Summary of Honda Motor Co. v. Oberg
Facts: Oberg was driving a Honda 3 wheeled ATV that was in a rollover accident. Oberg sued for negligence in an Oregon court claiming that Honda should have known the vehicle was inherently dangerous by design.
Procedural History: Oberg brought suit against Honda in Oregon for negligence. Case proceeded to jury trial which found Honda liable. Jury awarded Oberg $919,390.39 in compensatory damages and $5M in punitive damages based on Honda’s financial position. Honda appealed to Oregon Supreme Court claiming Oregon’s lack of judicial review in limiting juries punitive damage awards violated the Due Process Clause of the 14th Amendment’s protection against deprivation of property without due process. Honda filed petition for writ of cert. Granted by U.S. Supreme Court.
Issue: Does Oregon’s lack of judicial review in determining punitive damages constitute a due process violation?
Holding: Yes. Oregon’s denial of judicial review of jury awards based on punitive damages is a violation of 14th Amendment.
Judgment: Reversed and remanded back to Oregon Supreme Court.
Reasoning: Recent cases (Pacific Mutual Life v. Haslip, TXO) have recognized a Constitutional limit to punitive damage awards. The common law is also full of examples of judges throwing out excessive jury awards, and this right to judicial review protects outsider defendants and big business from jury bias, and judicial review is often the only protection against arbitrary awards.
Dissent: Ginsburg and Rehnquist dissented saying Oregon’s safeguards against improper instruction and verdict nullification are adequate to pass the due process threshold. Ginsburg viewed the 18th and 19th century cases as being deferential to jury awards.