PLAINTIFFS’ OPPOSITION TO DEFENDANT HAMILTON MATERIALS, INC.’S MOTION IN LIMINE NO. 11 TO APPLY UNITED STATES SUPREME COURT’S RECENT DECISION IN PHILLIP MORRIS USA V. WILLIAMS AND EXCLUDE EVIDENCE AND ARGUMENT REGARDING ALLEGED CONDUCT TOWARD NONPARTIES
Plaintiffs Tony E. Piro and Doris Piro (“Plaintiffs”) oppose Defendant Hamilton Materials, Inc.’s (“Hamilton” or “Defendant”) motion in limine to exclude evidence of harm caused to others by Hamilton’s conduct, and in support would show the Court as follows:
In seeking to exclude all evidence of harm caused to third parties by its conduct, Hamilton ignores the clear holding of Phillip Morris USA v. Williams (2007) 127 S. Ct. 1057, 1064, that such evidence is relevant to the reprehensibility prong of the punitive damages inquiry. Rather than exclude all evidence of harm to other parties, as Defendants unreasonably demand, according to Phillip Morris and Ninth Circuit precedent any potential prejudice posed by the introduction of such evidence can be cured with a limiting instruction. Plaintiffs have already provided such an instruction in their Proposed Jury Instructions submitted in this case. Therefore, Defendant’s motion in limine should be denied.
ARGUMENT AND AUTHORITIES
Evidence of Defendant’s Harmful Conduct Toward Others is Relevant to the Reprehensibility Prong of the Punitive Damages Analysis.
Defendant’s motion disregards a central holding of the Phillip Morris case. While Phillip Morris did hold that under the Due Process Clause evidence of harm caused to third parties could not be the basis for punishing the defendant, the Court also recognized that such evidence is relevant to the reprehensibility question. (See Phillip Morris, supra, 127 S. Ct. at pp. 1063-64 (copy attached as Exhibit A).) As the Court explained, “[e]vidence of actual harm to nonparties can help to show that the conduct that harmed the plaintiff also posed a substantial risk of harm to the general public, and so was particularly reprehensible.” (Id. at p. 1064 (emphasis added).) Indeed, even Phillip Morris, the defendant in that case, did not deny the relevance of this evidence in showing reprehensibility. (See id.) However, as the Court held, the jury is not permitted to go beyond considering harm to others for reprehensibility purposes and use this evidence to punish the defendant. (See id.)
The United States Supreme Court and the California Supreme Court have repeatedly recognized the importance of the reprehensibility inquiry in determining punitive damages. (See State Farm Mutual Automobile Ins. Co. v. Campbell (2003) 538 U.S. 408, 418; BMW of N. Am., Inc. v. Gore (1996) 517 U.S. 559, 575; Simon v. San Paolo U.S. Holding Co. (2005) 35 Cal.4th 1159, 1179-80; Johnson v. Ford Motor Co. (2005) 35 Cal.4th 1191, 1201.) Courts reviewing punitive damages awards for compliance with constitutional limitations are to look to three guideposts, the first of which is the reprehensibility of the defendant’s misconduct. (See State Farm, supra, at p. 418; BMW, supra, at p. 575; Simon, supra, at p. 1180; Johnson, supra, at p. 1201.) In fact, the Supreme Court has repeatedly held that “the most important indicium of the reasonableness of a punitive damages award is the degree of reprehensibility of the defendant’s conduct.” (State Farm, supra, at p. 419; Gore, supra, at p. 575.)
There are numerous factual circumstances relevant to determining reprehensibility, including “tortious conduct [that] evinced an indifference to or a reckless disregard of the health or safety of others” and “conduct [that] involved repeated actions.” (State Farm, supra, 538 U.S. at p. 419; Simon, supra, 35 Cal.4th at p. 1180.) Thus, the defendant’s similar misconduct toward other victims, or its recidivism, is important evidence to be considered in evaluating reprehensibility. (See State Farm, supra, at p. 423; BMW, supra, 517 U.S. at p. 574 fn. 21; Johnson, supra, 35 Cal.4th at p. 1213.) Mindful even prior to Phillip Morris that punitive damages could not be used to punish the defendant for harming others, (Johnson, supra, at p. 1206 fn. 6), the California Supreme Court determined that “[n]othing the high court has said about due process review requires that California juries and courts ignore evidence of corporate policies and practices and evaluate the defendant’s harm to the plaintiff in isolation.” (Id. at p.1207.) Thus, when assessing reprehensibility, California courts should consider “the defendant’s illegal or wrongful conduct toward others that was similar to the tortious conduct that injured the plaintiff or plaintiffs.” (Id. at p. 1204.) In fact, in Johnson the Court held the Court of Appeal had erred in failing to give express weight to evidence that the defendant had a corporate practice of engaging in wrongful conduct similar to that which injured the plaintiff. (Id. at 1213.)
Under both federal and California law, Plaintiffs have the right to introduce evidence of harm to others in support of their claim for punitive damages. Phillip Morris only confirmed the relevance of such evidence to determining Defendant’s reprehensibility. (See Phillip Morris, supra, 127 S. Ct. at pp. 1063-64.) Defendant’s motion seeking to summarily exclude all evidence of harm to nonparties on the basis of Phillip Morris is therefore misplaced.
Any Potential Prejudice to Defendant Can Be Cured By The Jury Instruction That Plaintiffs Have Already Proposed.
Precautions must be taken in order to ensure that the jury only considers evidence of harm to nonparties for purposes of determining the reprehensibility of the defendant’s conduct, and does not improperly consider such evidence to punish the defendant. (See Phillip Morris, supra, 127 S. Ct. at p. 1065.) While the Supreme Court left the particulars of such precautions up to the States, any fair reading of the opinion does not lead to the result that Hamilton urges here. Exclusion of all evidence of harm to others was not the type of protection the Court contemplated. As the Court explained, a trial court should, upon request, protect against the risk of jury confusion only if “the sort of evidence that was introduced at trial or the kinds of argument that the plaintiff made to the jury” raises the risk that the jury will consider the evidence for an improper purpose. (Id.) In other words, when evidence of harm to others is admitted to show reprehensibility, the court should act to “protect against the risk” that punitive damages will be awarded to punish the defendant for harming nonparties. (Id.)
In two recent cases the Ninth Circuit has applied Phillip Morris to require a limiting instruction to the jury. In White v. Ford Motor Co. (9th Cir. Aug. 30, 2007), No. 05-15655, 2007 U.S. App. LEXIS 20724, at *19 (copy attached as Exhibit B), the defendant requested a limiting instruction that would have informed the jury that harm to others could be considered in assessing reprehensibility but that the jury could only punish the defendant for the harm caused to this plaintiff. The Ninth Circuit agreed that such a limiting instruction was required because of the significant risk that the jury would punish the defendant for the harm it caused to third parties. (See id. at pp. *19-*20.) The court held that the failure to give such an instruction was a violation of the defendant’s due process rights. (See id. at p. *20.) In remanding the case the court instructed the trial court to “explain to the jury that although evidence of harm to nonparties may bear on [the defendant’s] reprehensibility, any award of punitive damages cannot be used ‘to punish [the defendant] for harms to . . . nonparties.’” (Id. at p. 21 (quoting Phillip Morris, supra, 127 S. Ct. at p. 1064).)
A similar result was reached in Merrick v. Paul Revere Life Insurance Co. (9th Cir. Aug. 31, 2007), No. 05-16380, No. 05-17059, 2007 U.S. App. LEXIS 20959 (copy attached as Exhibit C). In that case the court recognized that Phillip Morris “clarified that a plaintiff may offer evidence of ‘harm to other victims’ to show the reprehensibility of [the] defendant’s conduct . . . . (Id. at p. *21 (quoting Phillip Morris, supra, 127 S. Ct. at pp. 1063-64).) However, the court also found that it was error not to instruct the jury regarding the proper and improper uses of evidence that the defendant had a history of improper behavior that had damaged other victims. (See id. at pp. *24-*25.) Because the evidence of harm to others was admissible only for a limited purpose, a limiting instruction was required.(See id. at pp. *25-*26.)
Here, Plaintiffs have already submitted a proposed jury instruction that complies with the constitutional requirements set forth in Phillip Morris, White, and Merrick. Instruction 44 of Plaintiffs’ Proposed Jury Instructions includes the following punitive damages instruction: “Although evidence of harm to nonparties may bear on the defendant’s reprehensibility, any award of punitive damages cannot be used to punish the defendant directly for harms to non-parties.” Thus, the Court already has instructions that will eliminate the potential risk of prejudice to Defendant. Hamilton’s request to exclude all evidence of harm to others should therefore be denied.
Defendant Is Not Entitled to a “Detailed Offer of Proof” Regarding Evidence of Harm to Nonparties.
In seeking a “detailed offer of proof” for all evidence of harm to nonparties, Defendant has taken the legal reasoning behind the Phillip Morris opinion and turned it on its head. Phillip Morris did not hold, as Defendant claims, that defendants must be allowed to present a detailed defense to evidence that their conduct caused harm to others. Rather, the Supreme Court’s reasoning was that defendants could not be punished for harm to nonparties, consistent with the Due Process Clause, in part because there would be no opportunity in a civil trial to offer a defense to such charges. (See Phillip Morris, supra, 127 S. Ct. at p.1063.) It is precisely because the Due Process Clause prohibits punishment without the opportunity to present a defense that punitive damages cannot be awarded to punish defendants for the harm caused to other parties. As the Supreme Court recognized, “a defendant threatened with punishment for injuring a nonparty victim has no opportunity to defend against the charge” by offering evidence of the nonparty’s own negligence or mounting any other defense. (Id.)
Here, pursuant to Phillip Morris Defendant is not subject to being punished with punitive damages for the harm it has caused to other parties. The purpose of Plaintiffs’ limiting instruction is to prevent just such an event. Therefore, because Defendant is not at risk of punishment for harm to nonparties, it does not have the right to present the type of detailed defense as claimed in its motion regarding the causation of the nonparty’s injuries and other defenses. Phillip Morris recognized that such mini-trials were not feasible. (See Phillip Morris, supra, 127 S. Ct. at p.1063.) Therefore, this Court should deny Defendant’s alternative request that Plaintiffs be required to make a “detailed offer of proof”regarding all evidence that Defendant’s wrongful conduct injured nonparties.
Evidence that Defendant similarly harmed nonparties is important and relevant evidence to showing the reprehensibility of Defendant’s conduct for purposes of punitive damages. A limiting instruction already submitted by Plaintiffs will cure any potential risk that such evidence will be used by the jury for an improper purpose. Therefore, Defendant’s motion in limine should be denied in its entirety.
PLAINTIFFS’ LODGMENT OF NON-CALIFORNIA AUTHORITIES
Pursuant to California Rules of Court, Rule 3.1113(j), Plaintiffs hereby lodge the following non-California authorities:
- Attached hereto as Exhibit A is a true and correct copy of Phillip Morris USA v. Williams (2007) 127 S. Ct. 1057.
- Attached hereto as Exhibit B is a true and correct copy of White v. Ford Motor Co. (9th Cir. Aug. 30, 2007), No. 05-15655, 2007 U.S. App. LEXIS 20724.
- Attached hereto as Exhibit C is a true and correct copy of Merrick v. Paul Revere Life Insurance Co. (9th Cir. Aug. 31, 2007), No. 05-16380, No. 05-17059, 2007 U.S. App. LEXIS 20959.