Opinion ID: 4519084
Heading Depth: 3
Heading Rank: 2

Heading: Disparity Between Harm and Award

Text: “The second and perhaps most commonly cited indicium of an unreasonable or excessive punitive damages award is its ratio to the actual harm inflicted on the plaintiff.” Gore, 517 U.S. at 580. For this second guidepost, a “comparison between the compensatory award and the punitive award is significant.” Id. at 581. Courts often employ a ratio of punitive to compensatory damages to test the reasonableness of the punitive damages award. See State Farm, 538 U.S. at 425. 23 Case: 18-13045 Date Filed: 03/24/2020 Page: 24 of 31 The Tobacco Companies argue that the ratio of punitive damages to compensatory damages confirms the excessiveness of the punitive damages award. Here, the punitive damages award was $25.3 million, and the compensatory damages award was $15.8 million, making the ratio of punitive damages to compensatory damages approximately 1.6:1. This ratio is significantly lower than ratios that courts have accepted as satisfying due process. See, e.g., Bogle v. McClure, 332 F.3d 1347, 1361-62 (11th Cir. 2003) (noting that punitive to compensatory ratio “in the neighborhood of 4:1” does not violate due process); R.J. Reynolds Tobacco Co. v. Martin, 53 So. 3d 1060, 1072 (Fla. Dist. Ct. App. 2010) (concluding that punitive to compensatory ratio of 7.58:1 did not “offend due process”). So, we cannot say that the 1.6:1 ratio established that the punitive damages award was excessive. The Tobacco Companies argue that the 1.6:1 ratio is not the correct ratio to consider due to the jury’s apportionment of fault. The appropriate ratios are closer to 2:1 for both companies, they contend, because we should look only to the amount of compensatory and punitive damages awarded against each defendant. But even assuming the Tobacco Companies are correct that these are the relevant ratios, the punitive damages award still would not be unreasonable. The Supreme Court has explained that there are “no rigid benchmarks that a punitive damages award may not surpass,” but “[s]ingle-digit multipliers are more likely to comport 24 Case: 18-13045 Date Filed: 03/24/2020 Page: 25 of 31 with due process, while still achieving the State’s goals of deterrence and retribution.” State Farm, 538 U.S. at 425; see Gore, 517 U.S. at 580-81 (discussing history of courts awarding double, treble, or quadruple damages). The multipliers here are in the low single digits. We have upheld considerably larger ratios of punitive to compensatory damages. See McGinnis v. Am. Home Mortg. Servicing, Inc., 901 F.3d 1282, 1290 (11th Cir. 2018) (discussing decisions in which we upheld punitive damages awards with ratios of 5.5:1, 9.2:1, and 4:1). For these reasons, the second guidepost also weighs in Kerrivan’s favor. 3. Difference Between Damages and Civil Penalties Authorized or Imposed in Comparable Cases The final guidepost considers “the available civil and criminal penalties the state provides for” the Tobacco Companies’ misconduct to determine whether they had notice that they could be ordered to pay the amount awarded. Johansen v. Combustion Eng’g, Inc., 170 F.3d 1320, 1337 (11th Cir. 1999). “[A] reviewing court engaged in determining whether an award of punitive damages is excessive should accord substantial deference to legislative judgments concerning appropriate sanctions for the conduct at issue.” Gore, 517 U.S. at 583 (internal quotation marks omitted). This factor, however, “is accorded less weight in the reasonableness analysis than the first two guideposts.” Kemp v. Am. Tel. & Tel. Co., 393 F.3d 1354, 1364 (11th Cir. 2004). 25 Case: 18-13045 Date Filed: 03/24/2020 Page: 26 of 31 The Tobacco Companies ask us to compare the awards of punitive damages to the civil penalties authorized for willful violations of Florida’s Deceptive and Unfair Trade Practices Act. See Fla. Stat. § 501.2075. They observe that the Act authorizes a maximum penalty of $10,000 for each willful violation, id., far less than the punitive damages awarded here. But the Tobacco Companies fail to recognize that violators of the Act are subject to a maximum $10,000 penalty “for each [willful] violation.” Id. (emphasis added). So, the relevant comparison would be the total penalties authorized for each of the willful violations the Tobacco Companies committed over Kerrivan’s nearly five decades as a smoker that contributed to his harm. But even assuming that this guidepost favors the Tobacco Companies, it does not, in the light of the first two guideposts, compel the conclusion that the punitive damages awarded here were unconstitutionally excessive. Because the Gore guideposts weigh in Kerrivan’s favor, we conclude that the punitive damages award is not unconstitutionally excessive. The district court correctly denied the Tobacco Companies’ motion for judgment as a matter of law on the constitutionality of the punitive damages award. C. The District Court Did Not Err by Submitting Kerrivan’s Fraud Claims to the Jury. The Tobacco Companies argue that the district court should not have allowed Kerrivan’s fraud-based claims to go to the jury because the evidence was 26 Case: 18-13045 Date Filed: 03/24/2020 Page: 27 of 31 insufficient for a reasonable jury to find that Kerrivan detrimentally relied on their concealment of material information about the risks of smoking. We find, to the contrary, that the evidence supported an inference of detrimental reliance by Kerrivan. The district court correctly denied the Tobacco Companies’ renewed motion for judgment as a matter of law. Engle progeny plaintiffs need not demonstrate that they relied on specific statements from cigarette companies to establish detrimental reliance for fraudbased claims under Florida law. See, e.g., Philip Morris USA Inc. v. McCall, 234 So. 3d 4, 14 (Fla. Dist. Ct. App. 2017) (explaining that in an Engle case a fraudulent concealment claim need not be limited to reliance on a particular statement); Philip Morris USA, Inc. v. Duignan, 243 So. 3d 426, 439 (Fla. Dist. Ct. App. 2017) (holding that an Engle progeny plaintiff was not required to prove detrimental reliance on a specific statement). “Florida law permits an Engleprogeny jury to infer reliance based on evidence that the plaintiff was exposed to the disinformation campaign and harbored a misapprehension about the health effects and/or addictive nature of smoking.” Cote v. R.J Reynolds Tobacco Co. 909 F.3d 1094, 1108 (11th Cir. 2018) (collecting cases). To decide whether the evidence was sufficient to raise an inference of detrimental reliance, we must determine “[w]hether, considering all evidence and drawing all reasonable inferences in favor of [Kerrivan], any reasonable juror could have inferred that [he] 27 Case: 18-13045 Date Filed: 03/24/2020 Page: 28 of 31 was exposed to [the Tobacco Companies’] decades-long, pervasive disinformation campaign and was accordingly confused regarding the health effects or addictive nature of smoking cigarettes such that [he] may have behaved differently had [he] known the true facts.” Id. The jurors in this case heard evidence about the tobacco industry’s sustained and pervasive disinformation campaign. Kerrivan also testified about his exposure to cigarette advertisements and that the advertisements influenced his decisions about which cigarettes to smoke, such as his decision to switch to filtered cigarettes to “cut out the tar and nicotine,” Doc. 93 at 89—the very claim the tobacco industry made in marketing filtered cigarettes. Further, Kerrivan testified that he switched to Marlboro Lights in an attempt to quit smoking but instead ended up smoking more packs of cigarettes per day, the exact outcome the tobacco industry sought in making lighter cigarettes. He also testified that, had he known had bad cigarettes were for him or how addictive they were, he never would have started smoking and probably would have quit sooner. This evidence is sufficient to sustain an inference of detrimental reliance. The Tobacco Companies contend that, because Kerrivan introduced no evidence that he heard or saw any particular advertisement that misled him, the Florida First District Court of Appeals’ decision in R.J. Reynolds Tobacco Co. v. Whitmire, 260 So. 3d 536 (Fla. Dist. Ct. App. 2018), forecloses recovery on his 28 Case: 18-13045 Date Filed: 03/24/2020 Page: 29 of 31 fraud claims. This argument flies in the face of our previous observation that “Florida courts have consistently held that Engle-progeny plaintiffs are not required to show reliance on a specific statement.” Cote, 909 F.3d at 1108. In Cote, we explained that the “unique circumstances underlying Engleprogeny fraudulent concealment claims” has caused the Florida courts to “permit[] an Engle-progeny jury to infer reliance based on evidence that the plaintiff was exposed to the disinformation campaign and harbored a misapprehension about the health effects and/or addictive nature of smoking.” Id. (collecting cases). The Tobacco Companies maintain that Whitmire, which was decided after Cote, changed Florida law such that “the only proof that will satisfy the detrimental reliance requirement is evidence that the smoker read, saw, or heard a misleading statement.” Reply Br. at 20. We are not persuaded. Generally, we are bound by a previous decision of this court interpreting state law unless it is overruled by the court sitting en banc or “subsequent decisions of the United States Supreme Court or the Florida courts cast doubt on our interpretation of state law.” Hattaway v. McMillian, 903 F.2d 1440, 1445 n.5 (11th Cir. 1990). We reject the Tobacco Companies’ argument because Whitmire casts no doubt on Cote’s interpretation of Florida law. Whitmire merely explained that a jury may draw an inference of reliance on misleading advertisements only if the plaintiff “connect[s] [his] smoking to the false information disseminated by the 29 Case: 18-13045 Date Filed: 03/24/2020 Page: 30 of 31 tobacco companies.” See 260 So. 3d at 540. The appellee in Whitmire was the husband of the decedent smoker. Id. at 537. At trial, he provided no evidence that connected his wife’s smoking to the false information disseminated by the tobacco industry. Id. at 539. Instead, the evidence presented at trial displayed a lack of interest in cigarette advertisements: Appellee testified that he did not know whether the decedent was influenced by cigarette advertisements and that they had never discussed any statements by tobacco companies; Appellee’s son testified that he could not recall the decedent ever expressing interest in a statement from a tobacco company; and Appellee’s sister-in-law testified that she had never heard the decedent mention a cigarette advertisement. While Appellee testified that he was “sure” the decedent saw cigarette advertisements on television, he also testified that he did not know if she saw any “statements” from any tobacco companies. Id. at 539-40. Because no evidence connected the decedent’s smoking to any false information distributed by the tobacco industry, the court in Whitmire concluded that the appellee “failed to present adequate evidence as a matter of law that the decedent relied on fraudulent statements.” Id. at 541. This decision did not change Florida law concerning the circumstances in which a jury can infer reliance in Engle progeny cases. The requirements remain the same: that the plaintiff was exposed to the disinformation campaign and harbored a misapprehension about the health effects and/or addictive nature of smoking. Kerrivan satisfied this requirement: not only did he present evidence that he was exposed throughout his life to the Tobacco Companies’ large-scale advertising 30 Case: 18-13045 Date Filed: 03/24/2020 Page: 31 of 31 campaign, but he also testified that his decisions were influenced by the campaign’s contents. From this evidence, a reasonable jury could infer that Kerrivan would have quit smoking earlier had he known the true facts about the health risks of the cigarettes that he smoked. 10 Therefore, the district court did not err in submitting Kerrivan’s fraud claims to the jury. For the same reasons, it properly denied the Tobacco Companies’ renewed motion for judgment as a matter of law.