FORD MOTOR CO. v. ROMO
When Romo's Ford Bronco swerved to avoid another vehicle, it rolled over, killing three of the Romo family and injuring three more. A California jury found that the rollover was caused by a dangerous flaw in the design of the Bronco, which Ford had willfully ignored. The jury awarded Romo $5 million in compensatory damages (which are intended to compensate the plaintiff for a loss) and $290 million in punitive damages (which are intended to punish the defendant for wrongdoing.) Ford argued that the very large award of punitive damages was excessive. Nevertheless, the California Fifth Appellate District Court of Appeal upheld the verdict, comparing the level of Ford's negligence to involuntary manslaughter. After the California Supreme Court declined to hear the case, Ford appealed to the U.S. Supreme Court, arguing that the punitive damages awarded by the jury were so excessive as to be prohibited by the Constitution's Due Process Clause.
Is an award of $290 million in punitive damages, when full compensatory damages are $5 million, excessive and in violation of the Due Process Clause of the Fourteenth Amendment?
In a short, anonymous order, the Court voided the California Appellate Court's decision and sent the case back for further consideration in light of the Supreme Court's 2003 decision in State Farm Mutual Automobile Insurance Company v. Campbell. In that case, the Supreme Court struck down an award of $145 million in punitive damages which accompanied an award of only $1 million in compensatory damages. See State Farm Mutual Auto Ins. Co. v. Campbell [01-1289]. Upon reconsideration, the California court reduced the punitive damages to $23.7 million.