Amicus Curiae Brief — Ford Motor Co. v. Fulkerson

MOTION FILED ~

LZ)

APR 22 1996 No. 95-1516

In the Supreme Court of the Gnited States

OCTOBER TERM, 1995

FORD MOTOR COMPANY,

Petitioner

Vv.

WILLIAM FRANKLIN FULKERSON, PAULINE

FULKERSON, ALLSTATE INSURANCE COMPANY AND

MELINDA HERRENSMITH, INDIVIDUALLY, AS MOTHER OF

TROY E. CILONE, INFANT, AND AS ADMINISTRATRIX OF

THE ESTATE OF TROY E. CILONE, DECEASED,

Respondents

On Petition for Writ of Certiorari |

to the Kentucky Court of Appeals

MOTION FOR LEAVE TO FILE BRIEF AND

BRIEF OF AMICUS CURIAE

PRODUCT LIABILITY ADVISORY COUNCIL, INC.

IN SUPPORT OF PETITIONER

Of Counsel: ANDREW L. FREY*

CHARLES ROTHFELD

HUGH F. YOUNG, JR. Mayer, Brown & Platt

Executive Director 2000 Pennsylvania Ave., N. W.

Product Liability Advisory Washington, D.C. 20006

Council, Inc. (202) 778-0602

1850 Centennial Park Dr.

Suite 510 * Counsel of Record

Reston, Virginia 22091

(703) 264-5300

PR

MOTION FOR LEAVE TO FILE BRIEF

OF THE PRODUCT LIABILITY ADVISORY

COUNCIL, INC. AS AMICUS CURIAE IN

SUPPORT OF PETITIONER

Pursuant to Rule 37.2(b) of the Rules of this Court,

amicus respectfully moves this Court for leave to file the

attached brief amicus curiae in support of petitioner.

Petitioner has consented to the filing of this brief. This

motion is made necessary by the failure of respondents to

consent to filing.’

Amicus Product Liability Advisory Council, Inc.

(“PLAC”), is an association of manufacturing companies that

was formed for the principal purpose of submitting amicus

curiae briefs in appellate cases involving significant issues

affecting the law of product liability. PLAC’s members,

together with other corporations doing business in this

country, have borne the brunt of the massive increase in

punitive damages verdicts that have occurred over the past

two decades. See generally Pacific Mutual Life Ins. Co. v.

Haslip, 499 U.S. 1, 61 (1991) (O’Connor, J., dissenting).

PLAC and its members therefore have a particular interest in

* Respondents’ counsel indicated that he would not consent to

the filing unless amicus disclosed in its brief (1) whether Ford

Motor Co. is a member of the Product Liability Advisory Council,

Inc. (“PLAC”); (2) “[t]he amount that Ford Motor Company or

any related entity contributes to the Product Liability Advisory

Council, Inc. on a yearly basis and what percentage the amount

contributed bears to the total contributions of the organization”; and

(3) whether the Ford Motor Co. requested or solicited the filing of

PLAC’s brief in this case. (The letter containing these demands

has been filed with the Clerk of the Court.) While PLAC routinely

discloses its corporate membership when making court filings — a

list of PLAC’s membership is appended to its brief in this case —

respondent otherwise has demanded the release of PLAC’s internal,

confidential information as a condition of its consent.

(I)

the development of rules that will assure fundamental fairness

in the procedures used to award such damages.

Because amicus and its members have a compelling

interest in the issues presented in thé petition in this case —

and because they have experience in the operation of punitive

damages regimes used by States across the Nation — they

seek leave to file this brief to assist the Court in its

consideration of the petition for certiorari in this case.

Respectfully submitted,

Of Counsel: ANDREW L. FREY*

CHARLES ROTHFELD

HUGH F. YOUNG, JR. Mayer, Brown & Platt

Executive Director 2000 Pennsylvania Ave. , N.W.

Product Liability Advisory Washington, D.C. 20006

Council, Inc. (202) 778-0602

1850 Centennial Park Dr.

Suite 510 * Counsel of Record

Reston, Virginia 22091

(703) 264-5300

APRIL 1996

QUESTIONS PRESENTED

Amicus will address the following questions:

1. Whether the Due Process Clause of the Fourteenth

Amendment permits the use of jury instructions that offer the

jury no meaningful guidance in setting the amount of punitive

damages, in a jurisdiction where judicial review of punitive

damages verdicts is substantially more deferential than that

considered in Pacific Mutual Life Ins. Co. v. Haslip, 499

U.S. 1 (1991).

2. Whether, in States where juries are given no

meaningful guidance in setting the amount of punitive

damages and in which judicial review of punitive verdicts is

highly deferential, the Due Process Clause of the Fourteenth

Amendment requires proof of a punitive damages claim by

clear and convincing evidence.

‘i

TABLE OF CONTENTS

Page

COULIFRS RPGs PURRROMEEN EMER? v0 et te eet een es 69)

TAges GE Fas RRA nc ce tw we as ii

SUMMARY OF ARGUMENT .............. 1

PE 66 Se ORAS LO y

A. The Question Whether A State May Permit Punitive

Damages To Be Imposed Under Jury Instructions

That Provide No Meaningful Guidance, And Then

Afford Highly Deferential Judicial Excessiveness

Review, Is Important And Recurring ........ 4

B. The Question Whether, In A System With Vague

Jury Instructions And Highly Deferential Post-

Verdict Judicial Review, Liability For Punitive

Damages Must Be Established By Clear And

Convincing Evidence Is Recurring And Important 15

(A aE oie ees he ee re a ee 18

TABLE OF AUTHORITIES

Cases Pages

BMW of North America, Inc. v. Gore,

ei cin pt eg FE PE Se i5

Browning-Ferris Industries of Vermont,

Inc. v. Kelco Disposal, Inc., 492 U.S.

Wee ek ee kas ee ew kk a 6

Hodges v. S.C. Toof & Co., 833 S.W.2d

edith en» Big. Pee SI Pe ee ae 17

Honda Motor Co. v. Oberg, 114 S. Ct.

es fate a ae eee oe it, 3

Jonathan Woodner Co. v. Breeden, 665 A.2d

Wee a SND oe ee ees VS 17

Linthicum v. Nationwide Life Ins. Co.,

Fad Wee OTE Os PPO a kk kk ha 17

Masaki v. General Motors Corp., 780 P.2d

en et 17

Owens-Illinois, Inc. v. Zenobia, 601 A.2d

SE es ee 17

Pacific Mutual Life Ins. Co. v. Haslip,

Pe Weis 2 TORY kas os es 2, 3, 5, 6, 14-16, 18

Railroad Co. v. Stout, 84 U.S. (17 Wall.)

OO ie Ue he ras iy) 8

Santosky v. Kramer, 455 U.S. 745 (1982) ........ 14

Smith v. Wade, 461 U.S. 30 (1983) ............ 6

Tull v. United States, 481 U.S. 412

Le MAP SA SRE CE a ae OR ee 8

Tuttle v. Raymond, 494 A.2d 1353

RU I «iar a sr 17

iV

TABLE OF AUTHORITIES — Continued

Pages

TXO Production Corp. v. Alliance Resource

Corp., 113 S. Ct. 2711 (1993) . . . 3, 6, 7, 10, 11, 14

Wangen v. Ford Motor Co., 294 N.W.2d 437

tt Se eee rere ee ee eee 17

Zazu Designs v. L’Oreal, S.A., 979 F.2d

SF Cri CW. SOGee 6 os a 4 eee eee ee 10

Statutes

1995 Or. Laws Ch. 688, S.B. No. 482

(Approved July 19, 1995) (amending

Or. Rev. Stat. § 18.540(2) &

© PRRPCRD 62k eee leas a ce ae ee 17

Ala. Code § 6-11-20(a) (1993) ......-..ccccce 16

Alaska Stat § O9:17.@20 CI99@) 5 on 6 Be hc hc ee we 16

Cal. Civ. Code § 3294(a) (West

Sage. T7068) in BE ess. Cee 16

Colo. Rev. Stat. Ann. § 13-25-127(2)

(Went ISGP). 6s Sate Wi Fee ao 16

Ga. Code Ann. § 51-12-5.1(b) (Supp. 1995) ....... 16

Iii. Ann. Stat. ch. 735, para

5/2-1115.05(b) (Smith-Hurd 1996) .......... 16

Ind. Code Ann § 34-4-34-2 (Burns 1986) ......... 16

Iowa Code Ann. § 668A.1(1)(a) .............. 17

Kan. Civ. Proc. Code Ann. § 60-3701(c)

& § 60-3702(c) (Vernon Supp. 1993)......... 16

V

TABLE OF AUTHORITIES — Continued

Pages

Ky. Rev. Stat. Ann. § 411.184(2)

EE ol ie ee 16

Minn. Stat. Ann. § 549.20(1) (West

Pe?) ooo ek 16

Miss. Code Ann § 11-1-65(1)(a) (1993) .......... 16

Mont. Code Ann. § 27-1-221(5) (1995) .......... 16

Pies: SOUR, es REPO CRO) oss 6 oe oo eee VSR 16

N.D. Cent. Code § 32-03.2-11(1)

RS I eae ne 16

N.J. Stat. Ann. § 2A:15-5.12(a)

EE a ee ee 16

Nev. Rev. Stat. Ann. § 42.005(1)

ee iy win we ewes we 16

Ohio Rev. Code Ann. § 2307.80(A) &

£o1d.21( CO) (Anderson 1991) ............ 16

Okla. Stat. Ann. tit. 23, § 9.1(B), (C),

me Gee P,P, sk vc cc eee 16-17

S.C. Code Ann. § 15-33-135 (Law.

Se I PI cle ra eT nh ad tae a 17

Tex. Civ. Prac. & Rem. Code Ann.

41 .QUS(@) (Weat Supp. 1996) .............. 17

Utah Code Ann. § 78-18-1(1)(a) (1992) .......... 17

vi

TABLE OF AUTHORITIES — Continued

Pages

Miscellaneous

Abraham & Jeffries, Punitive Damages and

the Rule of Law: The Role of |

Defendant’s Wealth, 18 J. Legal Stud. |

A ee lg ey eke wo. 'g ha keen 10 |

ee Ie ee ee ee ee

Alaska Pattern Jury Instructions,

Se gen a seb a os eke Ke. 5

Arkansas Model Jury

I I oa ee gb oo ws Dice wee 4

3 W. Blackstone, Commentaries on the Laws

OF ee ae Be a ek eee kes 7

Chapman & Trebilcock, Punitive Damages:

Divergence in Search of a Rationale, 40

Ale. i: TA. Fk Ce ee ER RS 10

A. Chin & M. Peterson, Deep Pockets,

Empty Pockets: Who Wins in Cook County

FS Fe GS RE | eh 08g OS ees 7

Colorado Jury Instructions,

Cae, ee cs ee, ee ae 4

Cooter, Punitive Damages for Deterrence:

When and How Much, 40 Ala. L. Rev.

ERR es EG as ak ds ee es 10

Ellis, Punitive Damages, Due Process and . |

the Jury, 40 Ala. L. Rev. 975 (1989) ...... 8, 10

Florida Standard Jury Instructions and

eo a RR Se, ee eer 5

Georgia Suggested Pattern Jury

See, COs a CRD 6 ska ec bee a See 4

Vii

TABLE OF AUTHORITIES — Continued

Pages

Greene, On Juries and Damage Awards: The

Process of Decisionmaking, 52 Law &

Contemp. Probs. 224 (1989) .............. 6

Hans & Ermann, Responses to Corporate

Versus Individual Wrongdoing, 13 Law &

Human Behavior 151 (1989) .............. 7

Idaho Jury Instructions, Nos.

ee IES res 4

Illinois Pattern Jury

Instructions, Civil, No. 35.01

Oe Ss eS ke ea bs 4

I Indiana Pattern Jury

Instructions, Civil, No. 111.100

i Cy 4

Instructions for Virginia and

West Virginia, §§ 26-128, 26-129,

I et oe ay, 5

Iowa Uniform Jury Instructions Annotated,

RO MEO gk kok tte a eee 5

J. Fleming, The American Tort Process 113

SEO SSE SSS en la rr 8

Landes & Posner, New Light on Punitive

Damages, Regulation (Sept./Oct. 1986) .... 12, 13

Maine Manual of Jury Procedures and

Instructions, No. 352 (1990) .............. 5

Mississippi Model Jury Instructions,

Se re Ss a ka iw 5

eee

TABLE OF AUTHORITIES — Continued

Missouri Approved Jury

Instructions, Nos. 10.01, 10.02

ED tlds 56) in 4 hak iG Sb See bi ee ee

Montana Pattern Jury

Instructions, Civil, Nos. 25.60A-25.65

EE, 4 See oie nied eS Ode OSS eee oe

Morris, Punitive Damages in Tort Cases,

es en, Es I he 6 6 5 a oe

Murphy, Integrating the Constitutional

Authority of Civil and Criminal Juries,

61 Geo. Wash. L. Rev. 723 (1993) ..........

Nevada Pattern Jury Instructions, Civil,

eS a os in oe alee

New Jersey Model Jury Charges, Civil,

A Cee I ns I es oe eee

New York Pattern Jury

Instructions — Civil, No. 2.278

ee Gs Shee Vos we 6a Sees

North Carolina Pattern

Jury Instructions for Civil Cases,

ef gg eee

North Dakota Pattern Jury

Instructions, Civil, Nos. 1260, 1265

sD Sik Sie Nutias Cals 6 oo 0% 3 06

6 Vernon’s Oklahoma Forms,

i eta ak. Ss 5 Gb wb 4 8 88

Pennsylvania Suggested Civil Jury

Instructions, Nos. 14.00, 14.02 (1984) ........

ix

TABLE OF AUTHORITIES — Continued |

M. Peterson, S. Sarma, & M. Shanley,

Punitive Damages: Empirical Findings

28 (RAND Institute for Civil Justice

8 a 2 ane Dera

(Civil), No. 10C (1

Rustad, In Defense of Punitive Damages in

Products Liability: Testing Tort

Anecdotes With Empirical Data, 78 Iowa

oS Ck a eee

M. Rustad, Demystifying Punitive Damages

in Products Liability pra aay

of a Quarter Century of Trial Verdicts

Noelle

Foundation 1991) .....

M. Saks, Jury Verdicts: The Role of

Group Size and Social Decision 6 (1977)

M. Selvin & L. Picus, The Debate Over

Jury Performance: Observations From a

Recent Asbestos Case ix (1987) ......

South Carolina Recommended Civil J

ury

Charges, Nos. 14.01, 14.04 (1989) ....

jum Discussion, Punitive Damages,

56 S. Cal. L. Rev. 155 (1982) .......

U.S. Gen. Acct. Office, Report to the

Chairman, Subcomm. on Commerce,

Consumer Protection, and

Competitiveness, Comm. on Energy and

Commerce, House of Representatives,

Product , Verdicts and Case

Resolution in Five States,

GAO/HRD-89-99 42 (Sept. 1989)... ..

Pages

x

TABLE OF AUTHORITIES — Continued

Pages

Wheeler, The Constitutional Case of

Reforming Punitive Damages Procedures,

fF § | OPP eer sc 8, 13

G. Williams, The Proof of Guilt 272

ot Ree ee ee ee ee ae aS 7

II Wisconsin Civil Jury Instructions,

- 3% | 5 | Serrrrrrric eee 5

Wyoming Civil Pattern Jury

Instructions, No. 4.06 (rev. ed. 1988) ........ 5

BRIEF OF AMICUS CURIAE

PRODUCT LIABILITY ADVISORY COUNCIL, INC.

IN SUPPORT OF PETITIONER

INTEREST OF AMICUS CURIAE

The interest of the amicus is set forth in the motion

accompanying this brief.

SUMMARY OF ARGUMENT

This Court should grant review to determine whether it

is consistent with the Due Process Clause for a State to

permit the award of punitive damages where the jury

instructions provide no meaningful guidance as to the amount

of any award, and where the State also provides for only the

most deferential judicial review of the size of punitive

verdicts. The pattern instructions in at least 15 States tell the

jury no more than that punitive damages are designed to

punish and deter; jurors are not so much as given a list of

considerations that may be relevant to setting an amount that

will accomplish those purposes. Yet there can be no doubt

that such vague and fundamentally contentless instructions —

when given to jurors who have no experience in imposing

punishment and who lack the information and experience

needed to place the defendant’s actions in context with other

judicial punishments — encourage inconsistent, unpredictable,

and often excessive judgments. At the same time, highly

deferential, after-the-fact judicial review is not a complete

corrective for this problem. Such a regime starts with

inflated awards returned by unconstrained juries. The

imperative of judicial deference then means that excessive

judgments often will survive, and at a minimum it imposes an

inexorable hydraulic pressure to increase (and inevitably to

overstate) the punishment imposed upon punitive damages

defendants.

Review also is appropriate to determine whether a claim

for punitive damages must be proved by clear and convincing

evidence when the State does not provide the procedural and

2

substantive protections considered by the Court in Pacific

Mutual Life Ins. Co. v. Haslip, 499 U.S. 1 (1991). That

issue was left open in Haslip. See id. at 23 n.11. It should

be resolved now. A majority of the States have recognized

that use of a clear and convincing evidence standard is

essential to the preservation of fundamental fairness. And

surely, in a State that makes use of procedures less rigorous

than those before the Court in Haslip — and in which

enormous awards accordingly are returned by juries with

some regularity — it is particularly important that liability for

punitive damages be clearly established.

ARGUMENT

This case presents two recurring issues of enormous

importance that have remained unresolved following this

Court’s decision in Pacific Mutual Life Ins. Co. v. Haslip,

499 U.S. 1 (1991). In that case, the Court upheld a

procedural regime for the award of punitive damages that had

three components. First, the jury, while given wide

discretion in choosing a punitive award, was both instructed

as to the purposes of punitive damages and told that in fixing

the amount of any punitive verdict it was to “‘take into

consideration the character and the degree of the wrong as

shown by the evidence and the necessity of preventing similar

wrong.’” Jd. at 6 n.1 (citation omitted). Second, the amount

of any punitive judgment was scrutinized by the trial court in

light of a detailed list of considerations relevant to setting an

appropriate punishment. Jd. at 20. And third, the Alabama

Supreme Court “provide[d] an additional check on the jury’s

or trial court’s discretion” by “undertak[ing] a comparative

analysis” and then applying “detailed substantive standards it

has developed for evaluating punitive awards.” Id. at 20-21.

The Court found that this “full panoply of Alabama’s

|

3

procedural protections” accords due process to defendants in

punitive damages cases. Id. at 23.'

The Court, however, did not decide whether a procedural

system for the award of punitive damages is constitutional

where one or more elements of this “full panoply” are

missing. That issue is squarely presented here. In Kentucky

at the time that this case was decided — and in many other

States still today — the jury instructions concerning the

amount of punitive damages provided less guidance than those

in Haslip, while neither of the other Haslip procedural

protections were available. We submit that review to resolve

the constitutionality of such a regime is essential: “many

courts continue to provide jurors with skeletal guidance that

permits the traditional guarantor of fairness — the jury itself

— to be converted into a source of caprice and bias.” TXO

Production Corp. v. Alliance Resource Corp., 113 S. Ct.

2711, 2742 (1993) (O’Connor, J., dissenting).

The petition in this case also presents a second important

and closely related issue. In Haslip, the Court left open the

question whether it is consistent with the Due Process Clause

for a State to permit a jury to find a claim for punitive

damages established by a simple preponderance of the

evidence in cases where the defendant is not afforded the

other “procedural and substantive protections” provided by

Alabama. 499 U.S. at 23 n.11. Yet as many States have

recognized, a plaintiff must be required to prove the elements

of a claim for punitive damages by clear and convincing

evidence if fundamental fairness is to be preserved. Whether

a jury may be permitted to award punitive damages under a

preponderance standard when the jury’s discretion in setting

* Of course, subsequent experience — including the endless

stream of certiorari petitions challenging the shocking punitive

judgments that are routinely affirmed by the Alabama courts —

suggests that the Alabama system does not work as advertised.

4

the amount of such an award is essentially unconstrained

accordingly warrants review.

A. The Question Whether A State May Permit

Punitive Damages To Be Imposed Under Jury

Instructions That Provide No Meaningful

Guidance, And Then Afford Highly Deferential

Judicial Excessiveness Review, Is Important And

Recurring

1. The question whether juries must be given punitive

damages instructions that meaningfully channel their

discretion is one of great currency. While Kentucky has

prospectively modified the “bare-bones” regime that was in

place when this case was tried, juries in many other States are

affirmatively instructed that they may exercise essentially

unconstrained discretion in setting punitive awards — and

they are given virtually no guidance in doing so. The pattern

instructions in at least 15 States tell the jury no more than

that punitive damages are designed to punish and deter; jurors

are not told what considerations may be relevant to setting an

amount that will accomplish those purposes, and are told of

no consideration that may not properly govern their decisions.

Perhaps typical is the instruction in Georgia, where juries are

told only that “[t]he measure of [punitive] damages is your

enlightened conscience.” Georgia Suggested Pattern Jury

Instructions, No. 13 (1984).2 Such imstructions are

? States that similarly fail to identify either permissible or

impermissible considerations for the jury include Arkansas

(Arkansas Mode! Jury Instructions, Civil (1989)); Colorado

(Colorado Jury Instructions, Civil, No. 5.3A (3d ed. 1990)); Idaho

(idaho Jury Instructions, Nos. 921-1, 921-2 (1988)); Illinois

(Illinois Pattern Jury Instructions, Civil, No. 35.01 (3d ed., 1990));

Indiana (I Indiana Pattern Jury Instructions, Civil, No. 111.100 (2d

ed. 1989)); Missouri (Missouri Approved Jury Instructions, Nos.

10.01, 10.02 (3d ed. 1989)); Montana (Montana Pattern Jury

Instructions, Civil, Nos. 25.60A-25.65 (1987)); New Jersey (Model

——_—_- i

en a ne

5

considerably more harmful even than the “amorphous” charge

in Haslip (499 U.S. at 48, O’Connor, J., dissenting)), which

at least informed the jury that it was obligated to “‘take into

consideration the character and degree of the wrong as shown

by the evidence.’” Jd. at 19 (citation omitted). If the jurors’

“enlightened consciences” tell them that blacks should be

punished more than whites, or corporations more than

individuals, or foreign citizens more than local ones, these

instructions endorse such decision-making. In addition,

another nine States make use of jury Charges that do not

differ materially from the one applied in Alabama; these

States offer the jury a handful of relevant considerations and

leave it to the jurors to determine how these considerations

should be weighed and applied.’

Jury Charges, Civil, No. 6.40 (2d ed. 1983)); New York (New

York Pattern Jury Instructions — Civil, No. 2.278 (2d ed. 1990)):

North Carolina (North Carolina Pattern Jury Instructions for Civil

Cases, Nos. 810.00, 810.01 (1986)); North Dakota (North Dakota

Pattern Jury Instructions, Civil, Nos. 1260, 1265 (1986));

Oklahoma (6 Vernon’s Oklahoma Forms, §§ 7627-7631 (1990));

Virginia (Instructions for Virginia and West Virginia, §§ 26-128,

26-129, 26-130 (3d ed. 1990)); Wyoming (Wyoming Civil Pattern

Jury Instructions, No. 4.06 (rev. ed. 1988)).

* Alaska Pattern Jury Instructions, No. 20.20 (1990):

Recommended Arizona Jury Instructions (Civil), No. 10C (1990)

(list of considerations optional); Florida Standard J ury Instructions

and Civil Cases, No. 6.12 (1989); Iowa Uniform Jury Instructions

Annotated, Civil, No. 3.28 (1990); Maine Manual of Jury

Procedures and Instructions, No. 352 (1990); Mississippi Model

Jury Instructions, No. 20.10 (1977); Nevada Pattern Jury

Instructions, Civil, Nos. 10.20, 10.21 (1986); Pennsylvania

Suggested Civil Jury Instructions, Nos. 14.00, 14.02 (1984); South

Carolina Recommended Civil Jury Charges, Nos. 14.01, 14.04

(1989); II Wisconsin Civil Jury Instructions, Civil, No. 1707

(1990).

6

2. There can be no doubt that such vague and

fundamentally contentless instructions “encourage inconsistent

and unpredictable results by inviting juries to rely on private

beliefs and personal predilections” in setting punitive awards.

Haslip, 499 U.S. at 43 (O’Connor, J., dissenting). Members

of the Court repeatedly have expressed concern that this “lack

of clear guidance heightens the risk that arbitrariness,

passion, or bias will replace dispassionate deliberation as the

basis for the jury’s verdict.” 7TXO, 113 S. Ct. at 2729

(O’Connor, J., dissenting). See Haslip, 499 U.S. at 41

(Kennedy, J., concurring in the judgment); Smith v. Wade,

461 U.S. 30, 88 (1983) (Rehnquist, J., dissenting). As

Justice Brennan observed, “[g]uidance like this is scarcely

better than no guidance at all. * * * [P]unitive damages are

imposed by juries guided by little more than an admonition to

do what they think is best.” Browning-Ferris Industries of

Vermont, Inc. v. Kelco Disposal, Inc., 492 U.S. 257, 281

(Brennan, J., concurring).

The danger posed by such instructions is manifest. Even

in the best of circumstances, juries need considerable

guidance to perform their tasks satisfactorily. As the leading

scholars of the subject have observed,

[a] jury is composed of untrained citizens, drawn

randomly from the eligible population, convened briefly

for a particular trial, entrusted with great official powers,

permitted to deliberate in secret, to render a verdict

without explanation, and, without any accountability then

or ever, to return to private life.

M. Saks, Jury Verdicts: The Role of Group Size and Social

Decision 6 (1977). Students of the jury thus have found that

juries sometimes “consider[] extralegal factors in determining

liability and punitive awards” (M. Selvin & L. Picus, The

Debate Over Jury Performance: Observations From a Recent

Asbestos Case ix (1987)), while it seems clear from the work

of social scientists that juries “are occasionally biased against

corporate defendants.” Greene, On Juries and Damage

7

Awards: The Process of Decisionmaking, 52 Law &

Contemp. Probs. 224, 246 (1989).4 And vague punitive

damages instructions unnecessarily and unjustifiably invite

jurors to consider extralegal considerations by failing to tell

them what factors may or may not be considered.

Moreover, even the best-intentioned jury, as Blackstone

(himself a great defender of the institution) observed more

than two centuries ago, may return an incorrect verdict

because of “inexperience in business, incapacity, misappreh-

ension, inattention to circumstances, and a thousand other

innocent causes.” 3 W. Blackstone, Commentaries on the

Laws of England 389 (1768). After all, “[tJhere is no

guarantee that members of a particular jury may not be quite

unusually ignorant, credulous, slow-witted, narrow-minded,

biased or temperamental.” G. Williams, The Proof of Guilt

272 (3d ed. 1963). It thus is inarguable that juries’ decisions

“can be shaped by influences impermissible in our system of

justice. In fact, they are more susceptible to such influences

than judges.” 7XO, 113 S. Ct. at 2728 (O’Connor, J.,

dissenting). This makes it essential to provide meaningful

guidance to the jury.

) 3. The likelihood of juror error that exists in all cases

| is greatly increased by the nature of the question posed to the

| jury when punitive damages are at issue. While juries are

thought to be especially effective in making factual

determinations that are within the common experience of lay

men and women, “determining the amount of punitive

damages smells more like sentencing than fact-finding. It

does not require answering a ‘what happened’ question.

* See A. Chin & M. Peterson, Deep Pockets, Empty Pockets:

Who Wins in Cook County Jury Trials 42-45 (1985) (in personal

injury trials, corporate and governmental defendants more likely to

be found liable and to be required to pay larger damages); Hans &

Ermann, Responses to Corporate Versus Individual Wrongdoing, 13

Law & Human Behavior 151 (1989) (same).

8

Rather, it embodies the question, ‘what ought to happen’ to

the defendant, an issue typically committed to the judge, not

the jury, in a criminal case.” Ellis, Punitive Damages, Due

Process and the Jury, 40 Ala. L. Rev. 975, 1004 (1989).

Indeed, as this Court has noted, “highly discretionary

calculations that take into account multiple factors are

necessary in order to set civil penalties * * * . These are the

kinds of calculations traditionally performed by judges.” Tull

v. United States, 481 U.S. 412, 427 (1987). “Determining

a fair penalty and one that will likely bring about an

appropriate level of deterrence, neither too much nor too

little, does not invoke a familiarity with what the Court called

in Railroad Co. v. Stout{, 84 U.S. (17 Wall.) 657, 664

(1873),] ‘the common affairs of life.” * * * Such a sanction

represents an example of those ‘issues . . . presented for

adjudication which are far removed from commonplace activi-

ties and accidents familiar to the man on the street.’” Ellis,

supra, 40 Ala. L. Rev. at 1006 (footnotes omitted), quoting

J. Fleming, The American Tort Process 113 (1988).

Jurors judging a punitive damages case thus labor under

a significant handicap that derives from the nature of the

institution. A jury considers its case in isolation; it lacks the

information and experience needed to place the particular

defendant’s actions in context, and typically has no

knowledge of the range of punishments to which comparable

wrongdoers have been subjected. A jury is therefore far less

able than a judge to devise a sanction that is appropriately

proportioned to the relative wrongfulness of the defendant’s

conduct. See Wheeler, The Constitutional Case for Reform-

ing Punitive Damages Procedures, 69 Va. L. Rev. 269, 286

(1983); Ellis, supra, 40 Ala. L. Rev. at 1007. As a result,

a jury will be entirely at sea — and the jury’s verdict is likely

to be capricious — unless the jury instructions provide truly

meaningful guidance.

This is true even in those States where juries are given a

brief list of considerations relevant to the selection of a

9

punishment. Jurors in those States are not told how to weigh

the listed considerations or how to balance them against one

another. And, of course, the jurors cannot be given expertise

in assessing punishments and setting appropriate levels of

deterrence. Thus, as one commentator has noted, “[e]ven if

some factors [given to the jury as bearing on the punitive

damages calculation] are questions of pure fact,”

the calculation of punitive damages cannot be said to be

fact-dependent or meaningfully guided by a standard.

Multi-factor approaches to the calculation of punitive

damages typically allow the decisionmaker to decide for

itself the relative importance of individual factors and to

consider other factors as well. The decisionmaker then

makes a highly discretionary determination from a wide

range of choices.

Murphy, Integrating the Constitutional Authority of Civil and

Criminal Juries, 61 Geo. Wash. L. Rev. 723, 802 (1993).

The vague instructions typically given in so many states

accordingly do not serve as a meaningful and effective

constraint on the jury’s discretion.

4. The difficulty that a jury will have in reaching a

correct decision is compounded by a feature of many punitive

damages regimes that seems calculated to induce an

unjustified decision: in many states juries are informed of the

defendant’s financial condition, plaintiffs’ counsel urge the

jury to set the punishment directly on that basis, and juries

are affirmatively instructed to consider financial condition as

a basis for punishment.’ It has long been a commonplace

* Indeed, in some States the defendant’s wealth is the only

consideration that is called to the jury’s attention as bearing on the

size of a punitive award. See Arkansas Model Jury Instructions,

Civil (1989); Florida Standard Jury Instructions and Civil Cases,

No. 6.12 (1988); Idaho Jury Instructions, Nos. 921-1, 921-2

(1988); Wyoming Civil Pattern Jury Instructions, No. 4.06 (rev.

10

that juries blinded by evidence of the size and financial

condition of a wrongdoer and feeling “antipathy to a wealthy,

out-of-state corporate defendant” may surrender to

“redistributionist impulses.” TXO, 113 S. Ct. at 2725-2726

(Kennedy, J., concurring in part and concurring in the

judgment). This unsurprising temptation means that evidence

of wealth “may do more harm than good; jurymen may be

more interested in divesting vested interests than in attempting

to fix penalties which will make for effective working of the

admonitory function.” Morris, Punitive Damages in Tort

Cases, 44 Harv. L. Rev. 1173, 1191 (1931). See Abraham

& Jeffries, supra, 18 J. Legal Stud. at 424; Ellis, supra, 40

Ala. L. Rev. at 996.°

In Honda Motor Co. v. Oberg, 114 S. Ct. 2331, 2341

(1994), the Court accordingly noted that “the rise of large,

ed. 1988).

| ° Courts generally have permitted consideration of wealth in the

assessment of punitive damages (see TXO, 113 S. Ct. at 2737-2738

(O’Connor, J., dissenting)), and indeed this practice makes sense

in considering what may be needed to deter an individual defendant

from committing a punishable wrong, especially one that is not

economically motivated, and in protecting any type of defendant

from economically ruinous punishment. But commentators are

virtually unanimous in the view that a corporate defendant’s

“wealth” has no rational connection to the setting of an appropriate

penalty. See, e.g., Abraham & Jeffries, Punitive Damages and the

Rule of Law: The Role of Defendant’s Wealth, 18 J. Legal Stud.

415, 421-422 (1989); Chapman & Trebilcock, Punitive Damages:

Divergence in Search of a Rationale, 40 Ala. L. Rev. 741, 824-826

(1989); Cooter, Punitive Damages for Deterrence: When and How

Much, 40 Aia. L. Rev. 1143, 1176-1177 (1989); Symposium

Discussion, Punitive Damages, 56 S. Cal. L. Rev. 155, 190-191

(1982) (comments by Professors Jack L. Carr and Malcolm E.

Wheeler). See also Zazu Designs v. L’Oreal, S.A., 979 F.2d 499,

508-509 (7th Cir. 1992) (Easterbrook, J.).

|

11

interstate and multinational corporations has aggravated the

problem of arbitrary awards and potentially biased juries.”

The Court explained that

[pJunitive damages pose an acute danger of arbitrary

deprivation of property. Jury instructions typically leave

the jury with wide discretion in choosing amounts, and

the presentation of evidence of a defendant’s net worth

creates the potential that juries will use their verdicts to

express biases against big businesses, particularly those

without strong local presences.

Id. at 2340-2341. See TXO, 113 S. Ct. at 2723 (plurality

opinion); id. at 2737, 2738 (O’Connor, J., dissenting). The

need for instructions that properly channel the jury’s

discretion therefore is manifest.

5. Common sense thus suggests that unguided juries

often will return capricious and excessive awards. But we

need not rely on logic to establish that proposition: empirical

data demonstrate that trial and appellate judges frequently find

it necessary to reduce or remit damages awarded by juries.

These actions are significant because every case in which a

judge finds an award excessive is one in which the

instructions in fact did not succeed in keeping the jury’s

exercise of discretion within proper bounds.

One recent survey was described to the Court in the

petitioner’s brief in Honda, No. 93-644, at 27-28. This

analysis reviewed all reported cases, state and federal, in

which punitive damages awards were contested as excessive

during 1992 and 1993.” In 141 of the 271 cases in the

” The survey sample was constructed by searching the Westlaw

electronic database for all cases involving punitive damages that

discuss remittitur, reductions, or excessiveness. In technical terms,

the search — drawn to be as inclusive as possible — was “punitive

or exemplary/50 reduc! or remit! or exces! & da (>1991).” The

search was conducted in Westlaw files “allstates” and “allfeds.”

12

sample — or more than 50% — the punitive awards were

reduced or set aside altogether on post-trial or appellate

review.* These findings are consistent with the conclusions

of all of the published empirical studies on the subject.° This

* Concededly, a survey of reported decisions makes use of a

sample that is to some extent biased. Reported decisions are in

large measure appeliate decisions, and the cases most likely to be

appealed are those where the damages awards are the largest (and

therefore, presumably, the most likely to be reduced). See

generally Landes & Posner, New Light on Punitive Damages,

Regulation (Sept./Oct. 1986) at 34. On the other hand, such a

survey omits the large volume of cases in which awards are

reduced by trial courts or are settled at a significant discount while

an appeal is pending; there is reason to believe that there are a

substantial number of such cases. See Honda, 114 S. Ct. at 2341

n.11. Whatever the precise numbers, then, the survey establishes

beyond dispute that punitive verdicts returned by juries are

erroneous in a great many cases. And to the extent that the survey

sample is skewed towards cases involving larger punitive awards,

those are, of course, Ce ee

property take place.

* The most oft-cited empirical study of punitive damages, which

was conducted by the RAND Institute for Civil Justice, found that

punitive awards were reduced or eliminated in 32 out of a sample

of 68 punitive verdicts returned in two jurisdictions between 1979

and 1983. Twenty-one of the 32 awards were reduced through

post-judgment settlement. Larger verdicts were much more likely

to be reduced; although awards were reduced in just under 50% of

all cases, awards where reductions took place “involved nearly 90

percent of the total money at stake.” M. Peterson, S. Sarma, &

M. Shanley, Punitive Damages: Empirical Findings 28 (RAND

Inst. for Civil Justice 1987). The study found that “[njearly every

large award received some reduction — nine of 10 cases with a

punitive award greater than $50,000.” Jd. at 30. Other studies

have reached similar results. See U.S. Gen. Acct. Office, Report

to the Chairman, Subcomm. on Commerce, Consumer Protection,

and Competitiveness, Comm. on Energy and Commerce, House of

13

state of affairs plainly is unhealthy for the jury system: a

regime in which jury awards routinely are set aside is sure to

argument therefore is not an attack on the jury; to the

contrary, we suggest that the values that underlie the jury

system are best served by providing the jury with guidance at

the outset, rather than by intervening to throw out the jury’s

decision at the end.

6. In the face of vague jury instructions, due process is

not preserved by the availability of judicial review that falls

short of virtually de novo redetermination of a proper

punishment. In States where the jury’s discretion is wholly

Representatives, Product Liability, Verdicts and Case Resolution in

Five States, GAO/HRD-89-99 42 (Sept. 1989) (post-trial reductions

in 82% of 23 punitive verdicts studied); Wheeler, supra, 69 Va. L.

Rev. at 288 (of 45 appellate decisions in New York in decade

or reversed in 35); Landes & Posner, supra, Regulation 35

(punitive award reversed in six of 10 federal appellate cases

addressing punitive damages, and reduced in one); Rustad, Jn

Defense of Punitive Damages in Products Liability: Testing Tort

Anecdotes With Empirical Data, 78 lowa L. Rev. 1, 54-56 (1992)

(of 260 products liability punitive awards between 1965 and 1990,

punitive awards were reversed in approximately 23%, reduced in

8.5%, and settled in 39.6%; in the 80 cases settled prior to appeal,

19 plaintiffs settled for no punitive damages and another 17 settled

for a reduced award); M. Rustad, Demystifying Punitive Damages

in Products Liability Cases: A Survey of a Quarter Century of Trial

Verdicts 30-32 (Roscoe Pound Foundation 1991) (slightly more than

half of products liability punitive awards reversed or adjusted

14

unconstrained — those where the instructions offer even less

guidance than that provided to the jury in Haslip — after-the-

fact judicial review is not a complete corrective. Whether or

limits of substantive due process, “due process does not

simply require that a particular result be substantively

acceptable; it also requires that it be reached on the basis of

permissible considerations.” 7XO, 113 S. Ct. at 2735

(O’Connor, J., dissenting). Cf. Santosky v. Kramer, 455

U.S. 745, 757 (1982) (“[rjetrospective case-by-case review

cannot preserve fundamental fairness when a class of

proceedings is governed by a constitutionally defective

evidentiary standard”). Yet in States where juries are given

no meaningful guidance at all, “courts cannot review whether

a jury properly applied permissible factors, because juries are

not told which factors are permissible and which are not.”

Haslip, 499 U.S. at 56 (O’Connor, J., dissenting). And

surely there is something wrong with a system in which more

than 50% of jury awards are set aside or modified; that figure

makes plain that the first and most important part of the

system for the award of punitive damages is deeply flawed.

Most fundamentally, where vague instructions are

combined with judicial review that is less searching than that

at issue in Haslip, the system cannot withstand constitutional

scrutiny. Petitioner demonstrates (at Pet. 15-17) that

Kentucky, like most States, provided exceedingly deferential

review of the size of punitive awards, asking only whether the

verdict shocks the judicial conscience. Such a regime starts

with inflated awards returned by unconstrained juries; the

imperative of judicial deference then means that excessive

judgments often will survive, and at a minimum it imposes an

inexorable hydraulic pressure to increase (and imevitably to

overstate) the punishment imposed upon punitive damages

defendants. It also means that capricious and inconsistent

judgments — in which one defendant receives a small (or no)

punishment, while an identically situated defendant is

15

Punished massively — routinely will survive judicial

review .*° See Haslip, 499 U.S. at 50 (O’Connor, J.,

dissenting).

Such a system is fundamentally unfair. It surely would

be unconstitutional for a State to make use of a regime in

which punishments were set at random, with some defendants

not punished at all and others punished in the amount of tens

of millions of dollars. Even if judicial review reduced the

largest of these awards to the greatest amount that was not

excessive as a matter of substantive due process, there can be

no doubt that the wholly capricious nature of the system

would render the State’s regime unconstitutional. Yet that is

essentially what happens in many States now; unconstrained

That is evident in this case, where the first jury found for

petitioner and the second returned a massive award against

petitioner. Suci inconsistencies are commonplace in the world of

punitive damagss. See, ¢.g., BMW of North America, Inc. v

Gore, Pet. Br. No. 94-896, at 9 (noting that in two virtually

identical cases, one plainti‘f received no punitive damages while the

q

F

,

16

favor of a State’s requiring, as many do, * * * a standard of

‘clear and convincing evidence’ or, even, ‘beyond a

reasonable doubt,” before punitive damages are awarded.

499 U.S. at 23 n.11 (citations omitted). But the Court added

that it was not persuaded “that the Due Process Clause

requires that much. We feel that the lesser standard

prevailing in Alabama — ‘reasonably satisfied from the

evidence’ — when buttressed, as it is, by the procedural and

substantive protections outlined above, is constitutionally

sufficient.” Ibid. (emphasis added). In Kentucky at the time

that this case was decided, and in many other States today,

this lesser standard is mot buttressed by the Haslip

protections.

iti explains (at Pet. 19-26) why use of a

preponderance standard in these circumstances denies the

defendant due process, and we will not repeat that argument

here. We add only that a majority of the States have recog-

nized that application of a “clear and convincing evidence”

standard is essential to preserve fundamental fairness.

Twenty-two States have adopted this (or a more demanding)

requirement by statute."' The highest courts of another

" Ala. Code § 6-11-20(a) (1993); Alaska Stat § 09.17.020

(1994); Cal. Civ. Code § 3294(a) (West Supp. 1996); Colo. Rev.

Stat. Ann. § 13-25-127(2) (West 1989) (requiring proof beyond a

reasonable doubt); Ga. Code Ann. § 51-12-5.1(6) (Supp. 1995); Ill.

Ann. Stat. ch. 735, para 5/2-1115.05(6) (Smith-Hurd 1996)

(available on Westlaw); Ind. Code Ann § 34-4-34-2 (Burns 1986);

Kan. Civ. Proc. Code Ann. § 60-3701(c) & § 60-3702(c) (Vernon

Supp. 1993); Ky. Rev. Stat. Ann. § 411.184(2) (Michie 1992);

Minn. Stat. Ann. § 549.20(1) (West Supp. 1996); Miss. Code Ann

§ 11-1-65(1)(a) (1993); Mont. Code Ann. § 27-1-221(5) (1995);

Nev. Rev. Stat. Ann. § 42.005(1) (Michie Supp. 1995); NJ. Stat.

Ann. § 2A:15-5.12(a) (West Supp. 1996) (available on Westlaw);

N.C. Gen. Stat. § 1D-15 (1995); N.D. Cent. Code § 32-03.2-11(1)

(Supp. 1995); Ohio Rev. Code Ann. § 2307.80(A) &

2315.21(C)G) (Anderson 1991); Okla. Stat. Ann. tit. 23, § 9.1(B),

17

seven States have done so by means of their common-law

authority." These courts have explained that “punitive

damages are a form of punishment and can stigmatize the

defendant in much the same way as a criminal conviction”

(Masaki, 780 P.2d at 575), and have required use of an

elevated standard of proof “because of [punitive damages’]

penal nature and potential for debilitating harm.” Zenobia,

601 A.2d at 657. While these courts have invoked the

common law as well as federal constitutional considerations

in reaching this result, the common-law factors they have

identified are equally applicable to the due process inquiry.

And surely, in a State that makes use of procedures less

rigorous than those before the Court in Haslip — and in

which enormous awards accordingly are returned by juries

and upheld on appeal with some regularity — it is particularly

important that liability for punitive damages be clearly

established.

(C), & (D) (West Supp. 1996); 1995 Or. Laws Ch. 688, S.B. No.

482 (Approved July 19, 1995) (amending Or. Rev. Stat. §

18.540(2) & § 30.925(1) (available on Westlaw); S.C. Code Ann.

§ 15-33-135 (Law. Co-op Supp. 1995); Tex. Civ. Prac. & Rem.

Code Ann. 41.003(a) (West Supp. 1996); Utah Code Ann. § 78-18-

1(1){a) (1992). In addition, lowa requires proof by a

“preponderance of clear, convincing and satisfactory evidence” for

punitive damages. See lowa Code Ann. § 668A.1(1)(a).

" Linthicum v. Nationwide Life Ins. Co., 723 P.2d 675, 680-81

(Ariz. 1986); Jonathan Woodner Co. v. Breeden, 665 A.2d 929,

932, 938 (D.C. 1995); Masaki v. General Motors Corp., 780 P.2d

566, 575 (Haw. 1989); Tuttle v. Raymond, 494 A.2d 1353, 1363

(Me. 1985); Owens-Illinois, Inc. v. Zenobia, 601 A.2d 633, 657

(Md. 1992); Hodges v. S.C. Toof & Co., 833 S.W.2d 896, 901

(Tenn. 1992); Wangen v. Ford Motor Co., 294 N.W.2d 437, 457-

458 (Wis. 1980).

18

CONCLUSION

The petition for a writ of certiorari should be granted.

Respectfully submitted,

Of Counsel: ANDREW L. FREY*

CHARLES ROTHFELD

HUGH F. YOUNG, JR. Mayer, Brown & Platt

Executive Director 2000 Pennsylvania Ave., N. W.

Product Liability Advisory | Washington, D.C. 20006

Council, Inc. (202) 778-0602

1850 Centennial Park Dr.

Suite 510 * Counsel of Record

Reston, Virginia 22091

(703) 264-5300

APRIL 1996