In a recent 5-1 decision, the Florida Supreme Court struck down a $16 million punitive damages award as excessive.  Drawing attention from around the country, the recent opinion confirms that under both federal and state law, the punitive damages in the tobacco case were excessive when compensatory damages were merely $150,000.  Under Florida Statute 768.73, punitive damages greater than a 3:1 ratio is presumed invalid unless the facts and circumstances give rise to a reason to exceed that amount.  Further, Florida Statute 768.74 delineates five specific criteria courts can consider when deciding whether damages are excessive.  Namely, the statute clearly states the amount of damages be related to both the compensatory damages and the injury.

Underlying & Procedural History

In Coates v. R.J. Reynolds Tobacco Co. (RJR), decedent Lois Stucky’s sister Brinda Coates brought suit as personal representative on behalf of her sister after she died of cigarette-related lung cancer.  Out of the four causes of action Coates brought, she was only successful on her strict liability count.  The jury awarded decedent’s three adult children $100,000 each for loss of parental companionship, instruction, and guidance from their mental pain and suffering because of losing their parent.  After taking into account decedent’s 50% comparative negligence, the total remaining compensatory amount was $150,000.  There were no surviving spouses named.  After the jury awarded $16 million in punitive damages, RJR filed a motion for remittitur or a new trial.

The trial court denied RJR’s motion and they appealed.  On appeal, the Fifth District Court of Appeal (“Fifth DCA”) reversed and remanded the case after concluding the punitive damages were excessive under both state as well as federal law.  After rephrasing the question, the Fifth DCA certified it as a matter of public importance to the Florida Supreme Court.

The Florida Supreme Court looked at three factors in affirming the Fifth DCA’s decisions.  First, Florida Statute §768.74(5)(d), requires a punitive damages award to have a “reasonable relation to the amount of damages provided and the injury suffered.”  Here, Coates’ compensatory damages, after reduction, were $150,000, so the punitive damages of $16 million were grossly out of proportion.  Second, the cause of action for wrongful death in Florida is not common law but instead a creature of the legislature.  Florida’s Wrongful Death Act (WDA) has always focused on compensation to the survivors, not the decedent.  Therefore, in Florida, the death of a person gives rise to significantly less opportunity to recover damages than a serious injury to that person.  Both Coates and the dissent take issue with this.  However, in sticking to the letter of the law the Florida Supreme Court declined to step on the toes of the Florida Legislature by allowing death to serve as the cognizable injury for purposes of a punitive damages claim.  Third, in applying the law to the undisputed facts, the Court found the trial court abused its discretion when denying RJR’s motion for remittitur or a new trial.

Impact

This case garnered national attention as groups including Florida Defense Lawyers Association, Product Liability Advisory Counsel, Inc. and Washington Legal Foundation submitted amicus briefs in this matter.  The way the Court adhered to the text of the statute have some believing this opinion is a win for textualism as it shows the Court’s willingness to follow the law as it is.  Likewise, with the recent change to the Florida Appellate Procedure Rules allowing for interlocutory appeals for motions to include punitive damages may cause delays in litigation.  Whether parties will be deterred from seeking punitive damages based upon the rule change and recent opinion is unknown.  Instead, what this case solidifies is that if a party is awarded damages in excess of the 3:1 ratio in a wrongful death case, it must be reasonably related the injuries and damages.  Similarly, a party in Florida can safely assume courts will not rewrite the Florida Legislature’s policy choice to exclude death as a cognizable injury for purposes of seeking punitive damages under the WDA and instead recognize the statutory beneficiaries injuries suffered.