Beyond the tobacco case

When the Supreme Court accepted a case involving “Big Tobacco” and punitive damages, the expectation was that justices would review — and clarify — their muddled jurisprudence on the matter. But Tuesday’s oral arguments took a different track.

In Philip Morris USA v. Williams, the court was asked to review an Oregon Supreme Court ruling upholding $79.5 million in punitive damages awarded to the widow of a man who had died of lung cancer after smoking for nearly five decades. Philip Morris argued that the jury’s absurdly generous sum not only violated due process but also the court’s own guidelines governing punitive damages. In 2003, a 6-3 court suggested that a 9:1 ratio between punitive and compensatory damages was the maximum a jury could constitutionally award a plaintiff without violating the defendant’s right to due process. In the Oregon case, the plaintiff received $821,485 in compensatory damages, rendering the punitive-to-compensatory ratio a ridiculous 97:1.

Philip Morris’ point here, which we share, is that a jury cannot punish a defendant for harm done to “non-parties” — other smokers or spouses of smokers not involved in the case. But the court thought that was exactly what the Oregon jury did, especially since Philip Morris’ lawyers were barred by the trial court from instructing the jury on precisely that point. Philip Morris hoped that the court would at least reaffirm its previous 9:1 standard, if not set a smaller standard.

Instead, the court first questioned the lucidity of the instructions, which were that, although a jury could consider harm done to non-parties, it could not punish the defendant for that harm. Justice Ruth Bader Ginsburg wondered whether that might not confuse a jury. Justice Antonin Scalia in particular wanted to know the Oregon Supreme Court’s reasoning for upholding the judge’s decision not to allow those instructions to be read to the jury in the first place. He suggested that the case should be returned to the state court for clarification. All justices seemed to agree that a jury cannot punish a defendant for harm done to non-parties.

So all those heady constitutional issues have to wait for another day. Our own view is that while punitive damages are excessive across the country, it is not necessarily a constitutional matter demanding a Supreme Court remedy. As Justice Antonin Scalia wrote in his dissenting opinion in the 2003 case, “the Due Process Clause provides no substantive protections against ‘excessive’ or ‘unreasonable’ awards of punitive damages.” Instead, it’s a problem better solved through legislation, as Congress has done with tort reform.

Justice Scalia was joined in his 2003 dissent by Justices Clarence Thomas and Ginsburg. The departure of William Rehnquist and Sandra Day O’Connor, who favored punitive caps, leaves in doubt just where the high court would fall on a future ruling in this case, if any.