Court Opinion

ID: 9846014
Source: CourtListenerOpinion
Date Created: 2023-09-24 03:32:52.152985+00
Date Added: 2024-06-11T09:16:31.288598
License: Public Domain

REINHARDT, Circuit Judge,
concurring:
Although I concur in the order, I would add another consideration to our discussion of the relevant factors in assessing punitive damages.
If punitive damages are to achieve the twin purposes of deterrence and punishment, see Order at 15282-83 [1233], we must consider the impact of a damage award upon the particular defendant in determining the constitutional limit. The appropriate ratio of punitive to compensatory damages may vary with the amount of the compensatory damages and the net worth of the defendant. In some cases, although the conduct may be similar, because of lower compensatory damages or the defendant’s higher net worth, a higher ratio may be necessary to achieve a deterrent or punitive effect. In other cases, where the variables are the opposite, a lower ratio may be appropriate.
For example, if $10,000 in compensatory damages is awarded against a defendant with a net worth of $50,000, then $10,000 in punitive damages may be an appropriate amount to achieve both the punitive and deterrent purposes. The same amount of punitives awarded against a company earning $1 billion a year, with a net worth of $50 billion, would hardly serve either of these objectives.
The precept that the defendant’s wealth should be considered if we are to achieve the intended effects of deterrence and punishment is hardly novel. See, e.g., Browning-Ferris Indus. v. Kelco Disposal, 492 U.S. 257, 300, 109 S.Ct. 2909, 106 L.Ed.2d 219 (1989) (O’Connor, J., concurring in part and dissenting in part) (“Blackstone remarked that the ‘quantum, in particular, of pecuniary fines neither can, nor ought to be, ascertained by any invariable law. The value of money itself changes from a thousand causes; and at all events, what is ruin to one man’s fortune, may be a matter of indifference to another’s.’ ”) (quoting William Blackstone, 4 Commentaries *371); H.R.
Rep. No. 102-10, at 73 (1991) (“[Jjuries normally take the defendant’s financial standing into account in awarding punitive damages; courts have recognized that a higher amount may be appropriate against a particularly large or wealthy employer, to ensure effective deterrence.”); Restatement (Second) of Torts § 908 (1979) (“In assessing punitive damages, the trier of fact can properly consider the character of the defendant’s act, the nature and extent of the harm to the plaintiff that the defen*794dant caused or intended to cause and the wealth of the defendant.”).
In the ease before us, an award of over ten times the amount of the compensatory damages is far in excess of one that would reasonably accomplish the twin objectives. The proposed punitive damages are hardly commensurate with the need to deter the wrong-doer or others like him from committing similar offenses. Nor are they commensurate with the need to impose sufficient punishment on this defendant.
In sum, I write separately to express my agreement that the ratio arrived at today is not a magic figure, although it is the proper ratio here, but, more important, to make the point sometimes overlooked, that there should be no fixed ratio; rather, in a number of cases the ratio must be determined in light of the two purposes discussed above.