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Williams v. Philip Morris Inc.6/5/2002
Cooper Industries, Inc. v. Leatherman Tool Group, Inc., 532 US 424, 121 S Ct 1678, 149 L Ed 2d 674 (2001), undercuts the continuing vitality of Parrott. In Cooper Industries, the United States Supreme Court held that an appellate court must review a trial court's decision on whether an award of punitive damages is excessive as a matter of law rather than for an abuse of discretion. In reaching that conclusion, the Court stated that the amount of a punitive damages award is not a finding of fact that implicates the Seventh Amendment's limitations on judicial review of jury awards. Defendant argues that that holding in Cooper Industries weakens the premise of Parrott, which defendant identifies as treating the review of a punitive damages award as the review of a factual determination by a jury. Rather, according to defendant, it is now clear that the imposition of punitive damages is not based on findings of fact but on the application of a constitutional standard to the facts of a case. Thus, according to defendant, the rational juror standard of Parrott does not satisfy constitutional requirements.
We disagree with defendant's understanding of Cooper Industries. The background for that case was the Court's long-established rule that the Seventh Amendment forbids appellate review of federal district court refusals to set aside jury awards of compensatory damages on the ground that they are excessive. The Court modified that rule several years before Cooper Industries to allow federal appellate courts to review district court determinations for abuse of discretion, at least in diversity cases when the substantive state law provided for that kind of appellate review. Gasperini v. Center for Humanities, Inc., 518 US 415, 116 S Ct 2211, 135 L Ed 2d 659 (1996).
In Cooper Industries the Court held that a jury's determination of the amount of punitive damages was not a "fact" within the Gasperini rule and thus was subject to a broader scope of appellate review than it had established in that case. See 532 US at 437-40 and n 11. However, it also recognized that determining the amount of punitive damages is a "fact-sensitive undertaking" that is appropriately left to the discretion of the jury. Id. at 437-38 n 11. The Court noted in Cooper Industries that the district court had instructed the jury concerning the factors for it to consider in awarding punitive damages. It then stated that, " lthough the jury's application of these instructions may have depended on specific findings of fact, nothing in our decision today suggests that the Seventh Amendment would permit a court, in reviewing a punitive damages award, to disregard such jury findings." Id. at 439 n 12. Finally, the Court reaffirmed that the Gore criteria are the appropriate criteria for reviewing an award of punitive damages for excessiveness. Id. at 440.
The Court in Cooper Industries, thus, recognized the jury's primary role in finding the facts relevant to an award of punitive damages, in determining whether to make such an award, and in establishing the appropriate amount. Cooper Industries, in our view, does not alter the criteria by which a trial court is to review that award and, thus, does not affect the Oregon Supreme Court's discussion of those criteria in Parrott. Rather, what Cooper Industries does is to require an appellate court to review the trial court's decision on the amount of punitive damages as a matter of law--that is, by plenary review--rather than for an abuse of discretion. See also Bocci v. Key Pharmaceuticals, Inc., 178 Or App 42, 50-51, 35 P3d 1106 (2001), rev pending. That is consistent with the way that we have always reviewed trial court decisions regarding punitive damages. See, e.g., MacCrone v. Edwa
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