June 26, 2019

Oberlin College case triggers fight about Ohio's cap on punitive damages

We haven't yet written about the Ohio jury verdict awarding $33 million in punitive damages against Oberlin College, in a defamation case brought by a family-owned bakery.

For those who haven't heard about this case, The ABA Journal summarizes the basic facts: the bakery owners "sued the college and the dean of students after a shoplifting incident led to allegations the business practiced racial profiling. The allegations prompted student protests, which the family said was supported by the college."

We're not going to get into the political ramifications of that case.  You can find plenty of that elsewhere.  Rather, we're going to focus on a more nuts-and-bolts legal issue, namely, how Ohio's legislative cap on punitive damages will apply to the case.

First, a little background.  Ohio passed a cap on punitive damages back in the 1990s, but the Ohio Supreme Court struck that cap down as unconstitutional.  The state legislature tried again in 2004 and this time, after some change in personnel on the Supreme Court, the statute was upheld.

The statute limits non-economic damages to $350,000 and limits punitive damages to three times the amount of compensatory damages.  In this case, the parties dispute whether the punitive damages cap should be applied to the jury's full award of compensatory damages, or to the compensatory damages award after it has been reduced to comply with the cap.  They also dispute whether the caps apply to each individual cause of action for which relief was granted, or to the aggregate damages awarded.

The answers to these questions make a big difference in the ultimate outcome of the case.  According to Oberlin College's brief (link courtesy of Legal Insurrection), proper application of the caps results in a total award of just over $14.3 million.  According to the plaintiffs' brief, they are entitled to $25 million after the caps are applied.

However the trial judge resolves the issue, the case seems destined for appellate review.

UPDATE: (6/27/19): The plaintiffs have now filed a brief (link courtesy of Legal Insurrection again) arguing that application of the punitive damages cap in this case would be unconstitutional.  As noted, the Ohio Supreme Court already rejected a constitutional challenge to the statute, but the plaintiffs here argue that the Supreme Court's decision in that prior case held only that the statute was constitutional on its face, and left open the possibility that the statute might be still be unconstitutional as applied to a particular case.