Kemezy v. Peters

Case brief: template

Case name:	Kemezy v. Peters
Court:	UNITED STATES COURT OF APPEALS FOR THE SEVENTH CIRCUIT
Citation; Date:	79 F.3d 33; 1996

PROCEDURAL HISTORY
Trial court:		Appeal court (for appeal cases only):
Plaintiff:	Kemezy - security guard	Appellant:	Peters
Defendant:	Peters - police	Respondent:

Facts of the case:

Procedural history:

Jeffrey Kemezy sued a Muncie, Indiana policeman named James Peters under 42 U.S.C. § 1983, claiming that Peters had wantonly beaten him with the officer's nightstick in an altercation in a bowling alley where Peters was moonlighting as a security guard. The jury awarded Kemezy $ 10,000 in compensatory damages and $ 20,000 in punitive damages. Peters' appeal challenges only the award of punitive damages, and that on the narrowest of grounds: that it was the plaintiff's burden to introduce evidence concerning the defendant's net worth for purposes of equipping the jury with information essential to a just measurement of punitive damages.

Court opinion (including key issues and arguments):

    Two courts have adopted the position that Peters advocates. ... But the majority view is opposed.... Our decision in Littlefield v. McGuffey, 954 F.2d 1337, 1349 (7th Cir. 1992), can be read as aligning us with the majority, although as Peters points out the plaintiff there had presented some evidence of the defendant's net worth and it is possible (though not necessary) to read our opinion as placing some minimal burden of production on the plaintiff. See id. at 1349-50. But we think the majority rule, which places no burden of production on the plaintiff, is sound, and we take this opportunity to make clear that it is indeed the law of this circuit.
    The standard judicial formulation of the purpose of punitive damages is that it is to punish the defendant for reprehensible conduct and to deter him and others from engaging in similar conduct. ... This formulation is cryptic, since deterrence is a purpose of punishment, rather than, as the formulation implies, a parallel purpose, along with punishment itself, for imposing the specific form of punishment that is punitive damages. An extensive academic literature, however, elaborates on the cryptic judicial formula, offering a number of reasons for awards of punitive damages. ... A review of the reasons will point us toward a sound choice between the majority and minority views.
    1. Compensatory damages do not always compensate fully.
    2. By the same token, punitive damages are necessary in such cases in order to make sure that tortious conduct is not underdeterred
    These two points bring out the close relation between the compensatory and deterrent objectives of tort law, or, more precisely perhaps, its rectificatory and regulatory purposes. Knowing that he will have to pay compensation for harm inflicted, the potential injurer will be deterred from inflicting that harm unless the benefits to him are greater. If we do not want him to balance costs and benefits in this fashion, we can add a dollop of punitive damages to make the costs greater.
    3. Punitive damages are necessary in some cases to make sure that people channel transactions through the market when the costs of voluntary transactions are low.
    4. When a tortious act is concealable, a judgment equal to the harm done by the act will underdeter.
    5. An award of punitive damages expresses the community's abhorrence at the defendant's act. We understand that otherwise upright, decent, law-abiding people are sometimes careless and that their carelessness can result in unintentional injury for which compensation should be required. We react far more strongly to the deliberate or reckless wrongdoer....
    whether because the American legal and political cultures are unique, or because the criminal justice system in this country is overloaded and some of its functions have devolved upon the tort system, punitive damages are a regular feature of American tort cases, though reserved generally for intentional torts, including the deliberate use of excess force as here. This suggests additional functions of punitive damages:
    6. Punitive damages relieve the pressures on the criminal justice system.
    7. If we assume realistically that the criminal justice system could not or would not take up the slack if punitive damages were abolished, then they have the additional function of heading off breaches of the peace by giving individuals injured by relatively minor outrages a judicial remedy in lieu of the violent self-help to which they might resort if their complaints to the criminal justice authorities were certain to be ignored and they had no other legal remedy.
    What is striking about the purposes that are served by the awarding of punitive damages is that none of them depends critically on proof that the defendant's income or wealth exceeds some specified level. The more wealth the defendant has, the smaller is the relative bite that an award of punitive damages not actually geared to that wealth will take out of his pocketbook, while if he has very little wealth the award of punitive damages may exceed his ability to pay and perhaps drive him into bankruptcy.
    plaintiffs who are seeking punitive damages often present evidence of the defendant's wealth. The question is whether they must present such evidence--whether it is somehow unjust to allow a jury to award punitive damages without knowing that the defendant really is a wealthy person. The answer, obviously, is no. A plaintiff is not required to seek punitive damages in the first place, so he should not be denied an award of punitive damages merely because he does not present evidence that if believed would persuade the jury to award him even more than he is asking.
    Take the question from the other side: if the defendant is not as wealthy as the jury might in the absence of any evidence suppose, should the plaintiff be required to show this? That seems an odd suggestion too. The reprehensibility of a person's conduct is not mitigated by his not being a rich person, and plaintiffs are never required to apologize for seeking damages that if awarded will precipitate the defendant into bankruptcy. A plea of poverty is a classic appeal to the mercy of the judge or jury, and why the plaintiff should be required to make the plea on behalf of his opponent eludes us.
    The usual practice with respect to fines is not to proportion the fine to the defendant's wealth, but to allow him to argue that the fine should be waived or lowered because he cannot possibly pay it. ... Given the close relation between fines and punitive damages, this is the proper approach to punitive damages as well. The defendant who cannot pay a large award of punitive damages can point this out to the jury so that they will not waste their time and that of the bankruptcy courts by awarding an amount that exceeds his ability to pay.
    Individual defendants, as in the present case, are reluctant to disclose their net worth in any circumstances, so that compelling plaintiffs to seek discovery of that information would invite a particularly intrusive and resented form of pretrial discovery and disable the defendant from objecting. Since, moreover, information about net worth is in the possession of the person whose net wealth is in issue, the normal principles of pleading would put the burden of production on the defendant--which, as we have been at pains to stress, is just where defendants as a whole would want it.
    We were told by Peters' lawyer without contradiction that Peters will not be indemnified for the punitive damages that he has been ordered to pay. We have noted the inappropriateness of allowing the defendant to plead poverty if he will be indemnified not because such a plea was attempted here, but to underscore the anomaly of requiring plaintiffs seeking punitive damages always to put in evidence of the defendant's net worth. When the defendant is to be fully indemnified, such evidence, far from being required, is inadmissible. Thus, in some cases it is inadmissible, but in no cases is it required.

Disposition of case:

Affirmed

ECONOMIC ANALYSIS OF THE CASE