wrongful conduct

Paul Gibbs was hired in the summer of 1960 by Grundy Company, a wholly owned subsidiary of Tennessee Consolidated Coal Company, to serve as mine superintendent for a new mine at Gray's Creek and to haul the coal produced there under a separate contract. This arrangement occurred amid ongoing rivalry between the United Mine Workers of America and the Southern Labor Union for representation of coal miners in the southern Appalachian fields. On August 15 and 16, 1960, armed members of UMW Local 5881 prevented the mine from opening through threats and violence, including beating an organizer for the rival union, after learning that jobs they believed had been promised to them were going to others. George Gilbert, the UMW field representative for the area, was attending an Executive Board meeting in Middlesboro, Kentucky, when the violence occurred and did not return until late on August 16. Upon his return he received instructions from international union superiors to establish a limited picket line, prevent any further violence, and ensure the strike did not spread. No further violence took place at the mine site, a picket line was maintained for nine months, and no further attempts were made to open the mine during that period. Gibbs lost his superintendent position and never performed the haulage contract. He claimed to have lost other trucking contracts and mine leases in nearby areas as a result of a concerted union plan against him. He filed suit against the international UMW only, not against Local 5881 or its members, in the United States District Court for the Eastern District of Tennessee. Jurisdiction over the federal claim rested on alleged secondary boycotts under section 303 of the Labor Management Relations Act. Jurisdiction over the state law claim for unlawful conspiracy and boycott was premised on the doctrine of pendent jurisdiction. At trial the district court refused to submit claims of pressure on mining firms other than Grundy to cease doing business with Gibbs. The jury returned a verdict finding violations of both section 303 and state law and awarded $60,000 in damages under the employment contract, $14,500 under the haulage contract, and $100,000 in punitive damages. On post-trial motion the court set aside the haulage contract award for lack of proof of damages and sustained a remitted award on the state law claim alone. The Court of Appeals for the Sixth Circuit affirmed, and the Supreme Court granted certiorari.

In 1981, Curtis Campbell was driving with his wife Inez in Cache County, Utah, when he attempted to pass six vans on a two-lane highway. This caused an oncoming driver, Todd Ospital, to swerve onto the shoulder, lose control, and collide with a vehicle driven by Robert G. Slawson and his wife, killing Ospital and permanently disabling Slawson. Campbell's insurer, State Farm Mutual Automobile Insurance Company, declined settlement offers of the $50,000 policy limit from Slawson and Ospital's estate despite early investigations indicating Campbell's fault and advice from its own adjuster. A jury in the underlying tort actions found Campbell 100 percent at fault and returned a judgment of $185,849 against him. State Farm refused to pay the $135,849 excess over policy limits or post a supersedeas bond. The Campbells then entered an agreement with Slawson and Ospital's estate under which the claimants would not seek satisfaction of the judgment in exchange for the Campbells pursuing a bad-faith action against State Farm, being represented by the claimants' attorneys, and assigning 90 percent of any recovery to them. The Campbells sued State Farm for bad faith, fraud, and intentional infliction of emotional distress. The trial court bifurcated the case into two phases before separate juries. In phase one the jury found State Farm's refusal to settle unreasonable. In phase two the jury heard evidence that State Farm's decision was part of a nationwide Performance, Planning and Review policy implemented since 1979 to cap payouts and meet corporate profit goals, including testimony from former Utah employees and experts about practices in multiple states over twenty years. The jury awarded $2.6 million in compensatory damages and $145 million in punitive damages. The trial court reduced the compensatory award to $1 million and the punitive award to $25 million. Both sides appealed. The Utah Supreme Court reinstated the $145 million punitive damages award after applying the three guideposts from BMW of North America, Inc. v. Gore and relying on the nationwide evidence, State Farm's wealth, and the statistical likelihood of punishment in only one of 50,000 cases. The United States Supreme Court granted certiorari.

In January 1970 respondent A. Ernest Fitzgerald lost his job as a management analyst with the Department of the Air Force when his position was eliminated during a departmental reorganization and reduction in force. One year earlier, on November 13, 1968, Fitzgerald had testified before the Subcommittee on Economy in Government of the Joint Economic Committee that cost overruns on the C-5A transport plane could approximate $2 billion. Concerned that the dismissal might constitute retaliation for the congressional testimony, the subcommittee held public hearings. At a December 8, 1969 news conference President Richard Nixon promised to look into the matter and directed White House Chief of Staff H. R. Haldeman to arrange for Fitzgerald's reassignment to another administration position. An internal White House memorandum from aide Alexander Butterfield recommended that Fitzgerald "bleed, for a while at least" because of perceived disloyalty, and no further White House efforts to reemploy him occurred. Fitzgerald complained to the Civil Service Commission alleging unlawful retaliation. The Examiner held that Fitzgerald's dismissal had offended applicable civil service regulations based on a finding that the departmental reorganization was motivated by reasons purely personal to respondent. The Examiner recommended Fitzgerald's reappointment to his old position or to a job of comparable authority. The Commission explicitly found that the evidence did not support Fitzgerald's allegation of retaliation for his 1968 testimony. At a January 31, 1973 news conference President Nixon stated that he had approved Fitzgerald's dismissal. A day later the White House press office issued a retraction of the President's statement. In 1978 Fitzgerald filed a second amended complaint in the United States District Court for the District of Columbia naming Nixon as a defendant and alleging violations of the First Amendment and two federal statutes. The District Court denied Nixon's motion for summary judgment on absolute immunity grounds. The Court of Appeals for the District of Columbia Circuit dismissed the collateral appeal. Shortly after Nixon petitioned for certiorari the parties agreed that Nixon would pay Fitzgerald $142,000 immediately and an additional $28,000 if the Supreme Court ruled he was not entitled to absolute immunity.

In March 1989 the Exxon Valdez supertanker grounded on Bligh Reef in Prince William Sound, Alaska, releasing millions of gallons of crude oil. Exxon Shipping Company, the vessel's owner and now known as SeaRiver Maritime, Inc., together with its parent Exxon Mobil Corporation, confronted widespread liability from the spill. The company settled a class action brought by more than 32,000 commercial fishermen, Native Americans, landowners, and others for $2.5 billion in compensatory damages. Exxon also pleaded guilty to violations of the Clean Water Act, the Migratory Bird Treaty Act, and the Refuse Act, paying $150 million in criminal fines, and spent an additional $2.1 billion on cleanup. Respondents, other persons whose businesses and livelihoods were disrupted by the spill, filed this civil action seeking punitive damages. The United States District Court for the District of Alaska divided the plaintiffs into three classes and conducted a three-phase trial. In the first phase the jury found Exxon Shipping Company and Captain Joseph Hazelwood, the ship's master, reckless and therefore potentially liable for punitive damages. In the second phase the jury awarded $5 billion in punitive damages against Exxon. The District Court later reduced the punitive award to $2.5 billion. On appeal the Ninth Circuit reinstated the jury's original $5 billion punitive damages award. The Supreme Court granted certiorari to consider whether the $2.5 billion punitive damages award was excessive under maritime law.