Owens-Corning Fiberglas Corp. v. Ballard

Owens-Corning Fiberglas Corp. v. Ballard

Opinion

 [*483]  ANSTEAD, J.

We accepted jurisdiction to answer the following question certified to be of great public importance:

IS THE STATUTORY PRESUMPTION AS TO EXCESSIVE PUNITIVE DAMAGES, FOUND IN SECTION 768.73(1), FLORIDA STATUTES, OVERCOME IN A CASE WHERE THE PUNITIVE DAMAGES AWARD IS ALMOST 18 TIMES THE COMPENSATORY DAMAGES AWARDED, WHEN IT IS BASED ON CLEAR AND CONVINCING EVIDENCE THAT THE AWARD WAS LESS THAN 2% OF THE DEFENDANT COMPANY'S NET WORTH, [**2]  AND THAT THE DEFENDANT'S CONDUCT WAS MORE EGREGIOUS THAN THE STANDARD OF WANTON AND WILFUL DISREGARD  [*484]  FOR THE SAFETY OF THE PLAINTIFF?

 Owens-Corning Fiberglas Corp. v. Ballard, 739 So. 2d 603, 1998 Fla. App. LEXIS 4725, 23 Fla. Law W. D 1077, 1078 (Fla. 4th DCA 1998). We answer the certified question in the affirmative and approve the decision of the court below.

MATERIAL FACTS

Respondent Deward Ballard, a nonresident of Florida, brought the instant action against petitioner Owens-Corning, alleging that during the 1960's and 1970's he had been exposed to a dangerous asbestos product manufactured by Owens-Corning. Three years after the complaint was filed, two months after the case was ordered set for trial, and three months before the trial actually commenced, Owens-Corning filed a motion to dismiss based on forum non conveniens. The trial court denied the motion.

The case proceeded to a bifurcated jury trial in January 1997. According to the evidence at trial, Ballard was diagnosed with mesothelioma, a rare form of cancer of the lining of the chest, due to exposure to Owens-Corning's product containing asbestos fibers. The evidence indicates that [**3]  Owens-Corning produced Kaylo, a product containing asbestos fibers, for approximately thirty years, or until 1972 when Owens-Corning finally ceased using asbestos in its products. During the time that Owens-Corning produced Kaylo, Ballard worked on numerous job sites around the nation where he was exposed to Kaylo. After the trial on the liability issue, the jury found Owens-Corning was negligent and strictly liable to Ballard for selling Kaylo. It assessed compensatory damages of $ 1.8 million and determined Owens-Corning also was liable for punitive damages. ¹

During the punitive damages portion of the trial, Ballard presented evidence as to the company's financial position and reaction concerning the asbestos litigation.  [**4]  The evidence included a 1996 Fact Sheet, a 1995 Annual Report, and a copy of 1992 Annual Meeting Remarks by CEO Glen H. Hiner. The 1996 Fact Sheet provides Owens-Corning's income statement and balance sheet and indicates Owens-Corning's projected goal to reach some $ 5 billion in total sales by the year 2000. At the time of trial, the company's net income for 1995 was $ 231 million and its most recent market value was $ 2.5 billion (based on the number of outstanding shares of common stock). As for the company's response concerning the asbestos litigation, the 1995 Annual Report revealed Hiner's belief that the "vast majority of new claimants are not sick" and that "many of the cases were filed by lawyers eager to maximize their fees before tort reform legislation goes in effect." Hiner also remarked that the company had placed the asbestos litigation behind it and will focus instead on building the company's enterprise and not on "shedding tears about the past." Finally, the 1995 Annual Report indicates that due to reserved funds and insurance coverage, the pending and future asbestos litigation claims "will not have a materially adverse effect on the company's financial position. [**5]  " A representative from Owens-Corning testified as to both the small profits from Kaylo sales and the financial burdens placed on the company by a deluge of asbestos claims.

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