TortsProf Blog

Editor: Christopher J. Robinette
Widener Commonwealth Law School

Friday, December 22, 2006

Valdez Case Heard, For the 3,472nd time, By the Ninth Circuit

...and they've finally given up on telling the trial judge to come up with a number, instead setting the number for punitives at $2.5 billion (five times the actual harm determined by the trial court).  Of note, the trial court had previously set the figure at $4.5 billion, within the 9:1 ratio suggested by State Farm.

The opinion is here [PDF].  One significant issue involves the impact of payments made pre-judgment -- settlements, interest, and the like.  Exxon argued that it should be subtracted from the numerator such that the "actual harm" figure would be around $20 million rather than the $500+ million used by the trial court.  The Court of Appeals rejected that view, but also rejected the plaintiffs' argument that the ratio of 9:1 would be appropriate, concluding that the conduct was not so reprehensible as to justify going to that end of the range:

Thus, Exxon’s conduct is in the higher realm of reprehensibility, but not in the highest realm. In addition Exxon’s post-grounding efforts to mitigate the harm serve materially to reduce the reprehensibility of the original misconduct. They reduce the reprehensibility for purposes of our review to, at most, a mid range. 

Judge Browning dissents, and would affirm.

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