Case Name: SOUTHERN UNION COMPANY, Plaintiff-Appellee, v. James M. IRVIN, Defendant-Appellant
Court: United States Court of Appeals for the Ninth Circuit
Jurisdiction: United States
Decision Date: 2008-11-07
Citations: 548 F.3d 1230
Docket Number: No. 06-17347
Parties: SOUTHERN UNION COMPANY, Plaintiff-Appellee, v. James M. IRVIN, Defendant-Appellant.
Judges: Before: STEPHEN REINHARDT, JOHN T. NOONAN, and FERDINAND F. FERNANDEZ, Circuit Judges.
Reporter: Federal Reporter 3d Series
Volume: 548
Pages: 1230–1236

Head Matter:
SOUTHERN UNION COMPANY, Plaintiff-Appellee, v. James M. IRVIN, Defendant-Appellant.
No. 06-17347.
United States Court of Appeals, Ninth Circuit.
Submitted Nov. 26, 2007.
Filed Nov. 7, 2008.
Robert A. Mandel, Greenberg Traurig, LLP, Phoenix, AR, for defendant-appellant.
Tom Q. Ferguson, Doerner, Saunders, Daniel & Anderson, L.L.P., Tulsa, OK, for plaintiff-appellee.
Before: STEPHEN REINHARDT, JOHN T. NOONAN, and FERDINAND F. FERNANDEZ, Circuit Judges.
The panel unanimously finds this case suitable for decision without oral argument. Fed. R.App. P. 34(a)(2).

Opinion:
Concurrence by Judge REINHARDT; Dissent by Judge NOONAN.
ORDER
The jury in this case awarded $975,181 in compensatory damages to Southern Union Company, of which it assessed forty percent or $395,072.38 against James M. Irvin, and went on to assess an additional $60,000,000 of punitive damages against him. On appeal, we vacated the punitive damage award, which amounted to punitive damages of over 153 times the compensatory damage award. See S. Union Co. v. Sw. Gas Corp., 415 F.3d 1001, 1009 (9th Cir.2005) (S. Union I). We then remanded for a remittitur or a new trial on damages. Id. at 1011. The district court offered Southern Union the opportunity to accept a remittitur of punitive damages to $4 million, that is a punitive damage award at slightly over ten times the compensatory damage award. Southern Union accepted. Irvin again appeals.
Due Process "prohibits the imposition of grossly excessive or arbitrary punishments on a tortfeasor." State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408, 416, 123 S.Ct. 1513, 1519-20, 155 L.Ed.2d 585 (2003). No "simple mathematical formula" exists in this area. BMW of N. Am., Inc. v. Gore, 517 U.S. 559, 582, 116 S.Ct. 1589, 1602, 134 L.Ed.2d 809 (1996).
Nevertheless, the Court has pointed to three guideposts: "(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." State Farm, 538 U.S. at 418, 123 S.Ct. at 1520. In considering them, our goal is to determine whether the punitive damages achieved their ultimate objectives of deterrence and punishment, without being unreasonable or disproportionate. See Exxon Shipping Co. v. Baker,-U.S.-, 128 S.Ct. 2605, 2621, 171 L.Ed.2d 570 (2008); State Farm, 538 U.S. at 419, 426, 123 S.Ct. at 1521, 1524.
Here, the parties have not pointed to other similar cases, if, indeed, there are any, or to comparable penalties authorized for similar conduct. We therefore begin by looking to the other two guideposts.
We have already touched upon the second of them, and we do find the over ten to one ratio disquieting in this case, although choosing a correct ratio among the infinite number of ratios theoretically available is no easy task. It is a guide-post we will return to after first considering the reprehensibility issue; that is the issue that the Court itself has referred to as the most important of the guideposts. See BMW, 517 U.S. at 575, 116 S.Ct. at 1599; see also State Farm, 538 U.S. at 419, 123 S.Ct. at 1521.
As we see it, most of the indicia of reprehensibility do not appear here. See State Farm, 538 U.S. at 419, 123 S.Ct. at 1521; Planned Parenthood of Columbia/Willamette Inc. v. Am. Coal. of Life Activists, 422 F.3d 949, 957-60 (9th Cir. 2005). Any harm caused was not to some poor struggling person; it was inflicted upon a very large company—one that Irvin claims to have thought was unsavory, by the way. Moreover, the harm was not physical; reckless disregard of the safety of others was not involved; Southern Union was not financially vulnerable; and the incident was isolated, although it was not a mere accident. When we say that the incident was isolated, we do not intend to condone Irvin's actions either at the time of the wrongdoing or at trial. That is, we do not overlook the fact that Irvin held an important public position, which gave him great power to aid or wrong others. Irvin, as the evidence showed, abused and misused his power and caused significant damage to Southern Union — he has been ordered to pay close to $400,000 of compensatory damages for that. But, the evidence does not prove that Irvin obtained (or sought) any personal gain from his actions, certainly no gain of a financial nature, whether or not that was the case.
So, as is always true, we return to the question of how much is enough, and of when the constitutional limit is reached. Irvin is far from commendable, but he has not inflicted egregious physical or economic harm upon the weak, and we cannot even say on the basis of the evidence that he sold his office for financial gain. He will also have to pay compensatory damages. That award of damages was not paltry or minimal by any means. It was substantial. Undoubtedly Irvin's behavior outraged the jurors and the district judge, all of whom listened to and saw him in the close quarters of a courtroom setting. Still, wrong and wrong-headed though he is, we do not see constitutional justification for calling down the wrath of Apollyon upon him and his finances.
In fine, as we see it, the Constitution permits a three to one ratio of punitive to compensatory damages in this case, but not more. That is the sum of $1,185,217.14 in addition to the compensatory damages of $395,072.38. In selecting this ratio, we have considered whether the amount of punitive damages it results in is commensurate with achieving the two purposes we have mentioned without exceeding the constitutional limit. We have determined that it is in this case. In so stating, we emphasize that where the constitutional limit lies with respect to punitive damages will vary from case to case. Determining that limit is an art, not a science; no mathematical formula controls; no single asymptote defines the limit for all cases.
We see no proper reason to remand this case to the district court for further proceedings regarding punitive damages. "Having already afforded the district court an opportunity to review the award[] in the first instance, we believe it is appropriate to remit rather than again to remand." Planned Parenthood, 422 F.3d at 963.
Therefore, we reverse the district court's judgment regarding the punitive damage award, and vacate it. We reduce the award to the amount of $1,185,217.14. We also remand so that the district court may order a new trial unless Southern Union accepts the remittitur. If accepted, post judgment interest shall run on the reduced award from the date of entry of the original judgment, August 14, 2003. See Planned Parenthood of Columbia/Willamette Inc. v. Am. Coal. of Life Activists, 518 F.3d 1013, 1022 (9th Cir.2008).
REVERSED and VACATED as to the amount of the punitive damage award and REMANDED. The parties shall bear their own costs on appeal.
. It is worth noting, however, that when the Supreme Court selected a ratio for federal maritime law purposes, rather than constitutional purposes, it saw a ratio of one to one as the "fair upper limit." Exxon Shipping, 128 S.Ct. at 2633.
. At trial, Irvin actually sought to impede the jury's search for truth. S. Union I, 415 F.3d at 1008.
. The Commission of which he was a member "has sometimes been dubbed the fourth branch of the government of Arizona." S. Union I, 415 F.3d at 1014 (Fernandez, J., concurring and dissenting).