Thursday, October 23, 2014
Court Upholds $18 Million Punitive Award in Asbestos Case
Panel Says Union Carbide’s Failure to Disclose It Knew of Cancer Link Was ‘Reprehensible Indifference’
By KENNETH OFGANG, Staff Writer
An $18 million in punitive damages, to a man who contracted mesothelioma was not excessive, the Court of Appeal for this district ruled yesterday.
Union Carbide Company “acted with a reprehensible indifference to the health and safety of others,” including plaintiff Bobbie Izell, when it concealed internal studies establishing that even brief exposure to asbestos caused cancer, Presiding Justice Joan Dempsey Klein wrote yesterday.
A Los Angeles Superior Court jury initially awarded $30 million in compensatory damages against five defendants—including Union Carbide, which was assessed 65 percent of the fault—to Izell and his wife, and awarded the $18 million in punitive damages against Union Carbide alone. The plaintiffs later accepted a remittitur of the compensatory damages to $6 million.
Another defendant, Kaiser Gypsum, was found to have engaged in malice, fraud, or oppression, but settled prior to the punitive damages phase of the trial.
Izell worked as a cement contractor in the 1950s and worked as a general contractor building small houses in the Los Angeles area until he retired in 1994. He was diagnosed with mesothelioma in 2011, when he was 85 years old.
Izell acknowledged that he didn’t work with asbestos directly, but his attorneys argued that he was exposed to asbestos dust while inspecting the homes he worked on. Because his exposure to asbestos was relatively low, it took longer for the cancer to develop, they said.
Sufficiency of Evidence
Union Carbide said the verdict should be overturned as to both liability and damages. There was insufficient evidence linking Izell’s illness to a Union Carbide product, they argued, and the damages were in any event excessive.
Klein, writing for the Court of Appeal, cited testimony that Union Carbide was the exclusive supplier of asbestos to Hamilton Materials Inc. for its Hamilton Red Dot joint compound, which Izell claimed to have inhaled during the 1960s and 1970s. While Union Carbide complained that the claim it was the only supplier was based on the “faulty” memory of Hamilton’s president, and was inconsistent with Union Carbide’s own records, Klein said, the jury was entitled to weigh the conflicting evidence.
The causal link between Izell’s exposure to the Hamilton product and his illness, the presiding justice went on to say, was supplied by the plaintiff’s testimony that he saw his workers apply the compound in its wet form and then sand the dried product, and inhaled the resulting dust when it became airborne. The claim that these exposures caused cancer was backed by expert medical testimony, Klein added.
As for the punitive damage verdict, the presiding justice said the amount was not excessive under the rules laid out by the nation’s highest court in State Farm Mut. Auto Ins. Co. v. Campbell (2003) 538 U.S. 408.
The Campbell court said that a punitive damage award violates the Excessive Fines Clause if is disproportionate to the award of compensatory damages, the reprehensibility of the defendant’s conduct, and the amount of civil penalties authorized for similar conduct.
Klein said the reduced punitive damage award, being 4.62 times Union Carbide’s share of compensatory damages, was within the range deemed reasonable in Campbell, taking the other “guideposts” into consideration.
Most importantly, she said, the degree of reprehensibility was high. The damage caused by the company’s failure to warn was serious, repeated, and deceitful, and was intended to enhance profits at the expense of health and safety, the presiding justice concluded, noting the company’s stipulated net worth of $4.2 billion.
Justice Richard Aldrich concurred in Klein’s opinion, while Justice Patti Kitching dissented in part, arguing that the punitive damage award should be reversed in light of the reduction of the compensatory damage award. Jurors, she said, may have “acted with passion and prejudice,” in reaching both their compensatory and punitive damage award, and even if they didn’t, the award is “suspect” because the ratio of compensatory to punitive damages differs significantly from the unremitted verdict.
Attorneys on appeal were John Langdoc, Denyse Clancy and Christine Tamer of Baron & Budd, P.C. for the plaintiffs and Michele Odorizzi of Mayer Brown LLP and David K. Schultz of McKenna, Long & Aldridge LLP for the defendant.
Copyright 2014, Metropolitan News Company