Burns v. Prudn., Secr., Inc.

{¶ 183} I respectfully dissent only as to the final recalculation of the punitive damage award by the majority. At the outset, I concede that the thorough analysis of the prevailing case law in the majority opinion leaves little doubt that even considering the class action status of plaintiffs, the current jurisprudence of the United States and Ohio Supreme Courts does not support a $250 million punitive damage award in this case. Unfortunately, it seems equally clear that once a punitive award is determined to be excessive, the jurisprudence in this area essentially provides for the appellate courts to unilaterally substitute their own calculation of punitive damages for that of the trial court and jury — with little objective guidance and little or no deference to the trial process or jury verdict. Accordingly, this court now proposes to reduce the overall punitive damage award in this case, for a class of some 300 plaintiffs, from $250 million to about $6 million.

{¶ 184} I find at least two aspects of this appellate remittitur troubling. First, unlike most of the prevailing case law on this subject, our review of the record in this case has resulted in a unanimous determination that there was no error committed at the trial. Moreover, we have made an express determination in our opinion that the verdict and punitive damage award of the jury was not the product of any improper passion or prejudice. Under these circumstances, I believe that sound appellate review, even in this sensitive area, requires some deference to the trial court process and the jury verdict, beyond what the majority proposal reflects. At one time, the Ohio Supreme Court would seem to have agreed with this proposition. See Wrightman v. Consol. Rail Corp. (1998), 83 Ohio St.3d 1443, 700 N.E.2d 328.

{¶ 185} Second, while it is true that this case does not present an egregious matter of individual personal injury or death, the case does involve an entire class of some 300 individuals. Thus, the misconduct of the defendants, detailed at length in the majority opinion, clearly exhibited a corporate arrogance, reckless disregard, and indifference to the public interest that in my view, is equally egregious in its own way. Moreover, I respectfully disagree with the reluctance of the majority to characterize this misconduct as reflecting overall corporate policy. The record plainly shows otherwise.

{¶ 186} In particular, I believe that the majority calculation of the final punitive award is unduly influenced by the fairly generous compensatory award received by the plaintiffs, as opposed to consideration of the appropriate punishment for the defendants' misconduct. Simply put, if Prudential was willing to treat 300 of its own clients in the manner established in the record, I believe that the corporate threat to the public interest was real and is undervalued by the majority.

{¶ 187} I concur with the majority in identifying the period of the cover-up following these transactions as the operative period in evaluating the punitive award. And in the absence of clear evidence of corporate worth, I concur with the majority in identifying the cost to Prudential of restoring these accounts during this period as an important financial incentive in continuing the cover-up — and hence, an important factor for us in considering the appropriate financial punishment.

{¶ 188} However, I respectfully disagree with the majority in selecting the lower cost ($3.5 million) of restoring these accounts one week after discovering the illegal transactions as the base amount for the remitted punitive award, when we have clearly documented, and upheld in our opinion, a compensatory award based upon the highest value of these accounts over the cover-up period, which extended for several months. In my view, it would be more consistent to base the punitive award on the cost of restoring these accounts at their highest point during the period of the cover-up. The trial record indicates that this amount would have been approximately $6.5 million, which incidentally, would have been only three weeks after the date selected by the majority.

{¶ 189} In sum, even assuming the necessity of a drastic remittitur in this case, I believe that the appropriate punitive award would be a multiple of the $6.5 million representing the cost to restore these accounts at their highest point during the cover-up period. In my view, a doubling of this amount for a total punitive award of $13 million would constitute a minimum amount appropriate to these facts. Such an award would be more consistent with our analysis of the remaining issues in the case, and, while perhaps on the high side of existing Ohio case law for purely economic misconduct, it is not so high when applied to corporate misconduct toward a class of 300 plaintiffs, and the two-to-one overall ratio employed in this calculation would comport with the most recent formulas of the Ohio Supreme Court for the reasoned recalculation of excessive punitive damages. SeeDardinger v. Anthem Blue Cross Blue Shield,98 Ohio St.3d 77, 2002-Ohio-7113, 781 N.E.2d 121.

{¶ 190} Finally, such an award would at least constitute a token gesture of deference to the due process rights of the plaintiffs, who obtained this jury verdict in what we have expressly acknowledged was a fair trial conducted by the trial judge, counsel, and the jury without error, undue passion, or prejudice.

{¶ 191} I concur fully in every other aspect of the majority decision.