Bocci v. Key Pharmaceuticals, Inc.

Decision Date14 November 2001
Citation35 P.3d 1106,178 Or. App. 42
PartiesPaul R. BOCCI, Jr., guardian ad litem for Paul R. Bocci, III, an incapacitated individual, Plaintiff, v. KEY PHARMACEUTICALS, INC., a foreign corporation, Schering-Plough Corporation, a foreign corporation, and Schering Corporation, a foreign corporation, Defendants, and Miles, Inc., an Indiana corporation, Miles, Inc., Pharmaceutical Division, an Indiana corporation, Legacy Health System, an Oregon corporation, Legacy Immediate Care Clinic, Frederick D. Edwards, M.D., and The Eugene Clinic, a partnership, Defendants. Frederick D. Edwards, M.D., Respondent, v. Key Pharmaceuticals, Inc., a foreign corporation, Schering-Plough Corporation, a foreign corporation, and Schering Corporation, a foreign corporation, Appellants.
CourtOregon Court of Appeals

35 P.3d 1106
178 Or.
App. 42

Paul R. BOCCI, Jr., guardian ad litem for Paul R. Bocci, III, an incapacitated individual, Plaintiff,
v.
KEY PHARMACEUTICALS, INC., a foreign corporation, Schering-Plough Corporation, a foreign corporation, and Schering Corporation, a foreign corporation, Defendants, and
Miles, Inc., an Indiana corporation, Miles, Inc., Pharmaceutical Division, an Indiana corporation, Legacy Health System, an Oregon corporation, Legacy Immediate Care Clinic, Frederick D. Edwards, M.D., and The Eugene Clinic, a partnership, Defendants.
Frederick D. Edwards, M.D., Respondent,
v.
Key Pharmaceuticals, Inc., a foreign corporation, Schering-Plough Corporation, a foreign corporation, and Schering Corporation, a foreign corporation, Appellants

A9210-07050; A86556

Court of Appeals of Oregon.

November 14, 2001.


35 P.3d 1107
William F. Gary, Eugene, James E. Mountain, Jr., Salem, Sharon A. Rudnick, and Harrang Long Gary Rudnick P.C., Eugene, for appellants

Daniel M. Holland, Ronald B. Terzenbach, Mary H. Spillane, Margaret A. Sundberg, and Williams, Kastner & Gibbs PLLC, Seattle, WA, for respondent.

Before LANDAU, Presiding Judge, and DEITS, Chief Judge, and BREWER, Judge.

LANDAU, P.J.

This case is before us on remand from the Oregon Supreme Court. Previously, we affirmed by an equally divided court the trial court judgment in favor of defendant Frederick D. Edwards on his cross-claim against defendant Key Pharmaceuticals, Inc. (Key). Bocci v. Key Pharmaceuticals, Inc., 158 Or. App. 521, 974 P.2d 758 (1999) (en banc). The issue on which we divided concerned the validity and treatment of a Mary Carter agreement between plaintiff Bocci and defendant Edwards. See id. at 527-36, 974 P.2d 758 (Riggs, J. pro tempore, concurring), 548, 974 P.2d 758 (Edmonds, J., dissenting), 548-64, 974 P.2d 758 (Landau, J., dissenting). The concurring opinion also discussed the validity of a punitive damage award and concluded that the award did not violate the Due Process Clause of the Fourteenth Amendment to the United States Constitution. Id. at 545-47, 974 P.2d 758 (Riggs, J. pro tempore, concurring). The Supreme Court vacated our decision and remanded the case for reconsideration in light of its decision in Parrott v. Carr Chevrolet, Inc., 331 Or. 537, 17 P.3d 473 (2001). Bocci v. Key Pharmaceuticals, Inc., 332 Or. 39, 22 P.3d 758 (2001). On remand, we affirm, writing only to discuss whether the punitive damage award violates due process.

The pertinent facts are set forth in our previous opinions and will be summarized

35 P.3d 1108
only briefly here. Plaintiff Bocci was a long-time user of defendant Key's prescription asthma medication Theo-Dur, a timed-release theophylline product. In October 1990, Bocci was prescribed the antibiotic ciprofloxacin for a skin rash, but failed to tell the prescribing physician that he was taking Theo-Dur. On October 27, 1990, Bocci went to an urgent care clinic where Edwards worked complaining of nausea, vomiting, and diarrhea. Edwards diagnosed gastroenteritis and sent Bocci home. Edwards did not diagnose theophylline toxicity, because Theo-Dur had been promoted to him as a safe drug, and he did not believe that a patient on a stable dose of the drug could develop a serious toxicity problem. Shortly after Edwards sent him home, Bocci experienced seizures and was admitted to a hospital emergency room. He was treated for theophylline toxicity. He suffered permanent brain damage from the seizures

Bocci sued Key and Edwards, but entered into a Mary Carter agreement with Edwards that had the effect of limiting Edwards's potential liability for Bocci's injuries. Edwards cross-claimed against Key for negligence and fraud on the ground that Key had failed to provide adequate information concerning the potential toxicity of Theo-Dur. The jury returned verdicts in favor of Bocci and Edwards against Key. The jury awarded Bocci more than $5 million in compensatory damages and $35 million in punitive damages. The jury awarded Edwards $500,000 in compensatory damages and $22 million in punitive damages.

Key moved for a judgment notwithstanding the verdict or, in the alternative, for a new trial or remittitur. It argued that the punitive damage awards needed to be reviewed as required by Honda Motor Co. v. Oberg, 512 U.S. 415, 114 S.Ct. 2331, 129 L.Ed.2d 336 (1994), and Pacific Mutual Life Insurance Co. v. Haslip, 499 U.S. 1, 111 S.Ct. 1032, 113 L.Ed.2d 1 (1991). Key made no distinct arguments pertaining to Edwards's punitive damage award, but it argued that the total punitive damage award of $57 million in favor of Bocci and Edwards was excessive because their "own errors gave rise to their injuries." Key summarized the procedures from Haslip as requiring that the trial court review the award and state on the record its reasons for concluding that the award is not excessive and as requiring the appellate court "to review the award to ensure that it is reasonable in its amount and rational in the light of the purpose of punishment and deterrence." It cited as relevant to post-verdict review the culpability of the defendant's conduct, the desirability of discouraging others from similar conduct, and the impact on the parties as well as the impact on innocent third parties. It also argued that the trial court's post-verdict review "should be guided by the criteria in ORS 30.925 [for product liability punitive damage awards], which resemble those in Haslip and will serve as minimums in the absence of a definitive ruling by the Oregon Supreme Court." Key then quoted the criteria from ORS 30.925(2):

"(a) The likelihood at the time that serious harm would arise from the defendant's misconduct;
"(b) The degree of the defendant's awareness of that likelihood;
"(c) The profitability of the defendant's misconduct;
"(d) The duration of the misconduct and any concealment of it;
"(e) The attitude and conduct of the defendant upon discovery of the misconduct;
"(f) The financial condition of the defendant; and
"(g) The total deterrent effect of other punishment imposed upon the defendant as a result of the misconduct, including, but not limited to, punitive damage awards to persons in situations similar to the claimant's and the severity of criminal penalties to which the defendant has been or may be subjected."

The trial court reviewed the award and concluded that it was not excessive.

On appeal, Key significantly changed its arguments. As noted in the concurring opinion in our previous decision:

"Key argues for the first time on appeal that the trial court erred in failing to review the punitive damage award to Edwards independently of the punitive damage
35 P.3d 1109
award to Bocci, because the statutory criteria from ORS 30.925 apply to strict liability punitive damage awards, and Edwards's claims involved negligence and fraud. Not only did Key fail to
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  • Goddard v. Farmers Ins. Co. of Oregon, 9005-03204; A118750.
    • United States
    • Supreme Court of Oregon
    • October 12, 2005
    ...Or.App. 172, 180-81, 78 P.3d 570 (2003) (Waddill IV),21 and decline to revisit the issue here. See also Bocci v. Key Pharmaceuticals, Inc., 178 Or.App. 42, 50, 35 P.3d 1106 (2001), vac'd and rem'd on other grounds, 538 U.S. 974, 123 S.Ct. 1781, 155 L.Ed.2d 662 (2003) (rejecting argument tha......
  • Williams v. Philip Morris Inc.
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    ...damages as a matter of law—that is, by plenary review—rather than for an abuse of discretion. See also Bocci v. Key Pharmaceuticals, Inc., 178 Or.App. 42, 50-51, 35 P.3d 1106 (2001), rev. pending (2002). That is consistent with the way that we have always reviewed trial court decisions rega......
  • Williams v. Philip Morris Inc.
    • United States
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    • June 9, 2004
    ...of punitive damages in Bocci, before the decision in State Farm, we applied Parrott and affirmed the award. Bocci v. Key Pharmaceuticals, Inc., 178 Or.App. 42, 35 P.3d 1106 (2001). On remand from the Court after its decision in State Farm, we reevaluated the jury's award in light of the Gor......
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    ...not de novo review of the facts that the jury found that give rise to an award of punitive damages. See Bocci v. Key Pharmaceuticals, Inc., 178 Or.App. 42, 50-51, 35 P.3d 1106 (2001), rev. den., 334 Or. 260, 47 P.3d 486 (2002), vac'd, ___ U.S. ___, 123 S.Ct. 1781, 155 L.Ed.2d 662, on remand......
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