Court Opinion

ID: 9486331
Source: CourtListenerOpinion
Date Created: 2023-08-05 11:44:47.723367+00
Date Added: 2024-06-11T17:51:39.225960
License: Public Domain

BEAM, Circuit Judge,
dissenting.
I respectfully dissent. Cases like this must have been on the mind of the Supreme Court when, in Pacific Mutual Life Ins. Co. v. Haslip, 499 U.S. 1, 111 S.Ct. 1032, 113 L.Ed.2d 1 (1991), it said “[w]e note once again our concern about punitive damages that ‘run wild.’ ” Id. at 17-18, 111 S.Ct. at 1043. My concern comes in three parts and dates back to Robertson Oil Co. v. Phillips Petroleum Co., 871 F.2d 1368 (8th Cir.1989) (Robertson I).
I.
In Robertson I, as noted in the majority opinion, we analyzed several theories of recovery advanced by the plaintiff, found all but one of them wanting, and reversed for a partial new trial. We conceded that the district court was correct in finding that “all of the liability theories rested upon only one basis for actual damages.” Id. at 1376. We embraced the statement of the district court that, concerning actual damages, “All roads lead to Rome.” Id. Instead of remanding for a new trial on all issues, however, we let stand a $750,000 judgment supported by a jury finding of “tortious interference with contract.” Id. at 1369 & 1376. This was, in my view, an incorrect approach, for the reasons I set forth in my concurrence in Ledferd v. Dowd, 979 F.2d 661, 677 (8th Cir. 1992).1 Although Ledferd involved a constitutional tort, the principles and policies I referred to there apply here as well.
II.
As noted by the majority, by the time we looked at this matter again, Robertson Oil Co. v. Phillips Petroleum Co., 930 F.2d 1342 (8th Cir.1991) (Robertson II), Haslip had
*371arrived on the scene. The Supreme Court stated that the “rational decisionmaking” required by the due process clause includes jury instructions that adequately guide the jury. Haslip, 499 U.S. at 19-20, 111 S.Ct. at 1044. “[Ajdequate guidance from the court [to the jury] when the case is tried to a jury properly enter[s] into the constitutional calculus.” Id. at 17-18, 111 S.Ct. at 1043. The “guidance” referred to in Haslip included instructions on the purpose of punitive damages, on consideration of the character and degree of wrong of the defendant, and on the necessity of preventing similar wrong. Id. at 6 n. 1, 111 S.Ct. at 1037 n. 1. The instruction excluded, as specifically noted by the Supreme Court, any evidence of the defendant’s wealth. Id. at 19-20, 111 S.Ct. at 1044.
I earlier expressed my concern about the adequacy of the Arkansas pattern jury instruction on punitive damages in Union Nat’l Bank of Little Rock v. Mosbacher, 933 F.2d 1440, 1448 (8th Cir.1991), cert. denied, — U.S. —, 112 S.Ct. 870, 116 L.Ed.2d 775 (1992). Essentially this same instruction was used in both Robertson cases and, in my view, the content falls well short of the constitutional requirements outlined in Haslip. The standardless approach permitted by the Arkansas instruction, coupled with consideration of an improper element (wealth of the defendant), has prompted the jury to “run wild” in this case and no amount of post-trial judicial review can correct the error.
In Robertson II, we rejected Phillips’ attack on the punitive damages instructions because only a “general objection that the ... instructions ... violated the Fourteenth Amendment” was made. Robertson II, 930 F.2d at 1347. After a review of the record, I have difficulty perceiving the Fed.R.Civ.P. 51 violation purportedly committed by Phillips.2 Even if we accept the majority view on this, the constitutional overlay brought into play by Haslip dictates that this panel review the adequacy of the Arkansas instruction, adequate objection or not, to bring to an end its use in violation of the Fourteenth Amendment.
III.
The most troublesome aspect of the result reached by the majority is the affirmance of a $4,000,000 punitive damages award without an underlying award for compensatory (actual) damages. The law of Arkansas is crystal clear. “[P]unitive damages are not recoverable unless compensatory damages not only have been suffered by the plaintiff but also have been assessed by the jury.” Lake v. Lake, 262 Ark. 852, 562 S.W.2d 68, 69 (1978).
Upon retrial subsequent to Robertson I, the plaintiff chose to proceed upon only two of its theories of recovery, tortious interference with contract and fraud. Of course, according to Robertson I, plaintiff had prevailed on the tortious interference theory and had retained a compensatory damages verdict. Thus, the only issue with regard to this theory, as discussed, was punitive findings. Because we said in Robertson I that “[e]ach of these theories ... would support a different amount of punitive damages, depending upon the conduct involved,” Robertson I, 871 at 1376, the district court submitted the case to the jury on two separate interrogatories dealing with liability (for fraud) and punitive damages (under both theories). A proper analysis of the facts indicates that we were wrong in Robertson I and this directed the district court to a faulty approach in the trial leading to Robertson II. If all roads do not now lead to Rome for punishment purposes, and we are really dealing with two discrete intentional torts, each separate punitive award must also be supported by a separate compensatory award. The result reached by the majority, is bottomed on this statement: “It is evident that the jury’s deliberations were directed to two different torts and two different injuries, each of which supports an award of punitive damages.” Majority Opinion at 368. To repeat, if we are really dealing with “two different torts [covering two different time periods as stated by the majority] and two different injuries,” id., then *372we need two different compensatory awards, a circumstance not reached in this case.
With respect, however, I think the separate award theory is simply wrong and a single award of punitive damages, if any are indeed due, is the only logical result that can arise from the core of facts presented to the jury by plaintiff. Any way you massage the events at issue, the ultimate damages occurrence in this case is the “loss of the Spe-Dee Mart account.” Robertson I, 871 F.2d at 1376. The plaintiff is being compensated for that event and the defendant is being punished for bringing it about.
The majority states that the fraud claim is based upon communications and promises leading up to the October 1984 meeting, but not on the meeting itself. Majority Opinion at 369. On the other hand, it asserts that it is only the meeting itself that supports the tortious interference claim. Id. The pre-October communications, however, would not have been actionable at all had the Spe-Dee Mart account stayed with Robertson. Likewise, the October meeting would have led to naught by way of damages had the Spe-Dee Mart account been retained. The district court was correct; “All roads [do] lead to Rome” for both compensatory and punitive purposes.
The majority says, in essence, that even if this is true, Phillips got what it asked for as a result of its arguments in Robertson I. Id. at 369. When I read all the contentions advanced by Phillips and put them in the context of the first trial, I reach a very different conclusion. In Robertson I, separate theories of tortious interference, fraud, good faith and fair dealing (intentional acts) and negligence, (unintentional acts) were advanced by Robertson. Robertson I, 871 F.2d at 1369. Over the objection of Phillips, the jury was permitted to deliberate on .punitive damages based upon, all of the theories of recovery presented. Id. at 1375. We affirmed only the compensatory award on only the theory of tortious interference. Id. at 1377. Wé remanded for retrial on all other theories. We said that on the instructions given and the verdict form submitted, we could not ascertain the basis upon which the jury made its punitive damages decision. Id. Phillips advanced this argument and we agreed with the contention. In addition to the reply brief quotations from Robertson I set forth in the majority opinion at 1368-69, Phillips also stated as follows:
The jury fixing the punitive damages award found that Phillips had breached its duty of good faith and fair dealing. Cast in the language of Court’s Instruction No. 15 [App. 124], this finding said that Phillips had violated “standards of decency, fairness, or reasonableness” as well as “good faith” and “honesty” in the performance of a contract. Post trial, the District Court recognized that a directed verdict should have been granted on Interrogatory No. 3 [App. 66] because Phillips, having made no contract to brand the Spe-Dee Mart Stores, could not have breached duties of good faith, decency, fairness and honesty owed only by a contracting party. Memorandum Opinion, p. 6. Therefore, the jury was permitted to consider breaches of duty defined in the strongest terms (decency, honesty, fairness, and good faith) in arriving at the punitive damages award, when those breaches of duty did not exist as a matter of law.
In light of the District Court’s judgment NOV, which has not been appealed, Robertson Oil must argue that whatever conduct is left will now support a $5 million punitive damages award; but this result is contrary to law and manifestly unfair to Phillips. It cannot be ascertained what conduct of Phillips was determined by the jury to merit punishment. Some or all of the punitive damages award may have rested upon Phillips’ alleged breach of its duties of decency, honesty, fairness and good faith. Therefore, the general verdict on punitive damages must be reversed, error having been shown. Dudley v. Dittmer, 795 F.2d 669, 673 (8th Cir.1986).
In addition, the mere fact that the jury was permitted to assess punitive damages on the basis of negligent conduct should require reversal of the punitive damages award.
Reply Brief of Appellant at 5-6 (footnote omitted).
*373An argument that portions of the evidence adduced in Robertson I could not have supported a punitive damages award and should be separately considered by the jury in its damages determinations on retrial is not, in the least, at odds with the arguments now advanced by Phillips that under the facts of this case two punitive awards are duplicative because, on damages, including punitive damages, all roads do indeed lead to Rome.
Finally, I agree with the district court’s analysis of the scope of judicial review of punitive awards under Arkansas practice. Such a review, however, does not, as I have said, save jury awards based upon the faulty Arkansas pattern instruction.
Thus, I would vacate all awards and remand this matter for a new trial on all issues. Short of this, at least a $4,000,000 injustice will have been done.
ORDER
Jan. 27, 1993.
The suggestion for rehearing en banc is granted. The judgment and opinion filed by the panel are vacated.
This case will be set for argument before the court en banc at a later date.
Chief Judge RICHARD S. ARNOLD and Judge MORRIS S. ARNOLD took no part in the consideration or decision of this case.

. The author of the majority opinion (the author of Robertson I and Robertson II) states that I disregard the principles of the law-of-the-case. I fully understand his discomfort with my suggestions that errors may possibly have been made at earlier times in this dispute, and, we do deal with the same dispute today that we were dealing with in Robertson I and Robertson II. With the greatest respect, I suggest that there seems to be a modicum of misunderstanding between us on the law-of-the-case doctrine. This circuit has said that the "law-of-the-case doctrine is a discretionary one.” United States v. Callaway, 972 F.2d 904, 906 (8th Cir.1992). I concede that a decision in a prior appeal is usually followed "unless ... the prior decision is clearly erroneous and works a manifest injustice." Id. at 905. Or, if the facts have changed since the earlier appeal, the doctrine is not followed. Little Rock School Dist. v. Pulaski, 971 F.2d 160, 165 (8th Cir.1992). I believe we are faced with some change in the facts due to the evidence adduced at the trial level and also with the possibility of manifest injustice to Phillips as the case has now developed. Finally, the doctrine applies only to issues decided by final judgments. Peterson v. General Motors Corp., 975 F.2d 518, 522 (8th Cir.1992) (citing Smith v. Mark Twain Nat’l Bank, 805 F.2d 278, 286 n. 16 (8th Cir.1986)). Until we have acted on the appeal before us and all subsequent review has been denied, we have no final order on the issues of punitive damages raised today by Phillips.

. Federal Rule of Civil Procedure 51 requires that "no party may assign as error the giving or the failure to give an instruction unless that party objects thereto before the jury retires to consider its verdict, stating distinctly the matter objected to and the grounds of the objection.”