’s second high-profile case involving discrimination based on sexual orientation. In 1986, Pacific Bell agreed to pay $3 million to resolve claims by former employees who said they were denied jobs or promotions because they were homosexuals. That suit, filed in 1975 by Wotman on behalf of gay law students in Berkeley and San Francisco, produced a landmark state Supreme Court ruling in 1979 protecting gays and lesbians from discrimination in the workplace.

The Collins verdict was handed down at a time when an Assembly committee in Sacramento is poised to vote on whether to amend the state’s Fair Employment and Housing Act to prohibit discrimination based on sexual orientation.