Labor & Employment Law Daily Wrap Up, LITIGATION NEWS, TRENDS—Maryland’s highest court issues ruling on damage award calculations in discrimination lawsuits against local governments, (Jul 15, 2026)

By Brandi O. Brown, J.D.

Discrimination claims under the Maryland Fair Employment Practices Act are governed by that law’s own damages framework, rather than the Local Government Tort Claims Act’s $400,000 liability cap.

In a decision issued earlier this week, the Supreme Court of Maryland ruled in Prince George’s County v. Joseph Watts that claims brought under the Maryland Fair Employment Practices Act (MFEPA) are not limited by the Local Government Tort Claims Act (LGTCA), but discrimination claims brought under a separate state statute tied to Prince George’s County’s anti-discrimination code are subject to the LGTCA’s $400,000 cap.

A correctional officer with the Prince George’s County Department of Corrections, who lost part of his left leg following an infection, alleged in the lawsuit that the county discriminated against him because of his disability and retaliated against him after he sought accommodations and raised concerns about discriminatory treatment. He ultimately was fired.

Jury’s $1.7m award reduced. A Prince George’s County jury found in his favor on claims of disability discrimination and retaliation and awarded him $1.7 million in damages, including roughly $1.1 million for disability discrimination and about $602,000 for retaliation. The Circuit Court for Prince George’s County later reduced that award, however, to $400,000 after concluding the LGTCA’s damages cap applied.

The LGTCA (Md. Code Ann., Cts. & Jud. Proc. §§ 5-301—5-304) makes local governments responsible for the “tortious acts or omissions” of their employees committed within the scope of their employment, but it also limits the liability of local governments by capping the amount of damages that can be awarded against them and immunizes local government employees from liability for such claims if they acted without malice.

Reversed by appellate court. On appeal, the Appellate Court of Maryland reversed, holding that the LGTCA did not apply because the correctional officer’s injuries stemmed from statutory violations rather than “tortious acts or omissions.” Prince George’s County then appealed to the state’s highest court.

Supreme Court considers appeal. Here, the state’s high court considered whether the LGTCA damages cap applies to claims brought under two state statutes: (1) the Maryland Fair Employment Practices Act, or MFEPA, Md. Code Ann., State Gov’t §§ 20-601—20-611, and (2) section 20-1202 of the State Government Article, which establishes a state cause of action for violating anti-discrimination provisions in the county codes of Howard, Montgomery, and Prince George’s Counties.

MFEPA claims. Writing for the majority, Chief Justice Matthew Fader agreed in part with the intermediate appellate court, concluding that MFEPA claims fall outside the LGTCA damages limitation because the General Assembly established a comprehensive employment discrimination scheme that specifically addresses government employers and includes its own damages framework.

“MFEPA is a comprehensive statutory scheme,” the court said, noting that it expressly covers counties and municipal governments and requires that discrimination claims against those entities be governed by the same “rules, procedures, powers, rights, and remedies” that apply to private employers. The statute also contains its own compensatory damages caps based on employer size, with a maximum of $300,000 for employers with more than 500 workers.

LGTCA and MFEPA. Because the legislature specifically addressed local government liability within MFEPA, the court concluded, the employment discrimination law’s provisions take precedence over the more general provisions of the LGTCA. As a result, local governments cannot rely on the LGTCA to further reduce damage awards in MFEPA cases.

At the same time, the court rejected the employee’s broader argument that the LGTCA does not apply to any statutory claims. It explained that some statutory causes of action may still qualify as claims arising from “tortious acts or omissions” when the legislature has not created a separate and comprehensive liability scheme.

LGTCA and Section 20-1202. That distinction proved decisive for the employee’s claim under Section 20-1202 of the State Government Article, a statute that authorizes lawsuits based on anti-discrimination provisions contained in the county codes of Prince George’s, Montgomery, and Howard Counties. Unlike MFEPA, the court said, Section 20-1202 does not expressly address claims against local governments, establish unique damages caps, or otherwise indicate that lawmakers intended to depart from the LGTCA’s liability limits.

The court described Section 20-1202 as a comparatively narrow statute that creates a cause of action but provides little guidance regarding the scope of local government liability. Because the General Assembly did not signal an intent to expose counties to uncapped liability under that statute, the court held that the LGTCA applies.

New framework. According to the court, the LGTCA does not automatically apply to every statutory claim, nor is it categorically inapplicable. Instead, courts must examine the specific statute at issue to determine whether lawmakers already addressed governmental liability and damages within that statutory scheme.

The decision potentially restores a substantial portion of the employee's recovery. Rather than automatically limiting the award to the LGTCA's $400,000 cap, the Supreme Court directed the lower court to calculate recovery under both legal theories and enter judgment for whichever amount is greater after applying the appropriate statutory limitations.

Partial dissent. Justice Michele Hotten Watts concurred in part and dissented in part. She agreed that MFEPA claims are not subject to the LGTCA cap but argued that the cap also should not apply to claims brought under Section 20-1202. In her view, neither the statute nor the Prince George’s County anti-discrimination ordinance contains a damages limitation, and the majority improperly imposed one by importing the LGTCA into a statutory scheme where the legislature did not expressly do so.

The case is No. 56.

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