BENETTA BUELL-WILSON v. FORD MOTOR COMPANY

Filed 3/10/08; on remand from U.S. Supreme Court

OPINION ON REMAND FROM THE UNITED STATES SUPREME COURT

COURT OF APPEAL, FOURTH APPELLATE DISTRICT

DIVISION ONE

STATE OF CALIFORNIA

Story Continued From Part II ..

2. Analysis

In reviewing a noneconomic damage award "[t]here are no fixed or absolute standards by which an appellate court can measure in monetary terms the extent of the damages suffered by a plaintiff as a result of the wrongful act of the defendant. The duty of an appellate court is to uphold the jury and trial judge whenever possible. [Citation.] The amount to be awarded is 'a matter on which there legitimately may be a wide difference of opinion' [citation]. In considering the contention that the damages are excessive the appellate court must determine every conflict in the evidence in respondent's favor, and must give him [or her] the benefit of every inference reasonably to be drawn from the record [citation]. [] While the appellate court should consider the amounts awarded in prior cases for similar injuries, obviously, each case must be decided on its own facts and circumstances. Such examination demonstrates that such awards vary greatly. [Citations.] Injuries are seldom identical and the amount of pain and suffering involved in similar physical injuries varies widely. These factors must be considered." (Seffert, supra, 56 Cal.2d at p. 508.)

Further, "[t]he fact that an award may set a precedent by its size does not in and of itself render it suspect. The determination of the jury can only be assessed by examination of the particular circumstances involved." (Rodriguez v. McDonnell Douglas Corp. (1978) 87 Cal.App.3d 626, 654-655.)

"An appellate court should not assume to substitute its appraisal, for that of a jury, of the amount of damages for physical pain and mental suffering sustained by a party in a case where trial by jury was had as a matter of right [citation], but in a case where it appears that a verdict is so grossly disproportionate to any reasonable limit of compensation warranted by the facts as to shock the sense of justice and raise at once a strong presumption that it is based on prejudice or passion rather than sober judgment [citations] the appellate court may reverse the judgment and remand the case for a new trial either on all the issues or on the issue of damages alone [citations], or it may, in the interests of justice and with the consent of the party against whom the modification is made, modify the judgment as to the amount of damages, and affirm it as modified [citations]." (Deevy v. Tassi (1942) 21 Cal.2d 109, 120-121 (Deevy); see also Hunton v. California Portland etc. Co. (1944) 64 Cal.App.2d 876, 882-885 [trial court, on a motion for new trial, found compensatory damages award excessive and reduced a jury verdict of $40,000 to $18,000; on appeal the appellate court, finding the award still excessive, reduced the damages to $10,000].)

Ford characterizes the jury's award to the Wilsons of $118 million in noneconomic damages ($105 million to Mrs. Wilson + $13 million to Mr. Wilson) and the court-reduced award of approximately $70 million (approximately $65 million to Mrs. Wilson + $5 million to Mr. Wilson) as "irrational, punitive, and the clear product of passion and prejudice" and asserts that the evidence "does not come close to supporting this unprecedented award."^[1] Although Mrs. Wilson's injuries were catastrophic, analyzing all appropriate factors, reviewing the trial court record, and using our collective experience, we conclude we must reduce the noneconomic damage award as excessive and the product of passion and prejudice. We also conclude the loss of consortium award to Mr. Wilson is reasonable and affirm that award. Because Ford focuses its discussion almost exclusively on the award to Mrs. Wilson, our analysis likewise focuses on whether that award was excessive.^[2]

a. Nature of Mrs. Wilson's injuries

A review of the evidence shows the substantial nature of the Wilsons' noneconomic injuries. Mrs. Wilson, a once vibrant and energetic wife and mother is now a paraplegic, who is in constant and debilitating pain, has lost all control over her bladder and bowel movements, and now requires constant care from her husband. She is disfigured and subject to ailments associated with her injuries that could worsen her injuries and shorten her life span. Mr. Wilson has lost his role as a husband. He is now a constant caregiver.

Noneconomic damages do not consist of only emotional distress and pain and suffering. They also consist of such items as invasion of a person's bodily integrity (i.e., the fact of the injury itself), disfigurement, disability, impaired enjoyment of life, susceptibility to future harm or injury, and a shortened life expectancy. (Judicial Council of Cal. Civ. Jury Instns. (2008), CACI No. 3905A.)

In this case, the noneconomic damages suffered by Mrs. Wilson were substantial, permanent, and support a significant award. However, the reduced award of approximately $65 million is, even given the severity of her injuries, disproportionate to those injuries so as to "raise a strong presumption that it is based on prejudice or passion." (Saari v. Jongordan Corp. (1992) 5 Cal.App.4th 797, 807.)

b. Amount of award versusprojected life span

We also consider the amount of the damage award in connection with Mrs. Wilson's projected life span of 35 years.^[3] The damage award, as reduced by the court, still amounts to approximately $1,868,399 per year over her projected life span, an extremely high amount. Ford on the other hand argues an award of $1 million is reasonable, which would work out to $28,571 per year, and only $78 per day. While we believe that the award as reduced by the trial court is still excessive, we also do not believe that Ford's suggested award fairly and justly compensates Mrs. Wilson.

c. Comparison with other awards

In support of its position the noneconomic damage award is excessive as a matter of law, Ford attempts to compare that award to published California decisions that have upheld damage awards on similar facts. The Wilsons, on the other hand, argue that it is not appropriate to compare the award here to other cases, and that we must review it only by looking at the particular facts of this case. We conclude that while it is appropriate to look at awards in similar cases, ultimately we must determine the propriety of the award on a case-by-case basis.

In Seffert, supra,56 Cal.2d at page 508, the California Supreme Court stated, "While the appellate court should consider the amounts awarded in prior cases for similar injuries, obviously, each case must be decided on its own facts and circumstances. Such examination demonstrates that such awards vary greatly. [Citations.] Injuries are seldom identical and the amount of pain and suffering involved in similar physical injuries varies widely." (Italics added.)

More recently, the California Supreme Court made the following statements in a footnote: "Defendants have compiled a lengthy list of judgments awarding damages which have been reversed on appeal as excessive. Those cases do not, in and of themselves, mandate a reversal here. The vast variety of and disparity between awards in other cases demonstrate that injuries can seldom be measured on the same scale. The measure of damages suffered is a factual question and as such is a subject particularly within the province of the trier of fact. For a reviewing court to upset a jury's factual determination on the basis of what other juries awarded to other plaintiffs for other injuries in other cases based upon different evidence would constitute a serious invasion into the realm of factfinding. [Citations.] Thus, we adhere to the previously announced and historically honored standard of reversing as excessive only those judgments which the entire record, when viewed most favorably to the judgment, indicates were rendered as a result of passion and prejudice on the part of the jurors." (Bertero v. National General Corp. (1974)13 Cal.3d 43, 65, fn. 12 (Bertero), italics added.)

The Wilsons assert that Bertero stands for the proposition that courts of appeal should not compare the damages in other similar cases at all in reviewing a claim that an award is excessive. However, we do not read Bertero so broadly. Its criticism of comparing damage awards from other cases was limited to the statement that judgments awarding damages in other cases "do not, in and of themselves, mandate a reversal." (Bertero, supra,13 Cal.3d at p. 65, fn. 12, italics added.) In the quoted footnote the Bertero court cited the earlier Seffert court as support for its conclusion. (Bertero, supra, at p. 65, fn. 12.) Therefore, we conclude a verdict is not excessive as a matter of law simply because it exceeds the amount awarded in other cases. Courts of appeal must make their decisions based on the evidence in the case being reviewed. However, evidence of other verdicts is still relevant as a point of reference, to provide context to the award by establishing a range of values for similar injuries.

Ford cites five reported California decisions where noneconomic damages for purportedly similar injuries ranged from $1 million to $8.4 million. (Mendoza v. Club Car, Inc. (2000) 81 Cal.App.4th 287 [50-year-old plaintiff  award of $1 million]; Niles v. City of San Rafael (1974) 42 Cal.App.3d 230 (Niles) [child suffered paralysis from head trauma  award of $1,604,371]; Rosh v. Cave Imaging Systems, Inc. (1994) 26 Cal.App.4th 1225 [plaintiff rendered paraplegic from gunshot  award of $2.99 million]; Fortman, supra, 211 Cal.App.3d 241 [three-year-old girl rendered paraplegic from fall from car  $6 million award]; Hess v. Ford Motor Co. (2002) 27 Cal.4th 516 (Hess) [plaintiff rendered paraplegic after his truck rolled  $8.4 million award].)

However, the cited cases are of only small assistance. Of the five California cases cited by Ford, in only two were the damages claimed to be excessive, and in both cases the damages awards were upheld. (Niles, supra,42 Cal.App.3d at p. 244; Fortman, supra,211 Cal.App.3d at p. 261.) In the case with the largest noneconomic damage award, the size of the award was not challenged on appeal. (Hess, supra,27 Cal.4th at p. 520.) Ford cites no published California decisions involving same or similar injuries where a noneconomic damage award was reversed as excessive.

The Wilsons, on the other hand, cite an unpublished California decision upholding an award of $38 million in combined economic and noneconomic damages, reduced by 50 percent due to the plaintiff's comparative fault, to a quadriplegic who was 53 years old, and an award to his wife of $13 million for loss of consortium. The Wilsons also cite a published decision by an appellate court in Indiana that upheld an award of $55 million in combined economic, noneconomic, and loss of consortium damages, already reduced by a finding that the plaintiff was 20 percent at fault, making the total award $66 million. (Ritter v. Stanton(Ind.Ct.App. 2001) 745 N.E.2d 828, 833, 857.)

A review of all of these cases shows a range between $1 million and $66 million in compensatory damages awards and substantial differences in the facts of each case. This demonstrates that while a comparison of other cases may give us a point of reference, ultimately our decision must be based on the evidence in this case.

d. Evidence in record that jury acted out of passion or prejudice

Perhaps the most important factor that we must consider in determining if the award of noneconomic damages is excessive, other than the amount of the award itself, is whether there is evidence in the record to support the defendants' claim that the jury acted out of passion or prejudice. In this case we have substantial evidence in the record that demonstrates the jury's award was the product of such improper emotions and therefore must be reduced.

In discussing economic damages in closing argument, counsel for the Wilsons argued that Mrs. Wilson suffered "an economic loss of $4.6 million dollars . . . , based on the evidence that came before you." The jury awarded Mrs. Wilson that amount, and thus the reasonableness of her economic damages is not in dispute on appeal.

In discussing noneconomic damages in his closing argument, counsel for the Wilsons described some of the matters that could be included in such an award. This included past and future physical pain, mental suffering, and loss of enjoyment of life. Counsel then suggested a method for calculating these numbers, taking into account the past injury, as well as future injuries over her 33-year life expectancy. Following that discussion, counsel made the following statement: "I respectfully submit that if you look at the catastrophic injury that we have, the numbers there, they are probably three to four times the specials is what you are going to find. It's going to be fair, just and reasonable. And this is an awful lot of money. I know it is. It's a lot of money. But when someone says it's a lot of money, why are we doing this, you tell them it's a lot of pain. It's a loss of a human being's dignity and worth. . . . And I submit to you that there is no higher value than a good woman who is a good wife, a good mother, a good neighbor, that is out there helping others. And I can't put the number on it, but I want you to be reasonable, just and fair, recognizing the humanity of this issue." (Italics added.) Thus, counsel was requesting the jury award noneconomic damages to Mrs. Wilson in an amount three to four times the amount they awarded in economic damages, or $13.8 to $18.4 million.

As to Mr. Wilson's loss of consortium claim, counsel argued that "it's probably going to be equated perhaps reasonably just to what the economic loss is for his noneconomic loss." Counsel was thus requesting that the jury award Mr. Wilson $4.6 million for his loss of consortium claim.

Next, addressing all the compensatory damages, the Wilsons' counsel stated the following:

"I invite defense counsel to address my discussion of damages. If he does not discuss damages in his closing, if he does not disagree with me, you can accept these numbers as reasonable and just and fair." (Italics added.)

Defense counsel did not address the issue of damages in closing argument.

When we compare these numbers to the amount the jury awarded, it is apparent the jury disregarded the Wilsons' counsel's own statements as to what was a reasonable amount to award in this case. On noneconomic damages to Mrs. Wilson, the jury awarded $105 million, or approximately 13 times the amount counsel represented was "fair, just and reasonable." The reduced award of approximately $65 million is still approximately three to five times that amount. The size of the award provides compelling evidence that the jury rejected what even the Wilsons' counsel believed was fair and reasonable and acted out of passion or prejudice.

The jury's award of loss of consortium damages also supports our conclusion. The jury awarded Mr. Wilson $13 million for his loss of consortium claim, or almost three times the amount the Wilsons' counsel requested.

The jury's complete rejection of the damages suggested by the Wilsons' counsel, a range for noneconomic damages and an amount for loss of consortium that counsel characterized as fair, reasonable and just, is compelling evidence the jury acted out of passion or prejudice. The fact the jury's award, and the award as remitted by the court, far exceeded, and had no relation to, the amounts requested by counsel suggests the jury was not acting as a fair and neutral trier of fact.

There was also a question posed by Ford's counsel, in light of Mrs. Wilson's catastrophic injuries, that may well have inflamed the passions of the jury significantly enough to result in the excessive damage award. Ford's trial counsel, in its last question on cross-examination of Mr. Wilson, posited the following:

"[Q] The silver lining, to the extent that there could be one, it has brought you and [Mrs. Wilson] and the family closer together? [] . . . 

"[A] I think where we were together before, we are together after. I don't think it's done more for us. I think it's  I don't think it's a benefit or a plus in any way. I am sorry, I don't think I can see it that way."

This question implied that the family should find a silver lining in what befell Mrs. Wilson. It may very well have been viewed as callous by the jury and might explain, in some manner, the actions of the jury in rendering a verdict so out of line with the amounts requested by the Wilsons' own counsel.

e. Our review of the record

In addition to considering the above factors, we have reviewed the record to determine whether the award, as remitted by the court, is excessive. This includes reviewing the nature and extent of Mrs. Wilson's injuries, the testimony of lay and expert witnesses on damages and the damage award. Our own review of the record reveals the noneconomic damage award was excessive and was the product of passion or prejudice.

f. Conclusion

Based on all of the above factors, and utilizing our collective experience, we conclude the award of noneconomic damages to Mrs. Wilson, even as remitted by the court, was excessive, and the facts of this case instead support an award of $18 million, within the ratio/range requested by the Wilsons' counsel. As we have discussed, ante,the award, even as reduced by the trial court, far exceeds the amount suggested as reasonable, fair and just by the Wilsons' attorney. That is compelling evidence the jury acted out of "passion and prejudice" in awarding noneconomic damages. Further, although each case must be analyzed on its own facts, the award far exceeds any award we could locate that was upheld by a California appellate court.

However, the reduction to $18 million in noneconomic damages is in the range of one recent unreported decision in California where the award of such damages was upheld on appeal. Moreover, utilizing our collective experience, we conclude an award of $18 million in noneconomic damages is proportionate to Mrs. Wilson's substantial injuries, and is proportionate to the economic damages award. Considering the substantial nature of Mrs. Wilson's injuries, we conclude $18 million is a just and reasonable amount and an amount " 'a reasonable person would estimate as fair compensation' " under the circumstances of this case. (Duarte v. Zachariah (1994) 22 Cal.App.4th 1652, 1665.)

Ford summarily asserts the remitted award of $5 million for loss of consortium to Mr. Wilson was also excessive, citing cases with loss of consortium awards of $229,000 to $2.55 million. However, utilizing the same factors we considered above, and noting the devastating impact on Mr. Wilson's life that Ford's conduct has caused, we do not find the remitted award for loss of consortium to be excessive or the product of passion or prejudice. The amount to which the court reduced these damages approximates the amount suggested by the Wilsons' counsel.

To avoid further delay and expense to the parties, and because the record in this matter is sufficiently definite to determine the proper amount of noneconomic damages, we will remit the award of noneconomic damages to $18 million for Mrs. Wilson, conditioned on her acceptance of this reduced amount. If Mrs. Wilson does not agree to the reduced amount, the matter will be reversed and remanded for a new trial on the issue of noneconomic damages, as specified in California Rules of Court, rule 8.264(d).^[4]

B. Due Process Considerations

Ford also asserts that the noneconomic damages award is "unconstitutionally excessive as a matter of federal due process." Amicus curiae AAM makes the same argument, asserting that due process considerations applicable to punitive damages awards should also apply to compensatory damages. This contention is unavailing.

Ford and AAM ignore the fact that while the United States Supreme Court has in several recent decisions held that due process rights limit the amount of punitive damages that may be imposed upon an individual, a basic underpinning of those decisions was the very distinction between compensatory damages, which are designed to compensate the plaintiff, and punitive damages, which are in the nature of fines or sanctions, designed to punish and deter a defendant. For example, in State Farm Mut. Auto. Ins. Co. v. Campbell(2003) 538 U.S. 408, 416 (State Farm), the majority opinion began its analysis by making just this distinction: "[I]n our judicial system compensatory and punitive damages, although usually awarded at the same time by the same decisionmaker, serve different purposes. [Citation.] Compensatory damages 'are intended to redress the concrete loss that the plaintiff has suffered by reason of the defendant's wrongful conduct.' [Citations.] By contrast, punitive damages serve a broader function; they are aimed at deterrence and retribution." After establishing this important distinction, the high court concluded that the "[t]he Due Process Clause of the Fourteenth Amendment prohibits the imposition of grossly excessive or arbitrary punishments on a tortfeasor." (State Farm, supra,538 U.S. at p. 416,italics added.) The court likened punitive damages to criminal penalties, imposed without the protections of a criminal trial: "Although these awards serve the same purposes as criminal penalties, defendants subjected to punitive damages in civil cases have not been accorded the protections applicable in a criminal proceeding." (Id. at p. 417.)

Ford and AAM cite no authority for the proposition that constitutional due process limitations applicable to punitive damages awards, as recently confirmed by the United States Supreme Court (see State Farm, supra,538 U.S. at p. 412), also apply to compensatory damages awards. Nevertheless, AAM asserts that the rule applicable to punitive damages awards should be extended to noneconomic damage awards because (1) defendants need notice of their potential exposure to such liability that is imposed in a vague and standardless manner, and (2) the lack of concrete standards for such awards enables juries to pursue punitive goals in rendering such awards.

However, because noneconomic damages are not a punishment that serves to deter conduct, but rather compensation to make a plaintiff whole as a result of a defendant's conduct, uncertainty in the proof does not preclude their recovery: " '[O]nce the cause and existence of damages have been . . . established [with reasonable certainty], recovery will not be denied because the damages are difficult of ascertainment. . . . The law only requires that the best evidence be adduced of which the nature of the case is capable[,] and the defendant whose wrongful act gave rise to the injury will not be heard to complain that the amount thereof cannot be determined with mathematical precision.' " (Dallman Co. v. Southern Heater Co. (1968) 262 Cal.App.2d 582, 594, citations omitted; see also Speegle v. Board of Fire Underwriters (1946) 29 Cal.2d 34, 46 [" 'The most elementary conceptions of justice and public policy require that the wrongdoer shall bear the risk of the uncertainty [in fixing the amount of damages] which his own wrong has created' "].)

As the United States Supreme Court has noted, " '[T]he common law rule as it existed at the time of the adoption of the Constitution' was that 'in cases where the amount of damages was uncertain[,] their assessment was a matter so peculiarly within the province of the jury that the Court should not alter it.' " (Feltner v. Columbia Pictures Television, Inc. (1998) 523 U.S. 340, 353; see also Barry v. Edmunds (1886) 116 U.S. 550, 565 ["nothing is better settled than [the principle] that, in . . . actions for torts where no precise rule of law fixes the recoverable damages, it is the peculiar function of the jury to determine the amount by their verdict"].) Thus, we are loath to usurp this core function of the jury by relying on quasi-mathematical formulas to assess the amount of damages that may be awarded, simply because noneconomic damages are not readily quantifiable.

Nor does the imagined danger that vague standards for imposing or reviewing noneconomic damage awards will lead juries to use such awards as punishment, as opposed to compensation, justify imposing due process limitations on such awards. The jury here was instructed it "must not let bias, sympathy, prejudice, or public opinion influence [their] decision." Although the jury was instructed that as to noneconomic damages "[n]o fixed standard exists for deciding the amount of these damages," it was also instructed that it "must use [their] judgment to decide a reasonable amount based on the evidence and [their] common sense." The jury was instructed that for future economic damages, "[Mrs.] Wilson must prove that she is reasonably certain to suffer that harm." The court, in instructing the jury on noneconomic damages, also delineated the type of harm for which Mrs. Wilson could recover:

"Noneconomic damages may consist of the following: [] Past and future physical pain, past and future mental suffering, past and future enjoyment of life, past and future disfigurement, past and future physical impairment, past and future inconvenience, past and future grief, past and future anxiety, past and future humiliation, past and future emotional distress."

Thus, under these instructions juries are given guidance as to the proper matters they may consider in making an award of noneconomic damages. These guideposts protect against the purported danger that juries might use such an award to punish a defendant.

Moreover, to the extent that a jury's award of noneconomic damages is challenged as excessive, the judge, sitting as a 13th juror, will then review the evidence to determine if the award should be remitted. The trial judge is not limited to setting aside an excessive damage award based on evidence the jury acted out of passion or prejudice. Rather, " 'it is within the sound discretion of the trial court in ruling upon a motion for a new trial on the ground of excessive damages, to grant the same when there is a substantial conflict in the evidence regarding the extent of the damage.' " (Hughes v. Hearst Publications, Inc. (1947) 79 Cal.App.2d 703, 705.) This rule gives defendants a further check against excessive awards of noneconomic damages.

Finally, the "passion or prejudice" standard under which appellate courts review such awards also protects against excessive awards. It is true that recent cases have stated that awards for emotional distress can in some instances have a punitive element. (Gober v. Ralph's Grocery Co. (2006)137 Cal.App.4th 204, 223 (Gober); State Farm, supra, 538 U.S. at p. 426.) However, here we reviewed the record and determined the evidence supported an award of $18 million, the award was within the range for similar cases, and it was proportionate to Mrs. Wilson's substantial injuries and economic loss. By reducing the noneconomic damages to $18 million, we have effectively eliminated that portion of the award that was the product of passion or prejudice, and no punitive element remains.

AAM relies heavily upon a law review article for its position that the vague standards for quantifying noneconomic damage awards justify imposing federal due process constraints on such awards. However, the author of that article concluded that the solution to such unchecked awards is limits or standards imposed by legislatures, not application of due process notions to compensatory awards. (Niemeyer, Awards for Pain and Suffering: The Irrational Centerpiece of Our Tort System (2004) 90 Va. L.Rev. 1401, 1414, 1417-1418.)

Ford and AAM cite one out-of-state authority that states in a footnote "[a] grossly excessive award for pain and suffering may violate the Due Process Clause even if it is not labeled 'punitive.' " (Gilbert v. DaimlerChrysler Corp. (2004) 470 Mich. 749 [685 N.W.2d 391, 400, fn. 22].) However, that court expressly declined to address this constitutional issue and therefore it is not authority for the proposition cited. (Ibid. ["there is no need to reach this constitutional question"].)

We conclude it is not necessary to impose federal due process principles to limit noneconomic damage awards because (1) the Supreme Court in State Farm, supra,538 U.S. 408, imposed due process limits on punitive damages awards because they are similar to criminal penalties, without the protections afforded defendants in criminal proceedings, and noneconomic damages are designed to compensate, not punish, a defendant; (2) the defendants have adequate notice of potential awards; and (3) the review accorded damage awards by trial and appellate courts ensures there is no punitive element in noneconomic damage awards.

III. PUNITIVE DAMAGES

Ford asserts the punitive damages award must be reversed because (1) the Wilsons only proved that reasonable people could disagree regarding the design decisions made by Ford; (2) it complied with all applicable governmental standards; (3) it was improper to admit evidence of Ford's overall financial condition; and (4) the award is excessive under federal and California law.

On remand from the United States Supreme Court, with directions that we reconsider Buell‑Wilson I in light of Philip Morris, supra,166 L.Ed.2d 940, Ford asserts (1) it is entitled to a new trial because there is a "significant risk" the punitive damages verdict against it was based on improper evidence and arguments concerning third party harm; (2) the punitive damages award was barred because Ford's conduct was objectively reasonable; (3) Philip Morris requires a further reduction in the punitive damages award; and (4) we should revisit our ruling excluding industry custom and practiceevidence.

We reiterate our original holding that the punitive damages award, as remitted by the trial court, is excessive and reduce it to $55 million. We reject the remainder of Ford's contentions. We also decline Ford's (and amici curiaes') request that we reconsider our original holdings on the trial court's evidentiary rulings, the emotional distress damages, and issues related to the punitive damages award other than whether that award improperly punished Ford for harm to third parties. The United States Supreme Court's direction to this court was to reconsider our original decision "in light of Philip Morris." (Ford Motor Co. v. Buell‑Wilson (2007) ___ U.S. ___ [167 L.Ed.2d 1087, 127 S.Ct. 2250].) The only issue decided by Philip Morris was whether and when third party harm could be considered in imposing punitive damages. Based on our analysis of Philip Morris, our review of Buell‑Wilson I, and the proceedings in the trial court, we conclude that nothing in Philip Morris requires us to reconsider the remainder of our original decision.

A. The "Reasonable People Can Disagree" Argument

1. Standard of Review

We review an award of punitive damages to determine if there is substantial evidence that supports a finding by clear and convincing evidence that a defendant acted with fraud, malice or oppression. (Mike Davidov Co. v. Issod (2000) 78 Cal.App.4th 597, 606.)

2. Analysis

In this case the Wilsons presented evidence, which the jury accepted, that Ford knew of dangerous instability defects in the Explorer. Ford's own testing showed that the Explorer was unstable and prone to rollover on flat dry pavement at less than highway speeds. Ford knew before the Explorer was released for sale that the same instability characteristics in that vehicle led to serious injuries to Bronco II drivers. The Wilsons presented evidence that Ford knew that the Explorer's roof was weak and that roof crush caused injury during rollover accidents. Ford had the technology to make the Explorer stable and strengthen the roof, but did not use it. The modifications to strengthen the roof would have cost approximately $20 per vehicle. This evidence constitutes substantial evidence to support the jury's decision to award punitive damages.

Ford asserts, however, that because there was a "reasonable disagreement" among experts concerning the propriety of its design decisions it cannot, as a matter of law, be subject to punitive damages. We reject this contention.

The Wilsons presented expert testimony concerning the design and safety issues of the Explorer. Ford presented contrary expert testimony. The jury rejected the testimony of Ford's experts, as it was entitled to do. Ford's assertion that punitive damages are not allowed unless all experts agree there were improper design decisions is unavailing. If such an assertion were true, punitive damages would never be allowed in cases where the defendant simply had an expert who disagreed with the plaintiff's expert.

Moreover, the California cases cited by Ford on this issue do not support its position. They were cases where there was simply a failure of proof to support a punitive damages award. (See Lusardi Construction Co. v. Aubry (1992) 1 Cal.4th 976, 996-997; Chateau Chamberay Homeowners Assn. v. Associated Internat. Ins. Co. (2001) 90 Cal.App.4th 335, 348, 350, fn. 10 (Chateau Chamberay); Mason v. Mercury Cas. Co. (1976) 64 Cal.App.3d 471, 474-475; Kwan v. Mercedes-Benz of North America, Inc. (1994) 23 Cal.App.4th 174, 184-185; Stewart v. Truck Ins. Exchange (1993) 17 Cal.App.4th 468, 483-484.)

Ford also asserts there was no evidence any of Ford's decision makers believed the Explorer's design presented an unreasonable risk of injury, presenting the jury with only the "bare and illogical 'inference' that unnamed Ford officials 'must have' acted with malice . . . ." However, the Wilsons presented direct and substantial evidence of Ford management's recognition of the safety implications of their design decisions. As discussed in detail in the factual background, ante, there is substantial evidence that Ford's decision makers knew how to make the Explorer less dangerous, but chose not to because of financial considerations. Ford's "reasonable people can disagree" argument is unavailing.

PLAC supports Ford's arguments regarding disagreements among experts as a defense to punitive damages, asserting that where there are contemporaneous disagreements among experts regarding design decisions, punitive damages should be barred. However, PLAC cites no California authority for such a proposition. The California case law PLAC cites involves the well-established rule in insurance bad faith cases that an insurer cannot be liable for bad faith if there is an objectively reasonable dispute about coverage. (See, e.g., Chateau Chamberay, supra, 90 Cal.App.4th at pp. 347-348; Fraley v. Allstate Ins. Co. (2000) 81 Cal.App.4th 1282, 1293.) However, these cases state a substantive standard of liability for insurance claims and do not address when it is proper to impose punitive damages. Notably, PLAC has cited no California product liability case where expert disputes concerning design provide a defense to punitive damage liability or, for that matter, liability in its entirety.

In a footnote, PLAC also cites several out-of-state cases for the proposition that a contemporaneous disagreement among experts bars liability for punitive damages. However, several of these cases simply do not state such a proposition. Rather, some stand for the proposition that expert disagreement is merely one factor that could be considered in assessing the propriety of punitive damages awards. (Loitz v. Remington Arms Co., Inc. (1990) 138 Ill.2d 404 [563 N.E.2d 397, 406-407, 150 Ill.Dec. 510]; Owens-Corning Fiberglas Corp. v. Garrett (1996) 343 Md. 500 [682 A.2d 1143, 1158-1168]; Satcher v. Honda Motor Co. (5th Cir. 1995) 52 F.3d 1311, 1316-1317.)

PLAC does cite two cases from Iowa that hold a reasonable disagreement among experts about the adequacy of design was a defense to punitive damages. (Mercer v. Pittway Corp. (Iowa 2000) 616 N.W.2d 602, 618; Hillrichs v. Avco Corp. (Iowa 1994) 514 N.W.2d 94, 100.) However, no case from any other state has cited these cases with approval, and we could not locate any other state that follows such a "rule." Because these cases apply Iowa law, we are not bound by their holdings and decline to adopt such a rule in California.

PLAC also argues that punitive damages should be barred where there was a contemporaneous expert opinion that a product design that caused a plaintiff injury was necessary to avoid greater injuries of other kinds. This contention is unavailing.

First, this argument by PLAC focuses only on Ford's decisions regarding the Explorer's stability. There is no assertion that Ford allowed the roof defect to exist because changing the design would create a greater risk of other injuries. Because the roof's crashworthiness provided an independent basis for the award of punitive damages, this argument fails.

Second, PLAC cites to no evidence in the record to suggest that any member of Ford's management rejected changes to the Explorer's stability design because to do so would create a greater risk of injury in another manner. Rather, it only cites to statements made in Ford's brief that imply such a rationale, but Ford's statements are not supported by the cited record.

As such, Ford and PLAC's "reasonable people can disagree" argument is unavailing.

Story Continue As Part IV ..

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^[1] In making this assertion, Ford neglects to discuss the evidence in support of the Wilsons' damages at all, much less in the light most favorable to the judgment. This failure in itself would allow this court to disregard Ford's arguments concerning damages. (Nwosu v. Uba (2004) 122 Cal.App.4th 1229, 1246.) Nevertheless, we elect to consider Ford's contention on the merits.

^[2] We also note, as discussed, ante, that we do not review whether the jury's original award of $118 million to the Wilsons "shocks the conscience and suggests passion, prejudice or corruption on the part of the jury." (Seffert, supra, 56 Cal.2d at p. 507.) Rather, since the court remitted the award to $70 million as a condition of denying Ford's motion for new trial, we review the noneconomic damage award " ' "as if it had been returned in the first instance by the jury in the reduced amount." ' " (West, supra, 174 Cal.App.3d at p. 877.)

^[3] Mrs. Wilson's projected life span at the time of trial was 33 years. However, we use 35 years here because the award of noneconomic damages included an award for approximately two years of past general damages.

^[4] Ford asserts that if the noneconomic damages award to Mrs. Wilson is determined to be the product of passion or prejudice, we are required, as a matter of law, to grant a new trial on all issues. However, case authority demonstrates it is appropriate to issue a remittitur under such circumstances. (See Deevy, supra,21 Cal.2d at pp. 120-121; Bellman v. San Francisco H. S. Dist. (1938) 11 Cal.2d 576, 586-589; Las Palmas Associates v. Las Palmas Center Associates (1991) 235 Cal.App.3d 1220, 1255-1256; Burnett v. National Enquirer, Inc. (1983) 144 Cal.App.3d 991, 1011-1012.)