WASHINGTON – Moving again to rein in large verdicts that punish companies, the Supreme Court on Monday set aside a San Diego jury's award of $55 million against Ford Motor Co. for a rollover accident involving its popular Explorer.
In a one-line order, the justices told a California appeals court to reconsider the amount of the punitive verdict. The ruling does not affect the $27.6 million in compensatory damages that were awarded to a 51-year-old mother of two who was paralyzed after her Explorer rolled over in 2002.
Juries may award damages to compensate victims for wrongful injuries, and they can award additional money to punish the offenders. In the 1990s, the Supreme Court concluded that unrestrained punitive verdicts might violate the Constitution; since then, the justices have searched for a way to limit such damages.
In February, the court overturned a $79-million punitive verdict in favor of a deceased smoker from Oregon and ruled that it was unconstitutional to calculate the damages based on the harm suffered by other users of the same product. In that case, Philip Morris vs. Williams, jurors were told that thousands of smokers had been deceived by the advertising of the cigarette industry.
After losing in the California courts, Ford's lawyers appealed to the high court and argued that the jury in San Diego might have inflated its verdict after hearing that hundreds of people had been injured or killed in rollover accidents involving Ford Broncos or Explorers.
"Indeed, this case presents an even more graphic example of improper punishment for alleged third-party harms than Philip Morris," Ford lawyers Theodore J. Boutrous and Theodore B. Olson said in their appeal.
The court took their suggestion and sent the Ford case back to a California court "for further consideration in light of Philip Morris vs. Williams."
Though the action falls short of a reversal, Boutrous said he was pleased.
"This trial was so infected with improper and irrelevant evidence about persons other than the plaintiffs, and California's standards for imposing punishment are so vague and inscrutable, we believe the Supreme Court's recent decision … requires a new trial," Boutrous said Monday. "We are hopeful the California courts will agree."
A lawyer for the accident victim said the verdict was based on strong evidence that Ford had sacrificed safety for profit.
"I'm pretty confident the court of appeals will conclude their prior decision was correct, even in light of Philip Morris," said Dennis Schoville, a San Diego lawyer who represented Benetta Buell-Wilson.
On a January afternoon in 2002, Buell-Wilson was driving at a normal speed on Interstate 8 east of San Diego when she swerved to avoid a metal object that had fallen off a motor home. Her 1997 Explorer fishtailed and rolled over four times. Part of its roof was crushed, and Buell-Wilson suffered a severe spinal injury.
She sued Ford, contending the top-selling SUV had been defectively designed and was prone to rollovers.
Before the trial in San Diego, Ford had won 13 times in trials where plaintiffs had made similar allegations.
But in June 2004, the jury in Buell-Wilson's case socked Ford with a $368.6-million verdict. About a third was to compensate her and her husband for their injuries, including emotional suffering. The rest – $246 million – was intended to punish Ford for reprehensible conduct.
The verdict has been reduced twice, first by the trial judge and later by a state appeals court in San Diego. The compensatory damages for Buell-Wilson and her family were reduced to $27.6 million and the punitive damages to $55 million last year.
The California Supreme Court refused to hear Ford's appeal last year.
Corporations have fared better before the U.S. Supreme Court.
Now, the state appeals court in San Diego must decide whether to further reduce the punitive amount.