John Henry Faulk v. Aware, Inc., Hartnett, and Johnson
19 AD 2d 464, 244 NYS 2d 259 (1963)
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Rule of Law:
A court may reduce a jury's compensatory and punitive damage awards in a libel case if it finds the amounts to be shockingly excessive and without a reasonable relation to the evidence of the plaintiff's actual and potential losses, or the defendant's culpability.
Facts:
- John Henry Faulk was a prominent radio and television performer with his own daily show.
- Aware, Inc., a corporation co-founded by Vincent Hartnett, purported to combat Communism in the entertainment industry, with Hartnett serving as a paid consultant who vetted performers' political backgrounds.
- Faulk began a campaign within his union to oppose the 'blacklisting' practices of Aware, Inc. and Hartnett.
- In retaliation for Faulk's opposition, Hartnett authored and Aware, Inc. published a bulletin falsely implying that Faulk had communist associations.
- This bulletin was distributed to approximately 2,000 individuals and entities in the entertainment industry, including Faulk's employers and sponsors.
- As a direct result of the publication, Faulk's professional engagements were cancelled, and he became unemployable in the radio and television industry, effectively destroying his career.
Procedural Posture:
- John Henry Faulk sued Aware, Inc., Vincent Hartnett, and another individual for libel in a New York trial court.
- The trial court denied the defendants' pre-trial motion to dismiss the complaint, and an intermediate appellate court affirmed that decision.
- The case proceeded to a jury trial.
- During the trial, the court dismissed most of the defendants' affirmative defenses, such as truth and fair comment, for a complete failure of proof.
- The jury found for Faulk, awarding him $1,000,000 in compensatory damages and punitive damages of $1,250,000 each against defendants Aware, Inc. and Hartnett.
- Aware, Inc. and Hartnett, as appellants, appealed the judgment to the Appellate Division of the Supreme Court of New York.
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Issue:
Is a jury's award of $1,000,000 in compensatory damages and a total of $2,500,000 in punitive damages for a malicious libel that destroyed a plaintiff's career so grossly excessive as to warrant judicial reduction?
Opinions:
Majority - Rabin, J.
Yes, the jury's award for both compensatory and punitive damages was grossly excessive and must be reduced. While a jury has broad discretion in libel cases, a court cannot permit a verdict that is shockingly excessive and bears no relation to reality. The $1,000,000 compensatory award was unrealistic given the speculative nature of testimony about Faulk's potential earnings, which far exceeded his actual past income; therefore, it is reduced to $400,000. The punitive damages, intended to punish and deter, were also grossly excessive and did not properly reflect the different levels of culpability between the defendants. Hartnett, as the primary actor and author, was more culpable than Aware, Inc. Accordingly, punitive damages are reduced to $100,000 against Hartnett and $50,000 against Aware, Inc.
Analysis:
This case serves as a key precedent for the doctrine of judicial remittitur, confirming that even when a jury finds malicious and devastating conduct, damage awards are not immune from judicial review for excessiveness. The decision reinforces the principle that compensatory damages must be grounded in evidence and not pure speculation, even when considering future potential earnings. Furthermore, it clarifies that punitive damages, while meant to punish, should be reasonably bounded and can be apportioned among defendants based on their relative degree of culpability.
