Beyond State Farm: Due Process Constraints on Noneconomic Compensatory Damages
DeCamp, Paul, Harvard Journal of Law & Public Policy
INTRODUCTION I. THE HISTORY OF JUDICIAL REVIEW OF NONECONOMIC COMPENSATORY DAMAGES AWARDS A. The Origins of Judicial Review of Damages Awards for Excessiveness in the English Courts B. English Decisions Recognize the Conceptual Differences Between Reviewing Economic and Noneconomic Damages C. American Courts Adopt "Passion or Prejudice" or "Shock the Conscience" Approaches to Judicial Review D. To Compare or Not to Compare Awards in Other Cases E. Compensatory Damages and the Seventh Amendment II. THE INADEQUACY OF TRADITIONAL PROCEDURES FOR AWARDING NONECONOMIC COMPENSATORY DAMAGES AND REVIEWING VERDICTS A. Jurors Receive Inadequate Guidance or Evidence to Enable Them to Render an Informed Verdict B. Judicial Review of Awards of Noneconomic Compensatory Damages for Excessiveness Generally Lacks Principle or Predictability III. THE SUPREME COURT'S PUNITIVE DAMAGES JURISPRUDENCE A. Pacific Mutual Life Insurance Co. v. Haslip: The Court's First Procedural Due Process Evaluation of Punitive Damages 1. The Majority Upholds Common-Law Punitive Damages Procedures 2. Justice O'Connor's Dissent B. TXO Production Corp. v. Alliance Resources Corp.: A Plurality Recognizes a Substantive Due Process Prohibition of Grossly Excessive Punitive Damages 1. The Plurality Upholds the Verdict Under Substantive and Procedural Due Process Standards 2. Justice O'Connor's Dissent C. Honda Motor Co. v. Oberg: Procedural Due Process Mandates Judicial Review of the Amount of Punitive Damages Awards for Excessiveness D. BMW of North America, Inc. v. Gore: The Court Provides Substantive Due Process "Guideposts" to Determine Excessiveness E. Cooper Industries, Inc. v. Leatherman Tool Group, Inc.: The Court Requires De Novo Appellate Review of Excessiveness Analysis F. State Farm Mutual Automobile Insurance Co. v. Campbell: The Court Suggests a Constitutional Limiting Ratio of Nine-To-One IV. DUE PROCESS REQUIRES MEANINGFUL GUIDANCE TO JURIES AND MEANINGFUL JUDICIAL REVIEW OF NONECONOMIC COMPENSATORY DAMAGES AWARDS A. Trial Courts Should Inform Jurors of a Range of Noneconomic Compensatory Damages Awards in Factually Comparable Cases B. Trial Courts Should Exercise a Two-Tiered Review of Noneconomic Compensatory Damages Awards for Excessiveness C. Appellate Courts Should Exercise a Two-Tiered Review of Trial Court Rulings Regarding Excessiveness CONCLUSION
Punitive damages and noneconomic compensatory damages (1) share much in common. In the seventeenth, eighteenth, and nineteenth centuries, such damages were largely undifferentiated and, in some respects, interchangeable, with punitive damages serving in part as an avenue of recovery for types of intangible harms not yet expressly recognized as compensable. Unlike economic damages, which have long been subject to relatively robust judicial scrutiny, judges traditionally have left determination of punitive and noneconomic compensatory damages almost exclusively to juries, subject only to review under such amorphous standards as abuse of discretion, passion or prejudice, or "shocks the conscience."
Since 1991, however, the Supreme Court of the United States has decided a line of cases interpreting the Due Process Clause of the Fourteenth Amendment (2) as imposing limits, both substantive and procedural, on awards of punitive damages. Primarily in response to a concern that traditional modes of review were increasingly failing to reign in "runaway" punitive damages awards, the Court has dramatically increased the scope of judicial involvement in reviewing punitive damages awards for excessiveness. The Court's decision in State Farm Mutual Automobile Insurance Co. …