BFI, Inc. v. Kelco Disposal, Inc.
492 U.S. 257 (1989)

Annotate this Case

U.S. Supreme Court

BFI, Inc. v. Kelco Disposal, Inc., 492 U.S. 257 (1989)

Browning-Ferris Industries of Vermont, Inc. v. Kelco Disposal, Inc.

No. 88-556

Argued April 18, 1989

Decided June 26, 1989

492 U.S. 257

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR

THE SECOND CIRCUIT

Syllabus

Respondents Joseph Kelly and Kelco Disposal, Inc., filed suit against petitioners (collectively BFI) in Federal District Court, charging BFI with antitrust violations and with interfering with Kelco's contractual relations in violation of Vermont tort law. A jury found BFI liable on both counts, and awarded Kelco, in addition to $51,146 in compensatory damages, $6 million in punitive damages on the state law claim. Denying BFI's post-trial motions, the District Court upheld the jury's punitive damages award. The Court of Appeals affirmed as to both liability and damages, holding that, even if the Eighth Amendment were applicable, the punitive damages awarded were not so disproportionate as to be constitutionally excessive.

Held:

1. The Excessive Fines Clause of the Eighth Amendment does not apply to punitive damages awards in cases between private parties; it does not constrain such an award when the government neither has prosecuted the action nor has any right to recover a share of the damages awarded. Pp. 492 U. S. 262-276.

(a) The primary concern which drove the Framers of the Eighth Amendment was the potential for governmental abuse of "prosecutorial" power, not concern with the extent or purposes of civil damages. Nothing in English history suggests that the Excessive Fines Clause of the English Bill of Rights of 1689, the direct ancestor of the Eighth Amendment, was intended to apply to damages awarded in disputes between private parties. Pp. 492 U. S. 264-268.

(b) The history of the use and abuse in England of amercements, including the fact that Magna Carta placed limits on the Crown's use of excessive amercements, is no basis for concluding that the Excessive Fines Clause limits a civil jury's ability to award punitive damages. Magna Carta was aimed at putting limits on the excesses of royal power, purposes which are clearly inapposite in a case where a private party receives exemplary damages from another party and the government has no share in the recovery. Any overlap between civil and criminal procedure at the time of Magna Carta is insignificant when all indications are that English courts never have understood Magna Carta's amercements clauses to be relevant to private damages of any kind. Pp. 492 U. S. 268-273.

Page 492 U. S. 258

(c) The language of the Excessive Fines Clause and the nature of our constitutional framework make it clear that the Eighth Amendment places limits on the steps a government may take against an individual. The fact that punitive damages are imposed through the aegis of courts and serve to advance governmental interests in punishment and deterrence is insufficient to support applying the Excessive Fines Clause in a case between private parties. Here, the government of Vermont has not taken a positive step to punish, as it does in the criminal context, nor used the civil courts to extract large payments or forfeiture for the purpose of raising revenue or disabling some individual. Pp. 492 U. S. 273-276.

2. Because BFI failed to raise before either the District Court or the Court of Appeals the question whether the punitive damages award was excessive under the Due Process Clause of the Fourteenth Amendment, this Court will not consider the effect of due process on the award. Pp. 492 U. S. 276-277.

3. Federal common law does not provide a basis for disturbing the jury's punitive damages award. In performing the limited function of a federal appellate court, this Court perceives no federal common law standard, or compelling federal policy, that convinces the Court it should not accord considerable deference to a district court's decision not to order a new trial. The District Court in this case properly instructed the jury on Vermont law and applied the proper state law standard in considering whether the verdict was excessive, and the Court of Appeals correctly held that the District Court did not abuse its discretion. Pp. 492 U. S. 277-280.

845 F. 2d 404, affirmed.

BLACKMUN, J., delivered the opinion for a unanimous Court with respect to Parts I, III, and IV, and the opinion of the Court with respect to Part II, in which REHNQUIST, C. J., and BRENNAN, WHITE, MARSHALL, SCALIA, and KENNEDY, JJ., joined. BRENNAN, J., filed a concurring opinion, in which MARSHALL, J., joined, post, p. 492 U. S. 280. O'CONNOR, J., filed an opinion concurring in part and dissenting in part, in which STEVENS, J., joined, post, p. 492 U. S. 282.

Page 492 U. S. 259

JUSTICE BLACKMUN delivered the opinion of the Court.

We face here the questions whether the Excessive Fines Clause of the Eighth Amendment applies to a civil jury award of punitive or exemplary damages, and, if so, whether an award of $6 million was excessive in this particular case. [Footnote 1] This Court has never held, or even intimated, that the

Page 492 U. S. 260

Eighth Amendment serves as a check on the power of a jury to award damages in a civil case. Rather, our concerns in applying the Eighth Amendment have been with criminal process and with direct actions initiated by government to inflict punishment. Awards of punitive damages do not implicate these concerns. We therefore hold, on the basis of the history and purpose of the Eighth Amendment, that its Excessive Fines Clause does not apply to awards of punitive damages in cases between private parties.

I

These weighty questions of constitutional law arise from an unlikely source: the waste-disposal business in Burlington, Vt. Petitioner Browning-Ferris Industries of Vermont, Inc., is a subsidiary of petitioner Browning-Ferris Industries, Inc. (collectively, BFI), which operates a nationwide commercial waste collection and disposal business. In 1973 BFI entered the Burlington area trash collection market, and in 1976 began to offer roll-off collection services. [Footnote 2] Until 1980, BFI was the sole provider of such services in the Burlington area; that year, respondent Joseph Kelley, who, since 1973, had been BFI's local district manager, went into business for himself, starting respondent Kelco Disposal, Inc. Within a year, Kelco obtained nearly 40% of the Burlington roll-off market, and by 1982, Kelco's market share had risen to 43%. During 1982, BFI reacted by attempting to drive Kelco out of business, first by offering to buy Kelco and then by cutting prices by 40% or more on new business for approximately six months. The orders given to the Burlington BFI office by its regional vice president were clear: "Put [Kelley] out of business. Do whatever it takes. Squish him like a bug." App. 10. BFI's Burlington salesman was also instructed to

Page 492 U. S. 261

put Kelco out of business, and told that, if "it meant give the stuff away, give it away." Ibid.

During the first four months of BFI's predatory campaign, Kelco's revenues dropped 30%. Kelco's attorney wrote to BFI's legal department asserting that BFI's pricing strategy was illegal, and threatened to initiate court proceedings if it continued. BFI did not respond, and continued its price-cutting policy for several more months. BFI's market share remained stable from 1982 to 1984, but by 1985, Kelco had captured 56% of the market. That same year, BFI sold out to a third party and left the Burlington market.

In 1984, Kelco and Kelley brought an action in the United States District Court for the District of Vermont, alleging a violation of § 2 of the Sherman Act for attempts to monopolize the Burlington roll-off market. They also claimed that BFI had interfered with Kelco's contractual relations in violation of Vermont tort law. Kelley's claims were severed from Kelco's, and Kelco's antitrust and tort claims were tried to a jury. After a 6-day trial, BFI was found liable on both counts. A 1-day trial on damages followed, at which Kelco submitted evidence regarding the revenues and profits it lost as a result of BFI's predatory prices. Kelco's attorney urged the jury to return an award of punitive damages, asking the jurors to "deliver a message to Houston [BFI's headquarters]." Id. at 53. Kelco also stressed BFI's total revenues of $1.3 billion in the previous year, noting that this figure broke down to $25 million a week. BFI urged that punitive damages were not appropriate, but made no argument as to amount.

The District Court instructed the jury that it could award punitive damages on the state law claims if it found by clear and convincing evidence that BFI's conduct "revealed actual malice, outrageous conduct, or constituted a willful and wanton or reckless disregard of the plaintiff's rights." Id. at 81. It also told the jury that, in determining the amount of punitive damages, it could take into account "the character of the

Page 492 U. S. 262

defendants, their financial standing, and the nature of their acts." Ibid. BFI raised no relevant objection to the charge on punitive damages. The jury returned a verdict of $51,146 in compensatory damages on both the federal antitrust and state tort counts, and $6 million in punitive damages.

BFI moved for judgment notwithstanding the verdict, a new trial, or remittitur. The District Court denied these motions and awarded Kelco $153,438 in treble damages and $212,500 in attorney's fees and costs on the antitrust claim, or, in the alternative, $6,066,082.74 in compensatory and punitive damages on the state law claim. BFI appealed. The United States Court of Appeals for the Second Circuit affirmed the judgment both as to liability and as to damages. 845 F. 2d 404 (1988). On the issue of punitive damages, the court noted that the evidence showed that BFI "wilfully and deliberately attempted to drive Kelco out of the market," and found no indication of jury prejudice or bias. Id. at 410. Addressing the Eighth Amendment issue, the court noted that, even if the Amendment were applicable "to this nominally civil case," the damages were not "so disproportionate as to be cruel, unusual, or constitutionally excessive," and upheld the award. Ibid. Because of its importance, we granted certiorari on the punitive damages issue. 488 U.S. 980 (1988).

II

The Eighth Amendment reads: "Excessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishments inflicted." Although this Court has never considered an application of the Excessive Fines Clause, it has interpreted the Amendment in its entirety in a way which suggests that the Clause does not apply to a civil jury award of punitive damages. Given that the Amendment is addressed to bail, fines, and punishments, our cases long have understood it to apply primarily, and perhaps exclusively, to criminal prosecutions and punishments. See, e. g., 32 U. S. 7 Pet. 568, 32 U. S. 573-574 (1833) ("The eighth

Page 492 U. S. 263

amendment is addressed to courts of the United States exercising criminal jurisdiction"); Fong Yue Ting v. United States,149 U. S. 698, 149 U. S. 730 (1893) (Amendment inapplicable to deportation, because deportation is not punishment for a crime); Ingraham v. Wright,430 U. S. 651, 430 U. S. 664-668 (1977).

"Bail, fines, and punishment traditionally have been associated with the criminal process, and by subjecting the three to parallel limitations, the text of the Amendment suggests an intention to limit the power of those entrusted with the criminal law function of government."

Id. at 430 U. S. 664. [Footnote 3]

To decide the instant case, however, we need not go so far as to hold that the Excessive Fines Clause applies just to criminal cases. Whatever the outer confines of the Clause's

Page 492 U. S. 264

reach may be, we now decide only that it does not constrain an award of money damages in a civil suit when the government neither has prosecuted the action nor has any right to receive a share of the damages awarded. To hold otherwise, we believe, would be to ignore the purposes and concerns of the Amendment, as illuminated by its history. [Footnote 4]

A

The Eighth Amendment received little debate in the First Congress, see Weems v. United States,217 U. S. 349, 217 U. S. 368 (1910), and the Excessive Fines Clause received even less attention. This is not surprising; at least eight of the original States which ratified the Constitution had some equivalent of the Excessive Fines Clause in their respective Declarations of Rights or State Constitutions, [Footnote 5] so the matter was not a likely source of controversy or extensive discussion. Although the prohibition of excessive fines was mentioned as part of a complaint that the Amendment was unnecessary and imprecise, see 217 U.S. at 217 U. S. 369, Congress did not discuss

Page 492 U. S. 265

what was meant by the term "fines," or whether the prohibition had any application in the civil context. In the absence of direct evidence of Congress' intended meaning, we think it significant that, at the time of the drafting and ratification of the Amendment, the word "fine" was understood to mean a payment to a sovereign as punishment for some offense. [Footnote 6] Then, as now, fines were assessed in criminal, rather than in private civil, actions. [Footnote 7]

Page 492 U. S. 266

But there is more than inferential evidence from language to support our conclusion that the Excessive Fines Clause is inapplicable to an award of punitive damages. The undisputed purpose and history of the Amendment generally, and of the Excessive Fines Clause specifically, confirms our reading. The Eighth Amendment clearly was adopted with the particular intent of placing limits on the powers of the new Government.

"At the time of its ratification, the original Constitution was criticized in the Massachusetts and Virginia Conventions for its failure to provide any protection for persons convicted of crimes. This criticism provided the impetus for inclusion of the Eighth Amendment in the Bill of Rights."

Ingraham v. Wright, 430 U.S. at 430 U. S. 666 (footnote omitted). See generally 32 U. S. Mayor and City Council of Baltimore, 7 Pet. 243, 32 U. S. 250 (1833) ("In almost every convention by which the constitution was adopted, amendments to guard against the abuse of power were recommended"); Weems v. United States, 217 U.S. at 217 U. S. 372 (the "predominant political impulse" of proponents of the Bill of Rights "was distrust of power, and they insisted on constitutional limitations against its abuse"). Simply put, the primary focus of the Eighth Amendment was the potential for governmental abuse of its "prosecutorial" power, not concern with the extent or purposes of civil damages.

Moreover, specific and persuasive support for our reading of the Excessive Fines Clause comes from the pedigree of the Clause itself. As we have noted in other cases, it is clear that the Eighth Amendment was "based directly on Art I, §9, of the Virginia Declaration of Rights," which "adopted verbatim the language of the English Bill of Rights." Solem v. Helm,463 U. S. 277, 463 U. S. 285, n. 10 (1983). Section 10 of the English Bill of Rights of 1689, like our Eighth Amendment, states that "excessive Bail ought not to be required, nor excessive Fines imposed; nor cruel and unusual Punishments inflicted." 1 Wm. & Mary, 2d Sess., ch. 2, 3 Stat. at Large

Page 492 U. S. 267

440, 441 (1689). We recounted in Ingraham, 430 U.S. at 430 U. S. 664:

"The English version, adopted after the accession of William and Mary, was intended to curb the excesses of English judges under the reign of James II."

During the reigns of the Stuarts, the King's judges had imposed heavy fines on the King's enemies, much as the Star Chamber had done before its abolition in 1641. L. Schwoerer, The Declaration of Rights, 1689, p. 91 (1981). In the 1680's, the use of fines "became even more excessive and partisan," and some opponents of the King were forced to remain in prison because they could not pay the huge monetary penalties that had been assessed. Ibid. [Footnote 8] The group which drew up the 1689 Bill of Rights had first-hand experience; several had been subjected to heavy fines by the King's bench. Id. at 91-92, and n. 198.

The Framers of our Bill of Rights were aware and took account of the abuses that led to the 1689 Bill of Rights. [Footnote 9] This history, when coupled with the fact that the accepted English definition of "fine" in 1689 appears to be identical to that in use in colonial America at the time of our Bill of Rights, [Footnote 10] seems to us clear support for reading our Excessive Fines Clause as limiting the ability of the sovereign to use its prosecutorial power, including the power to collect fines, for improper ends. Providing even clearer support for this view is the English case law, immediately prior to the enactment of

Page 492 U. S. 268

the English Bill of Rights, which stressed the difference between civil damages and criminal fines. See Lord Townsend v. Hughes, 2 Mod. 150, 86 Eng.Rep. 994 (C.P. 1677). In short, nothing in English history suggests that the Excessive Fines Clause of the 1689 Bill of Rights, the direct ancestor of our Eighth Amendment, was intended to apply to damages awarded in disputes between private parties. Instead, the history of the Eighth Amendment convinces us that the Excessive Fines Clause was intended to limit only those fines directly imposed by, and payable to, the government.

B

Petitioners, however, argue that the Excessive Fines Clause "derives from limitations in English law on monetary penalties exacted in private civil cases to punish and deter misconduct." Brief for Petitioners 17. They recognize that nothing in the history we have recounted thus far espouses that view. To find support, they turn the clock hundreds of years further back to English history prior to Magna Carta, and in particular to the use and abuse of "amercements." According to petitioners, amercements were essentially civil damages, and the limits Magna Carta placed on the use of amercements were the forerunners of the 1689 Bill of Rights' prohibition on excessive fines. In their view, the English Bill of Rights and our Eighth Amendment must be understood as reaching beyond the criminal context, because Magna Carta did. Punitive damages, they suggest, must be within the scope of the Excessive Fines Clause because they are a modern-day analog of 13th-century amercements.

The argument is somewhat intriguing, but we hesitate to place great emphasis on the particulars of 13th-century English practice, particularly when the interpretation we are urged to adopt appears to conflict with the lessons of more recent history. Even so, our understanding of the use of amercements, and the development of actions for damages at

Page 492 U. S. 269

common law, convince us that petitioners' view of the relevant history does not support the result they seek.

Amercements were payments to the Crown, and were required of individuals who were "in the King's mercy," because of some act offensive to the Crown. Those acts ranged from what we today would consider minor criminal offenses, such as breach of the King's peace with force and arms, to "civil" wrongs against the King, such as infringing "a final concord" made in the King's court. See 2 F. Pollock & F. Maitland, History of English Law 519 (2d ed. 1905) (Pollock & Maitland); see also Solem v. Helm, 463 U.S. at 463 U. S. 284, n. 8 (an amercement "was the most common criminal sanction in 13th-century England"); W. McKechnie, Magna Carta 285-286 (2d ed. 1958) (McKechnie) (discussing amercements as a step in the development of criminal law). Amercements were an "all-purpose" royal penalty; they were used not only against plaintiffs who failed to follow the complex rules of pleading [Footnote 11] and against defendants who today would be liable in tort, but also against an entire township which failed to live up to its obligations, or against a sheriff who neglected his duties. [Footnote 12] The use of amercements was widespread; one commentary has said that most men in England could expect

Page 492 U. S. 270

to be amerced at least once a year. See 2 Pollock & Maitland 513. [Footnote 13]

In response to the frequent, and occasionally abusive, use of amercements by the King, Magna Carta included several provisions placing limits on the circumstances under which a person could be amerced, and the amount of the amercement. [Footnote 14] The barons who forced John to agree to Magna Carta sought to reduce arbitrary royal power, and in particular

Page 492 U. S. 271

to limit the King's use of amercements as a source of royal revenue, and as a weapon against enemies of the Crown. [Footnote 15] The Amercements Clause of Magna Carta limited these abuses in four ways: by requiring that one be amerced only for some genuine harm to the Crown; by requiring that the amount of the amercement be proportioned to the wrong; by requiring that the amercement not be so large as to deprive him of his livelihood; and by requiring that the amount of the amercement be fixed by one's peers, sworn to amerce only in a proportionate amount. [Footnote 16]

Petitioners, and some commentators, [Footnote 17] find in this history a basis for concluding that the Excessive Fines Clause operates to limit the ability of a civil jury to award punitive damages. We do not agree. Whatever uncertainties surround the use of amercements prior to Magna Carta, the compact signed at Runnymede was aimed at putting limits on the

Page 492 U. S. 272

power of the King, on the "tyrannical extortions, under the name of amercements, with which John had oppressed his people," T. Taswell-Langmead, English Constitutional History 83 (T. Plucknett 10th ed. 1946), whether that power be exercised for purposes of oppressing political opponents, for raising revenue in unfair ways, or for any other improper use. See 2 W. Holdsworth, A History of English Law 214 (4th ed. 1936). These concerns are clearly inapposite in a case where a private party receives exemplary damages from another party, and the government has no share in the recovery. Cf. United States v. Halper,490 U. S. 435 (1989) (Double Jeopardy Clause).

Petitioners ultimately rely on little more than the fact that the distinction between civil and criminal law was cloudy (and perhaps nonexistent) at the time of Magna Carta. But any overlap between civil and criminal procedure at that time does nothing to support petitioners' case, when all the indications are that English courts never have understood the amercements clauses to be relevant to private damages of any kind, either then or at any later time. See Lord Townsend v. Hughes, 2 Mod. at 151, 86 Eng.Rep., at 994-995 (Magna Carta's amercements provisions apply in criminal, but not civil, cases). Even after the common law had developed to the point where courts occasionally did decrease a damages award or eliminate it altogether, such action was never predicated on the theory that the government somehow had overstepped its bounds. Rather, the perceived error was one made by the jury, as determined by reference to common law, rather than constitutional, standards. Whether based on reasoning that the jury's award was so excessive that it must have been based on bias or prejudice, see Wood v. Gunston, Sty. 466, 82 Eng.Rep. 867 (K.B.1655); Leith v. Pope, 2 Bl.W. 1327, 96 Eng.Rep. 777 (C.P.1780), or that the jury must have misconstrued the evidence, see Ash v. Ash, Comb. 357, 90 Eng.Rep. 526 (1696), the proper focus was, and still is, on the behavior of the jury. It is difficult

Page 492 U. S. 273

to understand how Magna Carta, or the English Bill of Rights as viewed through the lens of Magna Carta, compels us to read our Eighth Amendment's Excessive Fines Clause as applying to punitive damages when those documents themselves were never so applied. [Footnote 18]

C

Our conclusion that the Framers of the Eighth Amendment did not expressly intend it to apply to damages awards made by civil juries does not necessarily complete our inquiry. Our Eighth Amendment jurisprudence has not been inflexible. The Court, when considering the Eighth Amendment, has stated:

"Time works changes, brings into existence new conditions and purposes. Therefore, a principle to be vital must be capable of wider application than the mischief which gave it birth. This is particularly true of constitutions."

Weems v. United States, 217 U.S. at 217 U. S. 373. [Footnote 19] This aspect

Page 492 U. S. 274

of our Eighth Amendment jurisprudence might have some force here were punitive damages a strictly modern creation, without solid grounding in pre-Revolutionary days. But the practice of awarding damages far in excess of actual compensation for quantifiable injuries was well recognized at the time the Framers produced the Eighth Amendment. Awards of double or treble damages authorized by statute date back to the 13th century, see Statute of Gloucester, 1278, 6 Edw. I, ch. 5, 1 Stat. at Large 66 (treble damages for waste); see also 2 Pollock & Maitland 522, and the doctrine was expressly recognized in cases as early as 1763. [Footnote 20] Despite this recognition of civil exemplary damages as punitive

Page 492 U. S. 275

in nature, the Eighth Amendment did not expressly include it within its scope. Rather, as we earlier have noted, the text of the Amendment points to an intent to deal only with the prosecutorial powers of government.

Furthermore, even if we were prepared to extend the scope of the Excessive Fines Clause beyond the context where the Framers clearly intended it to apply, we would not be persuaded to do so with respect to cases of punitive damages awards in private civil cases, because they are too far afield from the concerns that animate the Eighth Amendment. We think it clear, from both the language of the Excessive Fines Clause and the nature of our constitutional framework, that the Eighth Amendment places limits on the steps a government may take against an individual, whether it be keeping him in prison, imposing excessive monetary sanctions, or using cruel and unusual punishments. The fact that punitive damages are imposed through the aegis of courts, and serve to advance governmental interests, is insufficient to support the step petitioners ask us to take. While we agree with petitioners that punitive damages advance the interests of punishment and deterrence, which are also among the interests advanced by the criminal law, we fail to see how this overlap requires us to apply the Excessive Fines Clause in a case between private parties. Here the government of Vermont has not taken a positive step to punish, as it most obviously does in the criminal context, nor has it used the civil courts to extract large payments or forfeitures for the purpose of raising revenue or disabling some individual. [Footnote 21] We shall not ignore the language of the Excessive

Page 492 U. S. 276

Fines Clause, or its history, or the theory on which it is based, in order to apply it to punitive damages. [Footnote 22]

III

Petitioners also ask us to review the punitive damages award to determine whether it is excessive under the Due Process Clause of the Fourteenth Amendment. The parties agree that due process imposes some limits on jury awards of punitive damages, and it is not disputed that a jury award may not be upheld if it was the product of bias or passion, or if it was reached in proceedings lacking the basic elements of fundamental fairness. But petitioners make no claim that the proceedings themselves were unfair, or that the jury was biased or blinded by emotion or prejudice. Instead, they seek further due process protections, addressed directly to the size of the damages award. There is some authority in our opinions for the view that the Due Process Clause places outer limits on the size of a civil damages award made pursuant to a statutory scheme, see, e.g., St. Louis, I. M. & S. R. Co. v. Williams,251 U. S. 63, 251 U. S. 66-67 (1919), but we have never addressed the precise question presented here:

Page 492 U. S. 277

whether due process acts as a check on undue jury discretion to award punitive damages in the absence of any express statutory limit. See Bankers Life & Casualty Co. v. Crenshaw,486 U. S. 71, 486 U. S. 87 (1988) (O'CONNOR, J., concurring in part and concurring in judgment). That inquiry must await another day. Because petitioners failed to raise their due process argument before either the District Court or the Court of Appeals, and made no specific mention of it in their petition for certiorari in this Court, we shall not consider its effect on this award. [Footnote 23]

IV

Petitioners also ask us to hold that this award of punitive damages is excessive as a matter of federal common law. Rather than directing us to a developed body of federal law,

Page 492 U. S. 278

however, they merely repeat the standards they urged us to adopt under the Eighth Amendment. It is not our role to review directly the award for excessiveness, or to substitute our judgment for that of the jury. Rather, our only inquiry is whether the Court of Appeals erred in finding that the District Court did not abuse its discretion in refusing to grant petitioners' motion, under Federal Rule of Civil Procedure 59, for a new trial or remittitur. Applying proper deference to the District Court, the award of punitive damages should stand.

Review of the District Court's order involves questions of both state and federal law. In a diversity action, or in any other lawsuit where state law provides the basis of decision, the propriety of an award of punitive damages for the conduct in question, and the factors the jury may consider in determining their amount, are questions of state law. [Footnote 24] Federal

Page 492 U. S. 279

law, however, will control on those issues involving the proper review of the jury award by a federal district court and court of appeals. See Donovan v. Penn Shipping Co.,429 U. S. 648, 429 U. S. 649-650 (1977); see also 6A J. Moore, J. Lucas, & G. Grotheer, Moore's Federal Practice,

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