Opinion ID: 1154788
Heading Depth: 1
Heading Rank: 3

Heading: Plaintiffs Failed to Introduce Evidence of the Financial Condition of Ciba-Geigy Corporation.

Text: In C & C Trucking Co. v. Smith, 612 So.2d 1092 (Miss. 1992), decided while this case was pending, this Court overruled previous cases that made proof of a defendant's net worth a prerequisite for an award of punitive damages. The failure of the plaintiffs to introduce evidence of the financial condition of Ciba-Geigy Corporation was not error. The plaintiffs did introduce the 1989 financial report of Ciba-Geigy, Ltd., a Swiss corporation of which the Ciba-Geigy Corporation is a subsidiary along with 134 other companies in 62 countries. Ciba-Geigy, the defendant in this case, is a New York corporation. The financial report of Ciba-Geigy Ltd. was obtained by plaintiffs' counsel calling Ciba-Geigy directly and requesting the most recent annual report. Ciba-Geigy Corporation is not publicly traded and apparently does not publish a separate annual report. Ciba-Geigy objected to the admission of the report arguing that it was not properly identified and did not represent the financial statement of the defendant corporation. Counsel for Ciba-Geigy had not seen the document before trial and was just as surprised to see it as anybody else. During closing arguments plaintiffs' counsel used the annual report to argue that the defendant's net worth was in excess of 12 billion U.S. dollars. This figure represents the combined assets of all the companies in the Ciba-Geigy Group. There is no separate net worth of Ciba-Geigy Corporation in the report. This was the only financial information on corporate worth presented to the jury. Although it is not necessary to submit financial information as a prerequisite to obtaining punitive damages, the discussions before the judge on the admissibility of the document do not show that plaintiffs' counsel had any basis for confusion as to the distinction between the two corporate entities. In post-trial motion, the trial judge stated that he was concerned over the receiving into evidence the financial statement of the defendant. Really it's not the defendant. The only proof concerning the relationship between the two companies was the 1989 financial statement which identified Ciba-Geigy Corporation as a wholly-owned subsidiary of Ciba-Geigy, Ltd. There was no proof that Ciba-Geigy Ltd. operated its subsidiary Ciba-Geigy Corporation in such a way as to ignore corporate separateness of the subsidiary. The question of the separate identities of Ciba-Geigy, Ltd. and Ciba-Geigy Corporation has been considered many times by other courts and the separateness and integrity of the two corporations upheld each time. See Pitts v. Ciba-Geigy Corp., 616 F. Supp. 1495, 1497-1498 (D.Mass. 1985), and cases cited therein. Under the holding in C & C Trucking Co. v. Smith , the proper use of evidence of the financial worth of a defendant is only as to the quantum of punitive damages. In order to challenge on appeal that an award of punitive damages is excessive, evidence of net worth must be presented at trial, or error in the amount of punitive damages is waived. 612 So.2d at 1105. Since neither party has produced evidence of the net worth of Ciba-Geigy Corporation, this Court cannot express an opinion as to the amount of the punitive damages.