Warren E. Burger: We’ll hear arguments next in 1318, Krause against Rhodes. Mr. Sindell, you may proceed whenever you’re ready.
Steven A. Sindell: Mr. Chief Justice, may it please the Court. I don’t believe that this case can be decided with respect to the questions of law that are presented without a reference, at least some reference point to what the record contains with regard to the facts and I think something has to be said in that regard. The complaint filed in this action clearly state what would otherwise be a cause of action as at least, I can best understand it. We have alleged that four innocent students were shot on a college campus without any justification. We have alleged, members of this Supreme Court, we have alleged that the Governor and the Generals conspired intentionally to deprive these people with the specific intent and bad faith in effect of their rights under the Federal Constitution and under 1983. We have alleged that these facts are true and that they can be proven. We were confronted with a motion to dismiss on which as I understand it and notwithstanding any affidavit that was ever filed, and this record contains, if anything, the liberal invocation of the privilege against self-incrimination by some of these defendants. We have alleged, in these cases, that there was no justification for it and nevertheless, and not withstanding that and based upon what we felt in effect were news media accounts of this incident that the passions of the headlines were substituted for the rules of evidence in this case. And I quote specifically, where the concurring opinion in the lower court said that “the pleadings clearly contrive to hide rather than disclose the true background of the events” and the predicated causes of action without disclosing their true subject matter, without any evidence before that Court to so find, that is exactly what was said. The majority opinion in the lower court is infected with statement after statement that there was a riot, that there was an insurrection, that there was a rebellion and members of this Court, even the Governor of the State of Ohio the after it occurred never used a word like that, in his proclamations to justify it, not one word to that effect, nevertheless, the Court has so found. Now, I’m not suggesting anything except that there is a colorable claim. What as juxtaposed to these allegations have the defendants set? They have invoked the privilege against self-incrimination at least nine times in response to material interrogatories and more importantly, if we are going to take judicial notice, let us then take judicial notice of one responsible investigative organ of this nation and that is the Federal Bureau of Investigation, where it was specifically stated and I’m quoting at pages 24 and 25 of our brief things like these. “We have some reason to believe that the claim by the National Guard that their lives were endangered by the students was fabricated subsequent to the event. One guardsman admitted that his life was not endangered and that he fired indiscriminately into the crowd. He further stated that the guardsman had gotten together after the shooting and decided to fabricate the story that they were in danger of seriously bodily harm or death from the students. No, the guardsmen were not surrounded. No guardsman claims he was hit with rocks immediately prior to the firing. There was no sniper. Some guardsman are known is yet had to be physically restrained from continuing to fire their weapons,” directly quoted. The people shot in this case were over a football field away. One man sits here today in a wheelchair for the rest of his life. And I say that if we are going to substitute in the Court of Law, in the Court of Appeals, news media headlines or whatever predilections of the facts the Court may have for the presentation of evidence in its orderly course then I say that we have really reached the stage where the rudimentary concepts of due process of law have been violated and I think that would be a shocking departure from procedure at least as I’ve always understood it in the past. We have here a situation where there was no claim of insurrection. There is no evidence in this case, not only the day after the shooting and having this proclamation did he use insurrection, rebellion, invasion, riot, tumult or any such words, but Your Honors, in addition to that, months later with the advice presumably of competent counsel, my brother here, then he indeed not say anything more than if there were threatened disorders and breaches of the peace in the answers to interrogatories that are part of the record of this Court. The President’s Commission on Campus Unrest said that this shooting was unwarranted, inexcusable and unjustified. It is our view that the rules of evidence cannot be supplemented by the factual predilections of a judge reviewing a complaint not a summary judgment motion, but a complaint. Now, specifically dealing with the question of immunity and I think it’s important that we do that here, in this regard. In Sterling against Constantin, that Supreme Court was confronted with a situation where a Governor, Governor Constantin had issued a proclamation which was stronger than the one issued by Governor Rhodes. It said that there was an insurrection. It said that there was a rebellion. It said that there was a state of affairs which justified the calling of martial law. And nevertheless, the District Court went on to find behind those allegations of the Governor in his proclamation that that wasn’t true. And in fact, no such thing existed except what they characterized as breaches of the peace and when the Governor and the Generals came to this Court and said, “We are immune under the Eleventh Amendment,” this Court specifically held that a Federal Court has ample jurisdiction to determine the veracity of those allegations with evidence properly presented before them. And I think the case of Moyer against Peabody is clearly distinguishable from this one And I want to address myself to that point. Indeed, Moyer was a 1983 action and there’s no question about that. But what is important to recognize about Moyer and again I must return to the facts because I think they’re critical. In that case, the Governor and the complainant both agreed on two things. They agreed, number one, without dispute that an insurrection existed and they agreed that the Governor acted in good faith. Those were stipulated facts before that Court and I quote the language when I say that the Court, the Supreme Court, in its opinion said, “we are here assuming that there was no insurrection, excuse me, that there was an insurrection and that he exercised good faith and the only claim is that he was unreasonable in arresting Moyer under those circumstances.” Now, this is not such a case. There is no agreement amongst counsel in this case that a state of insurrection existed. Instead, we have alleged there was a peaceful gathering on a college campus with bullets intervening, the break up what otherwise was a peaceful gathering on a college campus. Now, if we can't prove that, then we should lose. But if we can prove it, it’s not a Moyer case. We do not agree, as counsel did in Moyer that there was good faith on the part of the Governor. To the contrary, it is our allegation in this case, and it is our intention to prove that the Governor was personally involved in this situation. That as Commander-in-Chief, remember this was a trial several days before the Republic Senator, senatorial primary and without editorializing on the validity of the law and order position that he was taking the fact is that that was his position that he advanced in that particular situation and here was threatened disorder and he just wasn’t sitting behind his desk, receiving information of an alarming situation and sending troops out, he went down there to that campus, the day before this incident occurred. He made a speech in the presence of the Commanding General --
Thurgood Marshall: Mr. Sindell, --
Steven A. Sindell: Yes sir.
Thurgood Marshall: How far you can go away from this record?
Steven A. Sindell: I would want to -- I want to stop going away from this record for this reason.
Thurgood Marshall: You’ve been talking about 15 minutes, you’ve gone --
Steven A. Sindell: Your Honor, I want to go to Court and I want to prove these things and the reason that I bring these things into the case is to, is simply because three of the reviewing judges in this case, three of them, have gone outside the record and refused to believe that the allegations were true. That’s why I go outside the record not to convince you that what I say is proof as a matter of law, but to convince you that there are allegations which weren’t the right to present evidence in a Court.
Thurgood Marshall: I don’t have to try you, do I? I don’t have to follow you outside directly to keep that, do I?
Steven A. Sindell: All you have to do is agree with me that the complaint’s allegation should be taken as true and it seems to me that we’re entitled to prove them. I would like specifically, in regard to the Eleventh Amendment intention and I’d like to address myself to that for a moment. It seems to me that the distinction that has been made here between a statute that an unconstitutional action under a statute that is allegedly unconstitutional is different than an action which is just plain unconstitutional because of the nature of the action, really was never intended as a distinction to be engrafted upon the Civil Rights Act at all. Congress intended to reach the unconstitutional effect if I understand the decisions of this Court. It says, “Every person who acts not under a statute, not under without a statute, within the statute, every person who acts under color of law to violate the constitutional rights of another is libel for that action.” Every person and it doesn’t engraft any distinction at all. The only reason we’re not seeking an injunction in this case and it says in that statute, an action at law equity or other proper redress the breadth is broad. We can't seek an injunction in this case. All we have is the available remedy of damages. That’s obvious from the circumstances and therefore we are well within the terms of the Civil Rights Act and to say that only where a statute exists that’s unconstitutional, can the Civil Rights Act apply as to I think emasculate the very purpose that Congress had in mind which was to reach the State official himself for the affect of what he did. And this Court has never held for example in dealing with police officers in Monroe against Pape or Egan against the City of Aurora, in any of those cases that because they were acting under color of a valid statute, that therefore for some reason, they were immune. That would be inconsistent, I think with the entire purpose of the Civil Rights Act. They were conducting actions not under a statute, but on their own which were unconstitutional, which violated the rights of those individuals, and therefore, they were held inappropriately so by this Court to be within the purpose and intent of the Civil Rights Act. It seems to me that cases like Ex parte Young, Sterling against Constantin, Griffin against the Board of Prince Edward County, all the way ranging from the passage of the Civil Rights Act right up until the present time have all held that where an injunction is the appropriate form of redress, the Civil Rights Act makes no distinction between damages and injunction. That issue has been raised here and I don’t think there is any difference because the Sterling specifically holds that an injunction is a more extraordinary remedy and damages is a less extraordinary remedy and other cases if so held as well of this Court and I don’t see the difference. It depends on the remedy that’s needed. It would seem on the damage that has been done and not upon the nature of the relief sought. Congress never intended, as I read the legislative history, as interpreted by this Court, to make a distinction between damages and injunctive relief as to whether or not there’s immunity. I never read that in any of the decisions and I don’t think it’s supportable by any of the rules of law that have been promulgated by this Court and I’m thinking of cases like Mitchum against Foster, Monroe against Pape, Zwickler against Koota and particularly those various circuits like McLaughlin against Tilendis, Jenkins against Averett was a damage action, many cases under the Civil Rights Act about damages where damage is the appropriate remedy. And what I think is critical here is that we did bring a case against the State of Ohio. We sued the State in its own Courts. We brought that case and we contended that the Doctrine of Sovereign Immunity was unconstitutional in violation not only of the Ohio Constitution, but the Federal Constitution.
Byron R. White: What’s the statute where you would think that (Inaudible) 1983 as an action?
Steven A. Sindell: Mr. Justice --
Byron R. White: I know you alleged in the complaint intentional wrong, but certainly you think that that would state a cause of action. How much further would you say would the section reach?
Steven A. Sindell: It seems to me, Mr. Justice White in this regard and I don’t mean to not answer your question, but I do want to emphasize that we couldn’t have alleged anything stronger, but taking it a step down, it seems to me that perhaps negligence in the tort sense may not be appropriate --
Byron R. White: You would say, it was not -- if it were reasonable for a person to understand that a certain act did not violate the law, he hasn’t been negligent?
Steven A. Sindell: Well, that’s the tort standard as I understand it, reasonable conduct under the circumstances.
Byron R. White: So it really doesn’t depend on how it final it turns out whether it violated the law or not?
Steven A. Sindell: Well, I think that it’s critical too as you point out. I think it’s critical to an interpretation of the Civil Rights Act to ask what the state of mind of the person you’re suing is, in addition to what the result was. A mere accident can cause a terrible tragedy and yet not create liability. It is my suggestion to this Court that the appropriate standard that occurs to me for a police type situation is in Jenkins against Averett. A case before the Fourth Circuit, I believe, where it was held that in that particular case, an act of wanton misconduct, a very high degree of reckless was sufficient to establish a cause of action --
Byron R. White: But they would require at least that?
Steven A. Sindell: At least a high degree of recklessness. Yes. I would say that would be the appropriate standard but I would not suggest to you that a lower standard is not possible. I’m simply saying that as the state of this case is now, I don’t see how we could have alleged anything stronger and that’s really what I’m suggesting in this particular situation. I would emphasize that with respect to the Eleventh Amendment claim, Your Honors, that this case is not a case against the State. The State is not a party to this action. No money is being sought from the State Treasury at all. No judgment rendered in this case will require a state official to take any action or prohibit a state official from taking any action. This is not an action even against State officials. The present defendants in this case aren’t even officials from the State of Ohio at all and I would suggest that the entire body of Eleventh Amendment law as I read it suggests that in such a case where the individual act is allegedly unconstitutional that that is not barred by the Eleventh Amendment and I think Sterling specifically so holds. What is being attempted and I think this is the critical distinction here and if I understand the defendant’s argument is that we shouldn’t just consider these things, but we should ask ourselves what will be the effect on the Governor in the future. How fearful will the Governor be, the Chief Executive be or other executives below him and I might add it goes all the way down to the trigger man in this particular case and the Court held that everyone to be immune not just the Governor, but let’s ask that question. What will be the effect that the State Government will not be able to operate that people will be fearful that they will have come in and defend lawsuits and so on and so forth, if I understand that argument correctly? And I would have this to answer to it. I would say that that argument can be made in every single case under 1983. There is no case where it cannot be argued that the effect of suing an individual for damages for violating constitutional rights be the Governor or anyone else would not have some effect on their future conduct, would not give them some “pause for concern,” would not inconvenience them in some way, but it is my suggestion that the Act was exactly what Congress had in mind. That was the very effect that was intended. Congress passed the Civil Rights Act in part to deter this very kind of thing and if we are to give meaning to that enactment, I think we to recognize that the purpose and intent of that particular enactment was to effectuate the deterrence that any tort remedy has and this a congressionally sanctioned tort. As I understand Section 1983, it is both a compensatory tort action as well as having a deterrent effect and the deterred effect that is complained of here is the very purpose of enactment in the first place and so to say, that because it has an effect, that should be the reason to bar suits. For that reason alone, it seems to me that that run completely contrary to the whole intent. It seems to me that if this Court should hold and we’ve sued the State of Ohio which has immunized itself in the state courts, If this Court holds that this too is an action against the State, then we are really left without a remedy. We have no place to go. Then this Court has permanently and forever foreclosed any right to appear in a Court of Law anywhere against anyone to test the allegations in these complaints and to establish any form of redress. This Court will -- “This is it! This is our last opportunity to have redress. There will be none. We can't sue the State in its own Courts and we can't if this Court should hold we can't sue here and we’re without redress.” And finally, I would like to conclude with the question of immunity as it applies to legislators and judges and that has been raised and I am cognizant of Pierson against Ray and Tenney against Brandhove, and I think this is very important. First of all, let me say that I have some empathy with the dissenting opinions of Mr. Justice Douglas in those cases that a dishonest legislature if it so alleged and a dishonest judge should be subject to suit, but we have those decisions and they stand as they do now and I suggest this. That after all a legislative process and a legislator is involved in a deliberative thing, the result of what he does is open to the public. He has the opportunity, first he must concur with other people. If his enactment is going to be harmful, a Court can review it. All of this process can take place and there is full opportunity for the public in the democratic process to participate and so perhaps we can say as does our Constitution that a legislature shall not be examined in any other place and with the judge, the same is true. It is an open process, presumably, a deliberative one.Before any finality takes place, a Court can review that action, but such is not the case with an executive. In the case of an executive, you have a situation where the actions maybe or may not be taken with deliberation, but not necessarily with public participation at that time. The Governor, in theory, in his own chambers and secretly without making it public, open up and decide to wheel the weapons of death without any such legislative or judicial process as a result which the instant action of a bullet terminates a youngster or man or anyone’s life. Now, it seems to me that the executive immunity is applied in that situation is clearly distinguishable from what occurs with the legislator and with the judge. And under those circumstances, I suggest to you that to say that they are all in the same kind is contrary to the purpose of the Civil Rights Act itself. To say that a Governor cannot even be or a General or a guardsman cannot be even subject to inquiry and we -- only has that he acts honestly in this case, we say he can make a mistake, that’s okay. Is that he act honestly, that is the only claim we make and I suggest to you to say that we can't even inquire into his honesty which has never been subject to any open democratic process is in effect to seriously endanger the citizenry and to give a Governor or Generals an absolute unbridled license without any review or inquiry at all except who knows how long after in the electoral process. I don’t think that’s the intent of the Civil Rights Act at all and I would like to reserve whatever remaining time I have, unless there are questions, for rebuttal.
Warren E. Burger: Very well. Mr. Alloway.
R. Brooke Alloway: Mr. Chief Justice, may it please the Court. I’d like to address a preliminary remark as to my posture in this case while I am of counsel in both the Scheuer case which has just been heard and the Krause and Miller cases which are being heard together at this time. I represent Governor Rhodes in his individual capacity and I am fully cooperative with all defense counsel in this case and I endorse my brother, Charles Brown’s argument in all respects. There are some things that I believe are applicable peculiarly to Governor Rhodes which ought to be brought to the attention of the Court. I’m prepared to answer questions on any aspect of the case, but my argument in chief will be addressed to the Governor Rhodes’ position primarily. There has been a great deal of talk about the case of Sterling versus Constantin as it may have limited or may not have limited ex parte Moyer. I believe it did not limit it in any material respect. The requirement of Sterling versus Constantin is expressed at 287 United States 399 by virtue of his duty to cause the loss to be faithful executive, faithfully executed. The executive has appropriately vested with the discretion to determine whether an exigency requiring military aid for that purpose has a arisen. His decision to that effect is conclusive. Now, the way Sterling versus Constantin arose there were stipulations and there was evidence taken which made it appear to the Court, to the District Court which had also had some prior jurisdiction on some of the same controversy that this exercise of discretion on the part of the Governor of Texas was not in entire good faith, that is, it was not within the limits of his discretionary power. Since he was using it for the purpose of controlling the production of oil, even though the expression was made that there were tumultuous conditions, the proclamation, I might say, in the Sterling case is very similar to the proclamation in the instant case. That is, I am speaking of the proclamation of April 29th, 1970. But in this case, the Governor was exercising as executive discretion with respect to calling out the guard and had proclaimed that there were riotous conditions, that there was tumult, that there was danger to persons and property and this, the Court of Appeals and the District Court felt was a matter of judicial notice. That there was sufficient notoriety in the situation of the campuses in Ohio and indeed throughout the nation in May of 1970 that the Court could not effect to be ignorant of the situation. My brother, Mr. Sindell, has made a very emotional argument with respect and running along pretty much along the lines of his brief, but he does not get into the actual allegations of the complaint. If one goes to the actual allegations of the complaint, one must find that there are only mere conclusions as to the part which Governor Rhodes took in the matter other than the fact that he did issue a proclamation and that he did call out the guard. In order to state a cause of action, here, I can understand that the question might be anticipated just what can a plaintiff do. Suppose a governor maliciously and corruptly and wantonly and evilly, let us say, decides to call out the National Guard for the specific purpose of extinguishing a life. If he does that, surely there are facts which could be stated in a complaint other than the bare conclusion that the defendants conspired to deprive the plaintiff or the decedents of their Civil Rights in each of these cases. There are -- there must be other facts available which could be pleaded which would support that situation. Obviously, there are not and obviously, there was a situation in which it could not be reasonable to conclude from the allegations of the complaint itself in either of these cases or in any of these cases. That the Governor conspired and -- evilly, corruptly and we can use other adverbs, to deprive these decedents of their civil rights. These conclusions are not reasonable under the facts well-pleaded in the complaints. Therefore, we submit that the judgment of the District Court below and that the judgment of the Court of Appeals and the majority of the two was correct that the 12 (b) (1) motion to dismiss was properly sustained. We submit further that there are other reasons on which looking only at Governor Rhodes’ particular situation one must conclude reasonably from the allegations of the complaints that there were substantial intervening causes, if anything, in connection with Governor Rhodes’ proclamation cause the death of these unfortunate people. There were intelligent intervening substantial forces which intervened between the proclamation which is all that is actually shown to have been promulgated by Governor Rhodes. Therefore, on other grounds, the motion to dismiss would properly have been sustained. I submit also that the question of whether a state employee, if a National Guard can be an employee or a state officer, whether the Doctrine of respondeat superior applies and in this instance, we submit that there is no authority for applying the Doctrine of respondeat superior so as to bring Governor Rhodes within the ambit of a proper action against him in these cases. And for all of those reasons and for the reasons, my brother, Mr. Brown has set forth, I would say that Governor Rhodes is in a fortiori situation with respect to all of the defendants. We must bear in mind that there are only seven defendants in this case. There are, as Mr. Sindell refers to them, the trigger man, there are no persons alleged to have been trigger man in these instances. And those must be taken as admissions in the briefs and as judicial admissions that there are no persons who are so charged in this case. So, with respect to Governor Rhodes, any liability which applies to him must be on the Doctrine of respondeat superior which we suggest is clearly not applicable. I have nothing --
Potter Stewart: As I understood the complaint, the allegation was that he ordered out the National Guard onto that campus at a time when he knew -- when he himself knew or should have known that arming them with live ammunition and sending them there in their state of training was an imminent danger to the lives of the students on that campus and that’s alleging personal culpability on his part not on any Doctrine of Respondeat Superior. Isn’t that correct under this complaint?
R. Brooke Alloway: I would say if the arming of the National Guard is in and of itself an act on his or is a culpable act, yes just as he is personally charged with having issued the proclamation which called out the guard. Yes, he is, if that is a culpable act, he is culpable. I submit that neither of those acts is one on which culpability can arise because the training of the guard is and this is a matter of judicial notice and is in the record, that the training of the guard is under the supervision of the United States Government and was at that time. The training of the guard was a responsibility of the United States Military Officers and the duty, the constitutional and statutory duty of Governor Rhodes was to call out the guard and the arming of the guard and the actions of the guard were the responsibility of the individuals and of any commanding officers who issued commands. I would submit that the act of calling out an armed guard is the risk that one takes anytime a National Guard unit is called out. It is within the realm of possibility that in the discretion of officers having discretion, there may be live ammunition used.
Potter Stewart: Because we’re dealing Mr. Alloway, are we not, with the allegations of the complaint?
R. Brooke Alloway: Yes.
Potter Stewart: And we, for the purposes of this case in its present posture under well settled principles of law, we must assume they’re all true. All those well pleaded allegations are true in facts, that’s correct, isn’t it?
R. Brooke Alloway: I think I should place the emphasis on the words well-pleaded.
Potter Stewart: Yes, but what I said is generally accepted.
R. Brooke Alloway: Yes, it is certainly an accepted proposition, yes. And I would place strong emphasis on the matter of the words well-pleaded because I would submit that this Court should not approve retrospectively or prospectively the irresponsible use of inflammatory language in pleadings, and therefore, then take the allegations as true.
Potter Stewart: Of course, the claim of your brother on the other side is that a very serious error was made by the Court of Appeals when they disregarded the allegations of the complaint and instead called upon what they understood to be their personal knowledge or judicial knowledge of what the true facts were and that the majority of the Court of Appeals therefore violated what you and I have just agreed is a fundamental, very elementary principle of law that on a motion to dismiss, the well-pleaded allegations of the complaint are assumed to be true?
R. Brooke Alloway: Plus, if Your Honor please, matters of which the Court can properly take judicial notice and the only fact which I’m suggesting --
Potter Stewart: Well, as far as that go. I can understand that if a complaint depended upon the plaintiff's allegation and he was Napoleon Bonaparte, for example that a Court could assume that probably wasn’t true, but beyond the extreme cases like that, how many exceptions are there to this rule?
R. Brooke Alloway: I would say, Your Honor, that one exception to the rule would certainly be the situation of the campuses in the State of Ohio and in the, over the country generally in May of 1970. And that there were at those times riotous situations where unusual measures had to be taken.
Potter Stewart: Well, that may well all be very true, as a matter of fact, but we have here a lawsuit in which a complaint was filed, making certain allegations which as I read them are not emotionally charged allegations. They are very serious allegations and a motion to dismiss. What you say may all be very true, as a matter of fact and they all come out in the trial, but this is a motion to dismiss the complaint?
R. Brooke Alloway: That is correct.
Potter Stewart: And isn’t -- didn’t the Court err in saying, “Well, whatever the complaint may say, we know that the real facts are such and such and therefore, the District Court was correct in dismissing the complaint?
R. Brooke Alloway: If the Court did commit error in respect of its statements, nevertheless, the judgment of the Court taking the narrowest construction of any judicial notice which it had a right to take was sufficient on which to dismiss the complaint. I would say, Your Honor, that for instance, the proclamation of Governor Rhodes is a document of which judicial notice could and should properly have been taken judicial notice. And that the facts well-pleaded plus properly judicially noticed facts are sufficient. Now, I would suggest, for instance, if the Court please, that if we’re going to take facts well-pleaded and let’s say that we have to allege in order to plead a cause of action that there were no roving bands of men bent upon destruction of property and endangering life, that allegation might have been made, but it was not made. That would not have been a conclusion. That would have been a statement of fact. I would submit that it’s a conclusion that the plaintiff’s attorney could not in good conscience have made, but it would be a statement of fact that would be one. If we would take for instance a statement that the ROTC building did not burn down the night before in the City of Kent, that would be an allegation of fact. It would not be an allegation which the plaintiff could in good conscience make, but it would be an allegation of fact which would support the complaint beyond the support that it needs, beyond the support which it does not have.
Warren E. Burger: Well, are you saying that the Court could take judicial notice of the specific item you’ve just mentioned, namely the burning of the ROTC building?
R. Brooke Alloway: I would say, if the Court please, that the Court could take judicial notice of generally disorderly conditions in the area of Kent, Ohio including the Kent University campus. Therefore, we are in the situation where Sterling versus Constantin applies to make the action of the Governor of Ohio not reviewable. If not being reviewable, I would say further that the natural consequences of his act are also not reviewable under the Doctrine of Executive Immunity. Under that, the Court had sufficient before it to make those determinations of fact in a general way. Whether or not the Court could take judicial notice of the specific fact of the burning of the ROTC building, I would be of the opinion that it could. That was a widely-known fact, that was perhaps almost as widely-known effect, certainly as widely-known in the Midwest area as the killing of Donald or Lee Harvey Oswald by Jack Ruby. The burning of the ROTC building was a notorious event viewed by millions of people.
Thurgood Marshall: But could the court take judicial notice that there was “insurrection” on the campus in Kent?
R. Brooke Alloway: I would say that the Court might do so, although I don’t think it’s necessary for the Court to do that because insurrection is not a sine qua non of the proper exercise of the discretionary power of the Governor to call out the guard.
Thurgood Marshall: But my point is, is it outside of the judicial notice? You take judicial notice that Kent University there or it has 18 buildings, but insurrection is a rather complicated legal term --
R. Brooke Alloway: It is a --
Thurgood Marshall: -- which is the basis of the lawsuit.
R. Brooke Alloway: It is a very complicated term. I don’t think it is a term which we necessarily must find in order to find the judgment of the Court of Appeals and of the District Court.
Thurgood Marshall: Well, would all of the other terms that are on the Governor’s proclamation, can the Court take judicial notice that they are correct?
R. Brooke Alloway: I’m sorry. I don’t believe I follow that.
Thurgood Marshall: Didn’t the proclamation say there is insurrection and this and that in the Governor’s proclamation?
R. Brooke Alloway: Yes.
Thurgood Marshall: Well, can the Court take judicial notice of those statements, are facts that are true?
R. Brooke Alloway: I will have to confess to you, I have not thought about it and I think that I would say, probably not. That Your Honor has just said that the term insurrection is a very complicated term which is widely embracing and has many legal consequences.
Warren E. Burger: That’s a legal conclusion not a fact?
R. Brooke Alloway: It is a legal conclusion and not a fact, that’s correct.
Thurgood Marshall: But in this way, you got positive allegations on one side and on the other side, all you have is the Governor’s proclamation, right?
R. Brooke Alloway: Well, we have the Governor’s proclamation, but we have some specific facts in the Governor’s proclamation that in the territory of northeastern Ohio, there were roving bands of men who were committing acts of violence.
Thurgood Marshall: Well, can the Court take that as true?
R. Brooke Alloway: I think the Court can take that as true. It is a fact. It is a fact as distinguished from a conclusion.
Thurgood Marshall: So, whatever the Governor says is a fact but whatever the petitioner say is not, where to the contrary the rule say that you must accept all well-pleaded facts in one paper. It does say any, about that other paper.
R. Brooke Alloway: Again, I respectfully --
Thurgood Marshall: Am I right?
R. Brooke Alloway: -- emphasize the words well-pleaded and I submit that if the Court will examine each complaint, it will find that the “facts” are conclusions.
Thurgood Marshall: When the Court will (Inaudible) you would only taken well-pleaded?
R. Brooke Alloway: Yes.
Thurgood Marshall: Right?
R. Brooke Alloway: That’s true. I have nothing further.
Warren E. Burger: Thank you. Mr. Sindell, do you have anything further?
Steven A. Sindell: Yes, Mr. Chief Justice, I do. First of all, I would like to indicate to the Court, if the Court will examine the proclamations of the Governor, it will find that the one that is applicable to the Kent State incident which is the main Fifth Proclamation after it occurred does not mention anything roving bodies of men. That referred to a truckers’ strike where there may well have been roving bodies of men and that had nothing to do with Kent State. It didn’t even include Portage County although it included vast other areas of the State of Ohio. The fact is that the Governor’s proclamation at no time even mentions the word insurrection. It doesn’t even, if we want to talk about well-pleaded facts, the Governors’ proclamation has no facts which would give rise to a conclusion that there was a state of insurrection or riot of any kind. It simply refers to disorders. Now, I want to be perfectly clear about our contention here. It is not our contention that the Governor is liable under the Federal Civil Rights Act because he called out troops. That is not our claim. We are claiming and what has been read by my brother in connection with Sterling against Constantin. What hasn’t been read is this, while the calling out of troops is unreviewable according to that case, it goes further and it says, it does not follow from the fact that the executive has this range of discretion deemed to be a necessary incident of this power to suppress disorder. That every sort of action the Governor may take, no matter how unjustified by the exigency or subversive of private right and the jurisdiction of the Courts otherwise available is conclusively supported by mere executive fiat. The contrary is well-established. What are the allowable limits of military discretion and whether or not they have been overstepped in a particular case are judicial questions and that is what we are contending in this case. And I would like to address myself to this matter of pleadings and what is well-pleaded and what isn’t pleaded. I understand, at least, as a trial practitioner who engages in some amount of litigation, I have always understood that the basic concept is notice to pleading. That we are not required to plead volumes of evidence or any evidence really that I feel it was improper to plead evidence as such and that largely, the federal rules are designed to confine the pleadings to the general allegations. Now, we have alleged a conspiracy to engage in a direct act which involved deaths of people and that’s included in that concept those orders and judgments and statements in their backs that we believe exists in good faith to back it up. Now, what I’m simply suggesting is this. If it wasn’t well-pleaded and not for my brother, Mr. Alloway, then he had the prerogative under the Rule 12 (e) to tell me that and to make a motion to make definite and certain and to ask me to be more specific if I didn’t plead it well enough and he didn’t do that. He didn’t ask me for more facts. He didn’t say, “It’s so vague that it’s not well-pleaded.” He didn’t say, “We don’t have notice. We don’t know what you’re talking about.” Instead, he filed a motion to dismiss and thereafter, invited the Court to conclude.
Warren E. Burger: You don’t suggest that he has an obligation to ask you for more. He can stand on your complaint and if he thinks it’s infirm, then that’s what the defense counsel does, isn’t that true?
Steven A. Sindell: You’re right, Mr. Chief Justice Burger. He has every right to suggest that it’s infirm and I claim that where we had specifically alleged and I quote from the complaint, “All acts herein mentioned including everyone of them, the shooting and everything else were done individually and in conspiracy by these defendants with the specific intent of depriving plaintiff and plaintiff dissidents of their rights to due process and equal protection. I contend that if that doesn’t state a violation of constitutional right, then nothing does. Now, if he wants it more specific than that, then I suggest that he ask what he wants, that he tell me that it’s to vague and that’s the question of pleading. But what I have said here in its allegation form and in its notice form is well-pleaded in the concept of the federal rules of civil procedure to give notice And let’s be practical about it. I sit in an office that has four walls and I look at what facts I have at the time I plead and I know that the Governor was down there, that he was involved in this event, that he was personally present, that he was giving orders, that he was doing a lot of things. I’m not the FBI. I don’t have those materials available. I only have what I know and it seems to me that on the basis of all those orders that were apparently given when he stood there and said publicly that we should eradicate people and that these people should be eradicated and that and so on and so forth, and I don’t want to get to far off the record except to say that when all those things were present before me, all I can say is, “I thought that there were some basis to make the allegation” and I think we have a right to ask him some very specific questions --
Byron R. White: I did not (Inaudible) to say State eventually, locally wants to (Inaudible)
Steven A. Sindell: Absolutely.
Byron R. White: Afterwards (Inaudible)
Steven A. Sindell: Absolutely, he was running for political office at the time. He was running at a law and order platform. I would like to ask him some questions. What orders did you give to your guardsmen?
Byron R. White: (Inaudible)
Steven A. Sindell: I’m sorry.
Byron R. White: (Inaudible) supposedly concluding that he was malicious (Inaudible) running for office?
Steven A. Sindell: No. Not because he was running for office because of his desire to be elected and to demonstrate. I’m saying, allegedly to demonstrate to the electorate.
Byron R. White: You haven’t stated maliciously.
Steven A. Sindell: As I unders -- did I have? I had the basis for saying that he was malicious in the concept of malice that to --
Byron R. White: Mostly (Inaudible)
Steven A. Sindell: Right.
Byron R. White: I tend to believe this regard to malice.
Steven A. Sindell: Yes. It seems to me, Your Honor, and again, the concept of malice is involved here vindictiveness, it seems to me that when orders are given in order to further a political goal which involves the risk of injury to an individual and perhaps an intent to create a demonstration that this particular were going to show the people that I stand for one order notwithstanding the risk to the lives of the people involved, I think that comes within the concept of certainly wanton and willful and if you will, malice. I don’t think that --
Byron R. White: (Inaudible)
Steven A. Sindell: That’s what I would like to ask him about. That’s what I would like to get into it in this case.
Warren E. Burger: If you like to find out whether your allegations are true?
Steven A. Sindell: Well, [Laughter Attempt] I’d like to ask him the questions that pertain to the allegations which I think have been reasonably filed. Yes, and I think there’s a basis for so doing.
Warren E. Burger: Very well.
Steven A. Sindell: I have nothing further.
Warren E. Burger: Thank you, gentlemen. The case is submitted.


William H. Rehnquist: We'll hear argument next in number 86-1743, Monessen Southwestern Railway Company versus Gerald L. Morgan. Mr. Manion, you may proceed whenever you're ready.
Paul A. Manion: Mr. Chief Justice, and may it please the Court. This case presents the question whether a Pennsylvania Court of Common Pleas sitting in a Federal employers liability act case is free to apply State Court rules concerning the propriety of an award of prejudgment interest and the reduction of an award for impairment of future earning power to its present value, or must apply the Federal law applicable to those issues. The facts relevant to this question can be stated very briefly. The plaintiff was injured in the course of his employment with the Monessen Southwestern Railway as a brakeman conductor. He was off work for about eighteen months. When he returned to work, he returned as a radio supply clerk, rather than as a brakeman conductor. He filed suit under the FELA in the Court of Common Pleas of Allegheny County in Pittsburgh. At that trial, he claimed damages first based on his lost wages to the date of trial, which approximately $50,000. And for impairment of his future earning power based on his claim that he would earn approximately $5,000 a year less as a radio supply clerk than he would have as a brakeman conductor for the remaining fifteen years of his expected work life. At the close of the evidence, counsel for the Railroad submitted a point for charge to the Court, requesting the Court to charge the jury on reducing an award for impairment of future earning power to its present value. In that request, there was specifically included a reference to present worth tables of which the Court had already taken judicial notice, and which would assist the jury in making the present worth reduction. The Court denied the request stating on three separate occasions, both orally and in writing that the basis for the Court's refusal was the recently announced decision of the Supreme Court of Pennsylvania holding that a present worth instruction should no longer be given in the Courts of the Commonwealth in personal injury cases in which claims for impairment of future earning power were asserted. The Judge made that very specific in chambers in ruling on the request for charge before she instructed the jury, then again in the charge itself, and then thirdly in her opinion on post-trial motions for judgment N.O.V. and for a new trial. After closing arguments of counsel and the Court's charge, the jury returned a verdict in favor of the plaintiff for $125,000, an amount equal to the claim for lost wages to the date of trial of $50,000 and of the claim for impairment of future earning power at $5,000 a year for fifteen years, the plaintiff being fifty years of age at the date of trial and counsel arguing to the jury on behalf of the plaintiff that although it could award damages to age 70, an award based on retirement at age 65 would not be unreasonable. Eleven days after the jury verdict and pursuant to a motion of counsel for plaintiff and over the objection of counsel for defendant, the Judge increased the jury's verdict by adding thereto prejudgment interest at the rate of ten percent per year to increase the $125,000 to approximately $152,000. The basis for that addition was a rule which had been promulgated by the Pennsylvania Supreme Court in 1978, stating that in bodily injury cases tried in the Courts of the Commonwealth, such an award would be made provided that certain conditions were met. That is that the defendant had not made an offer prior to trial, which was at least 75 percent of the amount which the jury ultimately returned. That was done over the objection of the defendant.
William H. Rehnquist: Is the announced purpose of Rule 238 to encourage settlement in this kind of case?
Paul A. Manion: It is, Your Honor. The Pennsylvania Supreme Court both in this case and in Laudenberger said that its purpose was to encourage settlement to rid the courts of congested dockets. There are serious questions as to whether that was a substantive rule within the rulemaking part of the Pennsylvania Supreme Court. It dealt with that issue within one year after the rule was promulgated, found it to be procedural but acknowledged that it had very substantial substantive implications. And the Third Circuit Court of Appeals has found it to be substantive in the Jarvis case and therefore that a Federal Court must apply it in a case in that Court based on diversity of citizenship because of its substantial substantive effect. But the articulated reason by the Court in justifying the rule was that it was within its rulemaking powers. Of course, the Court had to justify it on that basis because otherwise it would have been found to have not been validly promulgated.
William H. Rehnquist: But Pennsylvania doesn't say prejudgment interest is awarded as a matter of right to a prevailing plaintiff; it's only where there was a failure to submit an offer of a particular kind by the defendant?
Paul A. Manion: Yes, Your Honor, that is true. It's not an absolute rule, there is one condition. And I should, to bring the Court up to date, there was the Craig decision by the Pennsylvania Supreme Court which came down between the Superior Court and Supreme Court decision in this case which said that there were questions of due process raised by the rule in that the defendant may not have been at fault for the delay, and therefore in cases after Craig where this issue came up, there would have to be a hearing following the verdict and a determination made. But within the last month, the Court announced in Craig that its procedural rules committee was instructed to come up with a new rule. The new rule as promulgated in the Pennsylvania Bulletin on February 6th, which will take effect in a month and a half, in essence provides that as long as no offer has been made that upon the jury verdict, there will be an award of prejudgment interest unless the defendant files a motion affirmatively establishing that the plaintiff was the cause of at least some of the delay. Except for those conditions, Your Honor, that rule was applied uniformly. It was applied uniformly before Craig, in the interval after Craig before the Supreme Court Procedural Rules Committee came out with the suggested new rule, and it's being applied every day in the Courts of the Commonwealth. As Justice Hutchinson pointed out in the Supreme Court of Pennsylvania, there can be no question that this rule has a substantial effect on damages. In this case, it increased the award by at least 20 percent. That gets me to the point that the first question really in many respects this case perhaps more than coincidentally is being argued on the 50th anniversary by only a few days of this Court's decision in Erie Railroad v. Tompkins. As Your Honors will recall, that case involved the question whether a Federal court, hearing a case based on its diversity jurisdiction which arose solely under State law was free to apply its own general version of what the common law should be, or was obliged to apply State law as construed by the Courts of the State. And of course, Justice Brandeis' classic opinion and landmark in the field of federal-state relations said that the Federal court would have to defer to State law, not because of any notion of superiority or inferiority between the two systems of courts, but because of the fundamental precept. First that the law to be applied to a claim should be the law out of which the claim arose. Secondly, the fostering of any other rule would lead to chaos as it has in Pennsylvania because the Third Circuit justice declared last August that you cannot apply prejudgment interest in an FELA case. So that litigants in Pittsburgh under a Statute the principal purpose... or at least one of the primary purposes of which was to provide for a national uniformity for railroad workers across the country, not only are we getting different results between one state and another, but in Pittsburgh, you will get a substantially different result depending upon whether you file your suit at 7th and Grant in the Federal Court where you won't get prejudgment interest, or up the street at 4th and Grant, where you'll get an award of at least 20 percent in this case, substantially enlarging the damages. It's clear that Federal law has to be applied here, not because the Federal Courts are superior to the State Courts, but this is a Federal Statute. It cries out for national uniformity and enforcement. And it can't be justified on the ground of a substantive procedural distinction. This Court has long held in FELA cases starting at least in 1916 in the Chesapeake & Ohio Railroad v. Kelly case the question of the proper measure of damages is inseparably connected with the right of action. And in cases arising under the FELA, it must be settled according to general principles of law as administered in the Federal Courts. Eight years ago in the Liepelt case, Justice Stevens said, it has long been settled that questions concerning the measure of damages in an FELA action are Federal in character. And Justice Blackmun in dissent stating that income tax instructions the question whether they should be given is an incidental matter. Perhaps we should defer to State procedure. But he said, of course, I assume that if this procedural rule has substantive impact... as it does in our case... regardless of how the State labels its rule, it's got to give way to Federal law.
John Paul Stevens: Mr. Manion, in this case, who decided on the prejudgment interest? That wasn't the jury that did that, was it?
Paul A. Manion: It was not, Your Honor. It was done by the trial judge 11 days after the verdict.
John Paul Stevens: It wasn't characterized then as an element of the damages?
Paul A. Manion: It was not, Your Honor.
John Paul Stevens: And how did the Judge decide on the ten percent rate?
Paul A. Manion: Rule 238 which is applicable since 1978 in common law bodily injury cases or those which involve property damage provides that the award shall be at the rate of ten percent per year providing the conditions are met that there's been no offer by the defendant and that the award exceeds any offer by 125 percent.
John Paul Stevens: I see.
Paul A. Manion: And of course, that's another reason why this rule of course was adopted in that inflationary period of the late 70s. It's being applied at a rate of ten percent per annum. We are getting in some States, of course, there's no prejudgment interest in most FELA cases in any State Court. This Statute has been construed over 80 years on the question of the allowance of the award of prejudgment interest consistently. State and Federal courts have held uniformly that you cannot award prejudgment interest under the FELA. It was held not only... and we've cited a multitude contrary to the suggestion of counsel for the plaintiff that these are primarily Federal cases... not only are they State Court cases but they are State Court cases in States which have prejudgment interest rules, many of them, and the State Courts have said, we have to apply Federal law because this is the FELA. This isn't the ordinary automobile accident case. This is a Federal Statute. For 80 years the Court has held that you cannot award prejudgment interest--
William H. Rehnquist: When you say for 80 years, the Court has held that. Are you relying on any particular decision of this Court?
Paul A. Manion: --I am not, Your Honor. I am relying primarily on decisions of the Federal Appellate Courts and decisions of the Supreme Courts of the highest States in the country. I think that the course of history is such that there has been so much judicial precedent that this long history of judicial precedent construing this statute when Congress has had the opportunity to, and has amended it repeatedly by--
John Paul Stevens: Mr. Manion, did any of those cases involve the peculiar wrinkle we have in this case of a separate rule that provides that this can be done as a remedy for failing to make a high enough settlement offer?
Paul A. Manion: --Yes, Your Honor. Most of them are based either on State statutes involving prejudgment interest, or court rules. Many of the court rules... they vary all over the lot... that's another reason why a State Court rule should not be applied in an FELA case.
John Paul Stevens: But particularly to any of them involve State Court rules that are dealing with the subject of trying to motivate settlement offers?
Paul A. Manion: I believe a substantial number of them do, Your Honor.
William H. Rehnquist: The Third Circuit case certainly would be because it was dealing with the Pennsylvania Rule, wasn't it?
Paul A. Manion: It was in the first. Judge Becker's opinion is about 20 pages and he starts off his opinion, you can't possibly justify the use of Rule 238 to award prejudgment interest in an FELA case. A closer question which still must be resolved against the plaintiff is not whether you can use a State Court rule to justify it. That's clear. That's the clear air in this opinion. Regardless of what's done here, the Judge did it on the basis of a State rule. Justice Steven's decision for the Court in the Pfeifer case makes it clear you can't do it on that basis. There's a nicer question. That is, would such an award be consistent with Federal law. On that question, that has to be resolved against the plaintiff, because when the FELA was adopted in 1908, Congress took the state of the common law as it then existed with respect to tort claims for personal injuries and adopted in Section 1 a rule that provided that FELA plaintiffs would be awarded damages for injuries sustained as a result of the negligence of the employer, how slight. Prejudgment interest existed at common law in 1908, but it was permitted only in liquidated damages claims for breach of contract or other situations where the damages were liquidated. It was never permitted in personal injury cases where the damages were unliquidated. Congress saw fit to abolish the common law rule under which contributory negligence was an absolute bar. It said that it will not be an absolute bar; comparative negligence will be the rule. In Section 3, the very same section in which it did that, it said, moreover, contributory negligence will not be any defense where the injury arises from a violation of the Safety Appliance Act. In 1939, all the while we have hundreds of cases going up through the Federal courts and the State courts, none of which allows prejudgment interest. In '39, Congress, looking at the FELA, a Statute with which Congress has been concerned, with which this Court has been concerned, consistent line of decisions. In '39, Congress said, we're going to abolish assumption of the risk as a defense. They did that. Eighty years of history from 1908 to 1988. Not one court has ever said that prejudgment interest is authorized until the Pennsylvania Supreme Court. The only Court that did so was a District Court in Colorado which was reversed in the Tenth Circuit a few years ago in the Garcia case. And even in Garcia, they didn't say you can justify this under a State statute. They said it may be consistent with Federal law. When you take the state of the law at the time of the adoption of the FELA, Congress' deliberate decisions which aspects of common law it would do away with and which it would incorporate in this admittedly liberal statute, which this Court has consistently construed as broadening liability but has never held that you can get prejudgment interest. The state of the law at that time, the 80 years of precedent, Congress all the while acting on this Statute, amending it when it felt appropriate, never adopting a rule. As the Fifth Circuit has said, and other courts have said, the silence of Congress in 1908 speaks loudly and clearly that Congress never intended to allow prejudgment interest.
John Paul Stevens: Supposing the State rule, instead of having a prejudgment interest as a remedy for failing to make settlement offer provided that say it would be double costs of a thousand dollar flat one percent of the judgment. You'd making the same argument on such a rule, wouldn't you? Is the fact that it's prejudgment interest I'm not sure is as important as whether there can be any remedy in an FELA procedure for failing to make settlement offers that would not normally be allowed in Federal court, but is allowed in all State proceedings. And double costs is one that occurs to me.
Paul A. Manion: Your Honor... yes. Well, Your Honor, I think if there were a sanction imposed, for example.
John Paul Stevens: Right.
Paul A. Manion: Because counsel had delayed the prosecution of the case--
John Paul Stevens: Leave it the same. He failed to make a settlement offer of at least 75 percent of the verdict.
Paul A. Manion: --I don't think that would be permitted, Your Honor.
John Paul Stevens: And they couldn't do anything of that kind?
Paul A. Manion: Not as a State rule. Not unless it was a Federal matter, because you're doing something which has a substantial effect on the amount of damages, on the award itself. You could justify an award as a penalty because counsel did something wrong, but merely because they didn't make an offer, when an offer may not have been appropriate. They couldn't do that. That would substantially enlarge the remedy and the remedy is extricably intertwined with the cause of action. I'd just cover the--
Antonin Scalia: I presume you would also argue that the State rule is not really designed to punish for not making settlement offer, but rather the rule is designed to provide prejudgment interest and however there is a dispensation for someone who has been good enough to make a settlement offer? I mean, it's hard to say whether you're punishing the failure to make one or rewarding the making of one.
Paul A. Manion: --Whether the true motivation of the Court is to clear up the congested docket, that also is a consideration, Your Honor. I think regardless of the rationale advanced, the core inquiry is does this rule, this law have a substantial effect on the rights of the litigants. And using the outcome determinative test that was developed after Erie Railroad, are you going to get a substantially different result when you go down Grant Street to State Court, compared with when you go up Grant Street to Federal Court? And here, it's clear. This is a relatively nominal award, considering that there was only two years of prejudgment interest. But if the case happens to be on a docket and the cases aren't tried for three or four years, you're going to have awards which can double in some instances, the amount that's awarded by the jury. To say that doesn't have substantive effect is to ignore reality.
Sandra Day O'Connor: Mr. Manion, do you plan to discuss the total offset damages issue at all?
Paul A. Manion: I was about to address that, Your Honor.
Sandra Day O'Connor: And in that regard, may I inquire whether at trial there was any effort on the part of your client to establish a technically more accurate method--
Paul A. Manion: There was, Your Honor.
Sandra Day O'Connor: --than the total offset method?
Paul A. Manion: Yes, Your Honor. There was such an effort. As the Third Circuit has held, that obligation is not on the defendant; it's on the plaintiff because the plaintiff has the burden of proof. But in 1916, this Court held in Chesapeake & Ohio R.R. v. Kelly that any award for impairment of future earning power had to be reduced to its present value. And the case really dealt with the fact that whether present worth tables not only were good evidence, but were they conclusive. And the Court held they are good evidence probative of what the jury should do or what the fact finder should do in reducing an award to its present value. But it's clear that they are good evidence. In our case, we had an instruction that is set out in our brief and also in the Appendix.
Sandra Day O'Connor: I didn't find anything to indicate that you established that that was a better method than the total offset method.
Paul A. Manion: Well, Your Honor,--
Sandra Day O'Connor: Do you think it's open to the Court to select any reasonable method?
Paul A. Manion: --I don't think it's open to the Court, Your Honor. I think it's a matter for the fact finder.
Sandra Day O'Connor: We held that it was in Pfeifer.
Paul A. Manion: It was in Pfeifer, Your Honor, because the Court was sitting non-jury.
Sandra Day O'Connor: Yes. But do you think there's anything in our cases that indicates that the choice of a method of calculation of damages which is a legal question should be submitted to the jury?
Paul A. Manion: It is, Your Honor, because like a lot of questions of that kind, it depends on the evidence which goes into the record. The plaintiff may call an economist that says, this is the best record. The defendant may call an economist--
Sandra Day O'Connor: Well, I would have thought the method of calculating damages was one for the Court.
Paul A. Manion: --I don't think so, Your Honor, for this reason. As long as there are disputed issues concerning facts that are inherent in the method whether we use a six percent discount rate--
Sandra Day O'Connor: Well, once the method is selected, then the factual question and its application goes to the jury. I just couldn't really imagine how you got the proposition that the jury should determine the method?
Paul A. Manion: --I think Justice Hutchinson makes the point in his dissent in this case and Your Honor understanding now we're talking not just about the method in terms of a legal method, but where it involves issues of fact concerning the discount rate. Whether it should be total offset, whether it should be real interest rate the difference between inflation and the nominal interest rate. Whether it should be what someone earns in their savings account. This Court held that in Chesapeake & Ohio. The jury knows. They put money in savings accounts. We're not going to use the rate of interest that Ivan Boesky or someone might get. We're going to use what the ordinary person, and jurors being ordinary people know what interest is. It's up to them to make that selection. It must be, Your Honor, with appropriate instructions from the Court. You've heard varying methods of discounting to present value. But Justice Stevens in his opinion for the Court in Pfeifer said, it is for the fact finder to make that determination. He surveyed at least seven different methods and said, we're going to return this and it's for the fact finder. In this case, the Court violated this Court's mandate in Dickerson saying that you can't refuse the charge on the basis of the State rule. And Dickerson says, you've got to leave it to the fact finder. Judge Finkelhor took it away from the fact finder. I see my time is up. Thank you very much, Your Honor.
William H. Rehnquist: Thank you, Mr. Manion. We'll hear now from you, Mr. Hollander.
Thomas Hollander: Mr. Chief Justice, and may it please the Court. We're considering here today the application to a remedial statute, the Federal Employers Liability Act of two of what have become the most important cornerstones in the past decade of the civil practice in the Commonwealth of Pennsylvania. Rule 238 about which there's already been some discussion, and the Pennsylvania Supreme Court decision in Kaczkowski v. Bolubasz which has straightened up, at least for the time being, some very curious developments in how we reduce verdicts for impairment of earning capacity and other future payments to present value. I can't help but make this comment, that Rule 238 being designed to reduce congestion and delay which was the avowed purpose of the Pennsylvania Supreme Court in promulgating it, if my colleague for the railroad is correct, may do more to reduce the backlog in Federal Court because it will attract litigants down Grant Street to the State Court where their possibility of getting Rule 238 exists. But nonetheless, it's the kind of rule... about which I'll speak later... that the Pennsylvania Supreme Court should be permitted to promulgate to deal with the matter of the disposition of the cases in its system. I would like to first however discuss the total offset method that was used to reduce the verdict in this case to present worth. The trial court tried this case in 1981. For a long period of time, since this Court's decision in Chesapeake & Ohio v. Kelly in 1916, announcing that future payments in FELA cases, and for that matter, it has affected the fabric of all litigation involving future payments and especially personal injury litigation, must be reduced to present value. This Court in 1916 expressly did not lay down a precise rule or formula for how that reduction was to take place. And said it was not its purpose to do so. Thereafter then until the decision of this Court through Justice Stevens in 1983 in the Pfeifer case, a period of 67 years, the State courts and the Federal courts across this country used a wide variety of methods to reduce future impairment of earning capacity to present value, all with at least the tacit approval of this Court, because this Court let that go on for 67 years, and, I submit, should continue to let it go on because we're talking about methods of proof and how you handled methods of proof, evidentiary questions in trial courts. In 1980, in this context, the Supreme Court of Pennsylvania said that they wanted this evidentiary rule based on the theory that the market interest rate offsets the inflation rate and that therefore we will consider those totally offset and those issues will not be entertained for evidentiary purposes, and that proposal will not be submitted to the jury that the reduction to present worth will have taken effect in that way. That was to remedy an inequity that has been pointed out in a number of the circuit courts to which the appellant refers in which we had a situation where you could not introduce inflationary evidence at all and still had a discount to present worth which was essentially a double discount for the defendant. And I should add, all of this is in the context of what I submit is an economically inequitable process where you get nothing for delay in an FELA case under ordinary circumstances, and when all rules of the court are complied with, up through until the time of trial even though economic loss has occurred, but that future damages are discounted, which is an economically inequitable circumstance.
Antonin Scalia: You should make that argument to Congress when it enacted the FELA. I mean, Congress did make that judgment, didn't it?
Thomas Hollander: Well, Your Honor, I'm glad you raised that, because Congress... and we're talking now about prejudgment interest, I take it, is what your question is... Congress said nothing about prejudgment interest. And in an inference that a Court made many many years ago, and not this Court, the inference was that Congress' silence in 1908 meant there would be no prejudgment interest permitted. In 1908, there was neither prejudgment nor post-judgment interest in this country, as I read these cases. So the fact that there was no interest at all mentioned was deemed therefore without any discussion nor reference to the Congressional Record, it's questionable whether Congress considered it at all. But what Congress did consider at that time, and an examination of the Congressional Record will show... and I would like to refer the Court... and it's not in my brief, but I will read it into the argument... Congressional Record 60th Congress First Session, Vol. 42 in 1908, at pages 4527 to 4550, discussed the reasons for granting concurrent jurisdiction. Justice Holmes in 1916, which was apparently a banner year for litigation in this Court for FELA cases, referred to the fact that the Congress was to anticipate... I'll give you his words, which I think are pertinent here... "that Congress contemplated suits in State courts and accepted State procedures in advance. " In that case there was a question about a lien on an FELA claim by a local lawyer and the question that there couldn't be a lien because Congress hadn't allowed it. Oddly enough, about that same time, this Court affirmed a State court addition of ten percent in an FELA case in an appeal because the appeal was affirmed and the defendant had to add ten percent to the award on that basis which is coincidentally the same interest rate we're talking about here. Congress was concerned when it granted concurrent jurisdiction with the access of injured railroaders to the courts in 1908 and the sizes of the Federal Districts and the circuits, the question of how far people had to travel, how they'd get their witnesses to court if it were a Federal Court matter, and whether that imposed a great burden on the litigant. And Congress considered and determined not to grant removal powers to a defendant in an FELA case because of the costs and the denial of adequate access to the courts. That was in 1908. I submit, Your Honors, that at this time in 1988, the denial to access of the litigants injured in railroad cases and in any other cases to the courts, is now the delay and congestion that's occurring which is equally significant to the costs that would be incurred in the long distance travels and the transportation and hiring of lawyers in two or more locations in 1908. In short, the economic burdens that are placed on the plaintiffs now in the delays means that their verdicts are less valuable and have less meaning and are more costly in personal loss over the long run than they would be with the use of prejudgment interest. So I think that Congress has actually spoken to this issue, but not talking about interest, talking about access to the courts. And that because this Court has said that the FELA is a dynamic statute to be liberally construed and in the words of the Kernan decision, not a static remedy but one enlarged and developed to meet changing conditions and concepts over a period of time, suggests clearly that this is not a Congressional matter. Congress remains silent on interest. it remains silent on damages. The courts have--
William H. Rehnquist: Mr. Hollander, this Court has handed down many many decisions saying on fairly minor points that Federal law rather than State law governs how you construe a complaint. What standard is used for judging a release. And it seems to me none of those are any more really distinguishable from this.
Thomas Hollander: --Your Honor, if you're referring to whether the Rule for 238 prejudgment interest applies?
William H. Rehnquist: Yes.
Thomas Hollander: There are a number of things that I would like to comment on with regard to that, because we're really talking about the uniformity of the application of the FELA across the country. And what in effect happens if a prejudgment interest rule occurs and if that impacts on the formula. There are because of the concurrent jurisdiction of this Statute, a number, a wide variety of things that effect uniformity. Up until the amendment of the Section 1961 of the Code, all post-judgment interest in Federal courts were controlled by State rules. That varied a great deal. Verdict sizes vary from region to region. Jury sizes vary from district court to State court. The nature of the verdicts, whether they're a majority or whether they're five-sixths, or unanimous varies. Present worth calculations have varied from time to time. Pleadings are different, provisions are different. Does Rule 238 really create a disparity in the treatment of FELA claimants? And my response to that is not unlike what I was trying to get to in response to Justice Scalia's question. And that is this. Prejudgment interest is a just economic concept. The earlier that a defendant pays a verdict of judgment, the more expensive it is for the defendant and the better it is for the claimant. The later in time that a defendant is required to pay a verdict or judgment in an FELA case, the less expensive it is--
William H. Rehnquist: Well, is that really the question whether it's a just concept here? In other words, if we thought it was a desirable thing, does that mean that even though it would make quite a different result in Pennsylvania as opposed to the Federal Courts instead, we should nonetheless say it's all right because we think it's just?
Thomas Hollander: --Your Honor,--
William H. Rehnquist: I don't think that's the standard that our cases have laid down.
Thomas Hollander: --Well, let me make this comment with regard to that question. There are two issues that we seem to be addressing here with regard to Rule 238 of the Pennsylvania Supreme Court. One is whether prejudgment interest is an acceptable award in an FELA case, pursuant to that rule, which we submit is a procedural rule with substantive incidence. Or whether prejudgment interest is appropriate in general. On the latter point, let me say this. This Court and many of the circuit courts--
Antonin Scalia: In general, you mean as a matter of Federal law? That's what you're addressing now, you think? Right?
Thomas Hollander: --I think a case can be made, Justice Scalia, that prejudgment interest ought to be awarded in FELA cases because prejudgment interest is awarded in so many Federal claims across the country in Federal courts.
William H. Rehnquist: But I'm not asking-- --Couldn't you say the same thing for Jones Act cases?
Thomas Hollander: It has been done in Jones Act, Death on the High Seas Act, Outer Continental Shelf Lands Act cases. In fact, they are listed in our brief. And I can give you more.
William H. Rehnquist: That's quite a different argument than saying Rule 238 can be applied by the Pennsylvania State Court?
Thomas Hollander: That's correct. On that point, I was going to make this comment. The Tenth Amendment reserves to the States among other things, as interpreted by the Courts, the power to take care of the matters essentially for the disposition of cases in its jurisdiction. And in that regard, and in fact, Justice Frankfurter said in the Indianapolis v. Chase National Bank case that only Congress can restrict the power of States to provide for the determination of controversies within it.
Thurgood Marshall: Mr. Hollander, how many States have a statute like this?
Thomas Hollander: I don't know how many States, if any, Your Honor.
Thurgood Marshall: I don't mean just interest. I mean, like this Statute?
Thomas Hollander: I can only report that Pennsylvania has this rule.
Thurgood Marshall: Well, did you do any research to find out if--
Thomas Hollander: I did and I saw that there are 32 States with prejudgment interest statutes.
Thurgood Marshall: --Like this one?
Thomas Hollander: No, no. Not like this one. This rule--
Thurgood Marshall: So now we're going to have fifty of them?
Thomas Hollander: --Your Honor,--
Thurgood Marshall: We're going to have fifty of them, right? Right?
Thomas Hollander: --I don't know that.
Thurgood Marshall: Well, you could, couldn't you?
Thomas Hollander: You could have. Every State could say that this would be a way in which we can reduce congestion and delay by encouraging settlements.
Thurgood Marshall: That's what I said, each State could do a different one?
Thomas Hollander: Yes, yes.
Thurgood Marshall: That's a little different.
Thomas Hollander: That's correct, I'm sorry. Each State can easily promulgate its own rules to determine how it wants to move along the congestion in its courts.
Antonin Scalia: Mr. Hollander, suppose you decide to eliminate congestion instead of by providing prejudgment interest where there hasn't been a proper settlement offer, suppose you decide to do it by simply increasing the damages? You say in all actions in this State, the damage award will be increased 50 percent when there has been no settlement offer of 75 percent of the jury award. Does that mean that we would follow that rule in Federal cases as well because the objective is a procedural one and therefore it's all right, we increase the damages fifty percent?
Thomas Hollander: Let me say this, Your Honor. I would agree that if we had the kinds of interest rates that we see in South America and the Middle East in three digit numbers, that it would not be unreasonable to have--
Antonin Scalia: I didn't ask whether it would be reasonable. I asked whether you would consider that the kind of a rule under our Erie holdings that could be applied, or analogously to our Erie holdings, whether that's the kind of a rule that would be applied to FELA cases?
Thomas Hollander: --Well, I guess I heard the fifty percent and thought you wanted me to respond to that. That, if it's a damage percentage that is applied like that, the answer to that is I think it's consistent with Rule 238, yes. And I think that the problem with it is that there's a substantive due process question raised because of the amounts that are imposed.
Antonin Scalia: Well, change the amount. My point is if you are avowedly are increasing the damages, but your purpose in increasing them is to reduce congestion, does that mean that it's okay as far as Federal courts adopting it is concerned?
Thomas Hollander: Well, let me respond first, it's not my position that Federal courts should adopt Rule 238. I'm not seeking that. I'm simply saying that State courts should be permitted to use a rule like this as Pennsylvania has.
Antonin Scalia: No, I mean as far as this Federal Court receiving an appeal from the courts doing that, from the State courts doing that?
Thomas Hollander: Yes. What I'm saying is that because--
Antonin Scalia: Do you think the State courts could apply that rule and increase FELA damages a certain percentage so long as their purpose in increasing the damages is to eliminate congestion in State courts?
Thomas Hollander: --Yes, I do take that position.
Anthony M. Kennedy: Counsel, assume that we adopted the Federal rule that there would be prejudgment interest. Could the railroad then avoid it by tendering the offer under the Pennsylvania Rule?
Thomas Hollander: Yes. Well, no, I'm sorry. If there was a flat across the board prejudgment interest rule, a common law rule as I assume you're asking, Justice Kennedy, no, it couldn't be. It would be just part of the damages.
Anthony M. Kennedy: Well, then you're saying it's a Federal rule if there's interest but not a Federal rule if there's no interest?
Thomas Hollander: Perhaps I'm having difficulty with the question. I believe that the Federal courts have established in many many cases, excluding railroaders which I believe is an anachronism in view of Congressional intent to make it liberal for railroaders to be able to recover, has excluded them and I think that in all these other cases that we've referred to that are decided in the brief where prejudgment interest is awarded, equity is done. As a common law rule then it would apply across the board to railroad workers which are the group now that are singled out.
Anthony M. Kennedy: All right, suppose we say you're right. What happens under the Pennsylvania rule if the railroad tenders an offer and the offer is rejected?
Thomas Hollander: If the offer is tendered and rejected--
Anthony M. Kennedy: Could the Pennsylvania courts encourage settlement by saying that prejudgment interest would not apply in that event?
Thomas Hollander: --I don't think they could take the position that if it was a Federal rule allowing prejudgment interest that they could prevent its imposition in State courts, that's correct.
Anthony M. Kennedy: I don't see how that's any different than the case before us.
Thomas Hollander: Well, I guess if--
Antonin Scalia: It's the same purpose. You're saying in order to end their congestion, they can reverse a Federal Rule of no prejudgment interest, but in order to decrease their congestion, they can't reverse a Federal Rule of prejudgment. Why?
Thomas Hollander: --I guess I'm getting caught in the dilemma that I was going to refer to earlier of the consideration of whether there is a State court right to have a procedural rule to eliminate congestion which passes constitutional muster in Pennsylvania as well as Federal Constitutional muster, both by this Court's denying certiorari in the Laudenberger opinion, and the Third Circuit's affirmance of that matter in Insurance Federation of Pennsylvania v. Supreme Court of Pennsylvania. So I'm saying that yes, I think that's consistent. I think States have that power. It does nothing to violate the supremacy clause and it's not an area that is preempted because Congress has not spoken on it. And therefore, I think procedurally they're allowed to do that, even if it has some substantive implications.
Thurgood Marshall: Could Pennsylvania pass a rule that applies only to FELA cases?
Thomas Hollander: No, Your Honor.
Thurgood Marshall: They couldn't do that, could they?
Thomas Hollander: No, I don't believe they could.
Thurgood Marshall: No question about it.
Thomas Hollander: They have treated all cases over which they have jurisdiction alike, whether it's an FELA case or not. In fact, to exclude the FELA case, I would submit might violate the Equal Protections clause.
Thurgood Marshall: So if they wanted to get to the FELA cases, all they'd have to do is pass a general statute.
Thomas Hollander: That's correct, if they wanted to do that in Pennsylvania, they could pass a general statute. But I'm not so sure that that--
Thurgood Marshall: Do you think that Congress meant that?
Thomas Hollander: --My argument is what I have indicated--
Thurgood Marshall: Do you think Congress meant that?
Thomas Hollander: --I think that Congress did not preclude it. I think Congress, in its debates, concerning the Statute, did not address that issue. I think that Congress' concern about access to courts and the fact that lay damages reduces the validity and the fairness of the awards is consistent with the award of prejudgment interest. So if I may for a moment return to the total offset point that we were discussing earlier, the question that was raised earlier during the railroad's argument concerning whether it believed the jury should make the determination of the method of selection is one that I would like to comment on briefly. Because, interestingly enough, that would assume that the Pfeifer decision of Justice Stevens and this Court in 1983 applies in this case. Amicus curiae, in its brief, indicates that Pfeifer does not apply to this case, although the railroad takes the position that it does, or at least it has taken that position up to now. The question that comes up with regard to Pfeifer is this. When it was decided in 1983, it gave council to the courts and lawyers across the country that there were a number of methods that were appropriate to use in FELA cases, or in that case, I'm sorry, in 5(b) Longshoremen Harbor Workers Act cases. In that regard, Justice Stevens said that the total offset method that Pennsylvania has adopted has the virtue of simplicity and may even be economically precise, which we take it really to be quite an endorsement of that process. Because in that opinion, the discussion is that trying to approximately impaired earning capacity by reduction to present worth is a kind of rough and ready process. And if this one has some economic precision, it would be of value. What the Court said, however, was that a deliberate choice must be made, and it remanded the case to the District Court sitting in Pittsburgh and said, you don't have to reopen the record, but take a look at what's gone on here, and then consider it. But in Dickerson decided by this Court in 1985, the Court restated the Chesapeake & Ohio v. Kelly holding and again selected no single method as did the Kelly Court, the same thing, and said with regard to what the lower Court should do in Missouri was to require that whatever method is used, that it take into account inflation, other sources of wage increases and the rate of interest. At that point, the Court said, nothing was done in Missouri, the Missouri Court ignored the entire question of reduction to present worth, and as a result, there was no reduction to present worth in that case. And it was sent back to require an instruction. In the case before this Court now, I submit to you that Kelly, Pfeifer and Dickerson have been complied with. As a matter of fact, I submit to you that the Pennsylvania Courts have slavishly followed the reduction to present worth requirements of Federal law in this case. First of all, there was a reduction. The record is clear that the reduction was in conformity with the Pennsylvania decision on using the total offset method. Amicus, in its brief, admits that there was a reduction. And what's the question then? Whether there was a reduction or whether there should be an instruction for a reduction. And it's obvious that the reduction is the bottom line and the important part of the element of damages.
Sandra Day O'Connor: Well, the jury was not instructed that it had to make a reduction or that it had t calculate present worth.
Thomas Hollander: That's correct, Your Honor. What the jury was instructed was that the Court was going to take care of it. It was an admonition essentially to the jury not to do anything about inflation and not to do anything about reduction.
Sandra Day O'Connor: Well, do you suppose that Dickerson requires at least that the jury be told they have to base damages on present worth?
Thomas Hollander: Your Honor, the jury was told that their award would essentially have a reduced worth implication because of what the Court told them it was doing with regard to the use of the total offset method. The net effect is that there is a reduction to present worth but the jury doesn't have to calculate it. So what I think happened in this case, as a matter of fact, based on the figures that were cited to you by counsel is the jury may well have reduced it twice. After the Court did it by the total offset method, and then when it went out to the jury room to deliberate because if in fact the jury followed the instructions of the Court, and if the defendant's contention that all of the balance of the verdict of the $125,000 less the $50,000 lost income was true, there would have been no award for pain and suffering and the other elements of emotional distress that are part of the award, and the jury would have then disobeyed the Court's orders. I submit to you that what the jury did was give less than even the total offset method would have provided for in this case. After that... and by the way, I should also say that the Judge did make a selection as the Pfeifer case was suggesting the non-jury district court case should be done and that was between the total offset method which the plaintiffs were prepared to submit and the position that the defendant took in a request for instructions that essentially would have caused a double discount because the Court had not entertained evidence concerning inflation in accordance with Kaczkowski. It instructed the jury on the income tax considerations required by this Court in the Leipelt case and then when the Pfeifer decision came down, which was after the trial of this case and the decision of the post-trial motion by the trial judge, the Pennsylvania Superior Court asked for supplemental briefs concerning the Pfeifer case. The Pennsylvania Superior Court then did with a three-judge panel evaluate the record and appraise it to determine whether the total offset method as the Pfeifer opinion had required was the appropriate method to use for a railroad worker in Pittsburgh. The Superior Court could have remanded the case. It kept it and said, we looked at it, we think it's appropriate and they affirmed it. And then the Supreme Court, which had previously gone through the agonizing appraisal of the various methods to select the total offset method, affirmed. As an officer of the Court... and I'll be brief in this regard... I would like to make one comment concerning the Pfeifer case. And that is, under it, if it is to apply in State courts and if it is to apply in jury cases, which we submit it should not be extended to, then we need some guidance. And we need guidance because of the very question that Justice O'Connor asked, do you expect this to go to juries, and if so, how do you go about doing it. This Court said in the Pfeifer case, we don't want seminars on economics in the court room. We don't have to bring in all of the expert witnesses to talk about actuarial information, economic information and what methods are better and what methods are worse. And then to introduce evidence of how to implement them in the trial of a personal injury case of a railroader. It becomes time consuming and exorbitant and would add seriously to congestion. If it is to be applied in cases like this, then I ask that it be done prospectively with some consideration given to some clarification because obviously the railroad has a belief that we submit is inconsistent with Pfeifer. In short... and I see that my time is up... there are... there was a reduction to present worth in this case in compliance with Federal law.
John Paul Stevens: May I ask one question. This case was tried before Pfeifer was decided. The case took a long time to get here, it seems to me. It was tried in 1981, was it?
Thomas Hollander: The verdict was in 1981.
John Paul Stevens: How much of the appellate proceedings were post-Pfeifer?
Thomas Hollander: The Superior Court argument briefs were done before Pfeifer. The Superior Court argument and the Pennsylvania Supreme Court argument were post-Pfeifer.
John Paul Stevens: Were post-Pfeifer.
Thomas Hollander: Since there was a reduction to present worth, since there is equity and justice in prejudgment interest in any event, and since there is no violation of the Supremacy Clause, nothing that is done by the State Supreme Court in promulgating Rule 238 that is inconsistent with the FELA or with Congress' intent except by somebody's inference of what their silence was many years ago that has been honored reluctantly by Circuit Courts who have expounded in the very recent time in the Third Circuit, in the Ninth Circuit and in the Tenth Circuit and in the Fifth Circuit, that prejudgment interest ought to be allowed in these cases, and since there is no reason to exclude railroaders from the rest of the litigants in the Federal system who are entitled to have prejudgment interest, I ask this Court to dismiss the appeal or to affirm the judgment of the Supreme Court in its entirety. Thank you very much.
William H. Rehnquist: Thank you, Mr. Hollander. Mr. Manion, you have three minutes remaining.
Paul A. Manion: Your Honor, to answer Justice Stevens' last question, part of the delay in the appellate courts was that the Superior Court, on suggestion of counsel, delayed its decision or consideration pending Pfeifer which had been granted cert. So that about two years of it was because of Pfeifer because of the thought that it might have some impact. Justice O'Connor, to address again your present value question, it's our position that Dickerson controls and that as Your Honor suggested, the Court must charge on present value. What we say is that this Court, even assuming it were a Court decision, a deliberate choice of the Court as Justice Stevens' language suggests concerning that there must be a deliberate choice, no such deliberate choice was made in this case by the court, by the jury or anyone else. You can't read this record. When Judge Finkelhor said in chambers, we have reached the decision not to give the present worth charge, and the basis for it is, Chief Justice Nix's decision in Bolubasz, it's clear that it was, as Your Honor Justice Stevens said in Pfeifer, blind adherence to State law. It wasn't a deliberate choice. She said it three times, once in writing in her post-judgment opinion, and twice, once in chambers and then when she charged the jury, you don't have to bother to make this reduction any more because there's a recent decision, the decision of the Supreme Court of Pennsylvania. To say that that was a deliberate choice, as Justice Hutchinson pointed out, is to defy the record. Your Honor, it is the choice of the fact finder, because like any issue, you're dealing with economics. And we don't have to call economists in. You do it the way the Court suggested 70 years ago. You have present value tables in which the jury makes the determination of what rate is appropriate and the tables indicate what you award based on the years out into the future. Just as you use life expectancy tables. What we're suggesting would actually do away with economists in terms of their need in these kinds of cases because--
John Paul Stevens: Yes, but you'd have a one-way discount if you just used the table without any offset for inflation?
Paul A. Manion: --Oh, no, Your Honor. We would permit--
John Paul Stevens: Of course, that wasn't really debated, was it?
Paul A. Manion: --Well, Your Honor, it's clear that when one is projecting into the future, particularly in these cases, you take into account what the wage rates were for the last ten years, and what they might be into the future. No decent plaintiff's lawyer doesn't say, if he was making this much and it increased this much each year, probably most of which was attributable to inflation or cost of living, that you can do that into the future. And that you can show productivity or merit increases. That's permissible. But you can't do it when you're discounting to present value.
William H. Rehnquist: Thank you, Mr. Manion. The case is submitted.