March 26, 2021

Johnson & Johnson seeks SCOTUS review of Missouri punitive damages award

We previously reported on this talc case in which the Missouri Court of Appeal affirmed a $1.62 billion punitive damages award against Johnson & Johnson.  

Johnson & Johnson has filed a petition for certiorari in that case, raising the following issues:

(1) Whether a court must assess if consolidating multiple plaintiffs for a single trial violates due process, or whether it can presume that jury instructions always cure both jury confusion and prejudice to the defendant; (2) whether a punitive-damages award violates due process when it far exceeds a substantial compensatory-damages award, and whether the ratio of punitive to compensatory damages for jointly and severally liable defendants is calculated by assuming that each defendant will pay the entire compensatory award; and (3) whether the “arise out of or relate to” requirement for specific personal jurisdiction can be met by merely showing a “link” in the chain of causation, as the Court of Appeals of Missouri held, or whether a heightened showing of relatedness is required, as the Ford Motor Company in Ford Motor Co. v. Montana Eighth Judicial District Court has argued.

The first issue falls into a category that the Supreme Court has avoided thus far---the special concerns that arise when courts award punitive damages in mass tort situations.  The Supreme Court has repeatedly denied petitions raising these sorts of issues, but perhaps the eye-popping award here will make this the case that finally draws the court's attention.

The Court may feel that it has already answered "yes" to the first part of the second question, because the BMW and State Farm cases both held that a punitive damages award usually violates due process when it far exceeds a substantial compensatory damages award.  But the Court has not yet addressed the second part of that question, namely, whether in cases involving multiple defendants, courts can double-count the compensatory damages when calculating the punitive-to-compensatory ratio.  When this issue has come up in California, most courts have recognized that double-counting would result in an artificially low ratio, so our courts will generally calculate the ratio by comparing the punitive damages award against each defendant to that defendant's proportionate share of the compensatory damages award, taking into account the jury's allocation of fault.  It would be helpful to have a Supreme Court opinion validating that approach.

The third question seems to be DOA, now that the Supreme Court has ruled against Ford in the Montana case referenced in the question.

Law 360 has coverage of Johnson & Johnson's opinion here.