Supreme Court Strikes Down $290 Million Verdict Against Ford

By Agence France-Presse The Supreme Court on May 19 ordered a lower court to reconsider a $290 million liability award against Ford Motor Co., citing new guidelines limiting the size of punitive damages. Ford officials said the $290 million verdict was, to their knowledge, the largest single punitive damage award that had been upheld on appeal. The court sent the case back to the California courts for further consideration, saying only that it fell into a category on certain multimillion-dollar punitive damage awards that had to be re-examined. Those awards, aimed at punishing a company for liability, should in most cases be a single-digit multiple of the actual damages, the justices ruled last month, heeding an outcry from businesses about runaway jury awards. Ford was sued in connection with a 1993 accident in which a 1978 Ford Bronco overturned, killing three of the six occupants. The suit claimed the roof was improperly designed and $5 million in compensatory damages was awarded. In a related case, the court sent back to a Kentucky court another $15 million judgment against Ford on the same grounds. Ford has called both awards excessive. "We believe these awards violate the due process principles recently announced by the Supreme Court in 'State Farm,'" said Ford spokeswoman Kathleen Vokes. "We believe that they will be substantially reduced or eliminated in the next stage of the proceedings." The court in April ruled that a $145 million punitive judgment against State Farm Insurance Co. was excessive because it was out of proportion to the $1 million in actual damages in a mishandled insurance claim. Copyright Agence France-Presse, 2003

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