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Oberg v. Honda Motor Co. - 316 Or. 263, 851 P.2d 1084 (1993)

Rule:

In cases involving potential awards of punitive damages in Oregon, the finder of fact must determine what punitive damages, if any, to award based on the proper premise of deterring future similar misconduct by the defendant or others. To this end, a number of factors may be relevant, including the seriousness of the hazard to the public, the attitude and conduct of the wrongdoer upon learning of the hazard, the number and position of employees involved in causing or covering up the misconduct, the duration of the misconduct or its cover-up, the financial condition of the wrongdoer, and prior and potential punishment from similarly situated plaintiffs or other sources. 

Facts:

A product liability claim against defendants, who manufactured and sold a 1985 Honda Model ATC350X three-wheeled all-terrain vehicle (ATV) used by Oberg. Oberg attempted to drive the ATV up a steep embankment, it overturned backward, injuring him. He then brought action against the manufacturers and sellers of the ATV , alleging that they were negligent in manufacturing, distributing, and selling the ATV, because they knew or should have known that it had an inherently dangerous design that rendered it unreasonably dangerous to users, and alleging strict liability. A jury returned a verdict in favor of Oberg, awarding both general and punitive damages. The state appellate court affirmed the judgment, holding that the award of punitive damages did not violate defendants' rights under the Due Process Clause. Defendants sought further review. They argued, among other things, that the trial court erred in admitting in evidence excerpts of various documents generated by the Consumer Product Safety Commission (CPSC), relating to the safety of ATVs. Defendants also argued that the trial court erred in denying their motion for a new trial on the basis of the discovery of new eyewitnesses to plaintiff's accident. Finally, they argued that the award of punitive damages was excessive

Issue:

Did the jury's award of punitive damages to the injured plaintiff in this product liability case violate the Due Process Clause of the Fourteenth Amendment as "excessive"?

Answer:

No

Conclusion:

The Supreme Court of Oregon affirmed the judgment in favor of plaintiff Oberg in his products liability action against defendant manufacturers and sellers of an all-terrain vehicle. It held that the Consumer Products Safety Commission documents were relevant to issues at trial and were not hearsay because they were offered to prove notice of the dangerousness of ATVs, not the truth of the matters asserted therein. The provision against excessive fines in Or. Const. art. I, § 16 applied only to criminal cases. Defendants argued that because the award of punitive damages in this case was the product of an exercise of standardless discretion by the jury and was "excessive" and "disproportionate," the award violated the Due Process Clause of the Fourteenth Amendment. The Court disagreed. Application of objective criteria in considering punitive damages ensured that sufficiently definite and meaningful constraints were imposed on the finder of fact. The criteria established by Or. Rev. Stat. § 30.925 were detailed and objective, and were thus constitutionally sufficient. The jury was instructed properly about the substantive criteria to be applied, and there was evidence to support its determination. The punitive damages award thus did not violate the Due Process Clause of the Fourteenth Amendment. Explaining that procedural protections ensure that an award of punitive damages in a product liability action bears a rational relationship to a defendant's conduct and to the need for punishment and deterrence, the Court believed that Oregon's procedure in product liability actions -- as a whole and in its net effect -- is constitutional. The Court noted the relatively narrow scope of appellate review of punitive damages awards.

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