August 1, 2008

CAOC Amicus Brief in California Supreme Court Covers Punitive Damages Issues in Roby v. McKesson

The Consumer Attorneys of California (CAOC) has filed an amicus brief in the California Supreme Court in Roby v. McKesson. As we mentioned in a prior post, the Court of Appeal in Roby reduced the ratio of punitive damages to compensatory damages down to 1.4-to-1. The plaintiff's petition for review attacked the Court of Appeal's ratio analysis, but the parties briefs on the merits have focused primarily on other issues.

Now CAOC has filed a brief devoted exclusively to the punitive damages issue. The main theme of the brief is that California Supreme Court review is necessary to provide guidance to the lower courts regarding the maximum permissible ratio in cases with substantial compensatory damages awards. That theme seems a bit odd to us. Why argue that "review is necessary" when the Supreme Court has already granted review? That's the sort of argument one would expect to see at the petition stage, not the merits stage.

In fairness, the CAOC brief touches on the merits as well. CAOC argues that California appellate courts have gone too far in adhering to the U.S. Supreme Court's statement in State Farm v. Campbell 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 clause."

CAOC says that statement in Campbell was dicta, but according to CAOC some lower courts have taken it as a license to substitute their view of the appropriate amount of punitive damages in place of the jury's decision. The brief doesn't identify the courts that have done this (other than the Court of Appeal in Roby itself), but we suspect the brief's author probably had in mind cases like Jet Source Charter, Inc. v. Doherty (2007) 148 Cal.App.4th 1, 11 and Walker v. Fire Ins. Exchange (2007) 153 Cal.App.4th 965, 975, both of which reduced punitive damages awards down to a one-to-one ratio. The courts in those cases probably did not think they were imposing their own view of the appropriate amount of punitive damages. They probably thought they were determining the constitutional maximum ratio, regardless of whatever amount they might otherwise deem appropriate. At least that's what they said they were doing.

CAOC's brief also argues that the California Supreme Court should clarify the circumstances in which a Court of Appeal should order a new trial on punitive damages rather than granting a remittitur. Ironically, on this issue CAOC is aligned with Philip Morris, which has previously asked the California Supreme Court to provide guidance on the same issue. (See Philip Morris's petition for review in Boeken v. Philip Morris Inc.)

In any event, CAOC should be pleased that the Supreme Court accepted the brief, unlike the amicus brief in Taylor v. Crane Co. et al. The online docket in that case indicates that the court rejected CAOC's brief because of multiple procedural defects.