Opinion ID: 2566656
Heading Depth: 2
Heading Rank: 3

Heading: Comparable Civil and Criminal Penalties

Text: ¶ 42 The application of Gore's final guidepost, the difference between the punitive damages awarded by the jury and the civil penalties authorized or imposed in comparable cases, to State Farm's conduct does not cause us to retreat from our determination that a punitive damages award nine times greater than the compensatory damages is called for here. ¶ 43 In Campbell II, the Supreme Court pointed to a potential $10,000 fine for fraud as the most relevant civil sanction to which State Farm was exposed for its conduct toward the Campbells. [8] 538 U.S. at 428, 123 S.Ct. 1513; see also Utah Code Ann. § 31A-26-303 (2003). According to the Supreme Court, this fine was dwarfed by the $145 million punitive damages jury award. Id. It is unclear, however, what amount of punitive damages would be supported by a $10,000 fine. The Supreme Court endorsed a punitive damages award of $1 million, which is one hundred times greater than the $10,000 fine. Presumably, then, this 100-to-1 ratio does not offend due process. Thus, somewhere between $1 million and $145 million, the difference between the $10,000 civil penalty and the punitive damages award becomes so great that the latter dwarfs the former. State Farm claims in its brief that the Supreme Court impliedly found that the civil penalty would be dwarfed by a $17 million punitive damages award. Whether or not this is true, we hold fast to our conviction that a punitive damages award of $9,018,780.75 is in line with the third Gore guidepost. ¶ 44 The nature of a civil or criminal penalty provides some useful guidance to courts when fixing punitive damages because it reflects legislative judgments concerning appropriate sanctions for the conduct at issue. Browning-Ferris, 492 U.S. at 301, 109 S.Ct. 2909 (O'Connor, J., concurring in part and dissenting in part). However, the quest to reliably position any misconduct within the ranks of criminal or civil wrongdoing based on penalties affixed by a legislature can be quixotic. For example, while a $10,000 fine for fraud may appear modest in relationship to a multi-million dollar punitive damages award, it is identical to the maximum fine which may be imposed on a person in Utah for the commission of a first degree felony, the classification assigned our most serious crimes. Utah Code Ann. § 76-3-301 (2003). ¶ 45 The Campbells invite us to conduct anew an analysis of the potential penalties to which State Farm may be exposed, based on the narrowed range of conduct deemed relevant by the Supreme Court. While we agree that the Supreme Court opened the door to such a reassessment, we believe that it is unnecessary in light of our conclusion that $9,018,780.75 is amply supported by the $10,000 civil penalty. ¶ 46 In sum, the Supreme Court affirmed the authority of a state to make its own reasoned judgment about what conduct is permitted or proscribed within its borders. Campbell II, 538 U.S. at 422, 123 S.Ct. 1513 (citing Gore, 517 U.S. at 569, 116 S.Ct. 1589). It follows, therefore, that each state retains the right and the responsibility to draw on its own values and traditions when assessing the reprehensibility of tortious conduct for the purpose of reviewing the propriety of a punitive damages award, so long as that review conforms to the Gore guidelines and the demands of due process. To the extent that our conclusions about what size punitive damages award best serves the legitimate interests of Utah exceeds an award suggested by the Supreme Court, we are exercising what we interpret to be a clear grant of discretion to do so. We have carefully considered the scope of the Supreme Court's mandate and have endeavored scrupulously to confine ourselves to it.