Filed 6/16/05 (this opn. should follow companion case, S121933, also filed this date)
IN THE SUPREME COURT OF CALIFORNIA
GREG JOHNSON et al.,
Plaintiffs and Respondents,
S121723
v.
Ct.App. 5 F040188/F040529
FORD MOTOR COMPANY,
Fresno
County
Defendant and Appellant.
Super. Ct. No. 647176-9
Plaintiffs, purchasers of a used automobile, sued the manufacturer, Ford
Motor Company (Ford), for concealing the automobile’s history of transmission
repairs and replacements when reselling the car. Plaintiffs presented evidence of
corporate practices by Ford identical or closely similar to the fraud inflicted on
them, practices they maintain earned Ford millions of dollars in profit in
California every year. The jury found in plaintiffs’ favor and awarded them
$17,811.60 in compensatory damages and $10 million in punitive damages. The
Court of Appeal, holding Ford could constitutionally be punished in this case only
for its fraud on plaintiffs and not for its overall course of conduct, reduced the
punitive damages award to $53,435, approximately three times the compensatory
damages.
We agree with the Court of Appeal that the $10 million punitive damages
award may not, under the circumstances of this case, constitutionally be justified
on the basis of disgorgement of profits earned by Ford through its entire course of
1
wrongful conduct toward other consumers. In reducing the punitives to a small
multiple of the relatively modest compensatory damages award, however, the
Court of Appeal apparently failed to adequately consider that Ford’s fraud was
more reprehensible because it was part of a repeated corporate practice rather than
an isolated incident. For this reason, we reverse the Court of Appeal’s judgment
and remand for that court to conduct again the independent due process review
required under State Farm Mut. Auto Ins. Co. v. Campbell (2003) 538 U.S. 408
(State Farm) and BMW of North America v. Gore (1996) 517 U.S. 559 (BMW).
FACTUAL AND PROCEDURAL BACKGROUND
In February 1998, plaintiffs Greg and Jo Ann Johnson bought a used 1997
Ford Taurus from a car dealer, Decker Ford (Decker), for $17,411. When Greg
Johnson asked about the previous ownership, the salesman told them only that the
Taurus had been traded in for a newer model. When he asked to see the Taurus’s
repair history, he was shown a computer printout that indicated there had been no
significant repairs. The jury found Decker had acted as Ford’s agent in this sales
transaction.
In fact, the previous drivers, the McGills, had experienced repeated and
seemingly unrepairable difficulty with the car’s transmission after leasing it in late
1996. After at least four trips to the dealership for the transmission problems, one
transmission replacement, and an incident in which the transmission locked in low
gear on the freeway, the McGills, in July 1997, requested that Ford repurchase the
car as a “lemon.”
Ford’s district customer service manager reviewed Decker’s records and
decided the automobile did not qualify for mandatory repurchase under
California’s lemon law (Civ. Code, §§ 1790-1795.7).1 (The jury later found to the
1
All further statutory references are to the Civil Code unless otherwise
specified.
2
contrary.) Instead, she approved issuance of an “owner appreciation certificate”
worth $1,500 on any trade-in at Decker. Though the McGills were never told they
had received an owner appreciation certificate from Ford, Decker applied the
$1,500 credit to their trade of the Taurus for a new pickup truck, then recovered
the $1,500 from Ford.
After Decker resold the Taurus to plaintiffs, they also experienced
transmission problems with it. When, in August 1998, Greg Johnson complained
that it delayed in shifting and “slammed” into gear, Decker replaced the
transmission. In March 1999, the transmission would not shift into reverse;
Decker again replaced it. At that point, in discussion with Decker’s service writer,
Greg Johnson asked to see and was finally shown the car’s complete repair file,
thus learning of the McGills’ earlier problems.
The Johnsons sued Ford and Decker for intentional and negligent
misrepresentation and concealment, violations of the Song-Beverly Consumer
Warranty Act (Civ. Code, §§ 1790-1795.7) (Lemon Law), the Consumer Legal
Remedies Act (Civ. Code, §§ 1750-1784), the unfair competition law (Bus. &
Prof. Code, §§ 17200-17210), and the prohibition on false or misleading
advertising (Bus. & Prof. Code, § 17500). Plaintiffs settled with Decker prior to
trial and, after the jury verdict, voluntarily dismissed their unfair competition and
false advertising causes of action against Ford.
In addition to the facts of the Taurus’s repair history and its sale to them,
summarized above, plaintiffs at trial presented evidence of Ford’s corporate
policies and practices regarding reacquisition of vehicles and issuance of owner
appreciation certificates (OAC’s). Ford’s stated policy was that OAC’s—credits
of up to $5,000 on trade-ins for new Ford vehicles provided as goodwill to help
“satisfy the customer and to restore the customer’s confidence in Ford products”—
were to be issued only for vehicles that did not meet the state’s definition of a
3
lemon and therefore were not subject to mandatory reacquisition. But plaintiffs
introduced evidence that, in evaluating eligibility, at least some Ford managers
employed a narrow concept of what constituted a repair attempt for purposes of
applying state lemon laws, including California’s, under which a vehicle that
cannot be repaired in a “reasonable number” of attempts must be reacquired or
replaced. (See § 1793.2, subd. (d)(2).) Specifically, the regional customer service
manager who handled the McGills’ complaint and authorized issuance of the OAC
testified she interpreted the Ford training and policy materials to provide that an
occasion on which the customer brought the vehicle in with a complaint, but the
service staff was unable to find or confirm the problem, was not counted as a
repair attempt. Ford’s former policy manager for the reacquired vehicle program
similarly stated that “[i]f the technician does not replace a part or make an
adjustment to the vehicle, and it’s properly documented as no problem found, then
I would not count it as a repair.”2
In addition, Ford’s reacquired vehicle program looked almost exclusively
to whether a vehicle met the law’s presumption of reasonable repair attempts,
based on a specified number of attempts in a certain period (see § 1793.22, subd.
(b)), rather than whether the number of attempts was itself reasonable regardless
of the presumption (see § 1793.2, subd. (d)(2)). Thus, the 1998 reacquired vehicle
program manual repeatedly instructed customer service managers that vehicles
meeting “state lemon law presumption[s]” were not eligible for an OAC, stated
that a used car would be eligible for an OAC if it “does not meet lemon law
presumption,” and gave as examples of ineligible vehicles those with more repair
attempts or days out of service than specified under a state’s lemon law
2
Ford’s narrow understanding of a repair attempt has been rejected by an
appellate court in a Lemon Law case against another manufacturer. (Oregel v.
American Isuzu Motors, Inc. (2001) 90 Cal.App.4th 1094, 1103-1104.)
4
presumption. In line with these written policies, the regional customer service
manager testified she understood an OAC could not be offered “if the vehicle met
the presumption of lemon law,” and the former policy manager explained that “we
don’t determine anything by reasonable repair attempts because we cannot define
reasonable repair attempts.” By these narrow constructions, Ford allowed itself to
issue OAC’s for dealer trade-in of vehicles that arguably should have been
reacquired as lemons, thereby avoiding the title branding and additional notice
requirements involved in reselling a lemon. (See § 1793.23, subd. (c).)
Ford managers also testified that the company regarded OAC’s as
assistance to the customer, not the dealership. Ford thereby avoided the
requirement of California law to notify future buyers of defects that led to a
vehicle’s reacquisition by the manufacturer or the dealer with manufacturer
assistance “in response to a request by the buyer or lessee that the vehicle be either
replaced or accepted for restitution because the vehicle did not conform to express
warranties,” a requirement that applies even if the vehicle is not reacquired as a
lemon. (§ 1793.23, subd. (d) [in such cases, the manufacturer must give the
subsequent buyer the “warranty buyback notice” prescribed in § 1793.24].) The
reacquired vehicle policy manual specified that while OAC’s were ordinarily
mailed to the dealer, in California they were to be sent instead to the customer
(though, as noted earlier, no certificate was in fact mailed to the McGills).
According to the former policy manager, the policy of mailing to the customer
was adopted “[t]o avoid anyone getting the impression we’re trying to assist a
dealer.”
Plaintiffs presented further evidence that Ford’s San Francisco and Los
Angeles offices issued about 1,200 to 1,400 OAC’s per year in the year of trial and
the previous year (2000 and 2001). The average face amount of OAC’s issued
over the four previous years was between $2,700 and $3,200. Finally, testimony
5
was given to the effect that the cost of reacquiring a vehicle as a lemon (i.e., the
cost of repurchasing or replacing the vehicle less its resale or salvage value) was
between $8,500 and $13,500, depending on the year and the method of
reacquisition (refund or replacement).
Based on this evidence, plaintiffs’ attorney argued to the jury that Ford
saved $6,000 to $10,000 on each OAC for a vehicle that would otherwise have
had to be reacquired, and that approximately 1,000 such OAC’s were issued per
year to California customers (excluding some issued out of California offices to
customers in other states). Counsel estimated Ford’s savings in California from
“this whole scheme of owner appreciation certificates”—that is, the practice of
issuing OAC’s for vehicles that should have been reacquired as lemons, and of
failing to provide warranty buyback notices on all vehicles traded in with OAC’s,
thus concealing the vehicles’ defects from subsequent buyers—to be $6 to $10
million per year for 2000 and 2001. He urged the jury, in order to deter Ford from
continuing that conduct, to impose punitive damages in an amount that would, at
least, take from Ford all those wrongful profits.
The jury, after a single-phase trial on liability and punitive damages, found
that Ford, directly and through its agent Decker, had committed fraud by
misrepresentation and concealment and had violated the Lemon Law and the
Consumer Legal Remedies Act. On the Lemon Law cause of action, the jury
found specifically that the McGills’ vehicle qualified for mandatory replacement
or restitution because Ford and Decker had been unable to conform it to warranty
after a reasonable number of attempts (see § 1793.2, subd. (d)(2)), that Ford
reacquired or assisted Decker in reacquiring the vehicle at the McGills’ request
because it did not conform to warranty (see § 1793.23, subd. (d)), and that Ford
then failed to provide the Johnsons the required warranty buyback notice when
they purchased the used vehicle (see § 1793.24). The jury awarded the Johnsons
6
$17,811.60 in compensatory damages on all causes of action; further found by
clear and convincing evidence that Ford, through its officers, directors or
managing agents had acted with fraud or malice; and assessed punitive damages of
$10 million.
The trial court entered judgment on the jury’s verdict, subtracting the
$100,000 amount of the prior settlement with Decker, and awarded plaintiffs
$379,348 in attorney fees on their statutory causes of action.
The Court of Appeal found substantial evidence not only that Ford had
fraudulently concealed material facts from the Johnsons by failing to provide them
the warranty buyback notice required under section 1793.24, but also that punitive
damages against the corporation were justified because “defendant’s entire
customer response program was structured precisely to short-circuit lemon law
claims whenever defendant plausibly could,” by restrictively interpreting state
lemon laws and ignoring the possibility of nonpresumptive lemons.
Though it affirmed the jury’s decision to award punitive damages, the
Court of Appeal deemed the amount of the award unconstitutionally excessive.
Relying on its own decision in Romo v. Ford Motor Co. (2003) 113 Cal.App.4th
738, the court opined that federal law, particularly State Farm, supra, 538 U.S.
408, limits punitive damages to those needed to “punish only the conduct that
injured the present plaintiffs.” Punitive damages designed “to punish and deter
defendant’s overall course of conduct,” the Court of Appeal held, are not
constitutionally permitted. Consequently, the jury could not, as it was invited to
do, “cause defendant to disgorge all profit from use of owner appreciation
certificates in California over a two-year period.” After reviewing the
constitutional guideposts of State Farm, supra, 538 U.S. 408, and BMW, supra,
517 U.S. 559, but without any specific explanation of the amount reached, the
Court of Appeal decided that “punitive damages in the amount of $53,435, three
7
times the compensatory damages,” constituted the maximum award consistent
with due process and modified the judgment accordingly.
We granted plaintiffs’ petition for review.
DISCUSSION
As we explain at greater length in the companion case of Simon v. San
Paolo U.S. Holding Company, Inc. (June 16, 2005, S121933) ___ Cal.4th ___
(Simon), recent United States Supreme Court decisions require a court reviewing
an award of punitive damages for constitutionality to make an independent
assessment of the relationship between the award and the factual circumstances of
the case. (State Farm, supra, 538 U.S. at p. 418; Cooper Industries, Inc. v.
Leatherman Tool Group, Inc. (2001) 532 U.S. 424, 436-443.) This review
encompasses three constitutional “guideposts”: “(1) the degree of reprehensibility
of the defendant’s misconduct; (2) the disparity between the actual or potential
harm suffered by the plaintiff and the punitive damages award; and (3) the
difference between the punitive damages awarded by the jury and the civil
penalties authorized or imposed in comparable cases.” (State Farm, supra, at
p. 418; see BMW, supra, 517 U.S. at p. 575.) The high court’s decisions do not
preclude California from imposing civil damages awards “for the sake of example
and by way of punishing the defendant” (§ 3294, subd. (a)), though constitutional
review using the State Farm/BMW guideposts may, in some circumstances, limit
the degree of deterrence California can achieve through awards of punitive
damages. (Simon, supra, at pp. ___ [pp. 27-30].)
Plaintiffs contend the $10 million punitive damages award here was
justified as a deterrent measure, for “in cases such as this where the defendant’s
misconduct is profit driven, punitive damages which deny a defendant its profit
are uniquely appropriate to effect deterrence,” a consideration the Court of Appeal
8
assertedly ignored in reducing the award.3 Ford contends plaintiffs’ “aggregate
disgorgement” theory is foreclosed by State Farm, supra, 538 U.S. 408, “which
emphasized that due process requires that punitive damages be closely tethered to
the defendant’s conduct toward the plaintiffs themselves and the injury to those
specific plaintiffs” and that, for the same reason, the award was properly reduced
to $53,435. We conclude that the original award cannot be supported on a
disgorgement theory, but that the Court of Appeal, in determining the
constitutional maximum, may not have adequately considered how the scale and
profitability of Ford’s repeated conduct reflects on its reprehensibility.
I. Repeated Wrongful Conduct, Profitability, and Reprehensibility
Neither BMW, supra, 517 U.S. 559, which first drew the contours of the
required substantive due process review, nor State Farm, supra, 538 U.S. 408,
which elaborated on the reprehensibility and relationship-to-harm criteria (see
Simon, supra, ___ Cal.4th at pp. ___ [pp. 20, 22-25]), states precisely what role
evidence of the defendant’s similar wrongful conduct to others plays in the
analysis. As both decisions are nonetheless instructive on this question, we begin
by reviewing them.
BMW involved an automobile distributor’s nationwide policy of not
advising dealers or their customers of predelivery damage to new vehicles when
the cost of repair was less than 3 percent of the retail price. (BMW, supra, 517
U.S. at pp. 563-564.) The individual Alabama plaintiff, whose new car had been
repainted without his knowledge before he bought it, proved compensatory
damages of only $4,000 but, on evidence that nationwide the defendant had sold
about 1,000 refinished automobiles without disclosure, was awarded $4 million in
3
Although plaintiffs also introduced evidence at trial of Ford’s worldwide
net income, they rely in this court solely on the theory of disgorgement of profits
from Ford’s OAC practices in California.
9
punitive damages. (Id. at pp. 564-565.) The Alabama Supreme Court reduced
that award to $2 million, in part based on its conclusion that conduct in other
jurisdictions should not be considered. (Id. at p. 567.)
The United States Supreme Court reversed and remanded for a new due
process analysis by the state court, without itself determining the maximum
constitutional award. (BMW, supra, 517 U.S. at pp. 585-586.) The high court’s
legal analysis, however, is instructive on the role of the defendant’s practices
toward those other than the plaintiff. The court’s central holding in this regard is
that instances of the defendant’s similar conduct in states other than Alabama were
not properly considered in assessing punitive damages because the conduct was
not illegal in all the other states, and “a State may not impose economic sanctions
on violators of its laws with the intent of changing the tortfeasors’ lawful conduct
in other States.” (Id. at p. 572.)
At the same time, the court made clear it regarded similar conduct by the
defendant as potentially relevant to the reprehensibility of the conduct, and hence
to the permissible size of an award. To its holding that the state court correctly
ignored BMW’s out-of-state conduct in assessing the award, the high court added
this footnote: “Of course, the fact that the Alabama Supreme Court correctly
concluded that it was error for the jury to use the number of sales in other States as
a multiplier in computing the amount of its punitive sanction does not mean that
evidence describing out-of-state transactions is irrelevant in a case of this kind. To
the contrary, as we stated in TXO Production Corp. v. Alliance Resources Corp.,
509 U.S. 443, 462, n. 28, 113 S.Ct. 2711, 2722, n. 28, 125 L.Ed.2d 366 (1993),
such evidence may be relevant to the determination of the degree of
10
reprehensibility of the defendant’s conduct.” (BMW, supra, 517 U.S. at p. 574,
fn. 21.)4
The court expanded on this point in its discussion of reprehensibility, the
first and “[p]erhaps the most important” of the constitutional guideposts. (BMW,
supra, 517 U.S. at p. 575.) Though it ultimately rejected the plaintiff’s contention
that the defendant’s nondisclosure of the minor repairs to his car was particularly
reprehensible because it was part of a nationwide pattern of tortious conduct (the
point was rejected for lack of a showing the practice was generally tortious), the
court acknowledged that recidivism increases the wrongfulness of a defendant’s
conduct and may justify greater punishment: “Certainly, evidence that a
defendant has repeatedly engaged in prohibited conduct while knowing or
suspecting that it was unlawful would provide relevant support for an argument
that strong medicine is required to cure the defendant’s disrespect for the law.
[Citation.] Our holdings that a recidivist may be punished more severely than a
first offender recognize that repeated misconduct is more reprehensible than an
individual instance of malfeasance.” (Id. at pp 576-577.)
Seven years later, in State Farm, supra, 538 U.S. 408, the high court again
considered the role of a corporation’s practices and policies in an individual
lawsuit seeking punitive damages. The court reiterated that tortious conduct
toward others could be relevant to the reprehensibility of an individual tort and
that conduct in other states where it might not be illegal should not be considered,
4
In the cited passage from TXO Production Corp. v. Alliance Resources
Corp., supra, 509 U.S. at page 462, footnote 28, the court observed that in an
earlier decision, Pacific Mut. Life Ins. Co. v. Haslip (1991) 499 U.S. 1, 21-22, it
had approved Alabama punitive damages law permitting consideration of “the
existence and frequency of similar past conduct.”
11
but additionally distinguished between courses of conduct that were similar to the
individual tort and those that were dissimilar. (Id. at pp. 420-424.)
The defendant insurer’s wrongful conduct toward the individual State Farm
plaintiffs was its bad faith refusal to settle a third party tort suit against the
plaintiffs, its insureds. (State Farm, supra, 538 U.S. at p. 413.) The plaintiffs,
however, introduced evidence of other assertedly fraudulent State Farm business
practices encompassing many years and many states, most of which “bore no
relation to third-party automobile insurance claims.” (Id. at p. 415.)
Consequently, the high court complained, the case “was used as a platform to
expose, and punish, the perceived deficiencies of State Farm’s operations
throughout the country.” (Id. at p. 420.)
This evidence of wide-ranging business practices could not, consistent with
due process, be used to show reprehensibility that would support a large ($145
million) punitive damages award for two reasons: First, “[a] State cannot punish a
defendant for conduct that may have been lawful where it occurred.” (State Farm,
supra, 538 U.S. at p. 421 [citing BMW].) Second, and “more fundamental[ly],”
“[a] defendant’s dissimilar acts, independent from the acts upon which liability
was premised, may not serve as the basis for punitive damages. A defendant
should be punished for the conduct that harmed the plaintiff, not for being an
unsavory individual or business.” (Id. at pp. 422-423.)
The punitive damages award in State Farm therefore could not be justified
on grounds of recidivism. Quoting BMW’s statement that “ ‘[o]ur holdings that a
recidivist may be punished more severely than a first offender recognize that
repeated misconduct is more reprehensible than an individual instance of
malfeasance,’ ” the high court in State Farm added the qualification that “in the
context of civil actions courts must ensure the conduct in question replicates the
prior transgressions.” (State Farm, supra, 538 U.S. at p. 423.) The State Farm
12
plaintiffs had produced “scant evidence of repeated misconduct of the sort that
injured them,” and while “evidence of other acts need not be identical to have
relevance in the calculation of punitive damages,” conduct toward others that “had
nothing to do with” the tortious conduct toward the plaintiffs could not
constitutionally be considered. (Id. at pp. 423-424.)
While both BMW and State Farm were cases in which the evidence state
courts had considered of conduct toward others was impermissibly broad, the
United States Supreme Court’s analysis in both cases makes clear that due process
does not prohibit state courts, in awarding or reviewing punitive damages, from
considering the defendant’s illegal or wrongful conduct toward others that was
similar to the tortious conduct that injured the plaintiff or plaintiffs. We therefore
join the numerous courts holding that a civil defendant’s recidivism remains
pertinent to an assessment of culpability.5
The appellate court below, however, opined that punitive damages may not
be used “to punish and deter defendant’s overall course of conduct,” seemingly
5
See, e.g., Diamond Woodworks, Inc. v. Argonaut Insurance Company
(2003) 109 Cal.App.4th 1020, 1054, fn. 34 (jury may consider conduct “similar or
bearing a relationship to” that which injured the plaintiff); Williams v. ConAgra
Poultry Company (8th Cir. 2004) 378 F.3d 790, 797 (to be properly considered,
“recidivist conduct must be factually as well as legally similar to the plaintiff’s
claim”); Continental Trend Resources v. OXY USA, Inc. (10th Cir. 1996) 101 F.3d
634, 638-639 (evidence showing the defendant “used some of the same tactics” on
others as on the plaintiffs properly considered under BMW); Planned Parenthood
of the Columbia/Willamette, Inc. v. American Coalition of Life Activists (D.Or.
2004) 300 F.Supp.2d 1055, 1060, fn. 3 (repeated misconduct “demonstrates
defendants’ willingness to violate the law and ignore court rulings”); Bocci v. Key
Pharmaceuticals, Inc. (Or.Ct.App. 2003) 76 P.3d 669, 674, mod. on other grounds
and adhered to as mod., 79 P.3d 908 (the defendant’s nationwide misconduct in
disseminating false and misleading information, similar to its conduct that injured
the plaintiff, was properly considered); Trinity Evangelical Lutheran Church v.
Tower Ins. Co. (Wis. 2003) 661 N.W.2d 789, 801-802 (insurer’s repeated
violation of particular duty to insureds enhances reprehensibility).
13
ruling out consideration of the scale and profitability of Ford’s fraudulent conduct
toward California consumers. In lieu of further explanation, the lower court
referred readers to its contemporaneous decision in Romo v. Ford Motor Co.,
supra, 113 Cal.App.4th 738 (Romo). We therefore briefly examine the Romo
decision to see if the due process principles discussed there compel the Court of
Appeal’s conclusion here.
Although involving the same defendant, Romo was not factually similar to
this case; it was a defective product suit arising from a fatal vehicle rollover, in
which the jury awarded the plaintiffs $5 million in compensatory and $290 million
in punitive damages. (Romo, supra, 113 Cal.App.4th at p. 744.) On remand from
the United States Supreme Court for reconsideration in light of State Farm, the
Court of Appeal reduced the punitive damages award to around $23.7 million.
(Romo, supra, at p. 763.) Pertinent to our inquiry is the court’s general theoretical
discussion of punitive damages after State Farm.
Drawing heavily on a law review article (Colby, Beyond the Multiple
Punishment Problem: Punitive Damages as Punishment for Individual, Private
Wrongs (2003) 87 Minn. L.Rev. 583 (hereafter Beyond the Multiple Punishment
Problem)), the Romo court distinguished between a “narrow” “historically based”
view of punitive damages and the “broad” view the court believed had recently
prevailed in California and other jurisdictions (Romo, supra, 113 Cal.App.4th at
pp. 748-749) and concluded that the United States Supreme Court had adopted the
narrow view as a matter of constitutional doctrine (id. at 749). Under the narrow
historical approach, the Romo court opined, the punishment imposed was “for the
particular affront to the plaintiff, not a broader sanction for an affront to society at
large” (id. at p. 747), while the broad modern theory, developed in an era of
products liability and other consumer actions, held that punitive damages served to
14
punish and deter the affront “to all affected by the goods or services or, given the
reach of the misconduct, the affront . . . to society as a whole” (ibid.).
Under the narrow view, as Romo explains it, the size of a permissible award
was limited by the need for a reasonable relationship to the harm caused the
individual plaintiff (Romo, supra, 113 Cal.App.4th at p. 747), regardless of
whether such an award would actually deter repetition or imitation of the
defendant’s conduct (id. at pp. 750-751). In contrast, under the broad view,
“punitive damages awards needed to be based on the overall scope of the wrong in
order to punish and deter the mass torts” (id. at p. 747), leading to awards
calculated to actually deter a corporate course of action, given the corporation’s
profits and financial condition (id. at pp. 748-749).
The Romo court’s analysis does not convince us that the United States
Supreme Court, in State Farm, adopted wholesale the “historical” view of punitive
damages outlined in the Colby article (Beyond the Multiple Punishment Problem,
supra, 87 Minn. L.Rev. 583) as a constitutional rule binding on the states. The
article is not cited in the high court’s decision, nor does the decision contain any
explicit references to “broad” and “narrow,” or “modern” and “historical,” theories
of punitive damages. The high court does discuss the history of single-digit ratios
between compensatory damages and civil penalties (State Farm, supra, 538 U.S.
at p. 425), but does not relate its presumptive preference for single-digit ratios (see
Simon, supra, ___ Cal.4th at p. ___ [pp. 23-24]) to a requirement that the states
adopt a restrictive historical view of the purposes of punitive damages.
More important, we are not convinced the high court’s precedents dictate
that states take such a narrow view as to “what is to be deterred” through punitive
damages (Romo, supra, 113 Cal.App.4th at p. 747) as to blind state juries and
courts to the state’s public interest in deterring a wrongful course of conduct.
Indeed, the court’s analysis in BMW, supra, 517 U.S. 559, expressly affirms a
15
state’s constitutional freedom to use punitive damages as a tool to protect the
consuming public, not merely to punish a private wrong. Alabama, the BMW
court explained, could legitimately use punitive damages to punish and deter the
defendant’s unlawful conduct, thereby furthering its interest in “protect[ing] its
citizens [from] deceptive trade practices.” (Id. at p. 568.) To that end, a proper
award of punitive damages would be one “supported by the State’s interest in
protecting its own consumers and its own economy.” (Id. at p. 572.)
State Farm, in turn, did not bar deterrence of future public injuries as a goal
of punitive damages. The court reiterated its statement in BMW that “ ‘[p]unitive
damages may properly be imposed to further a State’s legitimate interests in
punishing unlawful conduct and deterring its repetition’ ” (State Farm, supra, 538
U.S. at p. 416) and did not limit the concept to punishment and deterrence purely
on behalf of the plaintiff. In elaborating on BMW’s reprehensibility guidepost, the
court in State Farm noted that conduct involving “repeated actions” was worse
than, and could be punished more severely than, conduct limited to “an isolated
incident.” (State Farm, supra, at p. 419.)6
6
To consider the defendant’s entire course of conduct in setting or reviewing
a punitive damages award, even in an individual plaintiff’s lawsuit, is not to
punish the defendant for its conduct toward others. An enhanced punishment for
recidivism does not directly punish the earlier offense; it is, rather, “ ‘ “a stiffened
penalty for the last crime, which is considered to be an aggravated offense because
a repetitive one.” ’ ” (Ewing v. California (2003) 538 U.S. 11, 25-26.) In
response to constitutional challenges to recidivist punishment, for example as ex
post facto laws, “[t]he uniform answer has been that it is the second or subsequent
offense which is punished, not the first.” (People v. Giggs (1937) 9 Cal.2d 508,
512.) By placing the defendant’s conduct on one occasion into the context of a
business practice or policy, an individual plaintiff can demonstrate that the
conduct toward him or her was more blameworthy and warrants a stronger penalty
to deter continued or repeated conduct of the same nature.
16
To be sure, State Farm requires reasonable proportionality between
punitive damages and actual or potential harm to the plaintiff. But what ratio is
reasonable necessarily depends on the reprehensibility of the conduct, “the most
important indicium of the reasonableness of the award” (State Farm, supra, 538
U.S. at p. 419), which in turn is influenced by the frequency and profitability of
the defendant’s prior or contemporaneous similar conduct. As the high court has
recognized, that a defendant has repeatedly engaged in profitable but wrongful
conduct tends to show that “strong medicine is required” to deter the conduct’s
further repetition. (BMW, supra, 517 U.S. at p. 577; see Kemp v. American
Telephone & Telegraph Company (11th Cir. 2004) 393 F.3d 1354, 1363 [“large-
scale corporate malfeasance,” involving collection of almost $300,000 in illegal
gambling debts, “merited a substantial penalty” under high court’s guideposts].)
In certain cases, as we explain in Simon, supra, ___ Cal.4th at p. ___
[p. 30], “the state may have to partly yield its goals of punishment and deterrence
to the federal requirement that an award stay within the limits of due process.”
The scale and profitability of a course of wrongful conduct by the defendant
cannot justify an award that is grossly excessive in relation to the harm done or
threatened, but scale and profitability nevertheless remain relevant to
reprehensibility and hence to the size of award warranted, under the guideposts, to
meet the state’s interest in deterrence. BMW and State Farm limit the size of
individual awards but leave undisturbed the states’ “discretion” (State Farm,
supra, 538 U.S. at p. 416) in use of punitive damages generally. Nothing the high
court has said about due process review requires that California juries and courts
ignore evidence of corporate policies and practices and evaluate the defendant’s
harm to the plaintiff in isolation.
California law has long endorsed the use of punitive damages to deter
continuation or imitation of a corporation’s course of wrongful conduct, and hence
17
allowed consideration of that conduct’s scale and profitability in determining the
size of award that will vindicate the state’s legitimate interests.7 We do not read
the high court’s decisions, which specifically acknowledge that states may use
punitive damages for punishment and deterrence, as mandating the abandonment
of that principle.
II. Disgorgement of Aggregate Profits from Repeated Conduct
To recognize that recidivism remains relevant is not to approve plaintiffs’
aggregate disgorgement theory of punitive damages. We must consider directly
the basis and fairness of plaintiffs’ approach.
7
See section 3295, subdivision (a)(1) (contemplating introduction by a
plaintiff seeking punitive damages of evidence as to “[t]he profits the defendant
has gained by virtue of the wrongful course of conduct of the nature and type
shown by the evidence”); Adams v. Murakami (1991) 54 Cal.3d 105, 116,
footnote 7 (recognizing “the profitability of the defendant’s misconduct” as one
measure of the ability to pay punitive damages); Egan v. Mutual of Omaha Ins.
Co. (1979) 24 Cal.3d 809, 820 (a principal purpose of punitive damages is “to
deter acts deemed socially unacceptable and, consequently, to discourage the
perpetuation of objectionable corporate policies”); Neal v. Farmers Ins. Exchange
(1978) 21 Cal.3d 910, 928 (size of deterrent needed depends on the defendant’s
financial condition); id. at page 929, footnote 14 (award large enough to cause the
defendant insurer “to lose business to those whose practices have not been”
tortious serves deterrence goal, “resulting in an ultimate benefit to insurance
consumers as a whole”); Grimshaw v. Ford Motor Co (1981) 119 Cal.App.3d 757,
819-820 and footnote 14 (award not excessive in light of, among other
considerations, the fact that Ford’s malicious conduct “endangered the lives of
thousands of Pinto purchasers” and “the profitability of the conduct”).
Under recent legislation, in effect only until July 1, 2006, 75 percent of any
punitive damages awarded by final judgment is to be deposited in a state fund, to
be appropriated for public purposes. (§ 3294.5, subds. (b), (i).) This would
appear to confirm that punitive damages in California are imposed to address a
public, not merely a private, wrong. The Legislature, however, has declared that
the statute “shall not be construed or interpreted in any way to establish any policy
. . . regarding the award of punitive damages.” (Id., subd. (a).)
18
Plaintiffs’ aggregate disgorgement theory should be distinguished from
simple return of ill-gotten gains earned from an individual plaintiff. Removal of
any profits the defendant has earned by a wrongful act is a logical step toward
deterring its repetition or imitation. “A gain-based measure of this sort sends a
clear signal to defendants that such misconduct does not pay and, thus, serves the
deterrent function of punitive damages.” (Cummings Medical Corp. v.
Occupational Medical Corp. (1992) 10 Cal.App.4th 1291, 1300.)8 But an
approach calculating punitive damages in an individual tort case by the profits
made through similar torts against hundreds or thousands of other individuals
creates possibilities for unfairness—to the defendant and other possible claimants
both—which may be of constitutional dimension.
The high court has observed that an award punishing the defendant for
dissimilar hypothetical claims of others “creates the possibility of multiple
punitive damages awards for the same conduct; for in the usual case nonparties are
not bound by the judgment some other plaintiff obtains.” (State Farm, supra, 538
U.S. at p. 423.)9 Critics of aggregate disgorgement or aggregate harm as theories
8
See also Pacific Mut. Life Ins. Co. v. Haslip, supra, 499 U.S. at page 22
(factors considered by state reviewing court, including “the profitability to the
defendant of the wrongful conduct, . . . provide for a rational relationship in
determining whether a particular award is greater than reasonably necessary to
punish and deter”); Mallor & Roberts, Punitive Damages: Toward a Principled
Approach (1980) 31 Hastings L.J. 639, 667 (“Where the defendant has engaged in
wrongful conduct for a profit, the award of punitive damages should remove the
profit incentive”); Model Punitive Damages Act (Final Draft 1996) section
7(a)(5), page 20 (available at http://www.law.upenn.edu/bll/ulc/mpda/finaldft.pdf
(as of Apr. 27, 2005)) (factors relevant to amount of punitive damages should
include “any profit or gain, obtained by the defendant through the wrongful
conduct, in excess of that likely to be divested by this and any other actions
against the defendant for compensatory damages or restitution”).
9
The high court in BMW, in a footnote to its discussion of the Alabama
Supreme Court’s analysis, observed that the $2 million figure reached by the state
19
of punitive damages argue the same danger exists when the hypothetical claims by
others are for conduct similar to that which injured the individual plaintiff. (See,
e.g., Owens-Corning Fiberglas Corp. v. Malone (Tex. 1998) 972 S.W.2d 35, 50
[concluding that “repeatedly imposing punitive damages on the same defendant
for the same course of wrongful conduct may implicate substantive due process
constraints”].)10
Plaintiffs argue that overpunishment may be avoided by permitting a
defendant to present evidence of past punitive damages awards for the same
conduct, which might be considered either by the jury or by courts reviewing the
court appeared anomalous in light of that court’s reasoning and evidence showing
only 14 of the refinished vehicles were sold in Alabama: “In light of the Alabama
Supreme Court’s conclusion that (1) the jury had computed its award by
multiplying $4,000 by the number of refinished vehicles sold in the United States
and (2) that the award should have been based on Alabama conduct, respect for
the error-free portion of the jury verdict would seem to produce an award of
$56,000 ($4,000 multiplied by 14, the number of repainted vehicles sold in
Alabama).” (BMW, supra, 517 U.S. at p. 567, fn. 11.)
Contrary to the argument of an amicus curiae, we do not read this footnote
passage, appearing not in the high court’s legal discussion but in its recitation of
the procedural background, as a definitive endorsement of using total in-state
profits to calculate punitive damages. The high court’s point seems to be that the
state court’s choice of a $2 million award makes little sense under the state court’s
own reasoning; it ultimately remanded to the state court not for imposition of a
$56,000 punitive damages award but instead for “an independent determination by
the Alabama Supreme Court of the award necessary to vindicate the interests of
Alabama consumers,” or, if necessary, a new trial. (BMW, supra, 517 U.S. at
p. 586.)
10
See also Williams v. ConAgra Poultry Company, supra, 378 F.3d at page
797 (“Punishing systematic abuses by a punitive damages award in a case brought
by an individual plaintiff, however, deprives the defendant of the safeguards
against duplicative punishment that inhere in the class action procedure”); cf.
Korea Supply Co. v. Lockheed Martin Co. (2003) 29 Cal.4th 1134, 1151
(permitting a remedy of nonrestitutionary disgorgement under the unfair
competition law “would expose defendants to multiple suits and the risk of
duplicative liability without the traditional limitations on standing”).
20
jury’s award.11 But the exact basis for a prior punitive damages award will not
always be clear, and even where it is proven that the defendant has already been
punished severely for a course of conduct that included harm to the current
plaintiff, there is no guarantee the jury or court will agree to deny the plaintiff
before them recovery of punitive damages simply because another plaintiff, in
another court, has already recovered. (See Roginsky v. Richardson-Merrell, Inc.
(2d Cir. 1967) 378 F.2d 832, 840.) Permitting an aggregate recovery followed by
credits in future cases could, moreover, unfairly deprive subsequent claimants of
their own recoveries, as well as present a problem of “successive prosecution” in
which a defendant that loses a single case would also lose the benefit of all
previous victories against the same claim of misconduct. (Beyond the Multiple
Punishment Problem, supra, 87 Minn. L.Rev. at pp. 594-597.)
Nor does an aggregate disgorgement theory fit easily within the BMW/State
Farm guideposts. Although the scale and profitability of a corporate practice is
related to its reprehensibility, gains made over some period of time and the harm
or potential harm to an individual plaintiff are not necessarily related. An award
of disgorgement of all profits from a group of transactions similar to that which
harmed the plaintiff (but not defined through the procedural limits of a class
action) is therefore likely to be disproportionate to the individual plaintiff’s
compensatory award.
Finally, and most pertinent to this case, an individual plaintiff resting his or
her claim for a large punitive damages award on profits earned from transactions
11
See Stevens v. Owens-Corning Fiberglas Corp. (1996) 49 Cal.App.4th
1645, 1661; Grimshaw v. Ford Motor Co., supra, 119 Cal.App.3d at page 812;
see, e.g., Owens-Corning Fiberglas Corp. v. Malone, supra, 972 S.W.2d at pages
38-40, 52-54 (the defendant offered posttrial evidence of previously paid awards
and other costs of asbestos litigation, which the appellate court considered in an
aggregate excessiveness analysis).
21
with a large class of similar claimants, but proceeding without the formalities of a
class action, can hope to recover without ever proving the specifics of those
“hypothetical claims.” (State Farm, supra, 538 U.S. at p. 423.) In a class action,
once the issues common to the class have been tried, and assuming some
individual issues remain, each plaintiff must still by some means prove up his or
her claim, allowing the defendant an opportunity to contest each individual claim
on any ground not resolved in the trial of common issues. (See Sav-on Drug
Stores, Inc. v. Superior Court (2004) 34 Cal.4th 319, 334-335, 339-340.) Here,
the Johnsons, as individual plaintiffs, proved only the facts of Ford’s tortious
transaction with them, yet they sought and obtained disgorgement of Ford’s
estimated earnings on a thousand or more other transactions without proof that
each of the others was also tortious.
Plaintiffs claim to have justified the punitive damages award by proving
that “[i]n the years 2000-2001, Ford issued about 1,300 . . . OACs per year in
California,” that “each OAC transaction represents a potentially dangerous,
defective and unrepaired vehicle which is resold to an unsuspecting consumer
without disclosure of material facts,” and that by issuing OAC’s instead of
replacing or repurchasing these vehicles Ford saves “$6,000 to $10,000 per
vehicle.” Plaintiffs’ proof, however, suffers from several major deficiencies.
First, plaintiffs nowhere explain the pertinence of the two-year period,
2000-2001, they use to estimate profits. Ford issued an OAC to the McGills for
their Taurus in 1997, and plaintiffs bought that vehicle in 1998. Plaintiffs
apparently assume, but do not point the court to any evidence, that Ford’s OAC
and reacquired vehicle policies and practices were uniform in nature and number
from 1997 to 2001. Nor do plaintiffs explain why Ford’s profits should be
estimated over a two-year period.
22
More important, plaintiffs offered no proof that all OAC transactions—in
any period—involved defective vehicles subject to California’s Lemon Law, much
less that all such vehicles were “dangerous” or “unrepaired.”12 To the contrary,
Ford introduced evidence that OAC’s were used to address a variety of customer
dissatisfactions. According to Ford’s former policy manager for reacquired
vehicles, “we have customers that are concerned about a lot of things that aren’t
defects. They could be concerned about a normal attribute of the vehicle . . . and
in their perception that’s a concern or problem. It’s not necessarily a defect.” For
a vehicle reacquired through use of an OAC for reasons other than defect, our law
demands no notice to a subsequent purchaser. (§ 1793.23, subds. (c)-(e).)
Even a vehicle with a defect is not necessarily a lemon. A “nonconformity”
requiring the vehicle’s refund or replacement under our law must “substantially
impair[] the use, value, or safety of the new motor vehicle.” (§ 1793.22, subd.
(e)(1).) Not every customer complaint about a new car, or even every valid
customer complaint, rises to that level. And customers and manufacturers
frequently disagree about whether a defect has been repaired or a reasonable
number of attempts have been made. A Ford manager testified such a
disagreement was “a good opportunity to use an owner appreciation certificate.”
Plaintiffs, seemingly, would have us assume the customer is always right in such
disputes, an assumption we cannot make.
A vehicle that is not a lemon but that is reacquired in response to customer
warranty complaints must carry a warranty buyback notice (§ 1793.23, subds. (d),
(e)), but its reacquisition under the Lemon Law is not required. Plaintiffs’ $6,000
to $10,000 savings estimate, which is derived from comparison of lemon buyback
12
While Ford did not order dealerships that acquired trade-ins using OAC’s
to make repairs on the vehicles, plaintiffs presented no evidence that dealerships
generally failed to do so.
23
costs with OAC face values, is therefore inapplicable to such a vehicle. Plaintiffs
introduced no evidence as to how many unrepaired, defective OAC trade-ins fell
into this category.
Nor can we assume that, in every other case in which a vehicle traded in
with an OAC was resold, the new buyer was kept entirely in the dark regarding
previous repairs and repair attempts. In plaintiffs’ case, Ford’s own fraudulent
concealment—its failure to provide the required historical notices—was successful
because Decker’s salesman also concealed, and affirmatively misrepresented, the
Taurus’s repair history. But plaintiffs did not show that California Ford dealers
always, or generally, conceal and lie about the repair history of used cars they sell.
We do not mean to suggest Ford’s fraud on plaintiffs was unique. Ford’s
reacquired vehicle manual stated that the principal use for OAC’s was to “satisfy
customers . . . who have lost confidence in a repaired vehicle.” A large number of
OAC’s therefore probably involved vehicles with serious defects. When taken in
conjunction with the evidence that Ford maintained its OAC’s did not assist
dealers to reacquire vehicles and interpreted other Lemon Law requirements
narrowly, this stated use supports an inference that in some number of cases in
addition to plaintiffs’ own, perhaps a large number of other cases, OAC’s were
used to evade Lemon Law requirements, and sales of OAC-traded vehicles were
made without the proper historical disclosures, resulting in significant savings to
Ford.13 In some subset of those cases, a dealer may also have concealed and lied
about the vehicle’s history, preventing the new buyer from learning the truth. But
13
We express no view regarding the Court of Appeal’s statements that Ford’s
reacquired vehicle program was “structured precisely to short-circuit lemon law”
and that the present transaction was a “typical” use of an OAC. Ford did not
petition for review of the lower court’s holding that sufficient evidence of fraud
existed to justify an award of punitive damages, in support of which the quoted
statements were made.
24
one cannot infer that this fraudulent practice occurred in all cases of OAC-traded
vehicles. As plaintiffs’ estimate of Ford’s savings on each OAC transaction
depends on assumptions that each such transaction was for a vehicle that should
have been reacquired as a lemon and thus should have carried with it a statutory
notice, and that each subsequent buyer of an OAC-traded vehicle was defrauded,
predicates plaintiffs failed to prove, their attempt to estimate aggregate profits
from fraudulent transactions similar to theirs also fails.
We need not decide whether a plaintiff could ever, consistent with due
process, justify the size of an award on a total profits basis. Our independent, de
novo review of the record, required by due process (State Farm, supra, 538 U.S.
at p. 418; Cooper Industries, Inc. v. Leatherman Tool Group, Inc., supra, 532 U.S.
at pp. 436-443; Simon, supra, ___ Cal.4th at p. ___ [pp. 9-10]), demonstrates that
these plaintiffs’ attempt to calculate punitive damages on this basis was fatally
deficient. The Court of Appeal correctly determined the award here could not be
upheld on a disgorgement theory.
CONCLUSION
Although the Court of Appeal correctly rejected the aggregate
disgorgement approach, in concluding that the maximum award consistent with
due process is $53,435, an amount approximately three times the compensatory
damages, the lower court appears not to have properly considered the evidence of
Ford’s policies and practices, and their scale and profitability. As we explained
earlier (pt. I, ante), a defendant’s recidivism is relevant to the reprehensibility of
its conduct. To the extent the evidence shows the defendant had a practice of
engaging in, and profiting from, wrongful conduct similar to that which injured
the plaintiff, such evidence may be considered on the question of how large a
punitive damages award due process permits. Although the lower court discussed
Ford’s policies in addressing reprehensibility ― noting “it is reprehensible for a
25
regulated manufacturer to implement a scheme that intentionally undermines the
protections granted consumers by state law” ― the court gave no express weight,
in its assessment of the constitutional maximum, to the profitability of that scheme
to Ford or the scale at which Ford pursued it. The Court of Appeal’s reliance on
its Romo decision suggests it incorrectly believed such weighing constitutionally
precluded.
Nor does the lower court’s discussion of the remaining two State
Farm/BMW guideposts explain the drastic reduction ordered. Regarding the ratio
guidepost, the court merely observed that “a higher ratio of punitive to
compensatory damages” was constitutional here because the compensatory
damages were strictly economic. Concerning the comparable-penalties guidepost,
the lower court held only that the specification in the Lemon Law of a maximum
twice-damages civil penalty for willful violations (§ 1794, subd. (c)) did not so
limit punitive damages for fraudulent misrepresentation. In short, the Court of
Appeal’s discussion of the last two State Farm/BMW guideposts lacks a
justification for restricting punitive damages to three times the compensatory
award. This, together with the court’s reliance on its Romo decision, which
incorrectly suggests that due process requires appellate review that is blind to the
state’s interest in punishing and deterring a wrongful corporate practice, leads us
to conclude the lower court may have given insufficient, if any, weight to the scale
and profitability of Ford’s fraudulent conduct. As we cannot be sure the lower
court made its decision under a correct understanding of the law, a remand for a
new determination of the maximum constitutional award is appropriate.
26
DISPOSITION
The judgment of the Court of Appeal is reversed, and the matter is
remanded to that court for further proceedings consistent with our opinion.
WERDEGAR, J.
WE CONCUR:
GEORGE, C.J.
KENNARD, J.
CHIN, J.
MORENO, J.
27
CONCURRING OPINION BY CHIN, J.
I agree fully with the majority opinion that I have signed. I write separately
only to emphasize my understanding that the Court of Appeal is not precluded
from reaching the same result on remand after reconsidering all relevant factors if
it believes that result is correct under the law as explained in today’s opinion.
As the majority opinion states, the Court of Appeal found that
“ ‘defendant’s entire customer response program was structured precisely to short-
circuit lemon law claims whenever defendant plausibly could,’ by restrictively
interpreting state lemon laws and ignoring the possibility of nonpresumptive
lemons.” (Maj. opn., ante, at p. 7, italics added.) Defendant was content with the
result in the Court of Appeal, so it did not petition for review on this point, and the
majority properly expresses no opinion regarding it. (Maj. opn., ante, at p. 25, fn.
13.) It is not clear to me that defendant’s overall behavior was as reprehensible as
the Court of Appeal suggests. As might be expected, defendant has taken a very
narrow view of what qualifies as a “lemon.” It has also attempted to avoid laws
requiring notification of defects to future buyers. But there is a difference between
avoiding a law by a narrow interpretation and evading a law by ignoring or
knowingly violating it.
To the extent defendant was merely trying to get around the lemon laws
whenever it “plausibly” could, I am not sure its conduct was reprehensible at all.
Trying to evade the lemon laws illegally would be reprehensible. But trying to
avoid the lemon laws by a narrow, but plausible, interpretation does not seem
1
reprehensible, at least until a court rules against that narrow interpretation. I see
nothing in today’s opinion that precludes the Court of Appeal from reconsidering
all relevant factors in determining the maximum permissible constitutional award.
CHIN, J.
2
CONCURRING & DISSENTING OPINION BY BAXTER, J.
I concur in the rationale and holding of the majority opinion. However, I
disagree with two aspects of the majority’s characterization of the opinion of the
Court of Appeal below.
First, I do not agree that the Court of Appeal failed to properly consider the
evidence of Ford’s policies and practices, and their scale and profitability, in
reaching its determination that a punitive damages award of three times the
compensatory damages is the maximum constitutionally permissible award under
the three-pronged test of State Farm Mut. Auto Ins. Co. v. Campbell (2003) 538
U.S. 408 (State Farm). Nor do I agree that the Court of Appeal gave no express
weight to the scale and profitability of Ford’s conduct in its analysis of
reprehensibility under the first prong of that test. (Maj. opn., ante, p. 26.)
In discussing the sufficiency of the evidence to support the award of
punitive damages in this case, the Court of Appeal wrote, “Compelling evidence
. . . supports an inference that the present transaction was typical of owner
appreciation certificate transactions, which numbered over 1,000 per year, and that
the use of such certificates was intended, as a matter of policy, to short-circuit
lemon law claims . . . .” The court concluded that “the evidence clearly supports
an inference that defendant’s entire customer response program was structured
precisely to short-circuit lemon law claims whenever defendant plausibly could.”
Then, in specifically discussing the reprehensibility of Ford’s conduct
under the first prong of the State Farm three-pronged test, the Court of Appeal
1
opined, “it is reprehensible for a regulated manufacturer to implement a scheme
that intentionally undermines the protections granted consumers by state law. If
the manufacturer believes the law is too vague to implement or requires of it
inconsistent actions, the courts are available to the manufacturer to challenge the
law. If it simply does not like the law or thinks it practically unworkable, the
manufacturer has the right to petition the Legislature. It should go without saying,
however, that the manufacturer does not have the right simply to ignore the parts
of the law it finds objectionable. [¶] Yet that is exactly what the evidence shows
defendant did in the present case. Defendant declared the ‘reasonable attempts’
standard of the lemon law ‘not definable’ and ignored it. It implemented through
formal policies a practice of resolving all ‘reasonable attempts’ claims through a
‘stair-step’ series of inducements that permitted defendant to avoid reacquiring
vehicles and notifying subsequent buyers of the claims concerning such vehicles.
While this program provided some relief to defendant’s new-car buyers, it entirely
frustrated the additional goal of the lemon law to protect subsequent purchasers of
such vehicles. Such intentional conduct is highly reprehensible.”
These passages in the opinion of the Court of Appeal, which was ordered
not to be published by that court, to my mind plainly reflect that the appellate
court did consider and weigh Ford’s general policies and practices of issuing
“owner appreciation certificates” as an alternative to strict compliance with this
state’s lemon law. Moreover, the court expressly found such widespread pattern
of conduct “highly reprehensible” under the first prong of the State Farm test
when it set the maximum constitutionally permissible punitive damages award at
three times the compensatory damages. The Court of Appeal’s understanding that
deterrence is a valid purpose to be served by punitive damage awards was further
reflected in the court’s conclusion on the matter: “Applying the three guideposts
in the present case, we determine that punitive damages in the amount of $53,435,
2
three times the compensatory damages, is not constitutionally excessive and
satisfies the state’s legitimate interest in punishing the conduct that harmed the
plaintiffs, thereby deterring similar conduct by defendant or others in the future.”
(Italics added.)
Second, I do not agree with the majority’s characterization of the Court of
Appeal’s conclusions reached under the third prong of the State Farm test—the
“comparable civil penalties” guidepost. The majority suggests the Court of
Appeal’s discussion of this guidepost fails to “explain the drastic reduction
ordered” and “lacks a justification for restricting punitive damages to three times
the compensatory award.” (Maj. opn., ante, pp. 26-27.)
In the companion case of Simon v. San Paolo U.S. Holding Company, Inc.
(June 16, 2005, S121933) __ Cal.4th __, we explained that “The third guidepost is
less useful in a case like this one, where plaintiff prevailed only on a cause of
action involving ‘common law tort duties that do not lend themselves to a
comparison with statutory penalties’ (Continental Trend Resources v. OXY USA,
Inc. [(10th Circ. 1996)] 101 F.3d [634,] 641), than in a case where the tort duty
closely parallels a statutory duty for breach of which a penalty is provided.” (Id.
pp. 25-26.) Accordingly, we concluded in Simon that “While comparison to these
statutory penalties cannot tell us precisely how large an award would be
constitutional, it clearly does not tend to support the present award of $1.7 million
dollars in punitive damages, a sum 340 times the financial harm defendant’s fraud
caused plaintiff.” (Id. at p. 26.)
In contrast to cases like Simon, which involve common law tort duties that
do not lend themselves to a comparison with statutory penalties, the Court of
Appeal below expressly recognized that this case does implicate legislatively
prescribed statutory penalities for the very conduct that established the basis for an
award of compensatory damages to plainitiffs. As the Court of Appeal explained,
3
“where a defendant has ‘willfully’ violated the Song-Beverly Consumer Warranty
Act, the Legislature has determined that the punitive interests of the state are
satisfied by a civil penalty equal to twice the damages award. ([Civ. Code,]
§ 1794, subd. (c).)”
I find the Court of Appeal’s discussion of comparable civil penalties under
the third guidepost of State Farm right on the money. As the court observed, “the
jury expressly concluded that the car, when reacquired from the McGills, was in
fact a lemon under the [Song-Beverly Consumer Warranty Act] statutory
definition,” and that “defendant acted with intent to defraud plaintiffs when it
failed to designate the car as a lemon and disclose that status to plaintiffs.” In
other words, unlike the tortious conduct at issue in Simon, here the jury found for
plaintiffs on statutory causes of action for which the Legislature has specifically
authorized the doubling of compensatory damages as the appropriate statutory
penalty in furtherance of the goal of deterrence under California law.
The Court of Appeal found the Legislature’s determination that double-
damages is the appropriate civil penalty for violations of the Song-Beverly
Consumer Warranty Act “significant” under the third guidepost of State Farm. I
agree. The majority suggests the Court of Appeal’s conclusion in this regard fails
to explain the “drastic reduction ordered.” (Maj. opn., ante, p. 26.) But the
necessity of a “drastic reduction” in the punitive damages award in this case is not
the result of the Court of Appeal’s whim or caprice—it is a direct consequence of
the jury having erroneously awarded plaintiffs $10 million in punitive damages on
the basis of disgorgement of profits earned by Ford through its entire course of
wrongful conduct toward other consumers. The Court of Appeal, in contrast, was
simply striving to follow the high court’s three guideposts set forth in State Farm,
and under the third guidepost, the appellate court concluded the existence of
legislatively prescribed civil penalties for the very conduct that formed the basis of
4
the compensatory damages award against Ford is relevant in setting the maximum
constitutionally permissible punitive damages award. I would therefore not fault
the Court of Appeal for supposedly failing to explain in its discussion of relevant
comparable civil penalties the necessity for the drastic reduction of the $10 million
dollar punitive damages award in this case.
In its discussion of the third State Farm guidepost, the Court of Appeal
went on to reason that, “In the present case, the punitive damages award arises
from a fraud cause of action which, although based on the failure to make Song-
Beverly disclosures, goes beyond Song-Beverly’s requirements of a ‘willful’
violation. In the present case, the jury found defendant intentionally concealed the
information with the intent to defraud plaintiffs. Accordingly, while the double
damages penalty of [Civil Code] section 1794, subdivision (c) is significant, it
does not establish a legislative intent to limit punishment of the present,
intentional misconduct.”
In short, the Court of Appeal concluded that tripling the compensatory
damages award was justifiable under State Farm and the facts of this case because
Ford’s conduct was “highly reprehensible” and willfully intended to defraud
plaintiffs, and because such egregious conduct went well beyond that minimally
required to establish a violation of the Song-Beverly Consumer Warranty Act.
I therefore conclude the Court of Appeal did properly discuss and consider
Ford’s pattern of wrongful conduct toward other consumers in assessing the
“reprehensibility” of Ford’s conduct under the first prong of the State Farm test,
and did validly discuss and consider the civil penalties authorized under the Song-
Beverly Consumer Warranty Act in assessing comparable civil penalties under the
third prong of the high court’s test.
Like Justice Chin, I conclude that nothing in today’s majority opinion
precludes the Court of Appeal on remand from reconsidering all relevant factors in
5
determining de novo the maximum permissible constitutional punitive damages
award in this case. Nor is the Court of Appeal precluded from reaching the same
result on remand after reconsidering all relevant factors if the court believes that
result is correct under the law. (Conc. opn. of Chin, J., pp. 1-2.)
BAXTER, J.
I CONCUR:
BROWN, J.
6
See last page for addresses and telephone numbers for counsel who argued in Supreme Court. Name of Opinion Johnson v. Ford Motor Company
__________________________________________________________________________________
Unpublished Opinion
NP opn. filed 11/25/03 – 5th Dist.Original Appeal
Original Proceeding
Review Granted
Rehearing Granted
__________________________________________________________________________________
Opinion No.
S121723Date Filed: June 16, 2005
__________________________________________________________________________________
Court: Superior
County: Fresno
Judge: Edward Sarkisian, Jr.
__________________________________________________________________________________
Attorneys for Appellant:
McCormick, Barstow, Sheppard, Wayte & Carruth, D. Gregg Durbin; Gibson, Dunn & Crutcher, Theodore
J. Boutrous, Jr., Sonja R. West, Courtney A. Cook, William E. Thomson and Dominic Lanza for Defendant
and Appellant.
Hugh F. Young, Jr.; Martin, Bischoff, Templeton, Langlset & Hoffman, Jonathan M. Hoffman; Drinker
Biddle & Reath and Alan Lazarus for The Product Liability Advisory Council, Inc., as Amicus Curiae on
behalf of Defendant and Appellant.
Mayer, Brown, Rowe & Maw, Evan M. Tager, Donald M. Falk; National Chamber Litigation Center and
Robin S. Conrad for The Chamber of Commerce of the United States as Amici Curiae on behalf of
Defendant and Appellant.
Deborah J. La Fetra for Pacific Legal Foundation as Amicus Curiae on behalf of Defendant and Appellant.
Susan Liebeler; Daniel J. Popeo and David Price for Washington Legal Foundation as Amicus Curiae on
behalf of Defendant and Appellant.
Greines, Martin, Stein & Richland, Robert A. Olson and Ferris M. Greenberger for Farmers Insurance
Exchange, Truck Insurance Exchange, Fire Insurance Exchange and Mid-Century Insurance Company
as Amici Curiae on behalf of Defendant and Appellant.
__________________________________________________________________________________
Attorneys for Respondent:
Erwin Chemerinsky; William M. Krieg & Associates, William M. Krieg and Kimberly L. Mayhew for
Plaintiffs and Respondents.
Page 2 - counsel continued – S121723
Attorneys for Respondent:
Chavez & Gertler, Mark A. Chavez and Kathryn C. Palamountain for Consumers for Auto Reliability and
Safety as Amicus Curiae on behalf of Plaintiffs and Respondents.
Anderson, Kill & Olick, Lawrence Fischer, Eugene R. Anderson and Alex D. Hardiamn for California
Consumer Health Care Council, Inc., as Amicus Curiae on behalf of Plaintiffs and Respondents.
Kenneth Chesebro; Law Offices of Michael J. Piuze and Michael J. Piuze for Keith N. Hylton as Amicus
Curiae on behalf of Plaintiffs and Respondents.
Lawrence A. Organ and Pamela S. F. Kong for the Civil Rights Forum as Amicus Curiae on behalf of
Plaintiffs and Respondents.
Center for Constitutional Litigation, Ned Miltenberg; Robinson Calcagnie & Robinson and Sharon J. Arkin
for Trial Lawyers of America as Amicus Curiae on behalf of Plaintiffs and Respondents.
Law Office of Daniel U. Smith, Daniel U. Smith, Ted W. Pelletier; Robinson, Calcagnie & Robinson,
Sharon J. Arkin; Rose, Klein & Marias, David A. Rosen; Shernoff, Bidart & Darras, Michael J. Bidart;
Law Offices of Nicholas Wagner, Nicholas Wagner; Robin E. Brewer; Donna Bader; Law Offices of Ian
Herzog, Ian Herzog; Law Offices of Jill P. McDonell, Jill P. McDonell; Michels & Watkins, Steven B.
Stevens; Law Offices of Donald L. Galine, Donald L. Galine; and Lea-Ann Tratten for Consumer
Attorneys of California as Amicus Curiae on behalf of Plaintiffs and Respondents.
Law Offices of Jeffrey K. Winikow, Jeffrey K. Winikow; The deRubertis Law Firm, David M. deRubertis;
Pine & Pine and Norman H. Pine for California Employment Lawyers Association as Amicus Curiae on
behalf of Plaintiffs and Respondents.
Pillsbury & Levinson, Arnold R. Levinson; Esner & Chang, Stuart B. Esner, Andrew N. Chang; Bach Law
Office and Amy Bach for United Policyholders as Amici Curiae.
Counsel who argued in Supreme Court (not intended for publication with opinion):
Theodore J. Boutrous, Jr.Gibson, Dunn & Crutcher
333 South Grand Avenue
Los Angeles, CA 90071
(213) 229-7000
Erwin Chemerinsky
Duke University School of Law
Corner of Science Dr. & Towerview Road
Durahm, NC 27708-0362
(919) 613-7173
| Date: | Docket Number: |
| Thu, 06/16/2005 | S121723 |
| 1 | Johnson, Greg (Plaintiff and Respondent) Represented by William M. Krieg Krieg & Associates 2014 Tulare St #700 Fresno, CA |
| 2 | Johnson, Greg (Plaintiff and Respondent) Represented by Erwin Chemerinsky Duke University School of Law Science Drive & Towerview Rd. Durham, NC |
| 3 | Johnson, Jo Ann (Plaintiff and Respondent) Represented by William M. Krieg Krieg & Associates 2014 Tulare St #700 Fresno, CA |
| 4 | Johnson, Jo Ann (Plaintiff and Respondent) Represented by Erwin Chemerinsky Duke University School of Law Science Drive & Towerview Rd. Durham, NC |
| 5 | Ford Motor Company (Defendant and Appellant) Represented by D. Gregory Durbin McCormick Barstow et al LLP 5 River Park Place East Fresno, CA |
| 6 | Ford Motor Company (Defendant and Appellant) Represented by Theodore J. Boutrous Gibson Dunn & Crutcher LLP 333 S Grand Ave., Suite 4700 Los Angeles, CA |
| 7 | California Consumer Health Care Counsel (Amicus curiae) Represented by Alexander David Hardiman Anderson Kill & Olick 1251 Avenue Of The Americas New York, NY |
| 8 | Untied California Policyholders (Amicus curiae) Represented by Arnold R. Levinson Pillsbury & Levinson 1 Embarcadero Ctr 38FL San Francisco, CA |
| 9 | Consumer Attorneys Of California (Amicus curiae) Represented by Ned Miltenberg Center for Constitutional Litigation 1050 31st Street N.W. Washington, DC |
| 10 | Consumer Attorneys Of California (Amicus curiae) Represented by Daniel U. Smith Attorney at Law P O Box 278 Kentfield, CA |
| 11 | Civil Rights Forum (Amicus curiae) Represented by Lawrence Anthony Organ Civil Rights Forum 180 Montgomery Street Suite 2000 San Francisco, CA |
| 12 | Farmers Insurance Exchange (Amicus curiae) Represented by Robert A. Olson Greines Martin et al LLP 5700 Wilshire Blvd #375 Los Angeles, CA |
| 13 | Untied Policyholders (Amicus curiae) Represented by Andrew N. Chang Esner & Chang 80 South Lake Avenue Suite 720 Pasadena, CA |
| 14 | Chamber Of Commerce Of The United States (Amicus curiae) Represented by Donald M. Falk Mayer Brown Rowe & Maw LLP Two Palo Alto Square, Suite 300 Palo Alto, CA |
| 15 | Product Liability Advisory Council (Amicus curiae) Represented by Alan J. Lazarus Drinker Biddle & Reath LLP 50 Fremont Street, 20th Floor San Francisco, CA |
| 16 | Pacific Legal Foundation (Amicus curiae) Represented by Deborah Joyce Lafetra Pacific Legal Foundation 3900 Lennane Drive, Suite 200 Sacramento, CA |
| 17 | Keith N. Hylton (Amicus curiae) Represented by Michael Joseph Piuze Attorney at Law 11755 Wilshire Blvd #1170 Los Angeles, CA |
| 18 | Association Of Trial Lawyers Of America (Amicus curiae) Represented by Sharon J. Arkin Robinson Calcagnie et al 620 Newport Ctr Dr 7FL Newport Beach, CA |
| 19 | Association Of Trial Lawyers Of America (Amicus curiae) Represented by Ned Miltenberg Center for Constitutional Litigation 1050 31st Street N.W. Washington, DC |
| 20 | Washington Legal Foundation (Amicus curiae) Represented by Susan W. Liebeler Lexpert Research Svcs P O Box 4362 Malibu, CA |
| 21 | Washington Legal Foundation (Amicus curiae) Represented by Daniel Popeo Washington Legal Foundation 2009 Massachusetts Avenue., NW Washington, DC |
| 22 | California Employment Lawyers Association (Amicus curiae) Represented by David Michael Derubertis deRubertis Law Firm 21800 Oxnard Street Suite 1180 Woodland Hills, CA |
| 23 | California Employment Lawyers Association (Amicus curiae) Represented by Norman Pine Pine & Pine 14156 Magnolia Blvd #200 Sherman Oaks, CA |
| 24 | California Employment Lawyers Association (Amicus curiae) Represented by Jeffrey Keith Winikow Attorney at Law 1801 Century Park E #1520 Los Angeles, CA |
| Disposition | |
| Jun 16 2005 | Opinion: Reversed |
| Dockets | |
| Jan 2 2004 | Petition for review filed by counsel for resps |
| Jan 6 2004 | Received Court of Appeal record 2 boxes, 2 volumes |
| Jan 23 2004 | Answer to petition for review filed by Defendant and Appellant Ford Motor Company (40k/ups-next day) |
| Feb 2 2004 | Reply to answer to petition filed in Fresno by counsel for plaintiffs and respondents (Johnson et al) |
| Feb 19 2004 | Time extended to grant or deny review to and including April 1, 2004 |
| Mar 24 2004 | Note: Letter sent to all parties enclosing a copy of the grant order and the certificate of interested entities or persons form |
| Mar 24 2004 | Petition for review granted (civil case) Votes: George, C.J., Kennard, Werdegar, Chin, Brown, and Moreno, JJ. |
| Apr 7 2004 | Certification of interested entities or persons filed counsel for appellant/Ford Motor Company |
| Apr 14 2004 | Certification of interested entities or persons filed by William M. Krieg, counsel for plaintiffs and respondents (Greg and Jo Ann Johnson) |
| Apr 19 2004 | Request for extension of time filed by respondents for a 60-day extension to and including 6-22-2004 to file respondents' opening brief on the merits. |
| Apr 20 2004 | Extension of time granted On application of respondents and good cause appearing, it is ordered that the time to serve and file Respondents' Opening Brief on the Merits is extended to and incuding June 22, 2004. No further extensions of time are contemplated. |
| Jun 22 2004 | Opening brief on the merits filed (in Fresno) by Respondents' Johnson et al. |
| Jul 8 2004 | Request for extension of time filed to file Answer Brief/Merits - resps'., ("Ford") asking to September 20,2004. |
| Jul 8 2004 | Received: Faxed extension of time request by appellant (Ford Motor) asking for 60 days to 9-20-2004, to file appellant's answer brief on the merits. |
| Jul 12 2004 | Extension of time granted On application of appellants and good cause appearing, it is ordered that the time to serve and file Appellants' Answer Brief on the Merits is extended to and including September 20, 2004. No further extensions of time will be granted. |
| Sep 20 2004 | Answer brief on the merits filed appellant, Ford Motor Company. |
| Sep 20 2004 | Motion filed (non-AA) appellant, Ford Motor Co., |
| Sep 20 2004 | Request for judicial notice filed (granted case) appellant, Ford Motor Co., |
| Oct 1 2004 | Request for extension of time filed respondents to file the reply brief on the merits. Asking to Nov. 9, 2004. |
| Oct 12 2004 | Extension of time granted to November 9, 2004 to serve and file the reply brief on the merits. |
| Oct 22 2004 | Request for extension of time filed joint application for extension of time to file consolidated answer to all amicus briefs. (submitted by counsel for record for both parties |
| Nov 2 2004 | Extension of time granted On joint application of the parties and good cause appearing, it is ordered that each side may file a single consolidated answer to all amicus curiae briefs and the time to serve and file the answers is extended to and including Jan. 10, 2005. |
| Nov 9 2004 | Reply brief filed (case fully briefed) Respondents ( Johnson). |
| Nov 9 2004 | Request for judicial notice filed (granted case) Respondents ( Johnson). |
| Nov 9 2004 | Received application to file Amicus Curiae Brief CALIFORNIA CONSUMER HEALTH CARE COUNSEL in support of respondent. With separate brief, memo of pts. and authorities, and exhibit. |
| Nov 17 2004 | Amicus curiae brief filed CALIFORNIA CONSUMER HEALTH CARE COUNSEL, with memorandum of points and authorities in support of request for judicial notice, and exhibit in support of respondent. Answer due within 20 days. |
| Nov 22 2004 | Request for extension of time filed UNITED CALIFORNIA POLICYHOLDERS to file an amicus curiae brief. Asking to Jan.8, 2005. |
| Dec 1 2004 | Extension of time denied for UNTIED CALIFORNIA POLICYHOLDERS to file an amicus curiae brief. |
| Dec 2 2004 | Application to appear as counsel pro hac vice (granted case) Attorney Ned I. Miltenberg to appear on behalf of amicus curiae Trial Lawyers of America & Consumer Attorneys of California (associated with California Bar member Daniel U. Smith) |
| Dec 7 2004 | Request for extension of time filed by amicus curiae applicant Consumer Attorneys of California to submit the application and brief in support of resps. to 12-16-04. |
| Dec 8 2004 | Request for extension of time filed CIVIL RIGHTS FORUM to Dec. 21, 2004 to file the amicus curiae brief. |
| Dec 9 2004 | Received application to file Amicus Curiae Brief PACIFIC LEGAL FOUNDATION in support of applt. ( Ford). |
| Dec 9 2004 | Received application to file Amicus Curiae Brief PRODUCT LIABILITY ADVISORY COUNCIL, Inc., in support of applt. (Ford). |
| Dec 9 2004 | Received application to file Amicus Curiae Brief UNITED POLICY HOLDERS |
| Dec 9 2004 | Received application to file Amicus Curiae Brief THE CHAMBER OF COMMERCE OF THE UNITED STATES in support of applt. (Ford). |
| Dec 9 2004 | Request for extension of time filed FAMERS INSURANCE EXCHANGE, et al., to file an amicus curiae brief. Asking to 12-16-04. |
| Dec 9 2004 | Received application to file Amicus Curiae Brief CALIFORNIA EMPLOYMENT LAWYERS ASSOCIATION in support of GREG JOHNSON |
| Dec 10 2004 | Received application to file Amicus Curiae Brief by the Association of Trial Lawyers of America in support of resps (Johnson) |
| Dec 10 2004 | Received application to file Amicus Curiae Brief from Washington Legal Foundation in support of appellant (Ford Motor) |
| Dec 13 2004 | Application to appear as counsel pro hac vice granted Ned I. Miltenberg of the District of Columbia on behalf of Amicus Curiae Consumer Attorneys and Assoc. of Trial Lawyers of America. |
| Dec 13 2004 | Extension of time granted to Dec. 16, 2004 for CIVIL RIGHTS FORUM to file its amicus curiae brief. |
| Dec 13 2004 | Extension of time granted to Dec. 16, 2004 for CONSUMER ATTORNEYS OF CALIFORNIA to file the amicus curiae brief. |
| Dec 13 2004 | Extension of time granted to Dec. 16, 2004 for FARMERS INSURANCE EXCHANGE to file their amicus curiae brief |
| Dec 13 2004 | Received application to file Amicus Curiae Brief KEITH N. HYLTON in suport of Respondents ( Johnson). |
| Dec 15 2004 | Permission to file amicus curiae brief granted UNITED POLICYHOLDERS. Answer due within 20 days. |
| Dec 15 2004 | Amicus curiae brief filed UNITED POLICYHOLDERS. Answer due within 20 days. |
| Dec 15 2004 | Permission to file amicus curiae brief granted CHAMBER OF COMMERCE OF THE UNITED STATES in support of applt. Answer due within 20 days. |
| Dec 15 2004 | Amicus curiae brief filed CHAMBER OF COMMERCE OF THE UNITED STATES. Answer due within 20 days. |
| Dec 15 2004 | Permission to file amicus curiae brief granted PRODUCT LIABILITY ADVISORY COUNCIL in support of applt. Answer due within 20 days. |
| Dec 15 2004 | Amicus curiae brief filed PRODUCT LIABILITY ADVISORY COUNCIL in support of applt. |
| Dec 16 2004 | Received application to file Amicus Curiae Brief CIVIL RIGHTS FORUM in support of respondents. |
| Dec 16 2004 | Permission to file amicus curiae brief granted PACIFIC LEGAL FOUNDATION. Answer due within 20 days. |
| Dec 16 2004 | Amicus curiae brief filed PACIFIC LEGAL FOUNDATION. Answer due within 20 days. |
| Dec 16 2004 | Received application to file Amicus Curiae Brief FARMERS INSURANCE EX CHANGE in support of appellant. |
| Dec 17 2004 | Received application to file Amicus Curiae Brief CONSUMER ATTORNEYS OF CALIF. in support of resps. |
| Dec 20 2004 | Permission to file amicus curiae brief granted by Washington Legal Foundation in support of defendant-appellant. Answers may be filed w/in 20 days. |
| Dec 20 2004 | Amicus curiae brief filed by Washington Legal Foundation in support of defendant-appellant. |
| Dec 20 2004 | Permission to file amicus curiae brief granted by Farmers Insurance Exchange in support of appellant. Answers may be filed w/in 20 days. |
| Dec 20 2004 | Amicus curiae brief filed by Farmers Insurance Exchange in support of appellant. |
| Dec 20 2004 | Permission to file amicus curiae brief granted by the Association of Trial Lawyers of America in support of plaintiffs-respondents. Answers may be filed w/in 20 days. |
| Dec 20 2004 | Amicus curiae brief filed by the Association of Trial Lawyers of America in support of plaintiffs-respondents. |
| Dec 20 2004 | Permission to file amicus curiae brief granted KEITH N. HYLTON in support of respondents. Answer due within 20 days. |
| Dec 20 2004 | Amicus curiae brief filed KEITH N. HYLTON in support of respondents. Answer due within 20 days. |
| Dec 23 2004 | Request for extension of time filed joint application by parties for filing of consolidated answers to all A/C briefs, to 1-24-05. |
| Jan 3 2005 | Permission to file amicus curiae brief granted THE CIVIL RIGHTS FORUM in support of respondents. Answer due within 20 days. |
| Jan 3 2005 | Amicus curiae brief filed THE CIVIL RIGHTS FORUM in support of respondents. |
| Jan 3 2005 | Permission to file amicus curiae brief granted CONSUMER ATTORNEYS OF CALIFORNIA in support of respondents. Answer due within 20 days. |
| Jan 3 2005 | Amicus curiae brief filed CONSUMER ATTORNEYS OF CALIFORNIA in support of respondents. |
| Jan 5 2005 | Extension of time granted to Jan. 24, 2005 to file the CONSOLIDATED ANSWERS TO ALL AMICUS CURIAE BRIEFS. |
| Jan 13 2005 | Permission to file amicus curiae brief granted CALIFORNIA EMPLOYMENT LAWYERS ASSOCIATION in support of respondents. Consolidated answer due by Jan. 24, 2005. |
| Jan 13 2005 | Amicus curiae brief filed CALIFORNIA EMPLOYMENT LAWYERS ASSOCIATION. |
| Jan 24 2005 | Response to amicus curiae brief filed Appellant Ford Motor Company's CONSOLIDATED ANSWER TO ALL. |
| Jan 24 2005 | Filed: Appellant FORD MOTOR CO's response to respondent GREG JOHNSONS's request for Judicial Notice |
| Jan 26 2005 | Received: Respondents' (Johnson et al) Application to file consolidated answer to amicus briefs in excess of length limit and Respondents' Consolidated Answer to Amicus Briefs on behalf of Ford Motor Company |
| Jan 27 2005 | Response to amicus curiae brief filed is Respondents Consolidated Answer to Amicus Briefs on behalf of Ford Motor Company [PERM] |
| Jan 27 2005 | Opposition filed Appellant's Opposition to California Consumer Health Care Counsel's Request for Judicial Notice [PERM} |
| Mar 8 2005 | Case ordered on calendar Thurs. 4/7/05 @1:30pm - Los Angeles |
| Mar 16 2005 | Application to appear as counsel pro hac vice (granted case) by Erwin Chemerinsky on behalf of resondents Greg and Jo Ann Johnnson. |
| Mar 21 2005 | Received: Letter from William M. Krieg & Associations, counsel for respondents (Johnosn et al) re cites |
| Mar 22 2005 | Application to appear as counsel pro hac vice granted The application of Erwin Chemerinsky of the State of North Carolina for admission to appear as counsel pro hac vice on behalf of respondents Johnson et al is hereby granted. |
| Mar 23 2005 | Request for judicial notice granted Plaintiffs' and defendant's requests for judicial notice of portions of the record in Croxton v. Ford Motor Co. (Super. Ct. Alameda County, 2002, No. 2002-042793) are granted. |
| Mar 23 2005 | Request for judicial notice denied The request for judicial notice by amicus curiae California Consumer Health Care Council, Inc., is denied on the grounds of irrelevance. |
| Mar 23 2005 | Motion denied Defendant's motion to strike or disregard a portion of plaintiffs' brief is denied. |
| Mar 25 2005 | Received: from appellant Ford Motor Company "SUPPLEMENT BRIEF RE: NEW AUTHORITIES." |
| Apr 7 2005 | Cause argued and submitted |
| Apr 15 2005 | Received: Letter from Gibson, Dunn & Crutcher, counsel for Appellant Ford, dated 4-14-2005, |
| Apr 22 2005 | Received: Letter from Erwin Chemerinsky [respondents] dated 4-19-2005, in response to appellant Ford Motor's 4-14-2005 letter. |
| Jun 16 2005 | Opinion filed: Judgment reversed And remanded. Opinion by Werdegar, J. ----joined by George, C.J., Kennard, Chin, Moreno, JJ. Concurring Opinion by Chin, J. Concurring and Dissenting Opinion by Baxter, J. ----joined by Brown, J. |
| Jul 21 2005 | Remittitur issued (civil case) to Fifth District Court of Appeal includes certified copies of the opinion |
| Jul 29 2005 | Received: Receipt for remittitur from Fifth Appellate District, signed for by Shandra Santana, Deputy Clerk. |
| Nov 3 2005 | Returned record to Fifth District Court of Appeal. Record consists of seven (7) doghouses. |
| Feb 2 2006 | Received Court of Appeal record one doghouse |
| Briefs | |
| Jun 22 2004 | Opening brief on the merits filed |
| Sep 20 2004 | Answer brief on the merits filed |
| Nov 9 2004 | Reply brief filed (case fully briefed) |
| Nov 17 2004 | Amicus curiae brief filed |
| Dec 15 2004 | Amicus curiae brief filed |
| Dec 15 2004 | Amicus curiae brief filed |
| Dec 15 2004 | Amicus curiae brief filed |
| Dec 16 2004 | Amicus curiae brief filed |
| Dec 20 2004 | Amicus curiae brief filed |
| Dec 20 2004 | Amicus curiae brief filed |
| Dec 20 2004 | Amicus curiae brief filed |
| Dec 20 2004 | Amicus curiae brief filed |
| Jan 3 2005 | Amicus curiae brief filed |
| Jan 3 2005 | Amicus curiae brief filed |
| Jan 13 2005 | Amicus curiae brief filed |
| Jan 24 2005 | Response to amicus curiae brief filed |
| Jan 27 2005 | Response to amicus curiae brief filed |
