February 5, 2008

Ohio Supreme Court Upholds Statutory Limits on Punitive Damages

In an interesting opinion, the Ohio Supreme Court recently upheld a state tort reform statute that limits punitive damages to three times compensatory damages among other provisions. The official summary of the opinion states that:

"In a 5-2 decision authored by Chief Justice Thomas J. Moyer, the Court ruled that legislation capping the amount of noneconomic damages that may be awarded to personal injury plaintiffs and placing limits on the amount of punitive damages that may be awarded in Ohio tort actions does not violate the constitutional rights of injured parties to trial by jury, to a remedy at law for their injuries, or to due process and equal protection of the laws. The Court also held that the challenged statutes do not violate provisions of the Ohio Constitution that guarantee open courts and the separation of powers between the legislative and judicial branches of government.

"The case involved multiple constitutional challenges to S.B. 80, legislation enacted by the General Assembly in 2004 which took effect in April 2005. One of the challenged provisions, R.C. 2315.18, limits the amount of “noneconomic” damages (damages for intangible injuries such as pain and suffering, loss of consortium, disfigurement, mental anguish, etc.) that may be awarded to a plaintiff in a personal injury suit to the greater of $250,000 or three times the amount of “economic damages” awarded to the same plaintiff based on the same injuries, up to an absolute maximum of $350,000. The bill makes an exception to those limits for plaintiffs who suffer permanent disability or the loss of a limb or bodily organ system. Another challenged provision in the bill, R.C. 2315.21, prohibits Ohio courts from awarding a plaintiff punitive damages that exceed two times the amount of his or her compensatory damages from the same defendant."

UPDATE (by Curt Cutting on 2/5/08 at 10:40 am): This decision is particularly interesting given the Ohio Supreme Court's history of striking down tort reform legislation, including restrictions on punitive damages, as unconstitutional. In 1999, the court struck down a prior statute that capped punitive damages. I'm certainly no expert on Ohio law, but this decision appears to represent a sea change in that state's high court, at least with respect to punitive damages.

FURTHER UPDATE (by Jeremy Rosen on 2/5/08 at 10:45 pm): To follow-up on Curt's point, a 2004 analysis of the Ohio Supreme Court describes its history of decisions striking down tort reform legislation passed by the Legislature and suggests that the court was then at a crossroads with a consistent 4-3 split. Perhaps the more recent opinion discussed above shows a new direction for that court.

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