Greg Stohr reports for Bloomberg that “Sotomayor on High Court May Mean Looser Limits on Damage Awards.” The article describes a couple of cases in which Sotomayor voted to affirm punitive awards (including the $1 billion award in Motorola Credit Corp. v. Uzan (2d Cir. 2007) 509 F.3d 74 ). The article notes, however, that the constitutional challenges to those awards may not have been very strong on the particular facts of those cases, so the rulings do not necessarily suggest hostility to court review of out-of-whack punitive damages.

But defendants in punitive damages cases might be more disturbed to hear that the judge is on record as being unfavorably disposed to legislative caps on compensatory damages. Stohr’s article quotes Judge Sotomayor’s 1996 comments in the Suffolk University Law Review in Boston, criticizing lawmakers who “introduced bills that place arbitrary limits on jury verdicts in personal injury cases.” She wrote that such laws are “inconsistent with the premise of the jury system,” and that laws’ focus “must be shifted back to monitoring frivolous claims, uncovering pervasive misrepresentation in court and educating the public that no system of justice is perfect.” This doesn’t bode well for those who rely on courts’ de novo review of the constitutionality of punitive damages to protect against excessive awards.

Related musings on the effect of President Obama’s replacement for Justice Souter can be found in earlier posts on this blog (“Will Justice Souter’s Retirement Revolutionize Punitive Damages Litigation?”; “Souter Favored Limits on Punitive Damages” and “The Effect of Justice Souter’s Retirement on Punitive Damages”).

As reported on Bloomberg.com, a jury in Pensacola Florida has awarded $30 million, including $25 million in punitive damages, in a lawsuit against R.J. Reynolds. This case is apparently the seventh individual smoker case to go to trial after the Florida Supreme Court ruled in its 2006 Engle decision that Florida smokers could not sue as a class. Some of these cases have resulted in defense verdicts, and one resulted in a $5 million punitive damages award, but the defense lawyers in this case (Martin v. R.J. Reynolds) say none of the other cases have resulted in an award of this magnitude.

Rex Heeseman, a Los Angeles County superior court judge, frequently writes op-eds on punitive damages for the Los Angeles & San Francisco Daily Journal. His latest piece, “Sustaining Damages” (subscription required) appeared in this Monday’s addition of the DJ.

Judge Heeseman recaps the U.S. Supreme Court’s recent dismissal of certiorari in Philip Morris v. Williams (Williams III) and the California Supreme Court’s dismissal of review in Buell-Wilson. (To read our posts on those dismissals, click here and here.) Judge Heeseman predicts that, because those questions raised questions about punitive damages jury instructions that were not resolved by the high courts, we can expect a series of upcoming punitive damages decisions focusing on instructional issues. He predicts that plaintiff’s lawyers will cite the Oregon Supreme Court’s opinion in Williams III as support for the proposition that a defendant cannot assert error in the refusal of a jury instruction on punitive damages unless the defendant’s requested instruction was “correct in all respects.” Judge Heeseman notes that the California Court of Appeal adopted a variation of that argument in Buell-Wilson.

In my view, California plaintiffs will have a very difficult time convincing appellate courts to adopt Oregon’s “correct in all respect” standard. Two recent published opinions have already rejected that argument. In Bullock v. Philip Morris and Holdgrafer v. Unocal, the courts held that a trial court committed reversible error by refusing to instruct the jury, under Philip Morris v. Williams (Williams II), that the jury should not punish the defendant for harm to nonparties. In both cases, the court expressly rejected the plaintiffs’ argument that the defendant had waived its rights under Williams II by proposing an instruction that was somehow defective. The courts held that, even if the defense instructions were not perfect, they were sufficient to invoke the defendant’s right to the protections guaranteed by the Due Process Clause. (See, e.g., Holdgrafer, typed opn. at p. 28 [“While Unocal’s proposed instruction does not squarely present the relevant principle enunciated in Philip Morris, it would have properly informed the jury that Unocal could not be punished for the impact its alleged misconduct had on others who were not parties to the litigation”].)

Bullock and Holdgrafer were both issued before the contrary decision in Buell-Wilson. The Supreme Court denied the plaintiffs’ petitions for review in Bullock and Holdgrafer, but granted the defendant’s petition in Buell-Wilson. The result is that the Bullock and Holdgrafer opinions are citeable, while Buell-Wilson is not. Thus, the current state of the law in California is contrary to Oregon’s “correct in all respects” rule. Trial courts throughout the state are bound to follow Bullock and Holdgrafer, and a plaintiff asserting the “correct in all respects” rule will have to convince an appellate court to reject both of those decisions.

The Associated Press is reporting that a trial judge in Miami has awarded $1 billion, including $393 million in punitive damages, against Cuba, Fidel Castro, Raul Castro, and Che Guevara. (Presumably Guevara’s estate is the actual defendant, not Guevara himself, who was executed in Bolivia in 1967.) The plaintiff claims that Guevara and the Castros imprisoned his father after the 1959 Cuban revolution and caused him to commit suicide.

As the AP story notes, the plaintiff is not likely to collect any portion of this punitive award. So in that sense, the amount of the award is irrelevant. The judge said he awarded the eye-popping amount because he wanted to “send a message.” In my view, however, absurdly high awards like this send an unfortunate message to the American public that no amount of punitive damages is too high. Awards like this receive major publicity, even though the appellate reversals of such awards often go largely unnoticed (except on this blog, of course). As a result, many jurors have become conditioned to believe that our legal system freely allows them to award hundreds of millions or even billions of dollars in punitive damages. While such awards may provide lots of business for appellate lawyers, ultimately they are a burden on the American economy.