Ford Denied New Trial on $290 Mln Bronco-Case Award
By Joyzelle Davis
Fresno, California, (Bloomberg) -- Ford Motor Co. won't get a new trial on a $290 million punitive-damage verdict awarded in 1999 by a California jury in a Bronco sport-utility vehicle rollover case, a state appeals court ruled.
The three-judge panel in Fresno, California, overturned a trial judge's order that Ford deserved a new trial on punitive damages based on juror misconduct. The appeals panel also upheld the compensatory award of $4.9 million and agreed that the punitive award isn't excessive.
The appeals court said admonitions by the foreman and the judge cured any taint to the jury caused by allegedly improper statements some jurors made. The world's second-largest automaker said the appeals-court decision is ``patently wrong'' and it plans to appeal to California's Supreme Court.
``Despite defendant's consistent attempts to portray this as a case of jurors run amok, the misconduct in the present case does not begin to approach the pervasive and insistent misconduct that resulted in reversals'' in other cases, Judge Steven Vartabedian wrote in a 37-page opinion.
Ford had claimed three instances of jury misconduct: one juror's discussion of a ``60 Minutes II'' show on Ford Mustang fires, another juror's discussion of a dream involving a Bronco rollover and the same woman's statements that the jury must ``save the babies,'' regardless of the law, and find Ford liable.
The appeals court said neither the ``60 Minutes'' comment nor the dream statements were discussed again after admonitions from the jury foreperson. The ``save the babies'' statement was made only in the first two days of deliberations of liability and compensatory damages and not during the punitive-damage phase, the court said.
Ford attorney Ted Boutrous argued the appeals court should've deferred to the trial judge's finding that there was a likelihood of bias in those two jurors.
``The generic admonition from the court and the self- admonition from the jury did not cure the prejudice,'' he said.
Ramon and Salustia Romo, and their 16-year-old son, Ramiro, were killed when their 1978 Ford Bronco rolled over several times on a Modesto freeway in California's Central Valley. The couple's surviving three children claim Ford sold the Bronco knowing its removable fiberglass roof wouldn't hold up in a rollover.
Ford had argued that the family failed to present evidence of ``malicious or despicable'' conduct in the design and production of the 1978 Bronco.
The appeals court disagreed, saying the automaker put a car on the market ``with a known propensity'' to roll over and inadequate crash protection for passengers wearing seat belts.
``Such corporate conduct can constitute involuntary manslaughter and, when viewed in the context of a mass-produced vehicle sold to the public, certainly is seriously reprehensible conduct,'' Vartabedian wrote.
He cited evidence that Ford declined to test the strength of the Bronco's roof before producing the vehicle and later the automaker found the vehicles didn't meet its own standards.
Ford modified the roof for the 1980 model but ``did nothing to remedy the structural inadequacies in the tens of thousands of 1978 and 1979 Broncos that were already on the road,'' the judge wrote.
Ford will ask for a rehearing from the appeals court. If the panel declines, the company must ask California's top court for a review, Boutrous said.
The court of appeals decision ``invented a new standard'' when it rejected Ford's argument that punitive damages have to be premised on proof of malice by an individual person, he said. It also conflicts with numerous U.S. and California Supreme Court decisions on juror misconduct and due process, he said.
Larry Drivon, a lawyer for the Romo family, said he wasn't surprised Ford plans to appeal. He said the trial court had a ``pristine'' record that will be upheld on review.
``This decision was just upheld by the most conservative appeals court in California,'' Drivon said. ``And Vartabedian was outraged by Ford's conduct.''
The jurors unanimously found Ford was 78 percent at fault, the driver of a second vehicle 12 percent at fault and plaintiff Juan Romo was 10 percent at fault. The jurors voted 9-to-3 on the punitive award.
At the time of the mid-1999 trial, Ford had daily after-tax profits of $20 million and its net worth was $25 billion, of which $14 billion was cash on hand. The appeals court noted that the $290 million award amounts to nine days of Ford's profits at the time of trial.
Shares of Dearborn, Michigan-based Ford rose 23 cents to $16.