Opinion ID: 160676
Heading Depth: 3
Heading Rank: 5

Heading: Reduction in Actual Damages Award

Text: Following the jury verdict, the district court reduced the award of actual damages by three thousand dollars to reflect the sum paid by Michael Kastning, Tina Kastning, and Calvin Kastning as part of the settlement agreement with the plaintiffs. We review the method of calculation of damages de novo and the actual calculation of damages for clear error. See Southern Colo. MRI, Ltd. v. Med-Alliance, Inc. , 166 F.3d 1094, 1100 (10th Cir. 1999). As a preliminary matter, we note that § 1983 does not contain any provision as to the propriety of offsetting an actual damages award because of a settlement. Because § 1983 does not provide any substantive law on the matter, we are obligated to “fill [the] interstices” of this federal statutory scheme. Miller v. Apartment & Homes of N.J., Inc. , 646 F.2d 101, 107 (3d Cir. 1981). Happily, “Congress [has] provided [us with] some modest guidance for resolving” this problem through 42 U.S.C. § 1988. Id. at 105. Section 1988 dictates that, where there are gaps in a civil rights statute, we must first look to federal law to supply the substantive law, but if federal law is somehow deficient then we apply state 3 (...continued) interest began to accrue on the day the plaintiffs filed their complaint. See Aplts’ App. vol. V, at 001411 (district court order, filed Nov. 25, 1996) (awarding prejudgment interest “from the date of filing until the date of this Judgment”). -13- law, that is, assuming it is consistent with the Constitution and other federal law. See 42 U.S.C. § 1988. For purposes of this case, whether we are guided by federal law or state law is not important because, under either, there would be a reduction in the plaintiffs’ actual damages award because of the money received as part of the settlement agreement. 4 See generally Miller , 646 F.2d at 101 (applying federal common law and reducing the damages award by the amount of settlement); 12 Okla. Stat. Ann. § 832(H)(1) (“When a release, covenant not to sue, or a similar agreement is given in good faith to one of two or more persons liable in tort for the same injury . . . [i]t does not discharge any other tort-feasor from liability for the injury . . . unless the other tort-feasor is specifically named; but it reduces the claim against others to the extent of any amount stipulated by the release or the covenant, or in the amount of the consideration paid for it, whichever is greater . . . .”). In any event, the plaintiffs do not seriously contend that there should be no offset whatsoever. The real issue for the plaintiffs is the amount of the offset. 4 The plaintiffs do not argue whether reduction should proceed on a dollarfor-dollar basis or a proportionate share basis. See Dobson v. Camden, 705 F.2d 759, 768 (5th Cir. 1983) (discussing the various possible methods of reducing), reh’g en banc, 725 F.3d 1003 (1984). Consequently, we do not address this matter on appeal. See In re Walker, 959 F.2d 894, 896 (10th Cir. 1992) (noting the general rule that “a federal appellate court does not consider an issue not passed upon below”) (internal quotation marks omitted). -14- The district court reduced the actual damages award by three thousand dollars – i.e., the entire settlement award. According to the plaintiffs, this was error because the settlement award was not simply compensation for the seizure of the horses; rather, the settlement award also covered other injuries sustained by the plaintiffs for which only the settling defendants were responsible, including an assault of Mr. McClane and damage to a car as a result of the assault. Consequently, the plaintiffs assert that the offset should be less than three thousand dollars. We disagree, concluding that the district court did not clearly err in reducing the actual damages award by the entire amount of the settlement. Admittedly, there is some evidence in the record that suggests Mr. McClane was assaulted and that this assault led to property damage. Furthermore, the settlement agreement specified that it covered not only actual claims raised in the pleadings but potential claims as well. See Aplts’ App. vol. V, at 001136-37 (agreed journal entry of compromise, settlement and judgment dismissing claims with prejudice, filed Aug. 26, 1996). However, even if the assault and property damage were taken into account in negotiating the settlement, the settlement agreement on its face made no distinction as to which part of the award was compensation for which injury. The district court therefore had no meaningful way of determining an appropriate set-off. Notably, the plaintiffs themselves -15- failed to provide any guidance on the matter, simply contending that the set-off should be an unspecified amount less than three thousand dollars. Accordingly, we AFFIRM in part and VACATE and REMAND in part for further proceedings consistent with this opinion. Entered for the Court, Robert H. Henry