Opposition Brief — Ford Motor Company v. Buell-Wilson, 127 S. Ct. 2250 (2007) (No. 06-1068)

No. 06-1068

IN THE

Supreme Court of the United States

Senertaeiemnanitieetinattinaiessclemaienes

FORD MOTOR COMPANY,

Petitioner,

.

BENETTA BUELL-WILSON and BARRY S. WILSON.

Respondents.

Ow Pretririon FOR A Writ oF CERTIORARI TO THE

Court oF ApPpEAL OF CALIFORNIA,

Four. H AppEi tate District, Division Ont

BRIEF IN OPPOSITION

Jerome B. Fark. Jr. Dennis A. SCHOVILLE

Counsel of Ree ‘ord Louis G. ARNELL

Steven L. Maver James S. LAGMIN

Keith D. KESSLER SCHOVILLE & ARNELE, LLP

Howsarp Rick NEMEROVSK! 1230 Columbia Street

Canapy Fark & RABKIN Suite 800

A PRroression At CORPORATION San Diego. CA 9210]

Three Embarcadero Center (619) 232-990]

7th Floor

San Francisco, CA 94111]

(415) 434-1600

Attorneys for Respondents

i

QUESTIONS PRESENTED

Ford prefaces its statement of the Questions Presented with

an incomplete précis of the facts. Although the jury verdict was

for more than $368 million, the trial court reduced the award to

$75 million in compensatory damages and $75 million in

punitive damages. Petitioner’s Appendix (Pet. App.) 15a.

The California Court of Appeal then reduced the total

compensatory damages for both plaintiffs to $27.606 million

and the punitive damages to $55 million. /d. at 61a.

li

TABLE OF CONTENTS

Page

PUBS TIONS PRESENTED ....ccccccccccccecs i

TE OF CONEBINIG ccccccccccccvcccccccs ii

TABLE OF CITEDAUTHORITIES ............ iv

TABLE OF APPENDICES ..........cccccccees ix

STATEMENT OF THE CASE ................. l

REASONS FOR DENYING THE PETITION ..... 4

I. FORD DID NOT PROPERLY RAISE ANY

OF ITS THREE QUESTIONS PRESENTED

AT EVERY STAGE OF THE STATE COURT

CME, ov vcsccccscercvcesere 4

Il. FORD’S VAGUENESS CLAIM PRESENTS

NO ISSUE MERITING CERTIORARI. .... 10

ll. THE OPINION’S ANALYSIS’ OF

REPREHENSIBILITY PRESENTS NO

ISSUE MERITING CERTIORARI. ....... 14

IV. NOTHING IN PHILIP MORRIS SUPPORTS

PEPUEED GP PEER EEOENe ccc ccccccvcvccvcces 19

A. Ford Did Not Preserve Any Issue Affected

By Philip Morris, Precluding A Grant And

CC 19

1. Ford Did Not Preserve The

Substantive Issue Addressed In

ESL 19

iii

Contents

2. Ford Did Not Preserve An

Instructional Error Claim. ........

B. The Court of Appeal Did Not Punish Ford

For Injuring Occupants Of Other Ford

WO Sedctaceks deen ueeteccess

l.

CONCLUSION

SA eke eee aaa em Bee

IN es oe ar te ae eee

The Opinion Does Not Allow

Improper Uses Of Evidence Or Jury

Arguments Of Any Sort Rejected In

Pu NGS Shes bee 406 ee ee ws.

a.

Plaintiffs Did Not Offer

Improper Evidence Of Bronco II

I . nv sucweesuetebune

Plaintiffs Made No Improper

Argements About Bronco II

PS ar aenecducnpeaneos

The Opinion Does Not Endorse

Improper Arguments About Non-

Party Explorer Injuries. ......

eeeseeeeseseneesegceeceseesneseesescaes

Page

20

21

21

22

24

24

25

26

30

iv

TABLE OF CITED AUTHORITIES

Page

Cases

Am. Drug Stores, Inc. v. Stroh, 10 Cal. App. 4th 1446

SE bb beat ee ade cevike us hebedsan sce 6

Baker v. ExxonMobil Corp. (In re: Exxon Valdez), 472

wo oF, le | Ree eer 18

Barclays Bank, PLC v. Franchise Tax Bd., 512 U.S.

EE cic chr venres idee ea tiers ouees 13

Beck v. Washington, 369 U.S. 541 (1962) ........ 5

Clark v. Chrysler Corp., 436 F.3d 594 (6th Cir. 2006)

SA Ee ern ie Pee PL eee ae 16,17, 18

Clay v. Ford Motor Co., 215 F.3d 663 (6th Cir. 2000)

ie peu eee pet ek ies Cree See in 18

Coll. Hosp., Inc. v. Superior Ct., 8 Cal. 4th 704 (1994)

BE Ee EE eee eee ne eae er ee 14

Denny v. Ford Motor Co., 662 N.E.2d 730 (N.Y. 1995)

sate AAs wd CG CREE eS kad Dw 18

Dunn v. HOVIC, | F.3d 1371 (3d Cir. 1993) ...... 13

Evans v. Centerstone Dev. Co., 134 Cal. App. 4th 151

SE 6h 5.9 00a whe Wah date MeN sea a snekes 5

Fibreboard Paper Prods. Corp. v. E. Bay Union of

Machinists, 227 Cal. App. 2d 675 (1964) ...... 21

Cited Authorities

Page

Ford Motor Co. v. Ammerman, 705 N.E.2d 539 (Ind.

oF ERT ORE Cee eer rit oer ee passim

Gotcher v. Metcalf, 6 Cal. App. 3d 96 (1970) ..... 29

Grimshaw v. Ford Motor Co., 119 Cal. App. 3d 757

SRUEE kb oe hb eb ao aoe ss Rieu sce taeeeeEes 12

Hasson v. Ford Motor Co., 32 Cal. 3d 388 (1982) ... 12

Hockensmith v. Ford Motor Co., 116 Fed. Appx. 244

te. ES A PSUR Reeser wanes pers oy wf anya a i9

In re Marriage of Goddard, 33 Cal. 4th 49 (2004) ... 9

In re S.C., 138 Cal. App. 4th 396 (2006) ......... 5

Jaramillo v. Ford Motor Co., 116 Fed. Appx. 76 (9th

PE EE erry ot ede 19

Karlsson v. Ford Motor Co., 140 Cal. App. 4th 1202

CE oss ub bab ca Nee VNA EO eee 25

Neumann vy. Bishop, 59 Cal. App. 3d 451 (1976) ... 29

Pac. Mut. Life Ins. Co. v. Haslip, 499 U.S. 1 (1991)

EN PET ey eee eae (cipetece tasenee aaa

People v. Gray, 37 Cal. 4th 168 (2005), cert. denied,

beg Oe ho: RR es beans coed 8

People v. Stitely, 35 Cal. 4th 514, cert. denied, 126

i se GOOG? Kaede dccconsud cee baeee 25

vi

Cited Authorities

Page

People v. Wader, 5 Cal. 4th 610 (1993) .......... 29

Philip Morris USA v. Williams, _ U.S. __, 127

De TEE, 6 bc Jobard neds seeunneuas passim

Prince v. United Nat’l Ins. Co., 142 Cal. App. 4th

DRE “Scents chcedubeeniweneade vada 6

Roberts v. Lomanto, \12 Cal. App. 4th 1553 (2003)

NP ee ee Pe epee antennae Pema ee Papal ays 5

Romw v. Ford Motor Co., 113 Cal. App. 4th 738 (2003)

atin eet nehe ba ae areas beaban wairenetes 12

State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S.

MEE. “SoG ab a Goce e eh edie oe eke rea peeet 2, 16

Sweatman v. Dep't of Veterans Affairs, 25 Cal. 4th 62

SEE valved eke weuwadaepenw eens PPR weae 9-10

Tilbury Constructors, Inc. v. State Comp. Ins. Fund,

137 Cal. App. 4th 466 (2006) ................ 7

TXO Prod. Corp. v. Alliance Res. Corp., 509 U.S. 443

re Oo ee ea Pe a Li 13

Unilogic, Inc. v. Burroughs Corp., 10 Cal. App. 4th

OSC Se ee ee 5

Village of Hoffman Estates v. Flipside Hoffman

Estates, Inc., 455 U.S. 489 (1982) ............ 12

Vii

Cited Authorities

Page

Watkins v. Ford Motor Co., 190 F.3d 1213 (11th Cir.

Are eo erry earn geo eer eer 15, 23

White v. Ford Motor Co., 312 F.3d 998 (9th Cir. 2002)

bane ie Raden cade ea neat eoenk ne tees 13

Witte v. United States, 515 U.S. 389 (1995) ....... 22, 24

Statutes

as EE ok ib aonb we ela cu eek ae aee wee 19

ee ee OE Va covewcdckawanesearewaes 16

Car. Civ. CODE

DE Scum) oie deeds aed bat ie wan ek cares ome 7,10

DE dn kde owes ed oes choo ee cedar a wian 14

EE i aka 0 6 'u wand oo see u6 ew beeen 14

Ral; Se Gas ts IIE 6 Sb vv pwiescdwaeebens 29

Ca. R. Cr.

ES oe ee an iced e Wee ies 5,7,8,9

Sy ab chk Oe dala be 0404 ered eRe eee 10

I hanno he on a eek bare eae eae ee ee 5

Fe a ae ee ees re? Pech papa eT 5,7

EE us) doe wea oka eh sussced theres 5

Ea 6 ise 50-6 are hd eee ees eevee 5

ForMerR CAL. R. Cr.

BE ON rsa Ge ka ok a elke eee oe eee 10

Ee sc cl bon lub k abc k cites naaraues 10

rT nt eee ie ea es cal nei 10

vill

Cited Authorities

Page

Other Authorities

TER. Rap. NO. GF-177O LISS) inc ivicivedesucess 16

ix

TABLE OF APPENDICES

Page

A — Excerpts of Appellants’ Opening Brief in the

Court of Appeal of the State of California, filed

ne as cledet keen eve ketene os la

B — Excerpts of Appellant’s Petition for Review

in the Supreme Court of California, filed

i nese whw-o wae bee eedes 7a

I

Respondents respectfully request that the Court deny the

Petition for Writ of Certiorari (the Petition) seeking review of a

decision of the California Court of Appeal.

STATEMENT OF THE CASE

Ford’s Petition and its Supplemental Brief offer a one-sided

account of the facts and evidence. The Court of Appeal’s opinion

(the Opinion) fairly summarizes the events that led to this

litigation, the Wilsons’ catastrophic injuries and the evidence

at trial. Pet. App. 5a-14a.

The jury awarded Mrs. Wilson $109.6 million, and Mr.

Wilson $13 million, in compensatory damages. Pet. App. 14a.

It also awarded $246 million in punitive damages. /d. at 15a.

The trial court reduced the compensatory damages to $70 million

for Mrs. Wilson and $5 million for Mr. Wilson, and the punitive

damages to $75 million. /d.

The Court of Appeal affirmed the finding of liability. Noting

that Ford had not challenged the sufficiency of the evidence

(id. at 9a), the court described the history of the Explorer’s

design. Ford based the Explorer on a prior SUV (the Bronco II}

with a history of great instability and susceptibility to rollovers.

Id. at 9a-10a. Although it knew of these problems, Ford retained

critical Bronco II design elements bearing on stability (a narrow

track width and high engine mount and center of gravity) and

carried over a high percentage of parts from the Bronco II, while

rebranding it as the Explorer. /d. at 10a. Because making the

necessary design changes would have delayed the Explorer’s

release date, Ford management rejected repeated requests by

its engineers to increase the vehicle’s track width and lower its

center of gravity, thus preserving a lethal feature of the Bronco

Il. Jd. at 9a-10a. For cosmetic reasons, management also

increased the Explorer’s tire size, exacerbating the vehicle’s

instability. /d. at lla. In subsequent years, as it modified the

Explorer’s design, Ford management again declined for

economic reasons to improve its stability. /d. at 12a-13a.

2

The Explorer was not just unstable; it also had a weak roof

structure prone to cfush in a rollover. Jd. at 8a, 13a. Rollovers

in vehicles with sturdy roofs are relatively nonviolent events

for passengers who are properly restrained (as was Mrs. Wilson).

Id. at 13a. Ford could have significantly strengthened the roof

for about $20 per vehicle. Jd.

The Court of Appeal upheld Mr. Wilson’s $5 million

compensatory damage award and Mrs. Wilson’s $4.6 million

economic damage award, but reduced her noneconomic damages

to $18 million. /d. at 36a-37a, 60a-61a. The Petition does not

challenge the resultant $27.6 million award of compensatory

damages.

With respect to punitive damages, the Court of Appeal found

that Ford had known that the vehicle was dangerously unstable

and prone to rollover in normal driving conditions; had known

that the roof structure was weak and prone to collapse in a

rollover; and had known of technologically and economically

feasible ways to stabilize the vehicle and strengthen its roof but

chose for financial reasons not to use them. /d. at 43a-44a. The

court also found that Ford had “evinced a reckless disregard for

the safety of its customers” and had engaged in “a pattern of

deficient design regarding safety in favor of increased financial

returns and was [sic] the result of the conscious disregard of

Ford executives.” /d. at 56a. It thus concluded that “the

reprehensibility of Ford’s conduct was high.” /d. at 55a; accord,

id. at 58a, 59a.

Nevertheless, the court reduced the punitive damages to

$55 million, a ratio of essentially 2:1. /d. at 60a. It noted this

Court’s comment in State Farm that “‘[w|hen compensatory

damages are substantial, then a lesser ratio, perhaps only equal

to compensatory damages, can reach the outermost limit of the

due process guarantee.’” /d. at 58a (quoting State Farm Mut.

Auto. Ins. Co. v. Campbell, 538 U.S. 408, 425 (2003)). In this

case, however, it concluded “that a two-to-one ratio is warranted

because the degree of Ford’s reprehensibility is also high.”

Pet. App. 58a-59a. It added that “[a]n award exceeding a two-

3

to-one ratio would exceed the constitutional maximum . . . under

the facts of this case.” Jd. at 60a.'

1. Ford’s incomplete statement of the case demonstrates its failure

to absorb any lesson from the Court of Appeal’s admonition that it had

“neglect[ed] to discuss the evidence in support of the Wilsons’ damages

at all, much less in the light most favorable to the judgment.” Pet. App.

27a n.6. For example, Ford seriously misrepresents the testimony of

the Wilsons’ stability expert: “Respondents” expert agreed that design

characteristics, other than those reflected in the stability index, affect

stability. As he testified, ‘[y]ou can’t tell until you go out and test it.’”

Pet. 4 (citations omitted). Ford neglects to say that the expert did test

the Explorer, and that it fared very poorly. Far from relying solely on

paper calculations of the Explorer’s stability index—as the Petition

suggests (see id. at 3)—Plaintiffs relied on their expert’s extensive

stability testing of production-model Explorers, as well as the real-world

tests that Ford itself had conducted, until the vehicle’s tendency to roll

over at 40-55 m.p.h. led Ford to abandon such tests in favor of computer

simulations. See Pet. App. 11a; 8 RT 1281-83, 1293-1301, 1318-27; 28

RT 5059:10-13; | RA 164-66, 1447-49; 9 AA 2503-17.

Ford compounds these omissions by misdescribing the testing it

does acknowledge. It stresses its claim that the Explorer “passed” the

Consumers Union (CU) test. Pet. 5. But the CU test is not a stability

test that vehicles “pass” or “fail.” As conducted by NHTSA and CU, it

measured the Explorer’s handling. Pet. App. lla; 23 RT 4115. The test

entails turning at increasing speeds through a series of cones; it ends

when the vehicle reaches a speed at which it starts to slide and hit cones.

20 RT 3513-16. It thus yields not a “pass” or “fail” but a maximal speed

at which a vehicle can navigate the course. 20 RT 3514-15, 3645-46. If

that speed is 'ess than the speed at which the vehicle rolls over, the test

will not show that rollover speed. CU and NHTSA testing thus did not

show that the Explorer rolls over on flat dry roads at sub-highway speeds.

But Ford’ own testing did reveal that fact. Ford used the CU course

differently, in order to test the Explorer for rollover. It did not stop the

test when the Explorer hit a cone, but kept going in order to determine

the speed at which it rolls over in accident-avoidance maneuvers like

that which resulted in Mrs. Wilson’s accident; that speed was 40-55

m.p.h. See 8 RT 1298-1303, 1318-27; 1 RA 164-66; 5 RA 1236-48,

1296-1300; 6 RA 1437, 1447-49; 9 AA 2503-17. When Plaintiffs’ experts

tested prodwetion-model Explorers, the results were similarly dismal.

(Cont'd)

4

REASONS FOR DENYING THE PETITION

Ford has not challenged the judgment insofar as it finds

liability for marketing a defective and dangerous product and

awards compensatory damages. The Petition seeks review only

of the award of punitive damages.

The Petition should be denied. Ford did not properly

preserve any of its Questions Presented in state court. See Part

1, infra. And on none of the issues presented does the opinion

below conflict with a decision of this Court, a federal Court of

Appeals or the highest court of a state. See Parts II-III, infra.

Finally, there is no reason to remand the case for reconsideration

in light of the decision in Philip Morris USA v. Williams, —

U.S. —, 127 S. Ct. 1057 (2007), as Ford urges in its

Supplemental Brief, for the Court of Appeal’s opinion is fully

consistent with Philip Morris. See Part IV, infra.

I. FORD DID NOT PROPERLY RAISE ANY OF ITS

THREE QUESTIONS PRESENTED AT EVERY

STAGE OF THE STATE COURT PROCEEDINGS.

Question 1 is whether California’s punitive damages statute,

as applied in this Case, is unconstitutionally vague and fails to

(Cont'd)

See 9 RT 1416-32; 20 RT 3537-43, 3546; 5 RA 1306-07; 6 RA 1615

(video).

Ford also suggests that Plaintiffs relied on evidence in ways they

did not. It asserts that “Respondents’ expert . . . relied on a Ford document

’ suggesting the Bronco IT had a ‘rollover rate three times higher than the

Chevy S-10 Blazer’” (Pet. 3 (quoting Pet. App. 10a)) and that “[wyJhile

admitting evidence concerning comparative rollover rates of other

vehicles, the trial court refused to allow Ford to present such data as to

the Explorer itself.” Pet. 3 But as the Opinion shows, Plaintiffs’ expert

briefly referred to the Ford document only to show Ford’s awareness of

the instability problem in the vehicle on which it based the Explorer--

and its propensity to conceal rather than fix such defects. Pct. App. 10a.

The court never mentioned “evidence concerning comparative rollover

rates of other vehicles” in describing Plaintiffs’ case for the simple reason

that they did not use such evidence to prove the Explorer’s defectivencss.

5

provide “fair notice.” Pet. i, 10-11. While Ford raised that issue

in the Court of Appeal, it did not present it properly to the

California Supreme Court in its Petition for Review.

Ford implies that it did so in footnote 5 of that Petition.

Pet. 9. It did not. California appellate rules require that all briefs

“{s]tate each point under a separate heading or subheading

summarizing the point.” Cac. R. Cr. 8.204(a)(1)(B); id. 8.504(a)

(subjecting petitions for review to Rule 8.204); Jn re S.C., 138

Cal. App. 4th 396, 408 (2006). Consequently, an issue raised

only in a footnote is not properly presented and is deemed

waived. See, e.g., Evans v. Centerstone Dev. Co., 134 Cal. App.

4th 151, 160 (2005) (“[P]laintiffs raise this issue in a two-page

footnote in the introduction to the opening brief. This is a

violation of court rules that require arguments to be contained

in discrete sections with headings summarizing the point. We

do not have to consider issues discussed only in a footnote”

(citation omitted)); Roberts v. Lomanto, 112 Cal. App. 4th 1553,

1562 (2003) (same); Unilogic, Inc. v. Burroughs Corp., 10 Cal.

App. 4th 612, 624 n.2 (1992) (“We do not view as adequate to

preserve an issue on appeal . . . one footnote[d] mention of

fit]”). Moreover, a Petition for Review “must begin with a

concise, nonargumentative statement of the issues presented for

review” (CAL. R. Cr. 8.504(b)(1)); the California Supreme Court

ordinarily does not consider issues not expressly raised or fairly

included therein. /d. 8.520(b)(2), (3).

Ford met none of these requirements. Its Petition for Review

identified three “Issues Presented” on which review was sought

(Respondents’ Appendix filed herewith (Resp. App.) 10a);

vagueness/"fair notice” was not among them. Nor do the

Petition’s topic headings ever mention the issue. See id. at 8a-

9a. Indeed, the body of the Petition includes not a word about a

void for vagueness or “fair notice” issue.

The issue appears only in a footnote, which is insufficient

under California law. Question | is thus procedurally barred.

See Beck v. Washington, 369 U.S. 541, 553 (1962) (federal claim

not raised in “assignments of error” in state supreme court brief,

6

as required by state procedural rule, was waived, even though

one sentence of brief mentioned claim).

Question 2 is whether the Court of Appeal “rendered the

‘reprehensibility guidepost’ a nullity.” Pet. i. Ford mainly argues

that the court misanalyzed “reprehensibility” when it “gave no

weight to the many objective factors, such as industry custom,

federal regulatory judgment, and reasonable grounds for

disagreement, that significantly mitigate against any finding of

reprehensibility.” Pet. 24.’

Ford did contend in the Court of Appeal that it had met

federal regulatory standards, and that experts reasonably disagree

about the design issues. See Appellants’ Opening Brief (AOB)

42-56. However, Ford presented this issue only as one of state

law. Id. at 56 (“[A]t most . . . Ford’s managers and engineers

were aware of reasonably debatable safety issues and made

reasonably defensible judgments about them. That cannot, under

California law, be boot-strapped into a finding of malice’’)

(emphasis added). Ford’s opening brief never claimed that the

federal Constitution required that weight be given to either of these

factors in assessing the reprehensibility of its conduct. See id. at

78-79.’ Accordingly, the claim is also procedurally barred.

2. Ford also contends that the Court of Appeal misapplied the

“reprehensibility” factor when it found that Plaintiffs were “vulnerable”

(Pet. 25) and that “*Ford’s actions were the result of intentional conduct

and deliberate decisions by Ford’s management.’” Pet. 26 (quoting Pet.

App. 57a). Ford’s Petition for Review did not present either point. See

Resp. App. lla-15a (argument that punitive damages were excessive).

3. One paragraph in Ford’s reply brief argued that federal law

required the Court of Appeal, in assessing reprehensibility, to consider

Ford’s alleged compliance with regulations and so-called “industry

custom.” Appellants’ Reply Br. 48. But California law precludes the

raising of new issues in reply briefs. See, e.g., Prince v. United Nat'l:

Ins. Co., 142 Cal. App. 4th 233, 238 (2006) (citing Am. Drug Stores,

Inc. v. Stroh, 10 Cal. App. 4th 1446, 1453 (1992)). Nor did Ford frame

its regulatery compliance and “industry custom” arguments in terms of

fedcral law in its Petition for Rehearing to the Court of Appeal. See Pet.

Reh’g 43-50.

7

The same is true of Ford’s claim about “industry custom”

(i.e., comparative statistical evidence regarding the Explorer’s

rollover rate). Ford’s opening brief in the Court of Appeal never

contended that the federal Constitution required consideration

of such evidence in determining the reprehensibility of conduct

in order to assess the amount of punitive damages. See Resp.

App. 5a-6a. Moreover, under California rules of appellate

practice, Ford’s Petition for Review adequately raised the

exclusion of its comparative statistical evidence only as an issue

of state evidence law. See Pet. Rev. 14-21. The section of the

Petition discussing federal constitutional issues (id. at 32-37)

never mentions the exclusion.* That claim, too, is procedurally

barred.

4. The Petition asserts in passing that comparative statistical

evidence “was also relevant to the due process issue of the degree of

reprchensibility of Ford’s conduct, and was required to be admitted as a

matter of state and federal due process.” Pet. Rev. 22-23. However, this

sentence was placed in a section arguing that the evidence was admissible

as a matter of state evidentiary law to determine whether Ford’s conduct

was “despicable” under Civil Code Section 3294, California’s punitive

damages statute. See Pet. Rev. 21-25 (Part I(B)); see also id. at 13 (Part

I) (framing evidence argument as raising a state law issue). But even if

it had been placed in the portion of Ford’s Petition for Review expressly

addressing federal constitutional issues, the single sentence in the

Petition contending that due process required the admission of

comparative statistical evidence would have_been insufficient under

California’s rules of appellate procedure to present this issue to the

California Supreme Court. See, e.g., Tilbury Constructors, Inc. v. State

Comp. Ins. Fund, 137 Cal. App. 4th 466, 482 (2006) (applying Rule

8.204(a)(1)(B) (as then numbered) to reject party’s attempt to raise issues

“{iJn a single sentence in its opening brief contained within its arguments

about [another issue]”).

Nor did the Petition for Review’s statement of “issues presented”

include the “due process/comparative statistics” issue. See Resp. App.

10a. A single sentence in the Petition’s body docs not comply with the

California Supreme Court’s requirement, discussed at p. 5, supra, that

every Petition “must begin with a concise, nonargumentative statement

of the issues presented for review” (Cat. R. Cr. 8.504(b)(1)) and that

only those issues will normally be considered by that court.

8

Finally, even if Ford had adequately presented this issue to

the California Supreme Court, the Court of Appeal also affirmed

the exclusion of Ford’s comparative rollover evidence as

unreliable and misleading under California law. See Pet. App.

23a-24a. Hence, the exclusion of this evidence rests on an

adequate and independent nonfederal ground having nothing to

do with Ford’s belated federal claims.

Question 3 is whether the Due Process Clause prohibits

“punish[ing] a manufacturer for selling products not at issue in

the case” or “for selling products . . . to third parties not before

the court.” Pet. i. Ford did not preserve that issue either.

As explained below (see pp. 20-21, infra), Ford did propose

a jury instruction touching on this issue. But it did not contend

before the Court of Appeal or California Supreme Court that

the refusal to so instruct the jury was error, let alone of

constitutional dimension. (And it was not error: as explained

on pp. 20-21, infra, the instruction misstated the law.)

While Ford did complain to the Court of Appeal that

Plaintiffs had asked the jury to punish it for Bronco II injuries

suffered by non-parties (see AOB 14-15; Appellants’ Reply Br.

4-5), Ford had and has forfeited that claim in no less than three

ways (two at trial and one on appeal). At trial, Ford never

objected to the parts of Plaintiffs’ closing that it now claims

improperly sought punishment for non-party injuries, thus failing

to preserve the issue. See, e.g., People v. Gray, 37 Cal. 4th 168,

215 (2005), cert. denied, 127 S. Ct. 38 (2006). Moreover, Ford

itself proposed an instruction authorizing the jury to consider

evidence of harm to non-parties. See pp. 28-29, infra. And on

appeal, Ford raised Bronco II-related jury arguments only in

the part of its brief challenging the use of Bronco II evidence as

a matter of state law (AQB 14-15}—not in those addressing

‘punitive damages. Cf Resp. App. 2a-4a.; AOB 40-63, 74-79.

In California appellate practice, a passing reference to the federal

Constitution in the text of an argument about state evidence

9

law does not preserve a federal constitutional claim. See CAL.

R. Cr. 8.204(a)(1)(B) and authorities cited at p. 5, supra.

In the wake of Philip Morris, Ford suggests that Plaintiffs

offered not just jury arguments but evidence of non-party injuries

suffered in Bronco Ils or Explorers. Supplemental Brief for

Petitioner (Supp. Br.) 4-8. Ford cites no such evidence in the

record because, as discussed below (see pp. 24-26, 27 n.14,

infra), there is none. But even if there were, Ford’s Petition for

Review did not challenge its admission. Cf Resp. App. 8a-9a.

That Petition did briefly contend that the Court of Appeal

had “found Ford’s conduct ‘more reprehensible’ because it was

‘repeated and not an isolated incident’ based on the fact that

Ford mass-marketed the Explorer [and] Bronco II.” Resp. App.

14a (quoting Pet. App. 56a-57a).° But neither the paragraph from

which Ford quotes the “repeated not isolated” passage (see Pet.

App. 56a-57a) nor any other part of the Opinion mentions the

mass-marketing of those SUVs as a reason Ford’s conduct was

reprehensible. Because the Opinion never states the proposition

that Ford attributes to the court (i.e., that mass-marketing turns

the design and sale of a defective product into “repeated

misconduct’), Ford’s argument must be that the Court of Appeal

relied on that idea implicitly, without examining its correctness.°

But to preserve that argument for review, California law required

Ford to call the Court of Appea!’s alleged (and assertedly

erroneous) assumption to that court’s attention in a petition for

rehearing. CaL. R. Cr. 8.500(c); In re Marriage of Goddard, 33

Cal. 4th 49, 53 n.2 (2004); Sweatman vy. Dep t of Veterans Affairs,

5. Philip Morris makes clear that a jury may, in evaluating the

reprehensibility of a manufacturer’s conduct, consider the disregard for

public safety inherent in knowingly selling dangerous products.

See pp. 21-22, infra.

6. In reality, the Court relied on no such idea: it found Ford’s

misconduct “repeated” because Ford repeatedly made choices sacrificing

public safety for profits and production schedules, through the

long history of the Bronco II and successive models of the Explorer.

See p. 23, infra.

10

25 Cal. 4th 62, 68 n.1 (2001).’ Ford did not do this: the treatment

of mass-marketing as repeated misconduct, or indeed the

imposition of punishment based in any way on third-party

injuries, is one of the few issues that Ford’s 68-page Petition

for Rehearing did not raise. Accordingly, Ford failed to preserve

any such issue.

Summary. Not one of the issues Ford now presents was

properly raised at every stage of the proceedings below.

Moreover, Question 2 is also barred, insofar as it concerns

comparative statistical evidence, because the Court of Appeal’s

affirmance of the ruling excluding this evidence rests on an

adequate and independent state law ground.

Il. FORD’S VAGUENESS CLAIM PRESENTS NO

ISSUE MERITING CERTIORARI.

Ford’s vagueness argument is really a quarrel with

California law that it has tried to repackage as a federal question.

Ford first contends that the Court of Appeal “dismissed as

irrelevant all objective standards,” including “compliance with

federal regulations and policy judgments, and the existence of

an objectively reasonable disagreement in the engineering

community,” in awarding punitive damages. Pet. 13 (emphasis

added). It then argues that this decision has rendered the state’s

punitive damages statute (CaL. Civ. Cope §3294) void for

vagueness, at least as applied to it. Pet. 9-22. Even if Ford had

properly presented this issue to the California Supreme Court,

it would not merit certiorari.

7. California Rule of Court 28(c) (now Rule 8.500(c)) provided

that “[a]s a policy matter, on petition for review the Supreme Court

normally will not consider an issue that the petitioner failed to timely

raise in the Court of Appeal” (id. 28(c)(1)) and that the Supreme Court

“normally will accept the Court of Appeal opinion’s statement of the

issues and facts unless the party has called the Court of Appeal’s attention

to any alleged omission or misstatement of an issue or fact in a petition

for rehearing.” /d. 28(c)(2). Here, the “opinion’s statement of the issues”

never mentions mass-marketing as a basis for finding reprehensibility;

the California Supreme Court was entitled to accept that framing of the

issue.

11

In the first place, the argument’s premise is demonstrably

false. Ford contended below that, as a matter of California law,

those circumstances preclude punitive damages. The Court of

Appeal did hold that compliance with federal regulations and

the existence of disputes in the engineering community are not

absolute defenses to an award of punitive damages. Pet. App.

43a-Sia. However, it did not hold that evidence of compliance

with federal standards or of engineering disputes was irrelevant

or inadmissible. Indeed, Ford was free to present evidence in

the trial court concerning its claimed regulatory compliance and

the views of its experts as to the design and safety issues pertinent

to this case, and it did so. See, e.g., 2 AA 528-35; 10 AA 2618-

56; 1O RT 1723-36; 28 RT 5145, 5179 (regulatory compliance);

28 RT 5152-54, 5164-67; 3 AA 716-19, 756 (expert

disagreement); cf, e.g., 3 AA 605-717 (NHTSA’s decision not

to regulate stability). Similarly, the trial court did not preclude

Ford’s counsel from arguing to the jury that it should not award

punitive damages, or should lessen their amount, because Ford

(allegedly) complied with regulations and/or because some

experts support its design decisions. Ford’s vagueness argument

thus rests on misstatements of what the California trial court

did and what the Court of Appeal held.

Moreover, Ford concedes that “the California punitive

damage standard is theoretically capable of rational application ,

in many circumstances” (Pet. 12) and that it “is making an as-

applied challenge, and is not arguing that the statute is

unconstitutional on its face.” /d. at 13 n.2. This concession

necessarily narrows the range of cases to which the principles

Ford advocates might be applied, thereby diminishing the

importance of review in this case.

Even as applied to products liability cases, Ford’s vagueness

argument is unworthy of review. That argument is premised on

two propositions: (1) that “California’s standards for determining

strict liability for defective product designs are exceedingly

vague and subjective” (Pet. 11-12); and (2) that an automobile

manufacturer cannot “determine, in advance, if its design

12

decisions . . . would subject it to punishment in California, and

[is left] with no guidance as it makes day-to-day design decisions

about what might subject it to punitive damages.” Pet. 14. The

first of these propositions is not properly before the Court. Ford’s

Petition challenges only the award of punitive damages. Having

chosen not to contest its liability for compensatory damages

under California tort law, Ford has no standing to complain

that California’s standards for imposing such liability are

unconstitutionally vague. See Village of Hoffman Estates v.

Flipside Hoffman Estates, Inc., 455 U.S. 489, 495 n.7 (1982)

(because “‘[vJagueness challenges to statutes which do not

involve First Amendment freedoms must be examined in light

of the facts of the case at hand,’ ‘[o]ne to whose conduct a statute

clearly applies may not successfully challenge it for vagueness”)

(citations omitted).

The same principle precludes Ford from arguing that

California’s punitive damages standards are unconstitutionally

vague as applied to it. The evidence established that Ford

knowingly produced and sold an automobile that (1) would roll

over in normal driving conditions and on dry pavement if a

driver swerved to avoid an obstacle, (2) had a roof so weak that

it would collapse during a rollover and (3) could easily have

been made more stable and given a stronger roof through well-

known, available and cost-effective design changes. Pet. App.

43a. Yet Ford declined for profit-maximization reasons to make

feasible and affordable design corrections urged by its own

engineers. Jd. at 10a, 12a-13a. Thus, however California punitive

damages law may be applied in other cases, Ford unquestionably

had notice that its conduct could result in punitive damages

liability. Indeed, courts in California, among other states, had

instructed Ford on that very subject before. See Hasson v. Ford

Motor Co., 32 Cal. 3d 388 (1982) (Continental); Romo v. Ford

Motor Co., 113 Cal. App. 4th 738 (2003) (Bronco); Grimshaw

v. Ford Motor Co., 119 Cal. App. 3d 757 (1981) (Pinto);

see also, e.g., Ford Motor Co. v. Ammerman, 705 N.E.2d 539

(ind. Ct. App. 1999) (Bronco II).

13

In any event, Ford’s suggestion that California’s punitive

damages standards are unconstitutionally vague is meritless.

Ford cites a great many of this Court’s vagueness opinions from

1915 to 1966 involving dissimilar statutes applied in dissimilar

contexts. Pet. 15-18. But its reliance on these dissimilar cases

ignores the principle that “rules against vagueness are not

‘mechanically applied,’ but depend in their application, on ‘the

nature of the enactment.’” Barclays Bank, PLC v. Franchise

Tax Bd., 512 U.S. 298, 316 (1994) (citation omitted).

Consequently, the relevant vagueness cases—which Ford

altogether ignores—are this Court’s two much more recent

decisions rejecting similar vagueness challenges to punitive

damages laws far less specific than California’s. See 7XO Prod.

Corp. v. Alliance Res. Corp., 509 U.S. 443, 465-66 (1993)

(plurality opinion) (“the notice component of the Due Process

Clause is satisfied if prior law fairly indicated that a punitive

damages award might be imposed in response to egregiously

tortious conduct”); Pac. Mut. Life Ins. Co. v. Haslip, 499 U.S.

1, 19-20, 24 n.12 (1991).’ (Ford’s statement (Supp. Br. 2) that

“{t]his Court has never directly addressed the due process

constraints on the imposition of punitive damages liability in

the first instance” is obviously incorrect.) Indeed, Ford cites no

case holding a punitive damages statute unconstitutional, and

makes no mention of decisions rejecting similar vagueness

challenges to punitive damages laws. See, e.g., White v. Ford

Motor Co., 312 F.3d 998, 1026 (9th Cir. 2002); Dunn v. HOVIC,

1 F.3d 1371, 1381-82 (3d Cir. 1993) (en banc).

In comparison to the punitive damages statutes upheld in

TXO and Haslip, the California statute gives prospective

defendants ample notice. It requires “clear and convincing

8. Justice O’Connor dissented in Haslip, arguing that Alabama’s

punitive damages law—which was implemented by an instruction telling

the jury that “[iJmposition of punitive damages is entirely discretionary

with the jury, that mcans you don’t have to award it unless this jury

feels that you should do so” (see 499 U.S. at 6 n.1)—was void for

vagueness. /d. at 42-53. No other member of the Court joincd that dissent.

14

evidence that the defendant has been guilty of oppression, fraud,

or malice.” Cat. Civ. Cope §3294(a). It defines “malice” as

“conduct which is intended by the defendant to cause injury to

the plaintiff or despicable conduct which is carried on by the

defendant with a willful and conscious disregard of the rights

or safety of others.” Jd. §3294(c)(1). Moreover, this jury was

instructed (in accordance with California precedent) that

“*djespicable conduct’ is conduct that is so mean, vile, base or

contemptible that it would be looked down on and despised by

reasonable people.” 35 RT 8281.’ The California Supreme Court

has explained that the requirement to show “despicable” conduct

“represent[s] a new substantive limitation on punitive damage

awards.” Coll. Hosp., Inc. v. Superior Ct., 8 Cal. 4th 704, 725

(1994).

These standards go far beyond those previously upheld by

this Court, and ensure that punitive damages are imposed only

on defendants whose conduct merits punishment. Accordingly,

they are not unconstitutionally vague, especially as applied to

Ford’s reprehensible conduct here.

Ill. THE OPINION’S ANALYSIS OF REPREHENSIBIL-

ITY PRESENTS NO ISSUE MERITING CERTIO-

RARI.

Ford contends that the Court of Appeal violated the federal

Constitution because, in assessing the reprehensibility of Ford’s

conduct, it “gave no weight to the many objective factors, such

as industry custom, federal regulatory judgments, and reasonable

grounds for disagreement, that significantly mitigate against any

9. Likewise, in the trial’s second phase, which decided the amount

of punitive damages, the court also gave standard California instructions

far more detailed than the one upheld in Has/ip. Among other things, it

told the jury that “[{i]n deciding the amount of punitive damages, if any,

you should consider . . . A, how reprehensible was the defendant’s

conduct; B, is there a reasonable relationship between the amount of

punitive damages and Benetta Wilson’s and Barry Wilson’s harm; C, in

view of the defendant’s financial condition, what amount is necessary

to punish it and discourage future wrongful conduct.” 41 RT 8527.

15

finding of reprehensibility.” Pet. 24. As already noted, this

contention was not properly presented below, and challenges a

ruling that rests in part on an adequate and independent non-

federal ground. See pp. 5-8, supra.

In any event, Ford’s argument presents no issue meriting

certiorari. Ford cites no case holding that either factor, if

established, is an absolute bar to punitive damages. And to the

extent its argument, toned down from its California submission,

is merely that compliance with applicable regulations or

reasonable disagreement among experts are factors to be taken

into account in determining the degree of reprehensibility, and

therefore the maximum constitutionally permissible ratio

between punitive and compensatory damages, neither the Court

of Appeal nor Plaintiffs disagree. As noted above, Ford was

free to argue, in both the trial court and the Court of Appeal,

that compliance with regulations and the existence of a

reasonable disagreement between experts were reasons not to

award punitive damages at all, or to reduce the amount of the

award. See pp. 6, 11, supra. There is no reason to think these

arguments fell on deaf ears: after all, the trial judge reduced the

punitive damages award from $246 million to $75 million, and

the Court of Appeal reduced it further, to $55 million.

The reason why Ford’s arguments for mitigation didn’t

reduce the punitive damages further still was that those

arguments suffered from a weak factual basis. As the Court of

Appeal pointed out, “there are no federal standards for stability

of vehicles, one ground upon which Ford’s liability for punitive

damages is based.” Pet. App. 49a-50a; see also Watkins v. Ford

Motor Co., 190 F.3d 1213, 1218 (11th Cir. 1999). Nor are there

any federal regulatory standards regarding roof-strength

warnings, another ground for liability.'° And, as the Court of

10. Although one non-preemptive federal regulation does govern

roof structure, there was a serious factual dispute at trial, never resolved

by a jury finding, as to whether Ford had complied with it. See 12 RT

2136-37, 2141-42 and 10 AA 2621 (evidence that Ford only passed

(Cont'd)

16

Appeal also emphasized, federal automobile safety regulations

expressly do not preempt state law liability for defective vehicles

(49 U.S.C. §30103(e)) and thus do not “‘affect the rights of

parties under common law particularly those related to warranty

... and tort liability.’” Pet. App. at 48a-49a (emphasis omitted)

(quoting H.R. Rep. No. 89-1776, at 24 (1966)).

As for the claimed disagreement among experts, the Court

of Appeal found that Ford engineers had proposed design

changes that would have improved the Explorer’s stability, but

that management rejected them because implementation “would

have delayed the vehicle’s release date and impacted profits.”

Pet. App. 9a-10a, 12a. Ford presented no evidence that its

management had relied on any recommendations by Ford safety

engineers against the rejected safety proposals. Nor did it present

any evidence that its management had studied any debate among

outside safety experts. Nothing in the record suggests that Ford’s

management made anything but a pure business decision—not

one based on that management’s good-faith, reasonable review

of an engineering disagreement.

Even if these factors gave some support to Ford’s argument

for mitigation of the punitive damages award, there would be

no reason for this Court to review whether the California courts

weighed those factors correctly. In the end, the Court of Appeal

reduced the punitive damages beyond the trial court’s reduction,

resulting in a ratio of 2:1. Nothing in its analysis contradicts the

standards established in State Farm or either of the decisions

claimed by Ford to be in conflict with the decision in this case.

The opinion here is consistent with (and in critical respects

distinguishable from) Clark v. Chrysler Corp., 436 F.3d 594,

602 (6th Cir. 2006). The panel majority in Clark did reduce a

$3 million punitive damages award to roughly $470,000, based

(Cont’d)

FMVSS 216 roof crush test by improper means); 12 RT 1980, 2131-32

(evidence that many Explorers on the road have roofs tou weak to pass

test).

17

in part on the existence of a good-faith dispute over the need to

test the strength of the failed part at issue. 436 F.3d at 602; cf.

id. at 614 (Moore, J., dissenting in part) (finding award not

excessive). But the Clark majority found that, in light of the

scientific dispute and other evidence, the maximum

constitutionally permissible ratio of punitive to compensatory

damages was 2:1 (id. at 600); the dissenting judge found the

original ratio of 13:1 not excessive. Id. at 614 (Moore, J.,

dissenting in part). Clark hardly supports an attack on an award

bearing the very ratio it upheld.

Moreover, in Clark “there [was] no evidence that a boxed-

in B-pillar [i.e., plaintiff's alternative design] would have

prevented the harm suffered by Mr. Clark.” Jd. at 602.

Accordingly, Clark’s experts “did not conduct any tests to see

whether another B-pillar would have prevented (the accident]

under similar circumstances.” /d. In contrast, there was ample

evidence in the present case that greater stability or a stronger

roof or a warning about the roof’s weakness would have

prevented the injuries suffered by Mrs. Wilson. Pet. App. 8a-

9a, 13a, 14a; 9 RT 1391-92; 19 RT 3420-23; 20 RT 3543; 12

RT 2159; 15 RT 2642-43, 2668-69; 25 RT 4495-96; 26 RT 4657.

In particular, Plaintiffs’ expert based his testimony that Plaintiffs’

proposed alternative designs would have prevented the harm

suffered by the Wilsons in significant part on extensive

independent testing. See note 1, supra (citing expert testimony,

and documentation and videos of testing, presented to jury).

Moreover, the Clark majority expressly found that Chrysler was

not a recidivist: “In this case, there is no evidence that Chrysler

knew that its use of the unboxed B-pillar could cause Mr. Clark’s

injury. Indeed, there is no evidence of earlier, similar accidents

that might have alerted Chrysler to the problem.” 436 F.3d at

604-05 (footnote omitted), In this case there was ample evidence

of Ford’s recidivism: the contrast between Chrysler’s lack of

notice in Clark, and the trail of “earlier, similar accidents”

~~

ri

18

involving the Bronco II that had alerted Ford to the danger of

instability,"' could not be starker.

Ford also contends that the decision below conflicts with

Clark and Baker v. ExxonMobil Corp. (In re: Exxon Valdez),

472 F.3d 600 (9th Cir. 2006), because the Court of Appeal said

that automobile consumers “were vulnerable as they would not

understand vehicle design, development and manufacture, and

would rely on Ford to inform them of risks as they made

purchasing decisions.” Pet. App. 56a. There is no conflict. Clark

held that Chrysler's wealth could not be considered in

determining the vulnerability of the plaintiff. 436 F.3d at 604.

The Court of Appeal made no such error in this case.'? In Exxon

Valdez, there was no “dispute that subsistence fisherman were

financially vulnerable” (472 F.3d at 616-17); the Ninth Circuit

merely held that Exxon had “not intentionally target{ed]

subsistence fisherman.” /d. (emphasis added). Neither Clark

nor Exxon Valdez hinted, let alone held, that courts analyzing

reprehensibility must ignore “vulnerability” of an injured party

that is due to a lack of specialized knowledge on an esoteric

scientific topic like automobile safety engineering, or an inability

to obtain adequate information on that issue. Ford cites no case

so holding. There is no conflict for this Court to resolve.

Finally, Ford claims that, because it assertedly won eleven

Explorer cases before the trial of this case, the Court of Appeal

11. See Ford Motor Co. v. Ammerman, 705 N.E.2d 539, 545-49,

556-57, 562 (Ind. Ct. App. 1999); Clay v. Ford Motor Co., 215 F.3d _

663, 665 (6th Cir. 2000); Denny v. Ford Motor Co., 662 N.E.2d 730,

733 (N.Y. 1995); see also 9 AA 2527-53, 2565-82; 5 RA 1273 (evidence

Ford knew that roof crush causes injury in rollovers).

12. Ford misrepresents the opinion below as having said that “*[t]he

defendant’s financial condition is an essential factor in fixing an

amount’” of punitive damages (Pct. 25) without so much as an ellipsis

to indicate that the sentence continued as follows: “. . . that is sufficient

to serve these goals without cxceeding the necessary level of

punishment.” Pet. App. 51a. Accordingly, the Court of Appeal did not

endorse use of the defendant’s wealth in evaluating the plaintiff's

vulnerability—the trial court’s error in Clark.

19

erred in finding its conduct “repeated and not an isolated

incident.” Pet. 27 (citing Pet. App. 56a-57a). The trial court

refused to allow Ford to use prior verdicts in its favor (41 RT

8516, 8534-37), and Ford did not challenge this ruling on appeal

or, for that matter, in its Petition for Review. (Significantly, two

of the verdicts have since been reversed, with directions to

exclude on retrial the comparative rollover statistics that the

trial and appellate court excluded in the present case.

See Jaramillo v. Ford Motor Co., 116 Fed. Appx. 76, 78-79

(9th Cir. 2004); Hockensmith v. Ford Motor Co., 116 Fed. Appx.

244 (11th Cir, 2004)). In any event, Ford’s premise—that it was

punished for “repeated” sales of Ford Explorers to other

persons—is false. See Part IV, infra. That juries in other cases,

presented with different witnesses and evidence by different

lawyers, came to different conclusions than the jury in this case

has no bearing on whether the conduct Plaintiffs proved in this

case was reprehensible.

IV. NOTHING IN PHILIP MORRIS SUPPORTS FORD’S

PETITION.

Ford asked the Court to hold the Petition until it announced

a decision in Philip Morris USA v. Williams, _ U.S. _, 127

S. Ct. 1057 (2007). The Court announced that decision on

February 20. Ford then filed its Supplemental Brief. However,

nothing in Philip Morris supports any argument in the Petition

or warrants a remand.

A. Ford Did Not Preserve Any Issue Affected By Philip

Morris, Precluding A Grant And Remand.

1. Ford Did Not Preserve The Substantive Issue

Addressed In Philip Morris.

In its Supplemental Brief, Ford urges the Court to grant

certiorari in order to remand for reconsideration in light of Philip

Morris. But the Court has power to grant, vacate and remand

only if Ford’s petition satisfies the jurisdictional requirements

of 28 U.S.C. §1257(a).

Pane gga

20

As shown in Part I, at pp. 8-10, supra, it does not: Ford did

not properly preserve the issue that would be the subject of a

grant, vacate and remand order. Ford’s complaint is that the

Court of Appeal improperly punished it for mass-marketing

Explorers and Bronco IIs to third parties. Because Ford did not

adequately present this issue as one of federal law, or raise it in

a petition for rehearing as California law required, the Court

lacks jurisdiction of it.

2. Ford Did Not Preserve An Instructional Error

Claim.

An issue raised (but not resolved) in Philip Morris was

whether the trial court erred in refusing to instruct the jury that

it could “consider the extent of harm suffered by others in

determining .. . [the] reasonable relationship” between plaintiff s

harm and punitive damages, but could not “punish the defendant

for the impact of its alleged misconduct on other persons.”

Philip Morris, 127 S. Ct. at 1061. As the Court noted, the

instruction Philip Morris had proposed “distinguishe[d] between

using harm to others as part of the ‘reasonable relationship’

equation (which it would allow) and using it directly as a basis

for punishment” (which it would not). /d. at 1064.

Ford proposed no such instruction. Its proposal, which the

trial court rejected, was erroneous and one-sided:

In determining the appropriate amount of

punitive damages, if any, in this case, you may

consider only the harm to the plaintiffs. Any

individuals other than the plaintiffs who might claim

to have been harmed by Ford have the right to bring

their own lawsuit seeking damages for any alleged

injuries they may have incurred. Therefore, if you

decide to award any punitive damages, your award

must be limited to redressing the injuries incurred

only by the plaintiffs in this lawsuit. (Pet. App. 103a)

Unlike Philip Morris’s instruction, Ford’s would have

barred the jury from considering Ford’s overall conduct in

21

determining reprehensibility. Because that instruction did not

completely state the governing legal principles, the trial court

properly rejected it under California law. E.g., Fibreboard Paper

Prods. Corp. v. E. Bay Union of Machinists, 227 Cal. App. 2d

675, 716-17 (1964) (judge has no duty to rewrite incorrect

instructions). The refusal thus rests on an adequate and

independent state ground.

In any event, no instructional error issue has been preserved.

Before the Court of Appeal and in its Petition for Review, Ford

did not claim—even on state law grounds and certainly not on

federal constitutional grounds—that the trial court incorrectly

instructed the jury or erred by refusing to give the foregoing ~

instruction. See Resp. App. 2a-4a, 8a-9a.

B. The Court of Appeal Did Not Punish Ford For

Injuring Occupants Of Other Ford Vehicles.

Ford claims that the Court of Appeal punished it “for its

sales of the Explorer—as well as the Bronco II-—to third parties

not before the court.” Pet. 2-3. Even if that argument had been

properly preserved, it would still rest on a misreading of the

Opinion. In fact, the Court of Appeal evaluated the punitive

damages award in prescient accord with the principles this Court

later enunciated in Philip Morris.

1. The Principles Set Forth In Philip Morris.

Philip Morris draws a line between “show[ing] harm to

others in order to demonstrate reprehensibility” and “punish[ing]

a defendant directly on account of harms it is alleged to have

visited on nonparties.” 127 S. Ct. at 1064. While barring the

latter, the Court affirmed the propriety of the former:

Evidence of actual harm to nonparties can help to

show that the conduct that harmed the plaintiff also

posed a substantial risk of harm to the general public,

and so was particularly reprehensible . . . . (/d.)

The Court later reiterated its “recogni{tion] that conduct that

risks harm to many is likely more reprehensible than conduct

that risks harm to only a few.” /d. at 1065.

22

After noting the heightened reprehensibility of acts that

threaten harm to many victims, the Court further invoked the

principle, derived from criminal recidivism cases, that an act is

more reprehensible if it is the latest in a string of similar

misdeeds. Jd. (describing Witte v. United States, 515 U.S. 389,

400 (1995), as holding that “recidivism statutes taking into

account a criminal defendant’s other misconduct do not impose

an additional penalty for the earlier crimes, but . . . a stiffened

penalty for the latest crime, which 1s considered to be an

aggravated offense because a repetitive one”) (citation and

internal quotation marks omitted). In short, Philip Morris affirms

that a manufacturer’s long history of disregard for public safety

can be considered in evaluating the “reprehensibility” of its

conduct toward the plaintiff.

2. The Opinion Accords With Philip Morris.

Although we discuss below Ford’s mistaken assertions that

the trial transcript includes evidence or closing arguments

inconsistent with the above principles (see Part IV(B)(3), infra),

the crucial point is that the Opinion adheres to those principles.

What most matters to the Court’s exercise of its certiorari

jurisdiction, after all, is not passages in a trial transcript but the

text of the published appellate opinion allegedly creating

confusion or conflict in the law.

That text in no way suggests that Ford was or should be

punished for selling Explorers (or Bronco IIs) to multiple buyers.

The passages of which Ford complains are all in a section

of the Opinion headed “Reprehensibility of conduct.”

Pet. App. 55a. They form part of the Court’s analysis of the

“reprehensibility” of Ford’s conduct—an analysis concluding

that, because “the degree of Ford’s reprehensibility is . . . high,”

a “two-to-one ratio is warranted.” Pet. App. 59a. There is no

dispute that this is how the Court of Appeal used Ford’s past

conduct: Ford’s Petition for Review acknowledged that the court

had analyzed its past conduct as relevant to reprehensibility.

See p. 9, supra (quoting Resp. App. 14a).

23

As part of that reprehensibility analysis, the Opinion notes

that “Ford had a pattern of deficient safety design that was

ignored in favor of increased financial returns . . . [as] evidenced

by Ford’s refusal to follow its engineers’ recommendations to

improve the stability of the Explorer.” Pet. App. 57a. This

conclusion had nothing to do with punishing Ford for injuries

suffered by other Explorer occupants. What made Ford’s design

and marketing of the Explorer that injured the Wilsons

reprehensible were (1) Ford’s similar disregard of public safety

in designing the Bronco II; (2) its decision to carry over, into

the Explorer, design features that made the Bronco II unstable

and unsafe, despite its own engineers’ recommendations to make

the design safer; (3) its disregard of prior product liability

judgments and punitive damage awards regarding the Bronco

II when it designed and produced the successor vehicle that

injured the Wilsons; and (4) its repeated failure to correct the

original Explorer’s stability and roof strength defects in

successive models, even though it was feasible and cost-effective

to do so, because Ford favored maximizing financial returns

and meeting production schedules over ensuring the safety of

Explorer occupants. See Pet. App. 9a-10a, 12a-13a, 43a-44a,

56a-57a.

The reprehensibility of Ford’s failure to correct the Bronco

Il’s safety defects when it produced the Explorer is underscored

by a string of decisions finding the Bronco II to be dangerous

and defective, and often imposing significant punitive damages.

See, e.g., Watkins, 190 F.3d at 1216-18; Ammerman, 705 N.E.2d

at 556-57, 562. Yet Ford produced a new-generation vehicle,

rebranding it “the Explorer,” without correcting its predecessor’s

fundamental stability defects. To consider, as part of a

reprehensibility analysis, a manufacturer’s wrongful acts in

designing a related series of defective products over an extended

period differs entirely from punishing that manufacturer for the

injuries caused to non-parties because it mass-produced a single

product, or for the injuries caused to non-parties by the prior,

om in date cited

24

related products. See Philip Morris, 127 8. Ct. at 1065; Witte,

515 U.S. at 400.

In sum, the Opinion does not punish Ford for the injuries

that the Explorer’s design defects have caused non-parties.

Instead, it bases its calculation of punitive damages on the $27.6

million in compensatory damages received by the Wilsons. That

base, by definition, includes compensation only for their injuries;

it includes no dollars intended to compensate non-parties (or

punish Ford) for such persons’ injuries. The Court of Appeal

did then consider Ford’s recidivism in determining that Ford’s

behavior was sufficiently reprehensible to warrant an award of

punitive damages equal to twice the compensatory damages

base. That calculus was entirely consistent with Philip Morris.

3. The Opinion Does Not Allow Improper Uses

Of Evidence Or Jury Arguments Of Any Sort

Rejected In Philip Morris.

Trying to shoehorn this case into the analysis in Philip

Morris, Ford contends that “‘the sort of evidence that was

introduced at trial [and] the kinds of argument the plaintiff made

to the jury’” created an undue risk that the jury punished Ford

for harming third persons. Supp. Br. 10 (quoting Philip Morris,

127 S. Ct. at 1065). Neither part of that contention is correct (or

properly preserved; see Part I, supra).

a. Plaintiffs Did Not Offer Improper Evidence

Of Bronco II Injuries.

Ford did complain in the Court of Appeal, as in its

Supplemental Brief, about the admission of evidence of the

Bronco II’s instability. Supp. Br. 4-6. However, Ford does not

cite even a shred of evidence submitted to the jury of injuries

suffered by third parties in Bronco Ils—and there wasn’t any.

Cf. id.; Pet. 29 (citing only (1) evidence of Bronco II instability

13. The trial court of course instructed the jury that arguments of

counsel are not evidence (35 RT 8155; 41 RT 8505)—an instruction

(Cont'd)

AEA TR LUE DNL, SN

25

evidence of the Bronco II’s instability, and Ford’s knowledge

thereof, in order to show the history of the Explorer’s

development (e.g., Ford documents assessing the Explorer’s

stability in light of the Bronco II’s known deficiencies) and to

show Ford’s notice of the problem and of the need to fix it. Pet.

App. 17a-20a. The notice issue concerned Ford’s liability for

punitive damages in the first place, and the reprehensibility of

its conduct—not the amount of harm it had caused.

There is a qualitative difference between evidence that a

manufacturer knew that a predecessor product had the same

defect as the product at issue, on the one hand, and evidence of

the actual harm that the past defect did to non-parties, on the

other. If Plaintiffs had offered the latter sort of evidence—

é.g., expert testimony detailing the number of Bronco II roll-

overs and calculating the amount of harm they had caused to

non-parties—Ford would have had something to complain

about. But as Ford’s lack of record citations reveals, Plaintiffs

did no such thing.

b. Plaintiffs Made No Improper Arguments

About Bronco II Injuries.

Nor did Plaintiffs’ counsel urge the jury to punish Ford for

the harm suffered by Bronco II victims. Ford block-quotes two

passages in Plaintiffs’ closing argument mentioning the Bronco

II. Supp. Br. 5. Ford contends that these passages fall on the

wrong side of the “use to measure reprehensibility”/"use to

punish for non-party injuries” line, but that is false. Here is the

key passage:

Ford is aware by 1989 that many people are killed

or seriously injured in [Bronco II] rollovers. Right

in this time period, and they are going out to market

with this new launch [i.e., the Explorer] with Job 1

(Cont'd)

that California law presumes the jury to have followed. See, e.g., People

v. Stitely, 35 Cal. 4th 514, 559, cert. denied, 126 S. Ct. 164 (2005);

Karlsson v. Ford Motor Co., 140 Cal. App. 4th 1202, 1229 (2006).

26

with the engineers telling them [of] the same

problems. (35 RT 8173-74 (quoted at Supp. Br. 5))

Counsel could not have made the point more clearly: he

alluded to people hurt in Bronco JI rollovers not to include those

third parties’ injuries in the pool of harm on which the jury

would base Ford’s punishment, but only to show that “Ford

[was] aware” of the instability problem, yet went “to market”

with the Explorer “with the engineers telling them [that] the

same problems” remained. That awareness enhances the

reprehensibility of Ford’s conduct. However, the basis for

calculating the amount of Ford’s punishment—i.e., the amount

of harm to be multiplied by the reprehensibility factor—was

limited to the harm that the Wilsons suffered as a result of those

“same problems.”

While the other block-quoted passage does refer to the

Bronco II having killed or injured many people (35 RT 8172),

one must view that brief comment in context-—i.e., as promptly

followed by the “new launch . .. same problems” passage quoted

above in this brief. The latter passage tied together counsel’s

points about the Bronco II into a single description of how Ford’s

pattern of disregard for the danger of instability began with the

Bronco II and carried over—along with that vehicle’s basic

design flaws—to the original Explorer and, ultimately, the 1997

Explorer that injured the Wilsons. The persistence of that

disregard for safety increases the reprehensibility of the conduct

that injured the Wilsons, but it was only for their injury that

Plaintiffs asked the jury to punish Ford. The Bronco II evidence

merely helped show that that injury was no unforeseen mishap,

but the latest in a string of eminently foreseeable results of

conscious choices. ‘i

c. The Opinion Does Not Endorse Improper

Arguments About Non-Party Explorer

Injuries.

After discussing the Bronco II, the Supplemental Brief

quotes passages in Plaintiffs’ closing argument allegedly seeking

punishment for non-party injuries caused by other Explorers.

27

Supp. Br. 6-7.'* The ¢ » «ges do no such thing, and would not

warrant a grant of certic.uri even if they did.

(1) Other Explorer Cases Are Outside The

Record.

Preliminarily, Ford complains that these alleged arguments

were unfair because “Ford had won the prior eleven cases

involving these defect claims, and there was no actual evidence

of other injuries, their proximate causes, severity, or how this

alleged threat to other drivers compared to that of other SUVs.”

Id. at 6.

This argument goes outside the record and is therefore

improper. There is no evidence in the trial record of any of those

alleged eleven prior verdicts.’ A fortiori, Ford did not introduce

“actual evidence of [the] other injuries, their proximate causes,

[or] severity™~in the prior cases or otherwise lay a foundation in

the record that the accidents or injuries made those cases

substantially similar to this case."

(2) The Quoted Arguments Are Not

Improper.

Ford’s arguments must therefore rest on the four passages

of argument it block-quotes. See Supp. Br. 7. But those passages

will not bear the weight. The first and fourth in no way mention

other Explorer rollover accidents, let alone injuries suffered by

14. Notably, Ford does not claim that Plaintiffs put before the jury

improper evidence of non-party injuries suffered in Explorer rollovers.

15. Ford proffered such evidence at the time of Phase II closing

arguments (41 RT 8534-37); the trial court excluded it (id.); and Ford

did not challenge the exclusion on appeal.

16. While Plaintiffs do not expect that the Court will consider

alleged facts lacking a valid foundation in the record—let alone the

alleged “additional victories” after trial mentioned in Ford’s Petition

(Pet. 27}—-we note that, if the Court expanded its inquiry beyond the

record, it also would find a comparable number of other Explorer cases

involving instability and/or roof crush in which the plaintiffs have

prevailed.

28

_non-parties in such accidents. They merely note the potential

harm to other drivers caused by Ford’s conduct—the very type

of argument this Court approved when it noted in Philip Morris

that “conduct that risks harm to many is likely more

reprehensible than conduct that risks harm to only a few.” 127

S. Ct. at 1065.

The second passage does note “[h]jundreds of Explorer

rollover cases” but vot in order to make the injuries suffered in

those accidents the base for calculating punitive damages. Rather

than mention injuries—let alone suggest their monetary value—

counsel immediately explained the relevance of the long line of

cases: it shows “Ford management’s willingness to accept this

risk from the Bronco II through the [1997 Explorer].” 35 RT

8179 (quoted at Supp. Br. 7). It shows, in other words, that

Ford’s conduct toward the Wilsons was reprehensible because

it was the latest instance in a long string of similar, uncorrected

misconduct. See Philip Morris, 127 S. Ct. at 1065 (approving

use in punitive damages context of principle that recidivist’s

“latest crime .. . is considered to be an aggravated offense

because a repetitive one’’) (citations and internal quotation marks

omitted).

Similarly, the third passage notes that Mrs. Wilson’s

accident was not “a single isolated incident,” as there were

“others in California.” But again, counsel never mentioned or

alluded to injuries suffered in those accidents or invoked the

suffering of non-parties. Instead, he used the fact that this

accident was one in a long line to show the conscious, willful

nature of Ford’s longstanding disregard of the proven risk posed

by its conduct.

(3) Ford Invited Any Error.

Even if the arguments of counsel raised a substantial federal

question, Ford could not complain about them, for they were

addressed to a legal standard given the jury in an instruction

Ford proposed (41 RT 8444-50, 8458, 8475-77):

29

In determining the amount of punitive damages,

if any, that 1s necessary to achieve the proper level

of punishment and deterrence, you may consider only

Ford's wrongful conduct, if any, that has had an ~

adverse impact on the citizens of California.

Accordingly, you may not award any punitive

damages for the purpose of punishing Ford for the

sale of vehicles in other states for any injuries that

may have occurred in other states, or for the purpose

of changing Ford’s conduct in other states. (41 RT

8528 (emphasis added))

Under California law, when a court instructs a jury on the law,

it frames the scope of permissible closing argument. See Gotcher

v. Metcalf, 6 Cal. App. 3d 96, 100 (1970); see, e.g., Neumann v.

Bishop, 59 Cal. App. 3d 451, 479-80 (1976); cf CaL. Cope Civ.

Proc. §607a (court must inform counsel before closing

arguments of instructions it will give). Needless to say, a party

cannot complain of an instruction that it proposed itself. People

v. Wader, 5 Cal. 4th 610, 657-58 (1993). Counsel’s arguments

simply pointed out to the jury that many other Ford Explorers

in California have the same defects as the Wilsons’, and may

also have “an adverse impact on the citizens of California.”

Even if such argument crossed a line drawn by Philip Morris, it

was at Ford’s invitation that Plaintiffs and the Court crossed

that line.

30

CONCLUSION

For these reasons, the Petition should be denied.

Respectfully submitted,

Dennis A. SCHOVILLE JEROME B. FALk, JR.

Louts G. ARNELL Counsel of Record

James S. IAGMIN STEVEN L. MAYER

SCHOVILLE & ARNELL, LLP KEITH D. KESSLER

1230 Columbia Street HowarD Rice NEMEROVSKI

Suite 800 CANADY FALK & RABKIN

San Diego, CA 92101 A PROFESSIONAL CORPORATION

(619) 232-9901 Three Embarcadero Center

7th Floor

San Francisco, CA 94111

(415) 434-1600

Attorneys for Respondents