Opinion ID: 1859243
Heading Depth: 1
Heading Rank: 3

Heading: Factors Considered on Review of Punitive Damages Award

Text: In Haslip, the United States Supreme Court cited with approval a number of review factors applied by this Court in its original opinion to arrive at the judgment conditionally affirmed in this case. In addition to the comparative verdict analysis we employed, the factors included: (a) whether there is a reasonable relationship between the punitive damages award and the harm likely to result from the defendant's conduct as well as the harm that actually has occurred; (b) the degree of reprehensibility of the defendant's conduct, the duration of that conduct, the defendant's awareness, any concealment, and the existence and frequency of similar past conduct; (c) the profitability to the defendant of the wrongful conduct and the desirability of removing that profit and of having the defendant also sustain a loss; (d) the `financial position' of the defendant; (e) all the costs of litigation; (f) the imposition of criminal sanctions on the defendant for its conduct, these to be taken in mitigation; and (g) the existence of other civil awards against the defendant for the same conduct, these also to be taken in mitigation. Haslip, ___ U.S. at ___, 111 S.Ct. at 1045. See also Green Oil Co. v. Hornsby, 539 So.2d 218 (Ala.1989). A number of these factors bear with particular force upon the facts presented in this case. First, the unusually subtle nature of the practice employed by InterContinental rendered detection particularly difficult. Moreover, the trial court, in an order following the hearing required by Hammond v. City of Gadsden, 493 So.2d 1374 (Ala. 1986), on InterContinental's post-trial motion alleging that the verdict was excessive, noted the evasive and inconsistent testimony presented by InterContinental's employees, including its senior vice president; that testimony indicated an ongoing attempt at concealment of facts relating to its wrongful conduct. Second, regarding the existence and frequency of similar past conduct, Mr. Grace testified as follows: Q. Now, you have also told me before, and is it still your testimony today in this court, that it is ... InterContinental's custom and practice, given circumstances such as those existing in this casecircumstances including the continuous acceptance of premiums without any pre-waiver or pre-lapse noticethat it's your company's custom and practice to handle this type of claim exactly this way? A. Yes, it is our custom and practice to handle this claim this way. Q. All of them? A. That is correct. (Emphasis added.) The evidence thus indicated widespread use of similar conduct and thus a high potential for harm similar to that suffered in this case. The frequency of this practice also increased InterContinental's potential for profitability from it. Finally, no criminal sanctions or civil penalties have been imposed upon InterContinental for its conduct in this instance as to require mitigation of the punitive damages award. In view of these and other factors, we reject InterContinental's contention that the reprehensibility of [its] conduct was [too] slight to support [such] a large punishment. Appellant's Remand Brief, at 29. Under our reading of Haslip, this Court's previous judgment against InterContinental in the amount of $1,000,000 bears a rational relationship to the legitimate goals of punishment and deterrence. Consequently, that judgment is hereby reinstated. [2] JUDGMENT REINSTATED. HORNSBY, C.J., and SHORES, HOUSTON, STEAGALL, KENNEDY and INGRAM, JJ., concur. MADDOX, J., concurs in the result.