RUDOVSKY et al v. WEST PUBLISHING CORPORATION et al

Filing 106

MOTION for Reconsideration filed by DAVID RUDOVSKY, LEONARD SOSNOV.Memorandum, Certificate of Service.(CHARLSON, NOAH)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
______________________________________
:
: CIVIL ACTION –
: JURY TRIAL DEMANDED
:
:
Plaintiffs,
:
: NO. 09-CV-727
v.
:
:
WEST PUBLISHING CORPORATION,
:
WEST SERVICES INC., AND
:
THOMSON LEGAL AND REGULATORY
:
INC. t/a THOMSON WEST
:
:
Defendants.
______________________________________ :
DAVID RUDOVSKY and
LEONARD SOSNOV,

ORDER
AND NOW, this ____ day of ______________, 2011, upon consideration of
Plaintiffs’ Motion for Reconsideration of the Portion of the Court’s March 30, 2011
Order Conditioning Denial of Defendants’ Motion for a New Trial on Plaintiffs’
Acceptance of a Reduced Amount of Punitive Damages, and any response thereto, it is
hereby ORDERED and DECREED that said Motion is GRANTED.

It is further

ORDERED as follows:
1.

Defendants’ Motion for Judgment as a Matter of Law is DENIED.

2.

Defendants’ Motion for a New Trial is DENIED.

3.

Judgment is hereby entered in favor of Plaintiff David Rudovsky

and against Defendants in the amount of _________________________.

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4.

Judgment is hereby entered in favor of Plaintiff Leonard Sosnov

and against Defendants in the amount of ________________________.

BY THE COURT:

__________________________
J.

2

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
______________________________________
:
: CIVIL ACTION –
DAVID RUDOVSKY and
: JURY TRIAL DEMANDED
LEONARD SOSNOV,
:
:
Plaintiffs,
:
: NO. 09-CV-727
v.
:
:
WEST PUBLISHING CORPORATION,
:
WEST SERVICES INC., AND
:
THOMSON LEGAL AND REGULATORY
:
INC. t/a THOMSON WEST
:
:
Defendants.
______________________________________ :

PLAINTIFFS’ MOTION FOR RECONSIDERATION OF THE PORTION OF
THE COURT’S MARCH 30, 2011 ORDER CONDITIONING THE DENIAL OF
DEFENDANTS’ MOTION FOR A NEW TRIAL ON PLAINTIFFS’
ACCEPTANCE OF A REDUCED AMOUNT OF PUNITIVE DAMAGES
Plaintiffs David Rudovsky, Esquire and Leonard Sosnov, Esquire, by and through
their undersigned counsel, respectfully move the Court for reconsideration of the portion
of the Court’s March 30, 2011 Order in which the Court conditioned the denial of
defendants’ motion for a new trial on plaintiffs’ acceptance of a reduced amount of
punitive damages.
The grounds supporting this Motion are set forth in the attached Memorandum of
Law.

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Respectfully submitted,

/s Noah H. Charlson
________________
Richard L. Bazelon, Esquire
(I.D. No. 02505)
Noah H. Charlson, Esquire
(I.D. No. 89210)
Michael F.R. Harris, Esquire
(I.D. No. 56948)
BAZELON LESS & FELDMAN, P.C.
1515 Market Street, Suite 700
Philadelphia, PA 19102
[phone]
Attorneys for Plaintiffs
David Rudovsky and Leonard Sosnov
Dated: April 8, 2011

2

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
______________________________________
:
: CIVIL ACTION –
: JURY TRIAL DEMANDED
:
Plaintiffs,
:
:
v.
: NO. 09-CV-727
:
WEST PUBLISHING CORPORATION,
:
WEST SERVICES INC., AND
:
THOMSON LEGAL AND REGULATORY
:
INC. t/a THOMSON WEST
:
:
Defendants.
:
______________________________________ :
DAVID RUDOVSKY and
LEONARD SOSNOV,

MEMORANDUM OF LAW IN SUPPORT OF PLAINTIFFS’
MOTION FOR RECONSIDERATION OF THE PORTION OF THE COURT’S
MARCH 30, 2011 ORDER CONDITIONING THE DENIAL OF DEFENDANTS’
MOTION FOR A NEW TRIAL ON PLAINTIFFS’ ACCEPTANCE OF A
REDUCED AMOUNT OF PUNITIVE DAMAGES

Richard L. Bazelon, Esquire
(I.D. No. 02505)
Noah H. Charlson, Esquire
(I.D. No. 89210)
Michael F.R. Harris, Esquire
(I.D. No. 56948)
BAZELON LESS & FELDMAN, P.C.
1515 Market Street, Suite 700
Philadelphia, PA 19102
[phone]
Dated: April 8, 2011

Plaintiffs David Rudovsky, Esquire and Leonard Sosnov, Esquire, by and through their
undersigned counsel, respectfully submit this memorandum of law in support of their motion for
reconsideration of the portion of the Court’s March 30, 2011 Order in which the Court
conditioned the denial of defendants’ motion for a new trial on plaintiffs’ acceptance of a
reduced amount of punitive damages.

I.

INTRODUCTION
In its March 30, 2011 Order, the Court (1) denied defendants’ motion for judgment as a

matter of law, (2) ruled that if plaintiffs accepted a remittitur of the jury’s verdict to $200,000 per
plaintiff ($400,000 total), defendants’ motion for a new trial would be denied, and (3) ruled that
absent plaintiffs’ acceptance of that remittitur, defendants’ motion for a new trial would be
granted.
Plaintiffs respectfully submit that the Court committed two clear errors of law. First, the
Court of Appeals has made it clear that the grounds relied upon by the Court for reducing the
punitive damage award are not valid. Accordingly, the Court should enter judgment in favor of
the plaintiffs in an amount that is consistent with the jury verdict and due process principles.
Second, if a reduction of punitive damages is constitutionally required, the Court should enter
judgment in the maximum amount allowable under the Constitution – and should not force
plaintiffs to choose between accepting a remittitur or a new trial.

II.

LEGAL STANDARD
The purpose of a motion for reconsideration under Local Rule 7.1(g) is to correct

manifest errors of law or fact or to present newly discovered evidence.’” Harsco Corp. v.

Zlotnicki, 779 F.2d 906, 909 (3d Cir.1985), cert. denied, 476 U.S. 1171 (1986). Under this
standard, reconsideration is appropriate when needed to correct a clear error of law or fact or to
prevent manifest injustice. Max’s Seafood Café ex rel. Lou-Ann, Inc. v. Quinteros, 176 F.3d 669,
677 (3d Cir. 1999).

III.

ARGUMENT
A.

The Court Erred In Ordering A Reduction In Punitive Damages

Plaintiffs respectfully submit that reconsideration is necessary and appropriate here to
correct two clear errors of law.
First, the Court committed a clear error of law when it ordered a reduction in punitive
damages. The jury awarded each plaintiff $90,000 in compensatory damages and $2.5 million in
punitive damages.

In its ruling on defendants’ post-trial motions, the Court upheld the

compensatory damages awards, but held that the amounts of the punitive damages awards
exceeded Constitutional limits.

The Court held that the “constitutional limit” for punitive

damages was $110,000 per plaintiff.
The Court ordered the reduction based on its belief that the jury was influenced by (1) the
net worth of the defendants, and (2) evidence indicating that there was a need to deter defendants
from similar misconduct in the future. As stated by the Court:
The jury may have been too much influenced by the net worth of
the defendants, and undoubtedly was influenced to some extent by
the defendants’ own evidence at trial, which seemed to show that
the defendants have learned nothing from the experience, and
would be likely to continue to commit violations of individuals’
rights in the future.
March 30, 2011 Memorandum, at 4.

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The Court of Appeals has made it clear that it is entirely appropriate for juries to base
punitive damages awards on defendants’ net worth and the need for deterrence. In Cortez v.
Trans Union, LLC, 617 F.3d 688 (3d Cir. 2010), the Court of Appeals stated:
we are troubled by the district court’s reasoning in reducing the
punitive damages. There is certainly nothing wrong with a jury
focusing on a “defendant’s seeming insensitivity” in deciding how
much to award as punitive damages.
*

*

*

*

A jury can consider the relative wealth of a defendant in deciding
what amount is sufficient to inflict the intended punishment. See
Restatement (Second) of Torts § 908(2) (1979) (listing wealth as a
factor which “can” be considered in determining punitive
damages.).
Common sense suggests that a corner “mom and pop” store should
not be subject to the same punitive level of damages as a company
worth close to a billion dollars. The latter would simply not be
deterred by an award that might be large enough to put the former
out of business. Moreover, the record certainly supports a jury
becoming “incensed” over Trans Union’s “insensitivity” to
Cortez’s claim, and we are hard pressed to understand the district
court’s reliance on that possible reaction to what Trans Union did,
and/or considerations of Trans Union’s fiscal wealth as reasons to
reduce the punitive award.
Id. at 718 n.37.
In Cortez, the Court of Appeals had no choice but to affirm on procedural grounds,
because plaintiff had accepted the District Court’s remittitur before filing her notice of appeal.
Id. at 717, citing Donovan v. Penn Shipping Co., Inc., 429 U.S. 648, 649 (1977), for the
proposition that “a plaintiff cannot challenge a remittitur s/he has agreed to.” However, the
Court of Appeals made it very clear that District Courts should not order reductions of punitive
damage awards based on a belief that juries were influenced by defendants’ net worth and/or

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insensitivity.

Here, those were the only grounds given by the Court in reducing punitive

damages.
Cortez is consistent with decades of binding precedent that establish that juries may
properly base punitive damages awards on defendants’ net worth and what amount is necessary
to deter the defendants and others from committing similar misconduct in the future. See, e.g.,
Donaldson v. Bernstein, 104 F.3d 547, 557 (3d Cir. 1997); Dunn v. HOVIC, 1 F.3d 1371, 1383
(3d Cir. 1993); Tunis Bros. Co., Inc. v. Ford Motor Co., 952 F.2d 715, 740 (3d Cir. 1991), cert.
denied, 505 U.S. 1221 (1992); Herman v. Hess Oil Virgin Islands Corp., 524 F.2d 767, 772 (3d
Cir. 1975).
Plaintiffs respectfully submit that even if the Constitution requires a reduction of the
jury’s punitive damages awards, the maximum amount of punitive damages allowable under the
Constitution far exceeds $110,000 per plaintiff. That figure represents approximately a 1.2-to-1
ratio between punitive damages and compensatory damages, and remarkably is a mere 4% of the
jury’s verdict. We submit that this reduction is inconsistent with the deference required for jury
verdicts under the Seventh Amendment.
The Third Circuit has held that such small ratios are the maximum amount allowable
under the Constitution only when the compensatory damages are “substantial,” i.e., far higher
than the $90,000 per plaintiff awarded in this case. In Jurinko v. Medical Protective Co., 305
Fed. Appx. 13 (3d Cir. 2008), the Court collected cases demonstrating that “[o]ther courts have
used a 1:1 ratio as a benchmark where compensatory damages are substantial.” Id. at 28. The
compensatory damage awards in those cases ranged from a low of $366,939 to a high of $4.025
million. Id. The Jurinko Court relied on those cases in deciding to reduce a punitive damage
award to $1,996,950.56, the same amount as the compensatory damage award. Id. at 30. See

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also State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408, 425 (2003) (citing to large
compensatory award of $1 million).
By contrast, the Court of Appeals has held that a higher ratio between punitive damages
and compensatory damages is constitutionally permissible where, as here, the compensatory
damages are not as substantial. See, e.g., CGB Occupational Therapy, Inc. v. RHA Health
Services, Inc., 499 F.3d 184, 193 (3d Cir. 2007) (approving 7:1 ratio between $750,000 punitive
damage award and $109,000 punitive damage award).
Because the Court relied on improper grounds for ordering a reduction in punitive
damages, the Court should reconsider its March 30, 2011 Order, and should enter judgment in
favor of the plaintiffs in an amount that, given the jury verdict, is the maximum permitted under
the Constitution.

B.

Even If A Reduction In Punitive Damages Is Constitutionally Required, The
Court Should Enter Judgment In The Maximum Amount Allowed By The
Constitution_______________________________________________________

Assuming that there are grounds for a Constitutional reduction, the Court erred by
making its denial of defendants’ motion for a new trial conditional on plaintiffs’ acceptance of
the reduction ordered by the Court.

Instead, when a Court finds that a reduction is

constitutionally required, the Court should enter judgment in the maximum amount allowable
under the Constitution – and should not force plaintiffs to choose between acceptance of a
remittitur and a new trial.
As Cortez makes clear, there are two different types of reductions of punitive damages
awards: “Constitutionally reduced verdicts” and “conditional remittiturs.” In our case, the Court
ordered a Constitutionally reduced verdict on the ground that the jury’s punitive damages verdict

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exceeded the maximum amount allowable under the Due Process Clause of the Constitution. By
contrast, a Court orders a conditional remittitur when it finds that the jury’s punitive damage
award is “unreasonable” based on the evidence adduced at trial:
The court orders a remittitur when it believes the jury's award is
unreasonable on the facts. A constitutional reduction, on the other
hand, is a determination that the law does not permit the award.
Unlike a remittitur, which is discretionary with the court ... a court
has a mandatory duty to correct an unconstitutionally excessive
verdict so that it conforms to the requirements of the due process
clause.
Cortez, 617 F.3d at 716, quoting Johansen v. Combustion Engineering, Inc., 170 F.3d 1320,
1331 (11th Cir.), cert. denied, 528 U.S. 931 (1999).1
As noted, this Court ordered a Constitutionally reduced verdict, not a discretionary
remittitur. See March 30, 2011 Memorandum, at 4-5 (“the constitutional limit in this case should
be set at $110,000 for each plaintiff”). When a court orders a constitutionally reduced verdict, it
is not appropriate to give the plaintiffs the option of a new trial, as the order is a purely legal
determination. Instead, the proper course is for the Court to enter judgment in the maximum
amount allowable under the Constitution:
upon determination of the constitutional limit on a particular
award, the district court may enter a judgment for that amount as a
matter of law.
*

*

*

*

The court may enter judgment only if it reduces that jury’s verdict
to the maximum permitted by the Constitution in that particular
case, as any smaller amount would invade the province of the jury.

1

Only when a court grants a conditional remittitur, must it give the plaintiff the option of a new
trial. Cortez, 617 F.3d at 316, citing Hetzel v. Prince William County, Va., 523 U.S. 208, 211
(1998). Here, the court’s opinion is clearly based on a constitutional reduction, and the time for
requesting a discretionary remittitur has passed. See Fed. R. Civ. P. 59(d).

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Johansen, 170 F.3d at 1331 & n.16, citing Dimick v. Schiedt, 293 U.S. 474, 486 (1935). Accord,
Ross v. Kansas City Power & Light Co., 293 F.3d 1041, 1049-50 (8th Cir. 2002); Tronzo v.
Biomet, 236 F.3d 1342, 1350-51 (Fed. Cir.), cert. denied, 534 U.S. 1035 (2001).
This rule is required because a Constitutionally imposed reduction of damages is a
strictly legal determination, subject to de novo review by an appellate court. See Cooper Indus.,
Inc. v. Leatherman Tool Grp., Inc., 532 U.S. 424, 431 (2001). Accordingly, a constitutionally
imposed reduction in punitive damages is reviewable in the same manner as any legal ruling by a
District Court.
This rule both (1) conserves judicial resources by avoiding unnecessary retrials, and (2)
prevents the unfairness inherent in forcing a plaintiff to choose between a constitutionally
reduced verdict and a new trial:
Giving a plaintiff the option of a new trial rather than accepting the
constitutional maximum for this case would be of no value. If, on
a new trial, the plaintiff was awarded punitive damages less than
the constitutional maximum, he would have lost. If the plaintiff
obtained more than the constitutional maximum, the award could
not be sustained. Thus, a new trial provides only a “heads the
defendant wins; tails the plaintiff loses” option.
Johansen, 170 F.3d at 1332 & n.19 (italics in original).
There is another strong reason for not requiring plaintiffs to choose between the reduction
of punitive damages and a new trial. Under the Court’s Order, if plaintiffs do not accept the
reduction, they may be required to proceed with a new trial, as an immediate appeal might be
considered interlocutory. Indeed, the grant of a new trial could also preclude an immediate
appeal by the defendants (on their post-trial claim for judgment as a matter of law), as such an
appeal would be considered interlocutory. Plainly, it is far more efficient and fair to all parties to
have this matter resolved by an appeal before any new trial proceedings. This would avoid the

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time, expenses and, as the Johansen court ruled, the unfairness of a new trial.2

If the Court

amends its Order to state the amount of punitive damages it determines is the maximum
permitted by due process principles, and does not require a choice between that amount and a
new trial, both sides would be free to appeal and the case would be more fairly and timely
resolved.

Accordingly, the Court committed a clear error of law when it ordered plaintiffs to
choose between a Constitutionally reduced verdict and a new trial. If the Court determines that
the Constitution requires a reduction of the jury’s punitive damages awards, the Court should
deny defendants’ motion for a new trial, and enter judgment in favor of the plaintiffs for the full
amount of compensatory damages awarded by the jury, plus the maximum amount of punitive
damages allowable under the Constitution.
For the reasons stated in Section A, above, plaintiffs respectfully submit that the Court
erred in its reasons for reducing the jury’s punitive damages awards. However, if the Court
determines that the Constitution does require a reduction, the Court should enter judgment in
favor of the plaintiffs for the maximum amount allowable under the Constitution – an amount
that is far in excess of $110,000 per plaintiff.

2

Due process protects plaintiffs’ right to appeal a constitutional reduction of punitive damages as
that is a legal issue to be reviewed de novo by the Court of Appeals. Cooper Indus. Inc. v.
Leatherman Tool Group, Inc., 532 U.S. 424, 431 (2001). Moreover, given this Court’s denial of
the defendants’ motions for a new trial or judgment as a matter of law, any new trial should be
limited to punitive damages, the only legal error cited by this Court. See Cortez, 617 F.3d at 695
n.2.

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IV.

CONCLUSION
For the foregoing reasons, plaintiffs’ Motion for Reconsideration of the Portion of the

Court’s March 30, 2011 Order Conditioning Denial of Defendants’ Motion for a New Trial on
Plaintiffs’ Acceptance of a Reduced Amount of Punitive Damages should be granted, and the
Court should deny defendants’ motion for a new trial and enter judgment on the jury’s verdict,
without any reduction.

To the extent that the Court determines that a reduction is

Constitutionally required, the Court should enter final judgment in the amount of the jury’s
compensatory damages awards, plus the maximum amount of punitive damages allowed by the
Constitution, without giving any party the option of a new trial.

Respectfully submitted,

/s Noah H. Charlson
___
Richard L. Bazelon, Esquire (I.D. No. 02505)
Noah H. Charlson, Esquire (I.D. No. 89210)
Michael F.R. Harris, Esquire (I.D. No. 56948)
BAZELON LESS & FELDMAN, P.C.
1515 Market Street, Suite 700
Philadelphia, PA 19102
[phone]
Attorneys for Plaintiffs
David Rudovsky and Leonard Sosnov
Dated: April 8, 2011

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CERTIFICATE OF SERVICE
I hereby certify that on this 8th day of April, 2011, I served a true and correct copy
of the foregoing Plaintiffs’ Motion for Reconsideration of the Portion of the Court’s
March 30, 2011 Order Conditioning Denial of Defendants’ Motion for a New Trial on
Plaintiffs’ Acceptance of a Reduced Amount of Punitive Damages, and supporting
Memorandum of Law, upon the following counsel for defendants, as follows:
via the Court’s Electronic Case Filing system:
Matthew J. Borger, Esquire
Klehr, Harrison, Harvey, Branzburg & Ellers LLP
260 South Broad Street
Philadelphia, PA 19102

via electronic mail:
James Rittinger, Esquire
Aaron Zeisler, Esquire
Satterlee Stephens Burke & Burke LLP
230 Park Avenue, Suite 1130
New York, NY 10169

s/ Noah H. Charlson
Noah H. Charlson, Esquire