Consorti v. Armstrong World Industries, Inc.
72 F.3d 1003, 1995 WL 760994 (1995)
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Rule of Law:
In a federal court diversity action, the substantive law of the forum state governs the standard for determining whether a jury's compensatory damage award is excessive, rather than the federal "shocks the conscience" standard.
Facts:
- From 1960 to 1978, John Consorti worked as a pipe covering insulator.
- During his work, Consorti was exposed to asbestos products manufactured by Owens-Corning Fiberglas Corporation (OCF).
- Consorti's exposure to asbestos occurred prior to his marriage to Frances Consorti.
- In August 1991, John Consorti began experiencing severe back problems.
- In February 1992, Consorti was diagnosed with pleural mesothelioma, an incurable cancer of the lung lining caused by asbestos exposure.
- The disease caused Consorti enormous suffering, including a tumor that enveloped his spine, loss of voice, and difficulty breathing, eating, and walking.
- John Consorti died from the disease in November 1993, after the trial concluded.
Procedural Posture:
- John and Frances Consorti filed a personal injury action against Owens-Corning Fiberglas Corporation (OCF) and other defendants in the U.S. District Court for the Southern District of New York.
- The case was consolidated for trial with three other mesothelioma cases.
- OCF's motion to sever the Consorti case was denied by the trial court.
- A jury returned a special verdict, finding OCF 7% responsible for John Consorti's injuries and awarding him $12 million for pain and suffering.
- The jury also awarded Frances Consorti damages for loss of consortium.
- OCF moved for judgment as a matter of law, a new trial, or a remittitur, all of which the district court denied with respect to the pain and suffering award.
- OCF, as appellant, appealed the final judgment to the U.S. Court of Appeals for the Second Circuit; the Consortis were appellees.
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Issue:
In a diversity action, must a federal appellate court apply the forum state's substantive standard that an award is excessive if it 'deviates materially from what would be reasonable compensation,' rather than the federal 'shocks the conscience' standard, when reviewing a jury's damage award?
Opinions:
Majority - Leval, Circuit Judge
Yes. A federal court sitting in diversity must apply the substantive law of the forum state when reviewing a jury's award for excessiveness. The amount of damages awardable for a state-law claim is a matter of substantive right, not federal procedure. Citing the principles of Erie R.R. Co. v. Tompkins, the court reasoned that to apply the federal 'shocks the conscience' standard instead of New York's 'deviates materially' standard would violate fundamental constitutional doctrine by creating a different substantive outcome for a state-law claim simply because it was brought in federal court. The court extended the logic from Browning-Ferris Indus. v. Kelco Disposal, Inc., which held that the excessiveness of punitive damages is a matter of state law, to compensatory damages. Applying New York's CPLR § 5501(c), the court compared the $12 million award to numerous New York state court decisions in similar mesothelioma cases, which consistently reduced awards to a range of $1 to $3 million. Concluding that the jury's award 'deviates materially' from what New York courts consider reasonable, the court ordered a new trial unless the plaintiffs accepted a remittitur reducing the pain and suffering award to $3.5 million. The court also vacated Frances Consorti's loss of consortium award based on a New York Court of Appeals ruling on a certified question.
Analysis:
This decision solidifies the application of the Erie doctrine to the review of compensatory damage awards, establishing that state-law standards for remittitur are substantive and binding on federal courts in diversity cases. By requiring federal courts to apply state-specific tests like New York's 'materially deviates' standard, the ruling promotes consistency between state and federal court outcomes for state-law claims. This precedent limits forum shopping by plaintiffs seeking more deferential federal review of large jury verdicts and enhances the predictability of damages in mass tort and personal injury litigation governed by state law.
