California Punitives by Horvitz & Levy

  • Supreme Court declines to address due process question arising from partial retrial on punitive damages

    The Supreme Court has denied Philip Morris’ petition for certiorari in the Schwarz case, in which an Oregon jury awarded $25 million in punitive damages after a previous award of $150 million was reversed on appeal.  The $25 million award was still 148 times larger than the compensatory damages awarded by the first jury.

    PM’s petition raised the following due process question that arises when a court allows punitive damages to be awarded by a separate jury that did not decide the liability issues in the case:

    [W]hether it violates due process for a jury in a partial retrial to determine the amount of punitive damages, but not the threshold question of liability for punitive damages, where the first jury did not specify which of multiple possible tort theories was the basis for its finding that the defendant was liable for punitive damages.

    This question touches on just one of the many problems that can arise when punitive damages and compensatory damages are awarded by separate juries.  Courts have disagreed about how juries should be instructed in these situations, and what evidence the second jury should be permitted to hear.  For now these questions will remain unanswered.

  • Johnson & Johnson hit with another big punitive damages award in Missouri over talc-based powder products

    Many of our readers have probably already heard about this verdict, which came down a few days ago, but in case you missed it . . .

    Reuters is reporting that a Missouri state jury has decided Johnson & Johnson should pay $5 million in compensatory damages and $55 million in punitive damages in a products liability lawsuit involving Baby Powder and Shower to Shower Powder.  The plaintiff’s theory is that talc in these products caused her to develop ovarian cancer. 

    If this all sounds familiar, that’s because in February another jury in the same court awarded $72 million, including $62 million in punitive damages, in a case with nearly identical allegations.  Johnson & Johnson has announced its intention to appeal in both cases.

  • Nebraska jury awards $2.4 billion in punitive damages

    10 11 News of Nebraska is reporting that a state court jury has awarded $2.6 billion, including $2.4 billion in punitive damages, to a father whose daughter was allegedly murdered by the defendant.  This is a symbolic award, as the defendant is in prison and presumably doesn’t have $2.6 billion laying around.

  • Court of Appeal reinstates punitive damages claim against DirecTV (Salinda v. DirecTV)

    In this disability discrimination case against DirecTV, the plaintiff won a jury verdict for $1.18 million in compensatory damages.  But she could not get punitive damages because the trial court granted a motion DirecTV’s for summary adjudication on that issue.  DirecTV argued, and the trial court agreed, that plaintiff could not obtain punitive damages because she could not prove that any corporate officer, director, or managing agent was responsible for the alleged misconduct against the plaintiff.

    The Court of Appeal (Second Appellate District, Division Three) reversed in an unpublished opinion.  The court noted that, under Supreme Court precedent, an employee does not qualify as a “managing agent” within the meaning of Civil Code section 3294 unless the employee has substantial discretionary authority over decisions that ultimately determine company policy.  In this case, DirecTV submitted declarations from several employees who stated, “I have no discretion or independent authority over decisions that ultimately determine corporate policy.”  The Court of Appeal said these declarations were insufficient because they merely restated the legal standard, and  the declarants should instead have provided descriptions of their job duties and responsibilities so that the trial court could decide for itself whether they might qualify as managing agents.  Accordingly, the Court of Appeal reinstated the plaintiff’s punitive damages claims and sent the case back to the trial court for further proceedings.

    This analysis of this opinion closely tracks this 2013 decision, which was originally unpublished but was later ordered published.

  • Punitive damages against yoga guru reduced from $6.47 million to $4.6 million

    In January we reported on a large punitive damages award against Bikram Choudhury, founder of Bikram Yoga.  My News LA reports that the trial judge (Judge Mark Mooney of the Los Angeles Superior Court) has ordered the plaintiff to accept a reduction of the punitive damages from $6.47 to $4.6 million or face a new trial.  The reduced amount is five times the amount of compensatory damages (the jury awarded seven times the compensatories).

  • Unpublished opinion departs from precedent, gives plaintiff a second chance after failure of proof (Modarres v. Thomas)

    This unpublished opinion reverses a punitive damages award because the plaintiff failed to present meaningful evidence of the defendant’s financial condition at the time of trial.  That holding is nothing unusual.  What is unusual, however, is that the Court of Appeal (Fourth Appellate District, Division Three) gave the plaintiff a do-over on that element of proof.

    Under longstanding California law, plaintiffs who fail to carry their burden of proof are not entitled to a “second bite at the apple.”  (Kelly v. Haag (2006) 145 Cal.App.4th 910, 919-920; see also these four unpublished opinions.)  If the plaintiff had a full and fair opportunity to prove the defendant’s financial condition and failed to do so, there is no reason to give the plaintiff a second chance.  The Court of Appeal should reverse the punitive damages award and direct the trial court to enter judgment for the defendant on that issue.

    In this case, however, the Court of Appeal sends the case back to the trial court to allow the plaintiff to conduct further discovery in order to present the evidence she neglected to present the first time around.  The opinion does not explain why the court departed from the usual rule, which raises the question whether anyone briefed this issue, and whether the Court of Appeal was made aware of the usual rule.  The defendant may want to consider a petition for rehearing.

  • Wisconsin jury awards $700 million in punitive damages against Indian company in trade secrets case (Epic v. Tata)

    The Wisconsin State Journal reports that a federal district court jury in Wisconsin has awarded nearly $1 billion in damages, including $700 million in punitive damages, against Tata Consultancy Services for theft of trade secrets. The plaintiff, software maker Epic, accused a Tata employee of posing as an Epic customer in order to gain access to proprietary information on Epic’s computer network. 

    This case reminds us once again that punitive damages are awarded in cases that do not fit the mold of consumer versus large corporation.  Epic, the plaintiff here, is a corporation that generated revenues in excess of $2 billion in 2015.  

    The Times of India reports that Tata intends to appeal.  The story reports that, according to Tata, the district court judge has already indicated he will reduce the amount of damages.

  • $10 million punitive award in hip implant case reduced to $1.1 million

    Guideposts reports on a Georgia district court’s decision to reduce the punitive damages against Wright Medical Technology for alleged defects in a hip implant device.

    Related posts:

    Atlanta jury awards $10 million in punitive damages against hip implant manufacturer

  • Gawker seeks reduction of Hulk Hogan’s $25 million punitive damages award

    The NY Post is reporting that Gawker has filed its post-trial motions seeking a reduction of the $140 million award in favor of Hulk Hogan. 

    Gawker has asked the court to (1) reduce the jury’s award of noneconomic damages from $60 million to $100,000, (2) reduce the $55 million economic damages award to $525,000, and (3) reduce the $25 million punitive damages award to $1.25 million.  The net effect would be a total award of $1.875 million.  They may not get everything they are asking for, but they are likely to get at least some relief from the trial court before the case goes up on appeal.

  • “When tort defendants die, should any punitive damages claim die with them?”

    Eugene Volokh reports about an interesting Ohio Supreme Court decision that permits a plaintiff to seek punitive damages from the estate of a deceased tortfeasor. 

    Unlike Ohio, California follows the majority rule, i.e., no punitive damages against dead people.  (See Code of Civil Procedure section 377.42.)  However, California law does permit judgment creditors to enforce a punitive damages judgment against the estate of a tortfeasor who dies after entry of judgment.  The plaintiff’s claim for punitive damages is extinguished only if the debtor dies before judgment is entered.