California Punitives by Horvitz & Levy

  • Plaintiff Files Petition for Review in Bullock v. Philip Morris

    The plaintiff in Bullock v. Philip Morris has filed a petition for review in the California Supreme Court. (We previously blogged about the petition for review filed by Philip Morris.) The plaintiff’s petition raises three issues:

    1. “Is a punitive damages defendant entitled by federal due process to demand that: (a) the jury be instructed “not to impose punishment” based on the harm the defendant has inflicted on non-plaintiffs; while (b) keeping from the jury the well-accepted principle that in setting punitive damages it may consider the harm imposed by the defendant on non-parties in its evaluation of the reprehensibility of its misconduct toward the plaintiff.”

    2. “Assuming federal due process does not entitle a defendant to such a one-sided, incomplete instruction, following an adverse verdict may a defendant a defendant nonetheless assert prejudicial error based on the failure of the plaintiff and/or the trial court to supply assistance in rewording the flawed instruction into a correct statement of federal due process law?”

    3. “If a jury’s punitive damages verdict was reached based on instructions which contain a federal due process flaw, rather than simply ordering a retrial of the amount of punitive damages, which could consume two months of court time, is a review court required to consider whether a remittitur of the jury’s verdict is an appropriate and more efficient means of remedying any federal due process issue regarding the jury instructions?”

    We will update this post with a link to the petition.

    UPDATE: Here’s the link to the petition.

  • Federal Judge Permits Family of Deceased Illegal Alien to Seek Punitive Damages Against United States Government

    According to the San Francisco Chronicle, “The family of an illegal immigrant who died of penile cancer that went untreated during 11 months of detention can sue government doctors for damages, a federal judge has ruled in a decision in which he condemned the defendants’ alleged actions as deceptive and heartless. The claims in Francisco Castaneda’s lawsuit – that government medical staffers and immigration officials brushed off his complaints of severe pain and multiple lesions, told him they saw no need for surgery and finally discharged him rather than having the government pay for treatment – describe conduct that, if proved, ‘is beyond cruel and unusual,’ said U.S. District Judge Dean Pregerson of Los Angeles. His ruling, issued late Tuesday, allows Castaneda’s family to sue the doctors for allegedly violating his constitutional rights and ask a jury to award punitive damages. Government lawyers argued that federal law allowed only a suit against the government, with a nonjury trial and a $250,000 limit on damages. . . . ‘The evidence that plaintiff has presented so far – through (government officials’) own records – suggests a strong case for punitive damages because it shows that (their) behavior was callous and misleading,’ the judge said.”

  • Philip Morris Files Petition for Review in Bullock v. Philip Morris

    Philip Morris has filed a petition for review to the California Supreme Court from the Second Appellate District’s Jan. 30 opinion, which reversed a $28 million punitive damages award. Philip Morris is asking the Supreme Court to review the portions of the opinion that rejected Philip Morris’ preemption argument and rejected its request to expand the retrial beyond just the amount of punitive damages.

    For further posts on this case, see our original post about the Bullock opinion, our follow-up post about the impact of Bullock on the CACI punitive damages instructions, and our follow-up post about the use of remittitur to cure legal error.

  • Further Commentary on Buell-Wilson Opinion

    Bruce Nye at Cal Biz Lit has a post entitled Cal Court of Appeal to US Supremes: Here’s A Thumb In Your Eye, summarizing the recent Buell-Wilson opinion that approved a $55 million punitive damages award against Ford. Bruce observes that much of the court’s opinion seems to be designed as “a bulwark against further US Supreme Court action.”

  • Plaintiffs Waive Opposition to Cert. Petition in Chemtall v. Stern

    We previously mentioned the pending cert. petition in Chemtall v. Stern, which presents an issue regarding the constitutionality of a reverse bifurcation procedure in which punitive damages issues are decided before liability and compensatory damages. Apparently, the plaintiffs are not too concerned about Carter Philips‘ petition, as they waived their right to file a response. (See the Supreme Court’s online docket for this case.) They aren’t really taking much of a risk, because the Supreme Court would call for an opposition before deciding to grant certiorari.

  • Punitive Damages Not Available in a Copyright Claim Against YouTube and Google

    A federal district judge in New York has denied Viacom’s effort to seek punitive damages against Google, holding that common law punitive damages can’t be recovered under the Copyright Act. Last March, Viacom sued online video-sharing site YouTube Inc. and its parent company, Google Inc., saying the companies infringed on Viacom’s copyrights because almost 160,000 unauthorized video clips were available for viewing on YouTube.

    Click here for a copy of the district court’s ruling.

  • $8.3 Million Punitive Damages Verdict in Washington, Where Punitive Damages Are Generally Unavailable

    There’s something that puzzles me about this story: $40 million verdict for burned heart may be largest in Snohomish County history. It reports on a Washington state verdict that includes an $8.3 million punitive damages award against a California company, Edwards Lifesciences Corp. of Irvine. What’s puzzling is that Washington law generally does not permit punitive damages, except in a few limited circumstances specifically authorized by statute. None of the circumstances would seem to apply here. The press reports about this case have not explained why punitive damages were available in this case. Perhaps the case was tried under California law.

  • Anthony Sebok’s Criticism of the Oregon Supreme Court’s Goddard Decision Is Unwarranted

    Professor Anthony Sebok of the Benjamin N. Cardozo School of Law has a column on Findlaw.com entitled The Oregon Supreme Court’s Recent Decision on Punitive Damages: Why It Took the Wrong Approach.

    Professor Sebok criticizes the court’s recent decision in Goddard v. Farmers Insurance, which appears to be the first time the Oregon Supreme Court has ever reversed a punitive damages award as unconstitutionally excessive. Sebok’s primary criticism is that the court reduced the punitive damages award to four times the compensatory damages award. He says the four-to-one ratio was based on nothing more than an offhand remark by the U.S. Supreme Court, and that the court’s approach improperly crosses over into the realm of judicial lawmaking: “When courts are debating between whether the ratio should be 3:1, 4:1 or 9:1, they do look an awful lot like members of a legislature dickering over the terms of a statute they are drafting.”

    But that’s not really a fair criticism. The U.S. Supreme Court’s decisions in BMW v. Gore, Cooper v. Leatherman, and State Farm v. Campbell mandate that lower courts scrutinize punitive damages awards closely and, absent extraordinary circumstances, reduce those awards to single-digit ratios. The Supreme Court has left it to the discretion of the lower courts to determine which ratio is appropriate in a particular case, but they have left no doubt that courts must pick some new ratio when they find an award to be excessive. The Supreme Court’s references to a 4:1 ratio in BMW and State Farm may have been off-hand remarks with respect to that particular ratio, but there can be no serious debate that the Supreme Court has directed the lower courts to reduce excessive awards. Whenever courts follow that mandate, they will necessarily adopt a new ratio other than the ratio chosen by the jury. So to the extent Professor Sebok believes that courts have no business deciding the appropriate ratios, that criticism is more properly aimed at the U.S. Supreme Court, not the Oregon Supreme Court.

    UPDATE (by Lisa Perrochet 3/11/08 at 11:06 AM): On the other hand, there may be some cases where a complete new trial–rather than a new ratio selected by the court–is the only logical cure for an excessive punitive award because the jury’s verdict suffers from so many flaws (such as wildly excessive compensatory damages that have to be reduced by the trial court and further reduced by the Court of Appeal, incomplete or inaccurate jury instructions on punitive damages, conflicting ratio analyses by the trial court and court of appeal, for example – if this sounds like a familiar scenario, see below for yesterday’s post on the Buell-Wilson decision from the California Court of Appeal).

  • Press Coverage of Buell-Wilson Decision

    Law.com features this article from The Recorder on the Buell-Wilson decision (which we blogged about yesterday afternoon): Despite Remand, Ford Motor’s Loss Stands at $82.6 Million.

    The San Jose Mercury News website has an AP story entitled Appeals Court Reiterates $82.6 Million Award for Paralyzed Woman.

    The Daily Journal reports Panel Upholds $82 Million Rollover Judgment (subscription required).

    And the Fox television affiliate in San Diego reports Damage Award Reduced in Rollover Crash.

  • Buell-Wilson v. Ford—Court of Appeal Says Ford Waived Due Process Protections Against Excessive Punitive Damages

    Today’s opinion from the Fourth Appellate District, Division One, in San Diego holds Ford waived any claim to a new trial based on its argument that that the jury improperly imposed punitive damages to punish Ford for harm caused to nonparties.

    In the third of three recent California appellate decisions to confront the fallout from the United States Supreme Court’s opinion in Philip Morris USA v. Williams (2007) 166 L.Ed.2d 940, 127 S.Ct. 1057 (see our earlier post on Bullock v. Philip Morris and our post on Holdgrafer v. Unocal), the court summarized its views as follows in the introduction to its decision:

    “Philip Morris holds that upon request, courts must adopt procedures to ensure juries do not punish defendants for harm caused to third parties when determining the amount of punitive damages to award. The Supreme Court also reiterated, however, juries could consider harm to third parties in determining the reprehensibility of a defendant’s conduct.

    “Ford asserts that based on Philip Morris it is entitled to a new trial (or at least a further reduction in the punitive damages award) because there is a “significant risk” the punitive damages verdict in this case was based on improper evidence and arguments concerning third party harm. Ford also asserts that we should reconsider our original decision’s rejection of its arguments that (1) California’s punitive damages statute (Civil Code section 3294) is unconstitutionally vague as applied to this case, and (2) the trial court erred in excluding its industry custom and practice evidence.
    ….
    “Based on our analysis of Philip Morris and our review of our original decision and the proceedings in the trial court, we conclude Philip Morris does not compel a reversal or a further reduction of the punitive damages awarded in this case. Ford has forfeited the right to assert there is a significant risk the punitive damages verdict in this case was based on improper evidence and arguments concerning third party harm because Ford (1) submitted incorrect and misleading jury instructions on third party harm; (2) did not timely object to plaintiffs’ closing argument at the punitive damages phase of the trial; (3) did not request a limiting instruction during the liability phase of the trial; and (4) did not raise instructional error as an issue on its original appeal. We also conclude our original decision reduced the punitive damages award to a constitutionally permissible amount that does not punish Ford for harm to third parties. We hold there was no evidence or argument at trial that created a significant risk that the jury, in deciding the amount of punitive damages to award, punished Ford for harm it caused to third parties.”
    ___________

    One reason the court gave for holding Ford could and should have proposed a better jury instruction during the 2004 trial in this product liability case is kind of interesting: in an earlier case (White v. Ford Motor Co. (9th Cir. 2007) 500 F.3d 963), the company offered an instruction that the court believed more accurately presaged the 2007 Philip Morris v. Williams decision. From this, the court in Buell-Wilson concluded:

    “Here, counsel for Ford was aware during the 2004 trial that United States Supreme Court and California precedent provided that, in determining the reprehensibility of a defendant’s conduct, juries could consider (1) whether the defendant’s conduct demonstrated an indifference or reckless disregard for the health or safety of others; and (2) whether a defendant’s actions were repeated or an isolated act that only impacted the plaintiff, both factors relating to third party harm. (State Farm, supra, 538 U.S. at p. 419; Simon, supra, 35 Cal.4th at p. 1180.) As discussed, ante, Ford argued against giving such an instruction to the jury and instead proposed a jury instruction that would have forbidden the jury from considering these factors.”
    ____________________

    One other interesting note is that the court did not see any need for a retrial on punitives even though both the trial court and the court of appeal found both compensatory and punitive elements of the jury’s verdict to be excessive – by tens of millions of dollars. Finding that plaintiff’s Ford Explorer was defectively unstable, that it lacked sufficient roof strength, and that Ford failed to warn plaintiff of these defects, the jury awarded plaintiff over $109 million in compensatory damages, including $105 million in noneconomic damages. The jury also awarded plaintiff’s husband $5 million for loss of consortium. The jury further found that Ford acted with oppression, fraud, or malice, and awarded $246 million in punitive damages. The trial court reduced plaintiff’s noneconomic damages award to $65,393,996 and reduced the punitive damages to $75 million, a one-to-one ratio to the total compensatory damages. On appeal, the court further reduced the damages, concluding that the jury’s compensatory award resulted from passion and prejudice, and ordering a remittitur of the noneconomic damages to $18 million, roughly four times the economic damages. Finally, the court reduced the punitive damages to $55 million, which represents about twice the amount of compensatory damages awarded, after reduction by the trial and appellate courts. It’s notable that, with the jury’s damages findings so thoroughly discredited, the court decided to come up with a new number on its own rather than sending the whole thing back for a retrial untainted by legal error, passion and prejudice, and so forth.

    The net result? A total reduced award to the Wilsons of $82,606,004 ($4,606,004 in economic damages + $18 million in noneconomic damages + $5 million in loss of consortium + $55 million in punitive damages).