Carlson & Erickson Builders, Inc. v. Lampert Yards, Inc.Carlson & Erickson Builders, Inc. v. Lampert Yards, Inc.
This is a review of a published decision of the court of appeals,
Carlson & Erickson Builders, Inc. v. Lampert Yards, Inc.,
Two questions are presented to this court: (1) Which burden of proof applies to private, civil antitrust actions under Chapter 133, Stats. 1991-92, the Wisconsin antitrust law? (2) Did the circuit court err in ordering a remittitur?
The plaintiff, Carlson & Erickson Builders, commenced this private, civil antitrust action against defendants Lampert Yards, Inc., Portside Properties, Inc., and Door County Material Specialists, Inc., (DCMS), in July of 1990. The circuit court instructed the jury on the ordinary, civil burden of proof. Applying this burden of proof, the jury found that Lampert Yards had intentionally discriminated in price between the plaintiff and Portside Properties and that it had allowed unearned discounts and extended special services and privileges not extended to all purchasers upon like terms and conditions in violation of secs. 133.04 and 133.05, Stats. 1991-92.
Because the court of appeals remanded for a new trial on all issues, it did not address Carlson & Erickson Builders’ cross appeal challenging the circuit court’s remittitur order. By its cross appeal, Carlson & Erickson Builders preserved its right of appeal on this issue. Carlson
&
Erickson Builders asks this court to decide the issue on the briefs or remand the issue to the court of appeals for decision. After examining all the parties’ briefs on this issue, we decide this issue rather than remand it to the court of appeals in order to advance the interests of judicial economy, speedy resolution of appeals, reduced costs to the litigants, and finality of decisions.
1
After reviewing the record, we conclude that the circuit court erred in determining that the jury’s award was excessive and in ordering remittitur.
2
Accordingly, we remand the cause to the
I.
We turn first to the question of the burden of proof (persuasion) standard in private, civil antitrust actions under chapter 133. Because the facts upon which the jury decided liability and damages are not relevant for this issue, we do not recite them.
Wisconsin law recognizes three degrees of burden of proof. In criminal eases the jury is told that the state has the burden to convince the jury beyond a reasonable doubt.
3
In certain civil cases, a higher civil standard is used; the jury is told that a party has the burden to convince the jury to a reasonable certainty by evidence that is clear, satisfactory and convincing.
4
In most civil cases the lower, ordinary burden of proof applies; the jury is told that a party has the burden to
Determination of the appropriate burden of proof in this case presents a question of statutory interpretation, a question of law which this court determines independently of other courts, benefitting from their analyses. 6 The principal objective of statutory interpretation is to ascertain and give effect to the intent of the legislature.
The statute is silent about the burden of proof in antitrust cases. No statutory history exists on the specific issue of the burden of proof for.a civil violation of ch. 133. We must therefore look to other indicia of legislative intent.
According to the defendants, one indicator of legislative intent is the longstanding Wisconsin case law applying the middle burden of proof in eases which the defendants analogize to antitrust eases.
7
The
Wisconsin cases have long applied the middle burden in civil actions involving such matters as punitive damages, conduct that could be prosecuted as a crime, and allegations of fraud and undue influence.
8
The
The defendants argue that a private, civil antitrust action is similar to cases in which the courts have applied the middle burden. They analogize treble damages awarded in a successful private, civil antitrust action to punitive damages to which the middle burden applies.
9
Further they point out that the
conduct prohibited under chapter 183 may subject the perpetrator
Accordingly, the defendants urge the court to follow this line of cases applying the middle burden of proof and to hold that, because treble damages in private, civil antitrust actions are comparable to punitive damages, and because violations of the antitrust laws may constitute a crime and stigmatize the defendants, the added protections of the middle burden are required in this private, civil antitrust action. The court of appeals adopted this approach in interpreting ch. 133.
Standing alone without analysis of the purpose and policies of the private, civil antitrust suit, the analogy between the cases imposing the middle burden of proof and treble damages in a private, civil antitrust action may seem apt. Yet, the court must examine the cases imposing the middle burden of proof— imposing a barrier to a claimant’s relief — in the context of the purpose
Antitrust laws are intended to prevent restraints on free competition, restraints which can harm purchasers, consumers of goods and the public. The importance of the antitrust laws in preventing monopolies and encouraging competition, “the fundamental economic policy of this state,” is directly reflected in the statement of legislative intent in sec. 133.01, Stats. 1991-92, and in the ease law.
American Medical Transport v. Curtis-Universal Inc.,
The Wisconsin legislature determined that private, civil antitrust suits are important methods of enforcing chapter 133. To encourage private enforcement, the legislature built incentives into the statute. These include tolling the statute of limitations under certain circumstances, allowing the cost of the suit, including reasonable attorney fees to prevailing claimants, awarding treble damages,
13
and granting expedited treatment to civil antitrust actions in the courts. Section 133.18(l)(a), (3), (5);
Kink v. Combs,
Thus, there is a “longstanding policy of encouraging vigorous private enforcement of antitrust laws.” 16 We must construe and apply the antitrust laws with the important role of private actions in mind. The court assumes that the legislature intended an interpretation that advances, not hinders, the purposes of the statute.
Applying the ordinary civil burden of proof to private, civil antitrust actions bolsters the legislative purpose of the antitrust statutes. The ordinary civil burden of proof standard allows both parties to “share the risk of error roughly in equal fashion.”
Ad-dington v. Texas,
Application of the lower, ordinary burden of proof also comports with the federal courts’ interpretation of federal antitrust law. At the time of the enactment of the Wisconsin antitrust law, the Wisconsin legislature intended to follow interpretations of the federal act for those sections of ch. 133 that were patterned after the federal Sherman
Act.
18
Madison v. Hyland, Hall & Co.,
Federal courts have applied the ordinary standard of proof to private, civil antitrust cases.
20
According to the defendants, the federal law on the standard of proof should not apply because treble damages in antitrust actions have been characterized differently in federal and Wisconsin cases. The defendants claim that the purpose of treble damage awards in federal antitrust cases is to encourage private enforcement of the antitrust laws and supplement the government enforcement apparatus. Thus federal law characterizes treble damages as “designed primarily as a remedy.”
21
The defendants argue that the Wisconsin courts, in contrast, view the treble damage award as punitive in nature to the extent damages exceed actual damages.
22
Based on this examination of the purpose and policies underlying antitrust law, including the federal courts’ application of the lower, ordinary burden, upon
II.
We next consider the question of the remittitur. The rule for remittitur was established by
The standard for appellate review of a circuit court’s remittitur order was also established by
Powers v. Allstate Ins. Co.,
If, however, a circuit court fails to analyze the evidence supporting its conclusion that the damage award is excessive, or fails to state the reasoning behind its decision, the reviewing court should place no weight upon the trial court’s findings. In such a situation, the reviewing court must then review the entire record and determine, as a matter of first impression, whether the jury award is excessive.
28
In conducting its analysis,
In its written ruling on the defendants’ motion to reduce the verdict in this case, the circuit court summarized the conflicting evidence on damages. The circuit court explained why the plaintiff should not be awarded damages for 1983 and 1989. The circuit court declared, however, without explanation that the jury award was excessive and was not “substantiated by any evidence.” The circuit court further asserted that “[i]t appears that the jury simply divided [the plaintiffs expert’s highest calculation of damages] in half.” The circuit court did not evaluate the evidence or point out in which respects the evidence did not support the jury verdict. It did not explain why the jury’s determination of damages, which fell within the range of the evidence on damages, represented an invalid compromise. Furthermore, although the circuit court stated that it was using a 4% differential to calculate the remittitur, it then figured the remit-titur on a 5% differential and did not state the basis for its conclusion that the 5% figure or the reduced award was reasonable. While the circuit court did not expressly determine that the jury award was not due to perversity, prejudice or error during the course of trial, that inference can be drawn from the decision.
The circuit court’s decision implicitly reduces the award on four grounds: (1) there was no basis for the jury’s calculation of a 7½% price differential; (2) it
We conclude that the circuit court erred in failing to look at the evidence in the light most favorable to the plaintiff, in determining that there was not sufficient evidence to support the jury’s verdict, and in concluding that the award was excessive.
The evidence on damages is set forth briefly. The parties presented evidence that the prices Lampert Yards charged the plaintiff for building materials were higher than the prices charged Portside Properties and DCMS for the years 1983-1989. 30 Because exact documentation was not available, witnesses used varying methods of evaluation and drew conflicting conclusions about the extent, if any, of the differential. Despite the differing calculations and conclusions of the witnesses, the evidence, taken as a whole, suggested a likely range of price differences for various items sold by Lampert Yards.
Plaintiffs witnesses testified that Lampert Yards discounted goods sold to Portside Properties from about 12% to 20%. The plaintiffs expert witness, although not purporting to determine the actual price
The defendants have argued throughout the course of this case that the plaintiff has suffered no damages. One defense witness testified that Lampert Yards charged DCMS, depending on the year, between 2% and 7.5% less than the supplier charged the plaintiff. Another testified that Lampert
Yards discounted its sales to Portside Properties by 4% to 8%. The defendants’ expert witness calculated a price difference of 4.6% to 4.7%. Defense witnesses concluded, however, that the discounts were immaterial and the plaintiff suffered no damages, because of a variety of factors including market conditions, the plaintiffs methods of doing business, and Lampert Yards’ performing functions for the plaintiff which the other defendants
The jury set damages at $177,000. This figure would, the circuit court computed, reflect a 7½% differential in prices, exactly one-half of the highest calculation offered by the plaintiffs expert. The circuit court then concluded that this “figure is not substantiated by any evidence.” While it is true that there was no definitive proof of the
exact
price differential, and no evidence explicitly established an exact 7½% price differential, evidence of damages is sufficient if it enables the fact-finder to make a fair and reasonable approximation.
Brogan v. Industrial Cas. Ins. Co.,
The circuit court apparently concluded that the defendants’ evidence placing the cost differential at somewhere between 0 and 7% or 8% was more credible than the plaintiffs evidence of a higher differential and that the years 1983 and 1989 should not be considered for damage purposes. Using the plaintiffs expert’s calculations of the plaintiffs purchases from Lampert Yards and 5% as the price differential for the
We conclude that the circuit court’s decision fails to give sufficient consideration to the evidence supporting the jury’s award. When the jury hears conflicting testimony about unliquidated damages, its verdict should not be disturbed on review when it is clear that the award arrived at is well within the range of figures placed in evidence, and that there is credible evidence to sustain the jury’s finding. The capacity of the jury to approximate a fair estimate is especially important when the jury is not able to make “an exact mathematical computation” of the claimant’s damages. In such a case the jury must use its best judgment to arrive at a fair result and, to that end, its award may reflect a compromise.
Tetzlaff v. Pilot Press, Inc.,
The witnesses introduced a range of figures, and the defendants introduced evidence discrediting the plaintiff’s damage calculations. In reaching a damage award, the jury could have accepted and rejected parts of each party’s evidence. The compromise nature of the damage award gives rise to an inference that the jury
The circuit court did not explain why the jury’s award was excessive in light of the evidence. Furthermore,
Viewing the evidence in the light most favorable to the plaintiff, under either standard of review, erroneous exercise of discretion or ah initio review, we conclude that the circuit court erred. Accordingly, we reverse the decision of the court of appeals. We remand the cause to the circuit court with directions to vacate the circuit court’s order of remittitur, to determine the cost of the suit, including reasonable attorney fees, and to enter judgment in accordance with the jury award of damages ($177,100), trebled, and the cost of the suit, including reasonable attorney fees, as the circuit court determines.
The judgment of the court of appeals is reversed and the cause is remanded to the circuit court with directions.
Notes
. Defendant Lampert Yards, Inc. asks us to exercise our discretion to review its challenge in the court of appeals to the sufficiency of the evidence on liability.. The court of appeals examined the record and addressed the question of the sufficiency of evidence to support the verdict, concluding that there was “extensive evidence" on each of the elements and that “the trial court properly denied defense motions for summary judgment, directed verdict and judgment notwithstanding the verdict.”
Carlson & Erickson Builders, Inc. v. Lampert Yards, Inc.,
. The circuit court granted Carlson & Erickson Builders the option of a reduced verdict of $67,-907.65 (trebled as provided in sec. 133.18(l)(a), Stats.1991-92) or a new trial on damages. (The jury found the sum of $177,100 would fairly and reasonably compensate the plaintiff for its injury.)
. Wis JI-Criminal 140 (Rel. No. 32 — 11/94) provides inter alia: “Before you can return a verdict of guilty, the evidence must satisfy you beyond a reasonable doubt that the defendant is guilty.”
. Wis. JI — Civil 205 (1990) sets forth the "middle” burden of proof as follows: "The burden of proof ... is ... to convince you to a reasonable certainty by evidence that is clear, satisfactory, and convincing ...”
. Wis JI-Civil 200 (1991) provides: "The burden of proof ... is to satisfy you to a reasonable certainty by the greater weight of the credible evidence.... By the greater weight of the evidence is meant evidence which when weighed against evidence opposed to it has more convincing power.”
. "Where Congress has not prescribed the appropriate standard of proof and the Constitution does not dictate a particular standard, we must prescribe one.”
Herman & MacLean v. Huddleston,
. The parties cite no Wisconsin case, nor have we located one, that specifically addresses the applicability of the middle burden of proof to a private, civil antitrust cause of action.
In
State v. Fonk’s Mobile Home Park and Sales Inc.,
.
Macherey v. Home Ins. Co.,
In a parole revocation hearing, a statutorily prescribed proceeding, the court did not look to the line of civil cases applying the middle burden of proof but rather applied the ordinary burden of proof, even though file basis for the revocation was allegedly criminal conduct.
State ex rel. Flowers v. H & SS Dept.,
For discussions of the higher standard of proof in civil cases, see Note, Appellate Review in the Federal Courts of Findings Requiring More than a Preponderance of the Evidence, 60 Harv.L.Rev. 111 (1946); 2 McCormick on Evidence sec. 340 (4th ed. 1992).
.See John Mohr & Sons, Inc. v. Jahnke,
The court has recognized, however, that common-law punitive damages are "distinguishable
from statutory multiple damages” and "the two forms of damages must be treated separately.”
Cieslewicz v. Mutual Serv. Casualty Ins. Co.,
. Carlson & Erickson Builders, Inc. v. Lampert Yards, Inc.,
.
See Herman & MacLean v. Huddleston,
. Sec. 133.01, Stats.1991-91, provides:
133.01 Legislative Intent. The intent of this chapter is to safeguard the public against the creation or perpetuation of monopolies and to foster and encourage competition by prohibiting unfair and discriminatory business practices which destroy or hamper competition. It is the intent of the legislature that this chapter be interpreted in a manner which gives the most liberal construction to achieve the aim of competition. It is the intent of the legislature to make competition the fundamental economic policy of this state and, to that end, state regulatory agencies shall regard the public interest as requiring the preservation and promotion of the maximum level of competition in any regulated industry consistent with the other public interest goals established by the legislature.
. The purpose of treble damages in chapter 133 is to give citizens an incentive to prosecute actions under chapter 133.
Gerol v. Arena,
. The self-interest of individuals and business makes the private party an excellent antitrust enforcer and is the cornerstone of competitive capitalism. Paul S. Ferber, Introductory Comments: Antitrust Symposium: The Effectiveness of the Private Treble Damages Action As An Antitrust Enforcement Mechanism, 8 Sw.U.L.Rev. 505, 507 (1976); Maxwell M. Blecher, The Only Game in Town, 8 Sw.U.L.Rev. 550, 556 (1976).
. Many reported state and federal antitrust cases arise in actions brought by private parties. Neil Hamilton & Virginia B. Cone, Mitigation of Antitrust Damages, 66 Or.L.Rev. 339, 350-51 (1987); Richard Posner, A Statistical Study of Antitrust Enforcement, 13 J. Law & Econ. 365, 388-95 (1970).
.
Illinois Brick Co. v. Illinois,
.
Blue Shield v. McCready,
. Defendant Lampert Yards points out that there are differences between secs. 133.04 (relating to price discrimination) and 133.05 (relating to secret discounts) and their federal prototypes. These differences in the underlying claims in the federal and state statutes are not determinative of the issue of the burden of proof. More significant than these differences is the similarity of the private right of action in both the federal and state statutes.
.
Grams v. Boss,
For an analysis of the historical development of antitrust law in Wisconsin, see Ralph J. Geffen, Antitrust Law in Wisconsin: Historical Development, 1951 Wis.L.Rev. 657.
.
Ramsey v. United Mine Workers,
.
Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc.,
.
John Mohr & Sons, Inc. v. Jahnke,
For discussions of the penal and remedial nature of treble damages, see, e.g., Robert H. Lande, Are Antitrust “Treble Damages” Really Single Damages?, 54 Ohio St.LJ. 115 (1993) (positing that " ‘treble damages' actually awarded are probably at most as large as the damages caused by the violation”); Lawrence Void, Are Threefold Damages Under the Antitrust Act Penal or Compensatory?, 28 Ky.L.J. 117 (1940) (contending that criminal penalty is punishment; treble dam- ' ages are compensation for ordinarily nonrecoverable damages).
.
Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc.,
.
Olson v. Siordia,
.
See, e.g., Fahrenberg v. Tengel,
.
Koele v. Radue,
.
Olson v. Siordia, 25
Wis.2d 274, 284-85,
.
Fahrenberg v. Tengel,
.
Koele v. Radue,
. Aside from the higher material prices, there was evidence of the plaintiff's profits and losses for various years but the amount of loss of profits caused by Lampert Yards was not shown in any detail except for the increased cost of materials.
. The plaintiff's expert, Professor J.R. Nevin, calculated the overcharge based upon the depositions, the plaintiff's financial statements, interviews with plaintiff's principals and accountant, and market data regarding the construction industry in Door county. He estimated the percentages of purchases made by the plaintiff from Lampert Yards and then assumed and assigned different percentages of overcharges to the plaintiff compared to charges to Portside Properties and DCMS. In addition he added an “inflation adjustment factor which increased each year's overcharge figure to a present day value.” Using the calculation of a 15% overcharge to the plaintiff compared to the charges to the other defendants, Professor Nevin concluded that the overcharge was $354,200; using a 10% calculation of overcharge resulted in damages of $236,134; and using a 5% calculation of overcharge resulted in damages of a total of $118,067. Professor Nevin’s calculations did not include damages for specific lost sales to Portside Properties or damages for lost profits or lost reputation.
.Indeed the jury was instructed that "the determination of damages cannot in many instances, such as in the loss of profits, be made exactly or with mathematical precision. You should award damages which will fairly compensate the named party for its injuries. The amount to be inserted by you in answer to the damage question is for you to determine from the evidence.... Examine the evidence carefully and dispassionately and determine your answer from the evidence in the case.”
. For example, the plaintiff asserts that the jury could have determined the price differential was 15% but could have accepted various aspects of the defendants' evidence that the plaintiff would not have realized the full 15%.
. Three kinds of "jury compromises” on damages are described in the cases and should be distinguished: A “jury compromise" on damages in a case of unliquidated damages; a "jury compromise” on damages in a case in which the damages are liquidated or the defendant does not contest the damages; and a "compromise verdict.”
In a case where damages are
unliquidated
and there is conflicting evidence, a jury may reach a figure that lies somewhere between the parties’ claims. Such a verdict, if supported by the evidence, can stand.
National Fire Ins. Co. v. Great Lakes Warehouse Corp.,
In a case where damages are
liquidated,
that is, mathematically calculable with certainty, or uncontested by the opposing party, a jury verdict of one-half what the injured party claims (or some other figure substantially less than what that party asserts) shows that the jury did not consider the evidence and that the jury compromised between the right of recovery and the amount of recovery. Such a verdict cannot stand.
National Fire Ins. Co. v. Great Lakes Warehouse Corp.,
A "compromise verdict” occurs when the jury, unable to agree on liability, compromises that disagreement and enters a grossly low award of damages. This compromise verdict between liability and recovery cannot stand.
Yarbrough v. Sturm, Ruger & Co.,