“application of the punitive caps in R.C. 2315.21 to the unique facts of this case would be arbitrary and/or unreasonable and is therefore, unconstitutional underArticle I, Section 16 of the Ohio Constitution”
Oberlin College has been on a crisis management public relations campaign to create a narrative that it is the victim in the Gibson’s Bakery case because it was held liable for student speech. In a series of scripted public statements, Oberlin College’s president Carmen Twillie Ambar has asserted that “this is a First Amendment case about whether whether an institution can be held liable for the speech of its students. And the actions of its students. And I think it’s important whether you’re a progressive or a conservative.”
That is, as we have noted before, a false characterization of the case.
Oberlin College was held liable for the speech of its senior administrators, particularly Dean of Students Meredith Raimondo, which the jury held was defamatory and made with actual malice. Oberlin College was held liable under long-standing and non-controversial legal principles that a corporation is liable for the actions of its employees, particularly officers, made within the scope of their employment. Oberlin College asserted that Raimondo was at the protest in question as part of her job, and didn’t claim that the actions attributed to her by witnesses in handing out the defamatory flyers were outside the scope of her employment (though it did dispute the witness testimony as to what Raimondo did).
While Oberlin College publicly seeks to create a more favorable narrative, in court it is trying to shave the calculation of damages under Ohio’s tort reform law down from $44 million ($11 million compensatory, $33 million punitive) down to $14.3 million. We went over that calculation, and the plaintiff’s counter-calculation netting plaintiffs $25 million, in a prior post, Gibson’s Bakery v. Oberlin College – Defense wants damages reduced to $14.3 million under Ohio tort reform caps.
The major dispute over calculation is whether the statutory cap on punitive damages of 2X compensatory damages applies to the full compensatory damages, or the compensatory damages after application of the cap on non-economic damages. That’s about at $10 million difference.
It’s not clear how the court will rule, but the plaintiffs seem to have the better argument based on the text of the statute in question. Defendants argued that the reading of the text argued by plaintiffs could result in an absurdity of a $1 billion verdict for non-economic damages being reduced to between $250,000 and $500,000 (depending how you calculate it) under the cap, yet the pre-cap $1 billion compensatory amount being doubled to $2 billion. That argument, based on the legal principle that statutes should not be read to create absurd results, is superficially sympathetic, but ignores that a court, in that scenario, could reduce or reject the $1 billion compensatory award without resort to the cap, as excessive and without legal or factual justification. The 2X punitive cap would apply only to whatever amount the court found was legally justified, not to a random absurd $1 billion non-economic verdict. So it’s a hypothetical absurdity that ignores the court’s ability to review a verdict.
But there is an underlying issue. The plaintiffs do not concede that the cap on punitive damages should apply at all, so plaintiffs want the court to keep the full $33 million punitive damage award.
Plaintiffs have filed a Brief (pdf.)(full embed at bottom) arguing that the cap on punitive damages as applied in this case is unconstitutional. The “as applied” language is critical, because the Ohio Supreme Court has upheld the punitive damage cap as a general matter, but according to plaintiffs’ legal analysis, left open that it would be unconstitutional as applied in a specific case. Plaintiffs argue that this is just such a case for the exception to the general rule on the punitive damages cap:
In Arbino, the Ohio Supreme Court found that R.C. 2315.21 was constitutional on its face. However, the Court left open “as applied” challenges to the constitutionality of this statute. As applied to the facts of the matter at hand, the caps on punitive damages in R.C. 2315.21(D)(2) violate the Plaintiffs’ right to due course of law under Article I, Section 16 of the Ohio Constitution.4 When reviewing R.C. 2315.21 on due process grounds, courts must apply the rational basis test. Arbino, 116 Ohio St.3d 468, ¶¶ 49, 99. Under the rational basis test, a statute must (1) bear a real and substantial relation to the public health, safety, morals or general welfare of the public, and (2) be neither unreasonable nor arbitrary. Id. at ¶ 49. The statute fails both prongs when applied to the facts at hand….
Thus, the legislative purpose behind R.C. 2315.21 was to maintain focus on keeping punitive damage awards rationally connected to the defendant’s wrongful conduct. It cannot be said that the statute was supposed to remove any analysis of whether the particular amount of punitive damages is sufficient to deter the defendant from future conduct or sufficient to place a safeguard between the defendant, and other potential tortfeasors, and society at large. Further, Arbino acknowledged that if a double-the-compensatory award does not punish the defendant, then applying the caps to that particular case would be arbitrary and unreasonable. Id. at ¶ 103.
Plaintiffs then go on to argue that given Oberlin College’s approximately $1 billion in assets, and its defiant attitude at trial, applying the cap would be unconstitutional as applied to this case. (The plaintiffs do not cite the post-trial statements of Oberlin College, in which it continues to deny it did anything wrong and falsely portrays itself as being held liable for student speech and conduct).)
As a result, the Court must look beyond the text of R.C. 2315.21 to determine which punitive damages award (the jury award or the proposed statutorily-capped award) actually bears a real and substantial relation to the public health, safety, morals or general welfare of the public. Plaintiffs submit that, given the unique facts of this case, namely a billion-dollar-institution versus a small business, the Court should apply the jury award of $33,223,500. To apply a statutorily-capped punitive award to the facts of this case would not serve the public welfare because it would, in effect, permit Oberlin College to consider its tortious conduct as nothing more than the cost of business….
Moreover, application of the punitive caps in this case would be arbitrary or unreasonable because it would remove any rational connection between: (a) the amount of the punitive damages award and (b) Defendants’ tortious conduct or Defendants’ financial wherewithal for purposes of arriving at a sufficient deterrent and punishment. In Arbino, the Ohio Supreme Court clearly identified that the purpose of punitive damages is not to compensate a plaintiff, but to punish the guilty, deter future misconduct, and demonstrate society’s disapproval of the defendant’s actions….
Capping punitive damages to two time compensatory damages is arbitrary and unreasonable because it fails to set forth sufficient safeguards necessary to protect Plaintiffs and other members of society from Defendants’ bulldozer mentality. Likewise, calculating the punitive damages through mere arithmetic on the facts at hand removes all connection to the critical factor of whether the award is sufficient to deter the conduct of the Defendants. In fact, when discussing the unique facts of this case, we know that using arithmetic will not deter Defendants from committing future conduct similar to that in this case.
The plaintiffs included in the brief testimony reflecting the position taken by the college in the highly controversial email sent by the General Counsel of the college after the compensatory verdict but before the punitive damages verdict:
The discussion concludes:
In sum, on the facts at hand, applying R.C. 2315.21 would not serve the purpose of connecting punishment and deterrence effects to the actual conduct of Defendants. Instead, R.C. 2315.21 offers nothing more than a mechanical doubling of the compensatory damages awarded by the jury. As a result, application of the punitive caps in R.C. 2315.21 to the unique facts of this case would be arbitrary and/or unreasonable and is therefore, unconstitutional under Article I, Section 16 of the Ohio Constitution.
So where we are now is that the final calculation of damages, depending on how and whether various caps are applied, could range from $14.3 million to almost $40 million, not to mention attorney’s fees and pre-judgment interest.
[Featured Image: Gibson Family and legal team after punitive damages verdict][Photo credit Bob Perkoski for Legal Insurrection Foundation]
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