A recent Ohio Supreme Court ruling upholding the constitutionality of two tort reform measures enacted by the Ohio General Assembly will promote Ohio’s business climate and economic health.

Arbino v. Johnson & Johnson, a product liability case, directly challenged the constitutionality of key provisions of Senate Bill 80, which took effect in April 2005. The challenged provisions set limits for both non-economic and punitive damages in personal injury lawsuits. In response, the Ohio Supreme Court held that the two key measures of the bill do not violate the constitutional rights of plaintiffs. In a 5-2 decision authored by Chief Justice Thomas J. Moyer, the Court concluded that “this case affirms the General Assembly’s efforts over the last several decades to enact meaningful tort reforms. It also places Ohio firmly with the growing number of states that have found such reforms to be constitutional.”

The Court agreed to consider the constitutionality of the tort reform provisions at the request of U.S. District Judge David A. Katz, who is presiding over the Arbino matter. In that case, Melissa Arbino claimed that Johnson & Johnson’s Ortho Evra birth control patch caused her to develop blood clots and made her vulnerable to high-risk pregnancies. Arbino’s motion for partial summary judgment, which asked the federal court to declare Ohio’s caps on the potential amounts of non-economic and punitive damages unconstitutional, prompted Judge Katz’s decision to seek guidance from the Ohio Supreme Court. In particular, Arbino claimed multiple constitutional violations on the part of Senate Bill 80, including interference with the right to a jury, the right to a remedy, due process, equal protection, and separation of powers.

The upshot of the decision is a reasonable and predictable justice system that nonetheless provides for fair awards for injured parties. The Ohio Supreme Court ruled on two of three challenged provisions:

1. R.C. 2315.18, which limits damages for non-economic injuries, such as pain and suffering, loss of consortium, and mental anguish, to the greater of $250,000 or three times the amount of economic damages awarded to the same plaintiff, up to a maximum of $350,000; and

2. R.C. 2315.21, which prohibits punitive damage awards that exceed two times the amount of the compensatory damages from the same defendant.

In briefing before the Ohio Supreme Court, Porter Wright Morris & Arthur filed an amicus — or “friend of the court” — brief on behalf of the International Association of Defense Counsel (“IADC”) that supported the punitive damages cap in R.C. 2315.21. In so doing, Porter Wright attorneys Joe Ryan and Colleen Marshall argued that punitive damage awards can be erratic and without standards and often result in awards that bear no relation to actual damages and amount to nothing more than windfalls for plaintiffs. The firm further pointed out that damages limits are within the province of the state legislature because excessive and unpredictable punitive damage awards can have crippling economic consequences.

The Court agreed with these arguments and held that placing reasonable limits on punitive damages makes the civil justice system more predictable: “[T]he General Assembly found that the uncertainty and subjectivity associated with the civil justice system was harming the state’s economy. The reforms codified in R.C. 2315.21 were an attempt to limit the subjective process of punitive-damage calculation, something the General Assembly believes was contributing to the uncertainty.” The Court likewise upheld the General Assembly’s caps on non-economic compensatory damages using similar reasoning.

The Court declined to rule on a third challenged provision that allows a defendant to present evidence about a plaintiff’s recovery from collateral sources — essentially notifying jurors of the amount of other benefits available to a plaintiff. Porter Wright attorneys Carolyn Taggart and J.H. Huebert filed an amicus brief on behalf of the Ohio Association of Civil Trial Attorneys urging the Court to uphold that statute. However, the Court ruled that Arbino did not have a legal standing to even challenge the provision.

In upholding the constitutionality of this latest legislative attempt at tort reform, the Court noted that the General Assembly effectively remedied the constitutional flaws that torpedoed three decades of legislative efforts to rein in unpredictable damage awards in personal injury lawsuits. The bottom line of the Arbino decision is that Ohio finally has a more predictable and balanced civil justice system that provides fair awards for injured parties and ensures that the state remains economically competitive.