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The Ohio Supreme Court has a long and somewhat controversial history of striking down laws enacted by the Ohio General Assembly to reform the state’s civil liability system.1 In stark contrast with the past, however, Ohio’s highest court recently upheld caps on non-economic and punitive damages in Arbino v. Johnson & Johnson and a ten-year product liability statute of repose in Groch v. General Motors Corp. These decisions may bode well for advocates of tort reform who have worked to enact other civil liability reforms in Ohio during recent years.

Arbino v. Johnson & Johnson

In 2006, the petitioner, Melisa Arbino, initiated a products liability action alleging that she suffered injuries from using a birth control patch manufactured by the respondent, Johnson & Johnson.2 The petitioner’s complaint contained challenges to the constitutionality of four statutory tort reform provisions that were enacted into law in 2005. The petitioner’s claim was consolidated with other claims relating to the birth control patch at issue before Judge David A. Katz in the United States District Court for the Northern District of Ohio, Western Division.3

Judge Katz certified four questions of state law for the Ohio Supreme Court’s review. Ohio’s highest court accepted three of the certified questions for review and later ruled that the petitioner did not have standing to challenge the statutory provision at issue in one of the certified questions, leaving two remaining questions for substantive review.4 The remaining certified questions were challenges to a recently enacted statute limiting non-economic and punitive damages in certain tort actions.5

The Ohio Supreme Court’s Recent History Related to Tort Reform

Chief Justice Thomas Moyer, in an opinion issued in December 2007 for a 5-2 majority of the court, briefly reviewed “the major tort reform laws enacted by the General Assembly in recent history.” Th e court noted that “[s]ince 1975, the General Assembly has adopted several so-called tort-reform acts, which were inevitably reviewed by this court.” Many of those statutes included “specific provisions” that were “similar in language and purpose” to those at issue in Arbino. The court conceded that “all of these similar statutes had been declared unconstitutional” in previous Ohio Supreme Court decisions.6

The Arbino court noted these past decisions did not necessarily mean the current version of tort reform was unconstitutional as well. According to Moyer’s majority opinion, “[i]n its continued pursuit of reform, the General Assembly has made progress in tailoring its legislation to address the constitutional defects identified” in past cases.7

Limits on Non-Economic Damages

The statute at issue in Arbino limits recoverable non-economic damages to the greater of $250,000 or three times the economic damages up to a maximum of $350,000 for each plaintiff or a maximum of $500,000 per each occurrence. The statute does not place any limits on economic damages, and the non-economic damages cap does not apply if the plaintiff suffers “[p]ermanent and substantial physical deformity, loss of use of a limb, or loss of a bodily organ system,” or “[p]ermanent physical functional injury that permanently prevents the injured person from being able to independently care for self and perform life-sustaining activities.”8

Limits on Punitive Damages

The statute also limits punitive damages in tort actions to a maximum of two times the total amount of compensatory damages awarded to a plaintiff per defendant. However, if the defendant is a “small employer” (i.e., generally no more than 100 full-time employees) or an individual, punitive damages may not exceed the lesser of two times the amount of compensatory damages or 10 percent of the employer’s or individual’s net worth, up to a maximum of $350,000.9

Standard of Review

As an initial matter, the Arbino majority noted “it is difficult to prove that a statute is unconstitutional” since “[a]ll statutes have a strong presumption of constitutionality.” In order to strike a statute down, it must appear beyond a reasonable doubt that the legislation and constitutional provisions are clearly incompatible.10 Furthermore, the court noted that the petitioner presented a facial challenge to the statute at issue in Arbino and that, to be successful, the petitioner must show there is no set of circumstances in which the statute would be valid.11

The Right to a Trial by Jury

The Ohio Constitution provides: “[t]he right of trial by jury shall be inviolate, except that, in civil cases, laws may be passed to authorize the rendering of a verdict by the concurrence of not less than three-fourths of the jury.”12 The petitioner argued that because the right to a trial by jury includes the right to have a jury determine the full amount of a plaintiff’s damages, the non-economic and punitive damages limits are unconstitutional.13

The Arbino majority acknowledged that “the right to trial by jury protects a plaintiff’s right to have a jury determine all issues of fact” and “[b]ecause the extent of damages suffered by a plaintiff is a factual issue, it is within the jury’s province to determine the amount of damages to be awarded.”14 However, the Arbino majority also noted that “the right to a trial by jury does not extend to the determination of questions of law” and “awards may be altered as a matter of law.”15

The Arbino court noted several ways in which a court may apply the law to change a jury award of damages without running afoul of the constitution, including the courts’ authority to order remittiturs to reduce jury awards when the courts deem these amounts to be excessive.16

The Arbino court also recognized the numerous statutes that treble jury damages in certain causes of action, including for Consumer Sales Practices Act violations, unauthorized removal of timber, and public utilities law violations. The Arbino majority noted that in each of these examples, the General Assembly demonstrated a clear policy choice to modify the amount of jury awards. The court noted that if a legislative choice to increase a jury award as a matter of law does not infringe upon the right to a trial by jury then a corresponding decrease as a matter of law cannot logically violate that right.17

The Arbino majority concluded that “[b]y limiting non-economic damages for all but the most serious injuries, the General Assembly made a policy choice that non-economic damages exceeding set amounts are not in the best interest of the citizens of Ohio” and the Ohio Constitution presents no barrier to such a policy judgment.18 Similarly, in upholding the punitive damages cap, the Arbino majority noted that the U.S. Supreme Court has held that “legislatures enjoy broad discretion in authorizing and limiting permissible punitive damages awards.”19 Accordingly, the court concluded the statutory caps on non-economic and punitive damages did not violate the right to trial by jury.

Open Courts, Right to a Remedy, and Due Course of Law

The Ohio Constitution provides: “[a]ll courts shall be open, and every person, for an injury done him in his land, goods, person, or reputation, shall have remedy by due course of law, and shall have justice administered without denial or delay.”20

The petitioner claimed the limits on the noneconomic damages and punitive damages also violate the Ohio Constitution’s “open courts,” “right to a remedy,” and “due course of law” provisions set out above.

The Arbino majority noted that “[w]hen an individual is wholly foreclosed from relief after a verdict is rendered in his or her favor, the rights to a meaningful remedy and open courts become hollow rights hardly worth exercising.”21 The caps on damages under consideration in Arbino, however, do not wholly deny a remedy. Injured plaintiffs not suffering catastrophic injuries may still recover their full economic damages, up to $350,000 in non-economic damages, and punitive damages up to twice the amount of compensatory damages. The Arbino court concluded that such recoveries were “meaningful” remedies under the Ohio Constitution, and therefore the statutory caps on damages did not violate the “right to a remedy” or the right to an “open court” under the Ohio Constitution.22

The Arbino court also noted the “due course of law” clause of the Ohio Constitution is the equivalent to the “due process of law” protections in the United States Constitution.23 Accordingly, when reviewing a statute on due-process grounds, the court uses a rational basis test unless the statute restricts the exercise of fundamental rights. Because the Arbino majority already found the caps on non-economic and punitive damages did not violate either the right to a jury trial or the right to a remedy, it applied the rational basis test. Accordingly, the court asked whether the damages caps (1) bear a real and substantial relation to the public health, safety, morals, or general welfare of the public and (2) whether the damage caps are unreasonable or arbitrary.24

The Arbino majority found there was ample evidence that the caps on non-economic and punitive damages had a real and substantial relation to the general welfare of the public. The court reviewed the uncodified sections of the tort reform legislation that found the current state of the litigation system “represents a challenge to the economy of the state of Ohio.”25 The court noted that the General Assembly relied upon, among other things, studies showing: (1) states that adopted tort reforms experienced growth in employment, productivity, and total output; (2) the cost of tort litigation amounted to a significant tax on wages, personal consumption, and capital investment income; and (3) “the tort system failed to return even 50 cents for every dollar to injured plaintiffs.”26

In addition to the general economic concerns, the General Assembly found that damages for “pain and suffering” were inherently subjective, imprecise, and susceptible to inflation. Further their inflated cost was being passed on to the general public.27 The General Assembly had similar concerns regarding the subjectivity of punitive damages.28

Having found the statutory caps on non-economic and punitive damages bore a real and substantial relation to the general welfare of the public, the court then asked whether the caps were arbitrary or unreasonable. The Arbino court noted that in previous cases the court found earlier legislative attempts to place statutory caps on non-economic damages to be arbitrary and unreasonable because they “imposed the cost of the intended benefit to the public solely upon those most severely injured.”29 Moyer’s opinion noted that the statute under consideration in Arbino “alleviates this concern by allowing for limitless non-economic damages for those suffering catastrophic injuries.”30 Similarly, the General Assembly’s statutory change to punitive damages would still facilitate punishment of reprehensible behavior while “ensuring that lives and businesses are not destroyed in the process.”31

The court concluded that the General Assembly “tailored” its statutory caps on damages “to maximize benefits to the public while limiting damages to litigants,” which is “neither unreasonable nor arbitrary.”32 Accordingly, the court concluded that the caps on noneconomic and punitive damages did not violate the “due course of law” provision of the Ohio Constitution.

Equal Protection

The Ohio Constitution provides: “[a]ll political power is inherent in the people. Government is instituted for their equal protection and benefit.”33 The Ohio Supreme Court has interpreted this provision as the “equivalent of the federal Equal Protection Clause.”34 The petitioner claimed the limits on non-economic and punitive damages violate the “equal protection” clause of the Ohio Constitution because such damages would disproportionately affect women, children, minorities, the elderly, and people with low incomes.

The Arbino court noted that because the statute does not infringe upon a fundamental constitutional right and is facially neutral as to suspect classes, the rational basis test applies and the statute will be upheld if it is found to be rationally related to a legitimate government purpose.35

The court conceded that the cap on non-economic damages created distinctions between different groups of people, as the limits do not apply to plaintiffs with catastrophic injuries.36 The court noted the General Assembly was concerned with the imprecise nature of non-economic damages generally—but recognized that severe injuries offered “more concrete evidence” of noneconomic loss, thus posing a “lesser risk of being tainted by improper external considerations” when awarded.37 Similarly, the General Assembly made distinctions related to the cap on punitive damages depending on whether the defendant is an individual or small business, as opposed to a large business, based on legitimate concerns regarding the state’s economy.

The court found the statutory caps on non-economic and punitive damages were “rationally related to the legitimate state interests of reforming the state civil justice system to make it fairer and more predictable and thereby improving the state’s economy.”38 The Arbino majority concluded “the General Assembly is charged with making difficult policy decisions on such policy issues” and the court was “not the forum to second-guess such legislative choices.”39 Accordingly, the court found the statutory caps on damages did not violate the Ohio Constitution’s “equal protection” clause.

Concurring and Dissenting Opinions

Justice Robert Cupp wrote a concurring opinion discussing the petitioner’s claim that the statutory caps violated the right to a trial by jury. Cupp cited Alexander Hamilton and Thomas Jefferson in finding that the right to a trial by jury was primarily intended to protect against judicial overreaching and bias and concluded the General Assembly’s adoption of statutory caps on damages did not implicate those intentions.40

Justice Terrence O’Donnell wrote a dissenting opinion concluding that the limit on non-economic damages violated the Ohio Constitution’s right to a jury trial because it substitutes the judgment of the General Assembly for that of a jury.41 Justice Paul Pfeifer wrote a lengthy dissent, a large portion of which was his own “examination of the evidence the General Assembly relied on” in enacting the caps on damages.42 Following his review of the various studies, surveys, public testimony, and other evidence, Justice Pfeifer concluded none of the General Assembly’s findings were “reliable,” and reliance on such evidence was “arbitrary and unreasonable.”43

Groch v. General Motors Corp.

Petitioner, Douglas Groch, was injured in March of 2005 while operating equipment manufactured more than ten years before the injury by respondents, Kard Corporation and Racine Federated, Inc., during the course of the petitioner’s employment with respondent, General Motors. Groch and his wife, who sought damages for loss of consortium, brought action against the respondents in the Court of Common Pleas for Lucas County. General Motors removed the case to federal court.44

The United States District Court for the Northern District of Ohio, Western Division, certified a series of questions for the Ohio Supreme Court to review. Several of the questions involved constitutional challenges to Ohio’s product liability statute of repose, which was enacted by the General Assembly, signed by then-governor Bob Taft and made effective in April 2005.45

The petitioners in Groch raised several of the same constitutional arguments that the petitioners in Arbino raised in arguing for the court to strike down the caps on damages. The Groch petitioners contended that the statute of repose violated the “open courts,” “right to a remedy,” “due course of law” and “equal protection” provisions of the Ohio Constitution.

Ten-year Product Liability Statute of Repose

The statute at issue in Groch provided that “no cause of action based on a product liability claim shall accrue against the manufacturer or supplier of a product later than ten years from the date that the product was delivered to its first purchaser.”46

Standard of Review

In an opinion issued in February 2007 for a 6-1 majority, Justice Maureen O’Connor reiterated the same standard of review in Groch as was set out in Arbino. O’Connor noted, as an initial matter, that it is difficult to prove a statute is unconstitutional because “all statutes have a strong presumption of constitutionality.”47 The court will only find a legislative enactment unconstitutional if it appears “beyond a reasonable doubt that the legislation and constitutional provisions are clearly incompatible.”48

The Groch court also reiterated that it is not the court’s duty to assess the wisdom of a particular statute since the legislative branch is the ultimate arbiter of public policy. The court recognized that in fulfilling its role of setting public policy, the legislature continually refines Ohio’s tort law to meet the needs of Ohio citizens.49

Open Courts and Right to a Remedy

The Groch court noted that the “right to a remedy” and “open courts” provisions of the Ohio Constitution apply only to existing, vested rights. The product liability statute of repose operates to potentially bar a plaintiff’s suit before a cause of action arises. For example, the piece of equipment that allegedly caused the injury in Groch was produced more than ten years before the injury, so the statute of repose would eff ectively prevent the claim from ever vesting.50

The court also noted that state law determines what injuries are recognized and what remedies are available and, by enacting the statute of repose for product liability actions, the General Assembly established “the injuries that are recognized and the remedies that are available” under law.51

O’Connor’s opinion also pointed out that the existence of a product liability statute of repose did not necessarily extinguish a right to a remedy just because the statute foreclosed a suit by a plaintiff against certain defendants. While the product liability statute of repose may prevent some suits against manufacturers, an injured party may still be able to seek recovery against other parties, including, for example, an employer that negligently modified a machine after it was acquired.52

Because the statute does not impact a vested right and plaintiffs may still have a right of remedy other than against the original manufacturer or supplier, the Groch court concluded that the product liability statute of repose was not incompatible with the “open courts” and “right to a remedy” guarantees of the Ohio Constitution.

Due Course of Law and Equal Protection

Because the Groch court found that the statute of repose did not violate the “open courts” and “right to a remedy” provisions of the Ohio Constitution, the court concluded the statute did not impinge upon a fundamental right. The court further found that the statute of repose did not involve a suspect class for purposes of the equal protection claim.53 Accordingly, the court applied a rational basis review to determine whether the ten-year product liability statute of repose is rationally related to a legitimate government purpose and is not unreasonable and arbitrary.54

The court noted that the General Assembly made several findings in adopting the product liability statute of repose, including:

  • Subsequent to delivery of the product, the manufacturer or supplier lacks control over the product and its uses, and it is more appropriate for the party which has control over the product during the intervening time period to be responsible for any harm caused;
  • More than ten years after a product has been delivered, it is very difficult for the manufacturer or supplier to locate reliable evidence and witnesses regarding design, production, or marketing of the product, thus severely disadvantaging manufacturers and suppliers in their efforts to defend actions based on product liability claims;
  • It would be inappropriate to apply current legal and technological standards to products manufactured many years prior to the commencement of a product liability action; and
  • A statute of repose for product liability claims would enhance the competitiveness of Ohio manufacturers by reducing their exposure to disruptive and protracted liability with respect to products long out of their control.55

The Groch court concluded that for both “due course of law” and “equal protection” purposes, the above findings “adequately demonstrate[d]” that the statute of repose bore a “real and substantial relation to the public health, safety, morals, or general welfare of the public” and was “not unreasonable or arbitrary.”56 Accordingly, the court found the statute did not violate the principles of due process or equal protection and was constitutional on its face.57

Dissenting Opinion

As in Arbino, Justice Paul Pfeifer issued a stinging dissent in Groch. Pfeifer accused the majority of “a propensity to engage in legal mumbo jumbo”58 and offering a “bromide” in suggesting the legislative branch is the ultimate arbiter of public policy.59 Pfeifer wrote that he does “not agree” that the court “owes all legislation passed by the General Assembly the presumption of constitutionality.”60 However, in the 2003 Klein v. Leis case, Pfeifer wrote the majority opinion upholding a statutory prohibition on carrying concealed weapons, declaring that “[i]t is fundamental that a court must presume the constitutionality of lawfully enacted legislation.”61

As in Arbino, Pfeifer reexamined the General Assembly’s findings and concluded they were “devoid” of facts.62 Pfeifer concluded that the Groch majority erred in not finding the product liability statute of repose violated the “open courts,” “right to a remedy” and “equal protection” provisions of the Ohio Constitution.

Conclusion

In several cases during the 1990s, the Ohio Supreme Court found various statutory reforms to the civil justice system inconsistent with the Ohio Constitution.63 In upholding the limits on non-economic and punitive damages in Arbino and the product liability statute of repose in Groch, the court took notice of the General Assembly’s recent efforts to tailor its reforms to address the constitutional defects identified in those prior cases and exhibited a new-found respect for the legislature’s role in crafting such reforms. The General Assembly has enacted other reforms that will likely be challenged in the future, including regarding the admissibility of collateral benefits evidence64 and establishment of statutes of repose for medical malpractice actions.65 The Arbino and Groch decisions suggest those reforms may receive a more welcome reception from the court than in the past.

* David J. Owsiany is the executive director of the Ohio Dental Association and the senior fellow in legal studies for the Buckeye Institute for Public Policy Solutions.

 

Endnotes

1 See Stephen J. Werber, Ohio Tort Reform in 1998: The War Continues, 45 Clev. St. L. Rev. 539, 540 (1997) (“In a real sense, the Court has become a super legislature comprised of a somewhat consistent four member majority.”). See also Note, State Tort Reform—Ohio Supreme Court Strikes Down State General Assembly’s Tort Reform Initiative, 113 Harv. L. Rev. 804 (2000).

2 Arbino v. Johnson & Johnson, Slip Op. No. 2007-Ohio-6948, at ¶ 1.

3 Id. at ¶ 2.

4 Id. at ¶¶ 83-84.

5 Id. at ¶¶ 3-6.

6 Id. at ¶¶ 9-10. The Arbino court reviewed the following Ohio Supreme Court cases invalidating various statutory tort reform provisions: Morris v. Savoy, 61 Ohio St.3d 684, 576 N.E.2d 765 (1991), Sorrell v. Thevenir, 69 Ohio St.3d 415, 633 N.E.2d 504 (1994), Galayda v. Lake Hosp. Sys., Inc., 71 Ohio St.3d 421, 644 N.E.2d 298 (1994), Zoppo v. Homestead Ins. Co., 71 Ohio St.3d 552, 644 N.E.2d 397 (1994), State ex rel. Ohio Academy of Trial Lawyers v. Sheward, 86 Ohio St.3d 451, 715 N.E.2d 1062 (1999). See id. at ¶¶ 10 -18.

7 Id. at ¶ 24.

8 Ohio Rev. Code, § 2315.18.

9 Id. at § 2315.21.

10 Arbino, at ¶ 25 (citations omitted).

11 Id. at ¶ 26 (citations omitted).

12 Ohio Const. art. I, § 5.

13 Arbino, at ¶ 33.

14 Id. at ¶ 34 (citations omitted).

15 Id. at ¶ 37 (emphasis in original) (citations omitted).

16 Id. at ¶ 38 (citation omitted).

17 Id. at ¶ 39 (citation omitted).

18 Id. at ¶ 40. The Arbino majority also noted that limitations on damages in the federal system have not been found to violate the analogous Seventh Amendment right to a jury trial. Id. at ¶ 41 (citation omitted).

19 Id. at ¶ 94 (quoting Cooper Ind., Inc. v. Leatherman Tool Group, Inc., 532 U.S. 424, 433, 121 S.Ct. 1678 (2001)).

20 Ohio Const. art. I, § 16 (emphasis added).

21 Arbino, at ¶ 45 (quoting Sorrell v. Thevenir, 69 Ohio St.3d 415, 426, 633 N.E.2d 504 (1994)).

22 Id. at ¶¶ 47 & 98. The Arbino majority also noted that the limits on punitive damages could not implicate the right to a remedy since punitive damages are intended to punish and deter reprehensible behavior, not to remedy injuries. Id. at ¶¶ 97-98.

23 Id. at ¶ 48 (citations omitted).

24 Id. at ¶¶ 49 & 99 (citations omitted).

25 Id. at ¶ 53 (quoting Am. Sub. S.B. 80, § 3 (A)(1) (125th General Assembly) (2003-04)).

26 Id. at ¶ 53.

27 Id. at ¶ 54 (citations omitted).

28 Id. at ¶ 101.

29 Id. at ¶ 59 (citing Morris v. Savoy, 61 Ohio St.3d 684, 690-691, 576 N.E.2d 765 (1991)).

30 Id. at ¶ 60.

31 Id. at ¶ 103.

32 Id. at ¶¶ 61 & 103.

33 Ohio Const. art. I, § 2.

34 Arbino, at ¶ 63 (citation omitted).

35 Id. at ¶¶ 65-66 (citations omitted). 

36 Id. at ¶ 67.

37 Id. at ¶ 72.

38 Id. at ¶¶ 69 & 106.

39 Id. at ¶ 71.

40 Id. at ¶¶ 119-136 (citations omitted) (Cupp, J. concurring).

41 Id. at ¶ 162 (O’Donnell, J. dissenting).

42 Id. at ¶ 186 (Pfeifer, J. dissenting).

43 Id. at ¶ 204 (Pfeifer, J. dissenting).

44 Groch v. Gen. Motors Corp., Slip Op. No. 2008-Ohio-546, at ¶¶ 5-7.

45 Id. at ¶¶ 15-19 & 22. The petitioners also challenged the constitutionality of a workers compensation subrogation statute that was enacted in 2003. Id. at ¶¶ 12-14.

46 Ohio Rev. Code, § 2305.10(C)(1).

47 Groch, at ¶ 25 (citation omitted).

48 Id. at ¶ 25 (quoting State ex rel. Dickman v. Defenbacher (1955), 164 Ohio St. 142, 128 N.E.2d 59).

49 Id. at ¶¶ 102 & 141 (citations omitted).

50 Id. at ¶¶ 149-150 (citation omitted).

51 Id. at ¶ 150 (citation omitted).

52 Id. at ¶¶ 151-152.

53 Id. at ¶ 159.

54 Id. at ¶ 157 (citation omitted).

55 Id. at ¶¶ 166-170.

56 Id. at ¶ 172.

57 Id. at ¶ 175. The Groch majority found that the product liability statute of repose violated the Ohio Constitution as applied to the petitioners because the injuries at issue occurred only thirty-four days before the effective date of the statute. According to the court, the statute of repose operated “unreasonably as applied to petitioners because it provided them with only 34 days to commence their suit, with the consequence that they lost their cause of action if they did not file suit within 34 days.” Id. at ¶ 198. The court concluded that the statute was “unconstitutionally retroactive under section 28, Article II of the Ohio Constitution.” Id. at ¶ 199. Section 28, Article II of the Ohio Constitution provides that “[t]he general assembly shall have no power to pass retroactive laws.” Ohio Const. art. II, § 28. The court’s holding that the product liability statute of repose is unconstitutional as applied to the petitioners in Groch will likely have limited impact on the applicability of the statute going forward. It would only affect those plaintiff s with injuries that occurred shortly before the eff ective date of the statute, thereby providing an “unreasonably short period of time in which to file suit.” Groch, at ¶ 199.

58 Id. at ¶ 227 (Pfeifer, J., dissenting).

59 Id. at ¶ 238 (Pfeifer, J., dissenting).

60 Id. at ¶ 239 (Pfeifer, J., dissenting).

61 Klein v. Leis, 99 Ohio St.3d 537, Slip Op. No. 2003-Ohio 4779, at ¶ 4 (citations omitted); see David J. Owsiany, Ohio’s High Court Back on Right Track, Columbus Dispatch, Mar. 2, 2008.

62 Groch, at ¶ 254 (Pfeifer, J., dissenting).

63 See Arbino at ¶¶ 10-18.

64 Ohio Rev. Code, § 2315.20.

65 Id. at § 2305.113(C).

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