Decision interferes with jury role in punitive damages, trial lawyers say

Chicago Daily Law Bulletin
By Bethany Krajelis
Law Bulletin staff writer

SPRINGFIELD – An individual’s right to have a jury decide damages is at risk if the Illinois Supreme Court does not reverse an appellate court ruling that sharply reduced a punitive damages award, the state’s trial lawyers argue.

In a friend of the court brief, the Illinois Trial Lawyers Association has urged the justices to send the state’s reviewing courts a clear message that it is not their place to disturb jury awards.

The group has joined the plaintiff in Jerry Slovinski v. James Elliott in asking the court to reinstate the jury’s $2 million award for punitive damages.

“If allowed to stand, the holding … threatens to reverse the value we place on permitting a jury of ordinary citizens to collectively determine that which will fairly compensate, that which will fairly punish and that which will adequately deter future harm,” the trial lawyers’ brief contends.

Tom Leahy, the attorney who recently represented Slovinski in arguments before the justices, said that the lower courts abused their discretion by reducing the jury’s award in the defamation case.

A Cook County jury awarded his client $2 million in punitive damages and $81,600 in compensatory damages. The trial judge reduced the punitives award to $1 million and the 5th District Appellate Court further reduced it to $81,600, equal to the compensatory damages.

ITLA’s brief asserts that while Supreme Court Rule 366 allows reviewing courts to order the entry of a remittitur, the rule is strict in saying that they should enter only an order “that ought to have been given or made” in the trial court.

In this case, the appeals panel did not analyze the trial court’s reduction for an abuse of discretion before it made a reduction of its own, the brief contends.

Leahy said that, before a trial court replaces a jury verdict, it must find “that the verdict was a result of passion, prejudice, bias or corruption,” a standard that was adopted in Deal v. Byford, 127 Ill. 2d 192, 204, 537 N.E.2d 267, 272 (1989).

Instead, Leahy and ITLA contend, the trial court improperly relied on Brown V. Farkas, 158 Ill.App.3d 772, 511 N.E. 2d 1143 (1st Dist. 1986).

The appeals court in Brown reduced the punitive damages award by nearly $1 million, which was on top of the trial court’s $1 million reduction.

“There can be no doubt that with regard to an appellate court’s appropriate use of the power of remittitur, the Brown case and the present case below are a clear departure from the overwhelming weight of Illinois jurisprudence,” the trial lawyers’ brief asserts.

The brief continued that “in neither the Brown opinion nor in the present order below did the appellate court elaborate upon its reasoning for reducing the punitive damages award at all, not to mention to the 1:1 ratio” between punitive and compensatory damages, which was the result in both cases.

The trial lawyers argue that the justices’ decision in this case also should overrule Brown.

“The one-to-one ratio of compensatory to punitive damages is now precedent,” Leahy told the justices in oral argument earlier this month. “Punitive damages in defamation cases are now capped at compensatory damages.”

But Jeffrey Patrick Guzak, who represented defendant in the case, told the justices that that lower courts did not abuse their discretion in reducing the jury award.

Guzak argued that the trial judge properly looked to other cases, such as Brown, for guidance in making the reduction. And while the court in Brown did not explain its reasoning for reducing the award, Guzak said, “it is still good law.”

“By far, this is the most on-point case we find,” Guzak said of Brown, adding that it did not explicitly establish a one-to-ratio for punitive and compensatory damages.

While Brown may not have mandated a one-to-one ratio, Leahy told the justices, “I know now that Slovinski does.”

“In the future, attorneys aren’t going to be citing Brown, they’re going to be citing Slovinski below if this decision is allowed to stand,” Leahy told the justices.

Although Guzak urged the justices to look to Brown for guidance, Leahy and ITLA contend there are distinguishing factors between Brown and Slovinski.

Brown dealt with a defamation claim stemming from the filing of a false report of child abuse, which is a criminal offense.

Slovinski also stemmed from a defamation claim, but one that did not involve a criminal offense.

Slovinski, a former CFO of a telecommunications company, accused Elliott, the former CEO, of telling some investors and employees of a telephone service provider that Slovinski was not doing his job.

Slovinski contends he had done his job, which including preparing financial statements for a meeting between Elliott and a telephone services provider to which the company owed money.

Slovinski asserted that Elliott had made the defamatory statements in an attempt to buy more time to pay the debt.

The Brown case was heard before a bench trial, according to the trial lawyers. The judge made the determination of damages in that case, unlike the jury did in Slovinski.

“In that sense, the job of the judge in Brown was just as difficult as that of the jury in the present case,” the ITLA brief argues. “Therefore, the appellate court in Brown was no more entitled to reject the damage determination of a fellow judge than this panel was to reject the work of the individuals who comprised the jury.”

But ITLA contends that “the distinction between the bench trial in Brown and the jury trial here calls greater attention to both the error of the appellate court in this case and the slippery slope caused by the erroneous decision in Brown.”

The brief urges the justices to reverse the appellate court in order to uphold the system that prevents a jury award from being overturned unless it’s the product of passion or prejudice.

“Any other system would require appellate and Supreme Court justices to weigh evidence and second-guess the jury, despite having an incomplete, second-hand view of the damages evidence presented to the jury,” the trial lawyers contend.

David M. Hundley wrote the brief on behalf of ITLA.

The case is Jerry Slovinski v. James Elliott, No. 107146.