Case Name: WILLOW INN, INC., A Pennsylvania Corporation, v. PUBLIC SERVICE MUTUAL INSURANCE COMPANY, A New York Corporation Appellant
Court: United States Court of Appeals for the Third Circuit
Jurisdiction: United States
Decision Date: 2003-05-20
Citations: 66 F. App'x 398
Docket Number: No. 02-2145
Parties: WILLOW INN, INC., A Pennsylvania Corporation, v. PUBLIC SERVICE MUTUAL INSURANCE COMPANY, A New York Corporation Appellant.
Judges: Before ALITO, FUENTES, Circuit Judges, and PISANO, District Judge.
Reporter: West's Federal Appendix
Volume: 66
Pages: 398–400

Head Matter:
WILLOW INN, INC., A Pennsylvania Corporation, v. PUBLIC SERVICE MUTUAL INSURANCE COMPANY, A New York Corporation Appellant.
No. 02-2145.
United States Court of Appeals, Third Circuit.
Argued on April 10, 2003.
Decided May 20, 2003.
Edward M. Koch [Argued], Louis J. Brown, White and Williams LLP, Philadelphia, PA, for Appellant.
Howard G. Silverman [Argued], Kane & Silverman, P.C., Philadelphia, PA, for Appellee.
Before ALITO, FUENTES, Circuit Judges, and PISANO, District Judge.
Honorable Joel A. Pisano, United States District Judge for the District of New Jersey, sitting by designation.

Opinion:
OPINION OF THE COURT
PER CURIAM.
Willow Inn, Inc. ("Willow Inn"), a restaurant, bar, and residence in Willow Grove, Pennsylvania and an insured of Public Service Mutual Insurance Company ("PSM") at all relevant times, commenced this breach of contract and bad faith action, 42 Pa. Cons.Stat. § 8371 (2001), to challenge PSM's adjustment of its property damage claim arising from a windstorm on June 1, 1998. After a two day bench trial, the District Court found PSM liable to Willow Inn for breach of contract and bad faith, and awarded $2,000 in compensatory damages and $150,000 in punitive damages. The District Court granted Willow Inn's post-trial motion for attorney's fees and costs, but denied all other post-trial motions. PSM then filed this appeal.
On appeal, PSM raises four issues: (1) Did the District Court err in finding that PSM breached the contract of insurance between Willow Inn and PSM?; (2) Did the District Court err in finding that PSM acted in bad faith under the Pennsylvania Bad Faith Statute?; (3) Is the District Court's punitive damages award in the amount of $150,000 constitutionally excessive?; and (4) Did the District Court abuse its discretion in awarding attorney's fees and costs? This Court granted oral argument, but, after notice to the parties, limited the argument to the punitive damages issue.
Only days before oral argument was held in this matter, the United States Supreme Court filed an. opinion in State Farm Mutual Automobile Insurance Company v. Campbell, — U.S.-, 123 S.Ct. 1513, 155 L.Ed.2d 585 (2003), in which the Court, reinforcing the particular guideposts it enunciated in BMW of North America, Inc. v. Gore, 517 U.S. 559, 116 S.Ct. 1589, 134 L.Ed.2d 809 (1996), articulated the principles that courts shall strictly apply before imposing upon a defendant in a civil case a punitive damages award. In short, the three guideposts are: (1) "the degree of reprehensibility of the defendant's misconduct; (2) the disparity between the actual or potential harm suffered by the plaintiff and the punitive damages award; and (3) the difference between the punitive damages awarded by the jury and the civil penalties authorized or imposed in comparable cases." Campbell, 123 S.Ct. 1513, 2003 WL 1791206, at *7 (citation omitted). The District Court's written memorandum opinion, however, does not explicitly apply the Gore/Campbell guideposts, and simply concludes that a $150,000 punitive damages award is appropriate "[biased on the evidence presented at trial and in light of the aforementioned factors[," the character of a defendant's conduct, the nature and extent of the harm intended or caused to the plaintiff, and the wealth of the defendant]. While our review is de novo in determining whether sufficient evidence in the record exists to support a punitive damages award, Alexander v. Riga, 208 F.3d 419, 430 (3d Cir.2000) (citation omitted), we recognize nevertheless that the District Court is in the best position to first determine whether to allow a punitive damages award, and, if so, the quantum of those damages. To be sure, the District Judge presided over a two day bench trial, observed the demeanor of witnesses, listened to witness testimony, and gained an overall sense of the case.
Because the District Court did not have the benefit of the Campbell decision when it imposed upon PSM a punitive damages award, see, e.g., Casey v. Planned Parenthood of Southeastern Pennsylvania, 14 F.3d 848, 856-57 (3d Cir.1994) (discussing generally the mandate rule and the Supreme Court's mandate to lower courts), we vacate the District Court's Memorandum and Order filed January 4, 2002 and remand to the District Court for a determination on the punitive damages issue in accordance with the Supreme Court's dictates in Gore/Campbell. Oh all remaining issues, we affirm without further discussion.
Accordingly, for the reasons stated above, we affirm in part and reverse in part the judgment of the District Court.
. Although Willow Inn attempted to untimely file a cross-appeal, it ultimately withdrew it after the District Court denied a motion to extend time to file a notice of appeal under Rule 4(a)(5)(A)(i) of the Federal Rules of Appellate Procedure and after this Court requested briefs on the issue of timeliness.