Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, June 26, 1993 TAG: 9306260070
SECTION: NATIONAL/INTERNATIONAL PAGE: A-8 EDITION: METRO
SOURCE: Los Angeles Times
DATELINE: WASHINGTON LENGTH: Medium
On a 6-3 vote, the justices retreated from earlier decisions suggesting the Constitution put outer limits on punitive damages. Instead, in this case, the court upheld a $10 million judgement against a Texas company that grew out of a $19,000 land title dispute, a punishment that was 526 times greater than the actual harm.
Although the high court has twice upheld multimillion-dollar punitive verdicts, it had suggested that a punishment that vastly exceeded the actual harm inflicted would be unfair and unconstitutional. In addition, it had said state judges must examine jury verdicts to make sure they are not out of line with previous awards.
On Friday, however, the justices stepped back from both positions and made clear they will take a hands-off approach to punitive verdicts.
"We do not consider the dramatic disparity between the actual damages and the punitive award controlling in a case of this character," wrote Justice John Paul Stevens for the court.
He added that a jury can take into account not only a company's harmful impact on actual victims, but the "potential harm" it could have inflicted on thousands of others.
Friday's case began in 1984 when Texas-based TXO Production tried to buy mineral interests from Alliance Resources and others on a 1,000-acre tract in West Virginia where was TXO seeking to drill for oil and gas. The parties failed to agree on royalty interests, and soon after TXO went to court questioning who held title to the land. The owners counterclaimed, alleging that TXO was using a "slander of their title" as leverage against them.
The jury agreed that the lawsuit was frivolous and awarded $19,000 in actual damages against TXO, arising from the attorneys' fees, and $10 million in punitive damages. The West Virginia Supreme Court of Appeals affirmed, and Friday, the Supreme Court agreed.
The court, which will end its 1992-93 term Monday, also announced these decisions Friday:
Employees cannot necessarily win job-bias lawsuits if they prove the reasons given by their employers for treating them differently are untrue, the court ruled by a 5-4 vote in a Missouri case.
Until now, a worker could often win a discrimination case by showing that the employer gave the court a dishonest explanation for a dismissal or other action that appeared discriminatory.
But ruling 5-4 in a suit brought by a black correctional officer who was dismissed from his job in a Missouri prison, the court held that it was not enough for an employee to show that an employer lied.
Instead, the court said in an opinion by Justice Antonin Scalia, the employee may also have to prove that the real reason he or she was dismissed or denied a promotion or a job was discrimination.
The government may prohibit television and radio stations licensed to operate in states that ban lotteries from advertising a neighboring state's games. The court, 7-2, said a federal law that keeps a North Carolina radio station from airing commercials for Virginia's state-run lottery does not violate free-speech rights.
by CNB