Opinion ID: 758052
Heading Depth: 4
Heading Rank: 1

Heading: How offensive was Wal-Mart's conduct?

Text: 90 (2) What amount is needed to prevent repetition of such conduct in light of Wal-Mart's financial condition? 91 (3) Does the amount bear a reasonable relationship to the actual damages awarded? 92 The factors to have been considered by the jury are, understandably, similar to the three factors designated in BMW, 517 U.S. at 559, 116 S.Ct. 1589, for determining the constitutional limits, under the Due Process Clause of the Fourteenth Amendment, for the amount of punitive damages awarded in a state court trial: (1) the degree of reprehensibility of the defendant's conduct; (2) the disparity between the harm suffered by the plaintiff and the punitive damages award; and (3) the difference between the award and penalties authorized or imposed in comparable cases. 93 We stated in Patterson that we understand that BMW deals with constitutional limits on punitive damages, but we find it instructive . 90 F.3d at 943 (emphasis added). And, like the case at hand, and unlike the situation in BMW, Patterson concerned federal, not state, law. Concerning the application of BMW to federal cases, see, e.g., Lee v. Edwards, 101 F.3d 805, 809 n. 2 (2d Cir.1996). 94 Again, Wal-Mart requests us to either remit the amount of punitive damages or remand this issue to the district court. See Patterson, 90 F.3d at 943 (in the light of the BMW-factors, remanding for reassessment of punitive damages amount awarded in bench trial against employee project manager); FDIC v. Hamilton, 122 F.3d 854, 862 (10th Cir.1997) (in the light of the BMW factors, ordering reduction of punitive damages awarded in bench trial on state law fraud claim); Mathie v. Fries, 121 F.3d 808, 817-18 (2d Cir.1997) (same for bench trial on § 1983 prisoner action); Lee, 101 F.3d at 809-13 (for § 1983 action against police officer for malicious prosecution and assault and battery, and rather than remand, court of appeals may determine amount of remittitur for jury's punitive damages award, pursuant to BMW factors; plaintiff has option of accepting the reduced amount or receiving new trial on issue of punitive damages); Continental Trend Resources, Inc. v. Oxy USA Inc., 101 F.3d 634, 642-43 (10th Cir.1996) (same for jury trial on state law fraud claim), cert. denied, --- U.S. ----, 117 S.Ct. 1846, 137 L.Ed.2d 1049 (1997). Deffenbaugh did not respond to Wal-Mart's remit or remand request. 95 In her affirmative cross-appeal brief on punitive damages, Deffenbaugh not only urges that they be reinstated, but also anticipates Wal-Mart's alternative excessiveness contention (as had been raised in district court). As to the amount, Deffenbaugh claims that the $100,000 is appropriate. But, as noted, Deffenbaugh did not respond through a reply brief to Wal-Mart's subsequent contentions that the award is excessive and that we should remit or remand. Similar to Wal-Mart's brief, Deffenbaugh's briefing on this point is remarkable, both for what it does, and does not, say. As for the latter, it does not mention either Patterson or BMW; or whether the award can be reduced by us, or should first be considered by the district court; or whether, if there is a remittitur, Deffenbaugh should have the option of a new trial on that issue. (In not mentioning Patterson on this point, Deffenbaugh is at least being consistent. As noted by the district court in its post-judgment opinion addressing Wal-Mart's motion for judgment as a matter of law, Deffenbaugh was instructed post-judgment to discuss Patterson; in her response, she failed to do so.) And, as referenced supra, in urging that the 5.26 to 1 ratio of punitive to compensatory damages is proper, Deffenbaugh, unencumbered by any citation to BMW, which was decided approximately 20 months before she filed her cross-appeal brief here, notes that a ratio of almost 10 to 1 in an employment discrimination case was upheld by another circuit; sadly for our purposes, that decision was long before the BMW decision. 96 Wal-Mart's terse remit or remand request may be shorthand for the well-established rule that, if we order a remittitur, we must give Deffenbaugh the option of a new trial on that jury-determined issue. See, e.g., Hetzel v. Prince William County, --- U.S. ----, 118 S.Ct. 1210, 140 L.Ed.2d 336 (1998); Hansen v. Johns-Manville Prods. Corp., 734 F.2d 1036, 1046-48 (5th Cir.1984). Or, for the remand request, it could be suggesting either that the award was based on passion or bias, requiring a new trial on punitive damages, see Auster Oil & Gas, Inc. v. Stream, 835 F.2d 597, 603-04 (5th Cir.1988); or that the district court should rule on this issue before we do. Of this much we are certain: Wal-Mart does not claim bias or passion. But, again, other than that, the brevity of Wal-Mart's request prevents a positive answer to just what it is proposing. 97 In sum, the briefing on this point falls far short of that expected, required, and needed. This is especially harmful in the light of the newly evolving standards for this issue. For this and other obvious reasons, remand for the district court to rule first on excessiveness seems, at first blush, to be the proper course. 98 Instead, we have determined that we should address this issue now. We base this on two factors. First, we give special weight to Deffenbaugh's not responding to Wal-Mart's remit or remand request. Second, in any event, efficiency and economy for the parties and the courts dictate our ruling now. Again, although BMW concerns constitutional limits, it is instructive for reviewing other excessiveness claims for punitive damages. See, e.g., Mathie, 121 F.3d at 816-17. Pre-BMW, in deciding whether to implement the remittitur procedure for jury awards, our standard touched, of course, on considerations similar to the three BMW factors: 99 We do not reverse a jury verdict for excessiveness except on the strongest of showings. The jury's award is not to be disturbed unless it is entirely disproportionate to the injury sustained. We have expressed the extent of distortion that warrants intervention by requiring such awards to be so large as to shock the judicial conscience, so gross or inordinately large as to be contrary to right reason, so exaggerated as to indicate bias, passion, prejudice, corruption, or other improper motive, or as clearly exceed[ing] that amount that any reasonable man could feel the claimant is entitled to. Nonetheless, when a jury's award exceeds the bounds of any reasonable recovery, we must suggest a remittitur ourselves or direct the district court to do so. Our power to grant a remittitur is the same as that of the district court. We determine the size of the remittitur in accordance with this circuit's maximum recovery rule, which prescribes that the verdict must be reduced to the maximum amount the jury could properly have awarded. 100 Caldarera v. Eastern Airlines, Inc., 705 F.2d 778, 784 (5th Cir.1983) (footnotes omitted); see Hansen, 734 F.2d at 1046-48. 101 In deciding the excessiveness claim here, we have utilized the BMW-factors. But, again, we stress that future applications of these factors, especially for constitutional claims, may demand far more detailed consideration, with far more subissues. For this case, in the light of this jury award and the inadequate briefing by the parties, a fairly summary analysis will suffice. 102
103 Perhaps the most important indicium of the reasonableness of a punitive damages award is the degree of reprehensibility of the defendant's conduct. BMW, 517 U.S. at 575, 116 S.Ct. 1589 (emphasis added). It goes without saying that any form of racial discrimination is reprehensible. But, the evidence of reprehensible conduct (discrimination), even when viewed in the light most favorable to Deffenbaugh, is a close case, as was such evidence in Patterson, 90 F.3d at 943. The limited evidence of ill will, when viewed in the most favorable light to Deffenbaugh, was sufficient for the jury to infer malice; but, as the discussion concerning malice demonstrates, that evidence does not reveal a high degree of reprehensibility. For example, there was no verbal or physical abuse. See Patterson, 90 F.3d at 943; Lee, 101 F.3d at 809-10. 104
105 As noted, the jury's $100,000 award for punitive damages is 5.26 times the $19,000 for compensatory damages. The principle that exemplary damages must bear a 'reasonable relationship' to compensatory damages has a long pedigree. BMW, 517 U.S. at 580, 116 S.Ct. 1589 (citations omitted). But, the Court has consistently rejected the notion that the constitutional line is marked by a simple mathematical formula. Id. at 582, 116 S.Ct. 1589. We need not, and indeed we cannot, draw a mathematical bright line between the constitutionally acceptable and the constitutionally unacceptable that would fit every case. Pacific Mut. Life Ins. Co. v. Haslip, 499 U.S. 1, 18, 111 S.Ct. 1032, 113 L.Ed.2d 1 (1991). We can say, however, that general concerns of reasonableness ... properly enter into the constitutional calculus. Id. As noted, the type harm inflicted or caused is a primary consideration in determining whether the ratio is acceptable. BMW, 517 U.S. at 580-83, 116 S.Ct. 1589; Lee, 101 F.3d at 810-11. 106 To some, on the facts in this case, a punitive damages award that is, as here, 5.26 times the compensatory amount may not be so disproportionate as to raise a suspicious judicial eyebrow. TXO Production Corp. v. Alliance Resources Corp., 509 U.S. 443, 481, 113 S.Ct. 2711, 125 L.Ed.2d 366 (1993) (O'Connor, J., dissenting). Compare Haslip, 499 U.S. at 23-24, 111 S.Ct. 1032 (holding that punitive damages award of more than 4 times the amount of compensatory damages might be close to the line but does not cross the line into the area of constitutional impropriety), with TXO, 509 U.S. at 462, 113 S.Ct. 2711 (indicating that a ratio between the punitive award and the potential harm of ten to one does not jar one's constitutional sensibilities) (citation omitted). 107 Unlike the situation in BMW, the injury here was not simply economic. Deffenbaugh's termination had wide-ranging adverse personal impact and consequences. And, again, we are not examining a constitutional challenge. In short, the ratio, standing alone, would not compel a remittitur. 108
109 Finally, in comparing the award in this case to comparable cases (again, damages were based on Title VII and § 1981), we note that, for Title VII claims against an entity of Wal-Mart's size, § 1981a(b)(3) imposes a maximum combined punitive and compensatory limit of $300,000. Obviously, the total $119,000 awarded is well below this maximum. With respect to § 1981 claims, $100,000 is on the high-end for cases of this type in our circuit. See Patterson, 90 F.3d at 943 (citing Jett v. Dallas Indep. Sch. Dist., 798 F.2d 748 (5th Cir.1986)). For the geographic area to look to for comparable cases, see, e.g., Mathie, 121 F.3d at 816-17; Lee, 101 F.3d at 812-13. 110 In the light of the above discussion of the three BMW-factors, we conclude that the jury-awarded punitive damages of $100,000 are excessive. Wal-Mart's maliciousness or reckless indifference is a close call; the degree of reprehensibility is not great enough alone to support the amount of punitive damages awarded by the jury; and, compared to comparable cases, the award is high. Considering all these factors, a remittitur to $75,000 is required.