The Bert Company v. Turk, Aplts. ( 2023 )

[J-59A-2022 and J-59B-2022] [MO: Donohue, J.]
IN THE SUPREME COURT OF PENNSYLVANIA
WESTERN DISTRICT
THE BERT COMPANY D/B/A : No. 13 WAP 2022
NORTHWEST INSURANCE SERVICES :
: Appeal from the Order of the
: Superior Court entered May 5, 2021
v. : at No. 817 WDA 2019, affirming the
: Judgment of the Court of Common
: Pleas of Warren/Forest County
MATTHEW TURK, WILLIAM COLLINS, : entered June 3, 2019 at No. AD 260
JAMIE HEYNES, DAVID MCDONNELL, : of 2017.
FIRST NATIONAL INSURANCE AGENCY, :
LLC, FIRST NATIONAL BANK, AND FNB : ARGUED: October 25, 2022
CORPORATION :
:
:
APPEAL OF: MATTHEW TURK, FIRST :
NATIONAL INSURANCE AGENCY, LLC, :
FIRST NATIONAL BANK, AND FNB :
CORPORATION :
THE BERT COMPANY D/B/A : No. 14 WAP 2022
NORTHWEST INSURANCE SERVICES :
: Appeal from the Order of the
: Superior Court entered May 5, 2021
v. : at No. 975 WDA 2019, dismissing as
: moot the cross-appeal from the
: Judgment of the Court of Common
MATTHEW TURK, WILLIAM COLLINS, : Pleas of Warren/Forest County
JAMIE HEYNES, DAVID MCDONNELL, : entered June 3, 2019 at No. AD 260
FIRST NATIONAL INSURANCE AGENCY, : of 2017.
LLC, FIRST NATIONAL BANK AND FNB :
CORPORATION : ARGUED: October 25, 2022
:
:
MATTHEW TURK :
:
:
v. :
:
:
:
THE BERT COMPANY, NORTHWEST :
BANK, AND NORTHWEST BANCSHARES, :
INC. :
:
:
APPEAL OF: MATTHEW TURK, FIRST :
NATIONAL INSURANCE AGENCY, LLC, :
FIRST NATIONAL BANK, AND FNB :
CORPORATION :
CONCURRING OPINION
JUSTICE MUNDY DECIDED: JULY 19, 2023
The Majority holds that the constitutional permissible ratio of punitive to
compensatory damages in cases with multiple joint and several liable tortfeasors – where
compensatory damages are awarded in a lump sum against all defendants while punitive
damages are awarded on an individual basis – should be calculated on a per defendant
basis. I agree that this is an acceptable basis to calculate the punitive to compensatory
damages ratio in the case currently before the Court.1 As the Supreme Court has
consistently refused to create strict mechanical tests in determining the constitutionality
of punitive damages awards, however, I would hold open the possibility that other
approaches to calculating the ratio would also be constitutionally permissible.
In BMW of North America, Inc. v. Gore, 57 U.S. 559 (1996), the High Court set out
three guideposts courts must follow in considering the constitutionality of a punitive
damages award. The second guidepost being the ratio between the punitive damages
and compensatory damages awarded. Gore, 57 U.S. at 580. The purpose in considering
this ratio is that there must be a “reasonable relationship” between punitive and
compensatory damages. Id. The Court also recognized that it has “consistently rejected
1I also agree with the Majority that potential harm caused by a tortfeasor’s actions is a
permissible consideration in comparing the relationship between a punitive damages
award and a compensatory damages award.
[J-59A-2022 and J-59B-2022] [MO: Donohue, J.] - 2
the notion that the constitutional line is marked by a simple mathematical formula[,]” id. at
582, and again refused to “draw a mathematical bright line between the constitutionally
acceptable and the constitutionally unacceptable that would fit every case.” Id. at 583
(quoting Pacific Mut. Life Ins. Co. v. Haslip, 499 U.S. 1, 18 (1991)).
Then in State Farm Mutual Automobile Insurance Co. v. Campbell, 538 U.S. 408(2003), the Court refined the Gore guideposts. In discussing the second Gore guidepost,
the Court again acknowledged it has been “reluctant to identify concrete constitutional
limits on the ratio between harm, or potential harm, to the plaintiff and the punitive
damages award.” State Farm, 538 U.S. at 424. The Court again declined to “impose a
bright-line ratio which a punitive damages award cannot exceed.” Id. In the absence of
such a bright-line ratio, courts must assure that a punitive damages award is reasonable
and proportionate to the amount of harm sustained by the plaintiff and to the
compensatory damages recovered. Id. at 426.
The Supreme Court’s continued reluctance to set a rigid benchmark for a
permissible punitive-to-compensatory damages ratio allows courts to consider the facts
and circumstances of a specific case in considering the constitutionality of a particular
punitive damages award. This flexibility should extend to the method by which the ratio
itself is calculated. In multiple defendant cases courts have calculated the ratio in one of
two ways. The first is the per-defendant approach, which divides the punitive damages
assessed against an individual defendant by the compensatory damages awarded
against that defendant. See, e.g., Planned Parenthood of Columbia/Williamette Inc., v.
Am. Coal. of Life Activists, 422 F.3d 949 (9th Cir. 2005); Horizon Health Corp. v. Acadia
Healthcare Co., Inc., 520 S.W.3d 848 (Tex. 2017). The second is the per-judgment
approach, which divides the punitive damages assessed against all defendants by the
compensatory damages assessed against all defendants. See, e.g., Advocat, Inc. v.
[J-59A-2022 and J-59B-2022] [MO: Donohue, J.] - 3
Sauer, 111 S.W.3d 346 (Ark. 2003); Cooley v. Lincoln Elec. Co., 776 F.Supp.2d 511 (N.D.
Ohio 2011).
Instantly, the Majority adopts the per-defendant approach. It reasons that the per-
defendant approach “assesses the individualized impact intended by the punitive
damages awards, whereas the per-judgment approach distorts the analysis by obscuring
the due process rights of the individual defendants.” Maj. Op. at 42. The Majority
continues that the per-judgment approach “undoes the jury’s determination of an
individual’s reprehensibility and need for deterrence as reflected in the punitive award.”
Id. This reasoning may be applicable when courts are calculating the ratio solely using a
plaintiff’s actual damages. However, as the Majority correctly finds, courts are permitted
to consider not only a plaintiff’s actual damages but also the potential harm caused by a
defendant’s conduct. See State Farm, 538 U.S. at 424 (“[W]e have been reluctant to
identify concrete constitutional limits on the ratio between harm, or potential harm, to
the plaintiff and the punitive damages award.” (emphasis added)).
Unlike compensatory damages, the jury does not make a finding of the amount of
potential harm caused by the defendants’ tortious conduct let alone allocate that potential
harm amongst the several defendants. In such circumstances, employing the per-
judgment approach and using the combined total of the compensatory damages and
potential harm as the denominator and the total amount of punitive damages awarded by
the jury as the numerator may be more appropriate because it would give fuller
consideration to the reprehensibility of the defendants’ conduct. It would also be
impossible for the court to accurately appropriate the amount of potential harm
attributable to each individual defendant without a specific finding by the jury, making it
practically impossible to employ the per-defendant approach when considering potential
harm.
[J-59A-2022 and J-59B-2022] [MO: Donohue, J.] - 4
The Majority finds that “[c]umulating the punitive verdicts as required under the
per-judgment approach obliterates the jury’s assessment of each defendant’s
reprehensibility, and we cannot conceive a reason for doing so where the Defendants are
not a single corporate entity.” Maj. Op. at 44. As seen from the complications potential
harm can have in the employment of the per-defendant approach, there are instances
where the per-judgment approach would be more appropriate, and the Court should not
be so quick to dismiss the possibility that other instances may arise that are not currently
before it. For those reasons, and in light of the fact the Supreme Court has continuously
refused to create mechanical rules in considering the constitutionality of the punitive-to-
compensatory damages ratio, I would leave open the possibility that approaches other
than the per-defendant approach could be permissible.
[J-59A-2022 and J-59B-2022] [MO: Donohue, J.] - 5