371 S.W.3d 83
Mo. Ct. App.2012Background
- Defendant and Mitchell co-founded Plaintiff in 1999 to handle property-damage restoration; Plaintiff coordinated restoration services for owners and insurers.
- In 2003, Defendant and Mitchell formed BoardUp to lead-generate for restoration firms; Plaintiff became its first franchisee and licensed the BoardUp phone number.
- After a deteriorating relationship, they dissolved their associations by Settlement Agreement in Sept. 2007; Defendant paid Mitchell $85,000 for Mitchell’s BoardUp interest and became sole BoardUp owner; Mitchell paid Defendant $80,000 for Plaintiff and became Plaintiff’s sole owner.
- Defendant posted three defamatory reviews about Plaintiff in 2008, two on March 31 (Google and Yahoo) and one on April 8 (Google, anonymous), using fictitious customer names.
- Yahoo identified Defendant as the poster on June 20, 2008; Defendant admitted authorship to Mitchell on July 1, 2008; the reviews remained online for varying durations.
- Plaintiff sued Defendant for defamation, with Plaintiff alleging reputational and pecuniary damages; jury awarded $1 actual damages and $150,000 punitive damages; BoardUp and others were dismissed; post-trial motions denied.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Plaintiff proved actual damages for defamation | Plaintiff showed reputational harm and resulting pecuniary losses | Plaintiff failed to prove actual damages; evidence was speculative | Substantial evidence supported actual damages |
| Whether JNOV was proper given nominal-appearing damages | N/A | Jury award reflected actual damages despite nominal appearance | No reversible error; cannot speculate on jury reasoning |
| Whether punitive damages violate due process given $1 actual damages | Punitive damages appropriate for egregious conduct | Ratio too high; violates due process | Punitive award within due process under circumstances; de novo review affirmed |
| Whether the punitive damages amount was appropriate given Gore/ Campbell framework | Zoning for deterrence and punishment justified by conduct | Disproportionate to actual damages | Award upheld; factors weighed support deviation from single-digit ratio |
Key Cases Cited
- Kenney v. Wal-Mart Stores, Inc., 100 S.W.3d 809 (Mo. banc 2003) (proves actual damages may rely on third-party testimony; not mere plaintiff’s claim)
- Bauer v. Ribaudo, 975 S.W.2d 180 (Mo. App. W.D. 1997) (damages proof cannot be too speculative)
- Taylor v. Chapman, 927 S.W.2d 542 (Mo. App. E.D. 1996) (plaintiff failed to prove actual damages; lack of support)
- Johnson v. Allstate Indem. Co., 278 S.W.3d 228 (Mo. App. E.D. 2009) (submissible case requires substantial evidence)
- Overcast v. Billings Mut. Ins. Co., 11 S.W.3d 62 (Mo. banc 2000) (context for damages and defamation standard)
- Gore v. BMW of N. Am., Inc., 517 U.S. 559 (1996) (due process limits on punitive damages; reprehensibility factors)
- Campbell v. State Farm Mut. Auto. Ins. Co., 538 U.S. 408 (2003) (guides review of punitive damages; deference to factual context)
- Estate of Overbey v. Chad Franklin Nat. Auto Sales N., LLC, 361 S.W.3d 364 (Mo. banc 2012) (statutory cap context for punitive damages ratios)