MODERN MANAGEMENT CO. v. Wilson

Before BLACKBURNE-RIGSBY and THOMPSON, Judges, and Associate SCHWELB, Judge. Senior BLACKBURNE-RIGSBY, Associate Judge:

This case arises from an unconscionable whereby ap- real estate transaction Wilson, pellee, suffering Maria-Theresa problems facing from health foreclo- (that sure, transferred title to her home twenty-two years) appel- she owned for Abell, appel- lant Vincent the sole owner of Management Company lant Modern (“Modern Appellant Management”). Cal- Baltimore, represented vin who himself as lender, money knocked on Wilson’s door days three before her house was scheduled them constitutionally excessive. 1) addition, go into foreclosure and convinced her to In they contend that the trial appellants’ court erred in participate permitting scheme. Wilson Wilson to pursue Abell, her admitting transferred title to her home to but RICO claims and evidence transaction, that appellants completed under the terms of the had one she hundred transactions, similar which caused the mortgage pay- jury remained liable for the 2) awards; to inflate ments and became a tenant in her own fact, compensatory damage home. her award must be monthly “rent” exceed- reduced the amount of the settlement previous ed amount of mortgage agreement Wilson reached before trial payments. Wilson soon defaulted on the 3) co-defendant;2 with “lease,” appellants’ former brought pro- Abell eviction the trial court in submitting erred ceedings against her to remove her from jury the issue of whether Wilson was a her own home. CPPA; “consumer” as defined in the trial, Following jury appellants Vin- 4) finding verdict appellants liable Abell, cent Management Compa- Modern for common law fraud and for violations of ny, and Calvin Baltimore were all found against CPPA was weight of the liable for common law fraud and for violat- evidence. ing the D.C. Consumer Protection Proce- First, we analysis focus our on the issue (“CPPA”) Act dures for their various mis- of whether the punitive damages awarded representations and omissions of material by the jury are unconstitutionally exces- facts and for including “unconscionable sive, and then we address each of the terms” in the transaction.1 The remaining issues turn. uphold We $60,000 awarded Wilson in compensatory punitive damages awards against entered damages for the common law fraud and appellants. For the explained reasons violations, CPPA which the trial judge tre- fully below, more issues, we affirm on all pursuant CPPA, bled to the D.C.Code but remand and direct the trial court to 28-3905(k)(l), § and $40,000 apply the setoff to the treble Abell, against amount of million $2 $1.1 award. million against Management, Modern Baltimore, respectively. I. We affirm. Background

Appellants raise a sharply contested is- sue of considerable importance by chal- Appellant pur- Maria-Theresa Wilson lenging the award of chased her house at Taylor Street alleging Statute, 1. Wilson filed suit common law and Usury the District of Columbia statutory pursuant fraud (2009 Racketeer In- § Supp.). D.C.Code 28-3301 Organizations CoiTupt fluenced and ("RICO”), Act 1961-1964.; §§ 18 U.S.C.A. Appellants also contend that the trial court District of Columbia Consumer Protection failing judgment erred in post-trial to enter on (“CPPA”), Procedures Act §§ D.C.Code 28- unpaid their despite counterclaim for rent (2001 Supp.); 3901 to-3905 & 2009 the Truth they present fact that did not the counter- ("TILPA”), Lending In Practices Act jury. claim to the supports The record 1635-1640; §§ U.S.C.A. the District of Co- finding trial appellants' court’s counter- Act, Sharking § lumbia Loan D.C.Code 26- appellants claim had no merit as conceded at (2009 Supp.); the District of Columbia "only trial that the counterclaim was relevant Act, Consumer Credit Services Amendment rescission,” in the event of and Wilson elected (2001); §§ D.C.Code 28-4601 to -4603 damages over rescission. Ownership Home Equity Protection Act ("HOEPA”), 1602, 1639; §§ 15 U.S.C.A. current, pay your mortgage will also in 1981. She lived there con- We Northwest foreclosure, lease the home back stop when she suffered a tinuously until prevented give you at work that injury you money severe head some you, give being consistently. to work you her from able continue buy back when a chance injury in Wilson suffered After her imme- home. Please call your to live in her to injuries causing head two additional help.” diately for and suffer seizures. Wil- develop epilepsy fact, pub- certified Baltimore was not a In fifty began spending approximately son (CPA) and he claimed lic accountant elderly her time at her mother’s percent of money language lender was trial that the (a away from the house few blocks house in error his business card printed on Street) health Taylor on due Wilson’s company where he ordered printing and in order to care for her problems company prepared Baltimore’s his cards. of her father. mother after death contracts for Vincent pre-foreclosure registered Taylor June Wilson Abell, Man- owner/manager of Modern housing home as rental with the Street actually Baltimore did not agement, but Department of District of Columbia Con- himself money. lend Baltimore described part prop- Affairs and leased sumer Abell, for and said as a “consultant” income, tenants for additional but erty to pre-foreclo- responsible for Abell’s he always kept keys a set of to the house she approaching and for sure transactions space and maintained room there the fore- prepare sign homeowners to work on her art.3 She also continued to After contracts on Abell’s behalf. closure receive mail at the house and listed it as card, his Wilson called Baltimore seeing on her District of her residence Columbia up appointment an be- immediately to set card, which was issued in identification upcoming foreclosure. fore September In Wilson received a 30, 2003, Baltimore September On indicating that foreclosure notice she had her met with Wilson and friend Wilson’s $42,525 2, 2003, pay at least October buy the for home and offered to house September foreclosure. On avoid offer, stating: declined the cash. Wilson days five before the scheduled fore- selling my proper “I’m not interested date, appellant Baltimore closure Calvin an ty[,] keep I’d like to be able to it.” As home, left a business card Wilson’s ad- alternative, offered Baltimore Wilson himself on the front of the card vertising whereby Wilson would option, lease-back as: $2,100 living month to continue pay per Lenders, Money Company, “Baltimore home. Wilson declined this offer as her Homes, Hours, Buy and Sell Seven only could a maxi well because she afford Week, Days Specialists, Foreclosures $1,800. monthly payment mum After Baltimore, President, CEO, Calvin Abell over getting approval from CPA.” Baltimore offered the lease phone, Wilson The back of the card read: $1,800 for a month. Wilson option back “Agreement an to Sell Real Es signed help you equity will to save the “We home, tate,” signed by buy your prepared home. will which was your pay We Baltimore, “Agent your mortgage, pay you your equity. who listed himself as off $1,500. charged monthly proximately $625 her tenant Wilson rent, mortgage payments ap- while her were signature.4 under his for Vincent Abell” Wilson entered into a year one “Lease Agreement” Baltimore left with an whereby Wilson “Authoriza- Abell leased the property tion to Release Information” form that back to her. The Agree- Lease as the “borrower” under the ment “Option listed Wilson included an to Purchase” line.5 day, next signature provision Baltimore which she could invoke at the returned and drove and her Mend end of year. Wilson Pursuant to Section 5 of $2,1007 lease, “closing” to the with Abell at transaction pay Wilson was to for ($600 the law offices of Houlon Berman. rent more than mortgage pay- transaction). prior However, ments At “closing,” signed Wilson various Wilson contends that she pay- intended the documents, “Deed,” including: a a “Real go ments to towards the loan that she Form,” Property and Transfer an “Own- foreclosure, obtained to stop and not to Affidavit,” and a “Seller Affidavit er/Seller appellants as rent. Ultimately, when Wil- Subject Mortgage.” of Sales Wilson son any failed to make of the rent pay- why the asked titles certain documents during ments the thirteen months follow- indicated sale of her home when she transaction, ing the sales Abell sued her only stop intended to obtain loan to possession of the property and success- response, foreclosure. both Abell and fully evicted her from her house. Follow- the attorney from Houlon Berman told eviction, ing her Wilson initiated ac- this only Wilson that the sale was a “legal tion in February 2005 against appellants necessary speed up fiction” which was and their former co-defendant Houlon Ber- process foreclosure was man. go days. scheduled to forward in two A price sales negotiated during was never Appellants partial moved for summary the transaction. repre- CPPA, While Deed judgment fraud, on Wilson’s sented that Wilson was to receive “consid- RICO claims. Initially, the trial judge $199,273.10” sale, eration of for the granted Wilson partial summary judgment, dis- via check.6 missing the RICO claims. But Wilson only a payment received The end result of the transaction that reconsideration, was filed a motion for contend- mortgage Wilson remained liable for the ing that the trial judge improperly dis- (which assume) Abell did not but then she missed the appel- RICO claims because pay also had to rent to remain in the home. lants any failed to make or legal factual Contrary transaction, appellants' 4. to contention that paid After the Abell the out- there was insufficient evidence to find Abell standing property liens on the and the actions, vicariously liable for Baltimore's $45,000 required mortgage to reinstate the clearly supports finding. record such a Abell stop the foreclosure. Abell claims that testified that he hired Baltimore to work as payments these constitute consideration in “independent an approach contractor” to addition paid to the cash to the title facing inquire homeowners foreclosure and company that issued Wilson the check be- they selling whether were in interested their property subject cause he took the Moreover, property. Abell ratified Balti- liens. closing. more's actions at the See Lewis v. Auth., Washington Metro. Area Transit Agreement, 7. Under the Lease Wilson owed (D.C.1983). A.2d 671-72 $1,800 per month in pay rent and had to Baltimore, remaining According $300 only to from each his failure to month if she change buy-back option "borrower” term to “seller” was exercised the at the end of oversight practice an because his to year. use the same form in all of his business transac- mortgage to tions obtain information. their dismissal.8 par the motion for In addition to supporting arguments argued that Abell’s counsel filed a summary judgment, appellants Wilson’s tial “ap- was to purposes for RICO “scheme” in limine to exclude series of motions in foreclo- that are homeowners proach physical condi testimony about Wilson’s to lend sure, they’re going that tell them tion, property, the fair market value of the house, their money to save them testimony regarding and evidence homeowners, trick, title from the take “other Management’s Abell and Modern house, in their own them a tenant make transactions,” allegedly em they where court come to then landlord/tenant against other vul ployed the same scheme of their own try and kick them out nerable homeowners.9 The trial court de the mo- judge granted The trial house.” limine, motions in appellants nied all of stage and at this for reconsideration tion presented the evidence to be permitting Wilson proceedings, permitted she jury.10 her RICO claims. pursue (D.C.2009) (citing Ivey v. complaint alleged A.2d 185 n. 11 that 8. Count II of Wilson's Columbia, (D.C. 1962(c), § A.2d appellants violated 18 U.S.C. District 2008)). any provides: which "It shall be unlawful any employed by with person or associated The trial court denied the motion limine in, engaged enterprise or the activities of the fair market value of to exclude evidence of commerce, affect, foreign interstate or which opposi- the house "for reasons set forth directly participate, or indirect- to conduct or arguments op- Wilson listed several tion.” enterprise's ly, of such affairs in the conduct limine, position principal to motion in racketeering through pattern activi- being appellants’ that contention was one complaint al- ty....” Count III of Wilson's that would be based on facts record conspired leged appellants to violate Further, disputed medical at trial. Wilson's 1962(d). 1962(c). § § See 18 U.S.C. directly relevant to her CPPA condition is summary judg- appellants' motion for alleges appellants claim where she took ment, only Wilson’s RICO reference to advantage inability protect of her her inter- concluding paragraph, claims was in the "by age, physical or mental ests reasons requested partial summary appellants where infirmities, ignorance, illiteracy, inability IV,” through judgment I Counts on "Counts language agree- to understand the being III Wilson’s RICO claims. Be- II and 28-3904(r)(5). § ...” ment. D.C.Code appellants, moving party, failed cause establishing "an meet their burden of ab- 10.Appellants also filed a motion in limine supporting [Wilson’s] sence of evidence arguing required to elect her Wilson was claim,” say that the trial court we cannot remedy of either rescission or before granting the motion abused its discretion "mutually requested trial because she various permitting Wilson to for reconsideration equitable legal relief. exclusive” This Ayodeji, pursue Tolu v. her RICO claims. See argument merit and the trial court has no (citations (D.C.2008) omit- A.2d 600 properly denied the motion. While it is true ted). plaintiff are that when the remedies a seeks "duplicative,” plaintiff cannot win relief sought evidence of the 9. Wilson to introduce claims, recognized we have also that on both quantify to fair market value of the home required plaintiff ] is not to "elect between [ a Appellants argued exclude the evi harm. alternative claims before the case is submitted would have received dence because Wilson Interdonato, jury.” to the See Giordano fair market value for her house less than (D.C.1991); compare A.2d 717-18 id. "inevitable foreclosure.” because she faced (concluding plaintiff not have that should sought testimony Appellants to exclude also put been forced before trial to elect between history regarding medical Wilson's fiduciary duty ting or claims for breach of We con evidence was "irrelevant.” such performance agreement specific to the court did not abuse its clude that trial Garland, jury), 779 A.2d with Dean v. denying the motions in limine. discretion Care, P.C., (D.C.2001) (concluding trial Family Coulter v. Gerald See Before the case was submitted to the of the Clauses Fifth11 and Fourteenth jury, appellants for judgment prohibit moved as a Amendments a State from impos- time, ing “grossly matter of law a punishment second and the trial excessive” civil upon a judge granted the tortfeasor.12 The respect motion with has opportunities had several the RICO claims because found she consider process due challenges presented damage evidence did not amount to a cases, awards. From these we “pattern practice,” glean within sev- meaning eral illuminating principles of the § RICO statute. 18 concerns U.S.C. guided which have the Supreme jury found Court’s appellants liable for com- review of damage mon awards. These law fraud and for violating CPPA principles 1) include the concern by that: making misrepresentations and omis- courts conduct a “meaningful and adequate sions of material including facts and “un- review” jury’s punitive of a damage award conscionable terms” in the transaction. both at the appellate trial and level to trial, appellants After filed a motion for ensure that the award is product of a judgment notwithstanding the verdict process that is entitled to a (“JNOV”) strong pre- and a motion for a new trial on 2) sumption of validity; punish- damages, both of which were denied. This conduct; 3) truly reprehensible es pu- appeal followed. nitive damage award has some relation to the harm suffered plaintiff II. evidences proportion- “reasonableness and Damages Analysis Punitive ality,” although there is no “bright-line” A. ratio, to ensure that the award is not In reviewing appellants’ constitu grossly out of proportion severity to the tional challenge offense; 4) damage the award advances case, awards in this think we it is policy useful to State concern such protection revisit legal and distill the principles public by and the deterring the defendant or guidance gleaned from the relevant Su others from doing wrong such in the fu- preme Court cases. The Due Process ture. dismissing court did err in Carter, the rescission Columbia. See District Columbia v. 418, 424, count plaintiffs before trial because the 34 L.Ed.2d sought (1973) (“[Sluice both rescission of the contract and the District of Columbia damages for breach of the contract and the is not a ‘State’ meaning within the plaintiffs longer Amendment, were no entitled to rescis- Fourteenth neither the District sion). Here, sought Wilson subject restrictions.”) alternative recov- nor its officers are to its ery (citations under omitted); several different statutes for the see also McNeil v. United conduct, appellants' States, specifically asserting (D.C.2007) 933 A.2d 362 n. 11 that, Columbia, transaction was an (noting unconscionable loan in the District of or, alternative, if the decided that Due Process Clauses the Fifth and Four- loan, the transaction was not provide fraudulent teenth "equivalent Amendments pro- Therefore, tection”). sale. the trial court did not err in refusing require Wilson to elect her reme- Indus., Cooper 12. prior dies Inc. v. to trial. Leatherman Tool 424, 433, 1678, Group, 532 U.S. 121 S.Ct. 149 BMW,

11. We (2001); Am., note that while the cases we use in our L.Ed.2d 674 N. Inc. v. of analysis Gore, 559, 562, discuss whether 1589, awards are 517 U.S. 116 S.Ct. 134 (1996); excessive under the Due Process Clause of the L.Ed.2d Corp. 809 TXOProd. v. Alli Amendment, holding 443, 453-55, Fourteenth our is Corp., based ance Res. 509 U.S. 113 2711, on the (1993) Due Process Clause of the Fifth (plurality S.Ct. 125 L.Ed.2d 366 Amendment, applies which opinion). to the District of 46 puni- of delimit an award puni- appropriately reviewing whether

In its first case Due within the context of due may violate the tive damage awards tive jury the Fourteenth Amend- instructions and process (through of Process Clause review). ment, Haslip, Ins. Co. v. Mut. the particular, jury In judicial Life Pacific 1, 18, 113 L.Ed.2d sufficiently conveyed pur- the instructions (1991), noted its con- Supreme Court 1 ‘not to com- pose punitive damages —“ wild.” may awards “run cern that such any injury’ but plaintiff pensate There, a claim for fraud Haslip brought ‘for the punish the defendant’ and ‘to employee and its against Pacific Mutual purpose protecting public added agent misappropriated the insurance after and others by [deterring] the defendant ” premium pay-. for a customer’s checks wrong in the future.’ doing from such ments, in of her lapse resulted which (quoting Id. at S.Ct. 1032 coverage. Notices of health insurance instructions) (alteration added jury were not forwarded lapse coverage The also held that Haslip). Court pay hospital forced to Haslip, who was jury’s discre- jury instructions limited could discharge hospital bill on was confined to deterrence “[i]t tion— coverage. her health not confirm retribution, policy con- [S]tate general verdict for jury returned sought to be advanced.” Id. cerns $1,040,000.13 appeal, Supreme addition, On that “the Su- the Court noted affirmed the Court Alabama had preme Court Alabama established Life then award. Pacific Mutual damage scrutinizing pu- post-trial procedures for arguing that the petitioned for certiorari 1032. nitive awards.” Id. S.Ct. damage product award was “the procedures together allowed the These jury viola- [ ] of unbridled discretion review” “meaningful adequate process rights.” Id. at tive of its due Supreme both the trial court and the Noting specific 1032. that S.Ct. of Alabama. Id. “The Alabama Court in that case resulted in Supreme postverdict Court’s review en- than the com- damages more four times are punitive damages sures that awards damages, the cautioned pensatory Court grossly out of to the se- proportion “unlimited discretion —or unlim- verity of the offense and have some un- discretion for that matter —in judicial ited relationship compensato- derstandable may invite fixing punitive damages ry damages.” Id. S.Ct. jar extreme results one’s constitution- Accordingly, Supreme upheld Court Id. at al sensibilities.” S.Ct. punitive damage award and conclud- However, the to draw a Court refused unconstitutionally it was not ex- ed mathematical line between awards that Id. at 1032. The cessive. “constitutionally acceptable and the were Haslip concern in that courts Court’s constitutionally that would fit unacceptable meaningful adequate conduct review Id. every case.” awards is consistent- ly cases. analysis, Supreme subsequent de- echoed Court

In its This concern is one which we deem criti- termined that Alabama law contained analysis to cal in our here. adequate guidelines reasonable and appellant’s requested proba- counsel 13. The Court noted that "it is $3,000,000 compensatory damages pu- general respondent ble that the verdict for damage compo- damages. Haslip, supra, at 6 Haslip punitive a nitive contained 2, $840,000” nent n. 111 S.Ct. 1032. of not less than

47 later, an years Corp. adequate hearing Two in TXO Prod. counsel on post- 443, 509 Corp., Alliance Res. U.S. 113 verdict motions and concluded that fair (1993) 2711, 125 (plurali S.Ct. L.Ed.2d procedures were followed.

ty opinion), challenge a constitutional to a again The Court in sought TXO to in- punitive award came before the damages sure of the amount reasonableness this again, Court time in the awards, it punitive but reiterated that context a law common slander-of-title- not, cannot, need indeed we “[w]e and There, argued action. TXO that the puni a bright mathematical line draw between unconstitutional, damages tive was award constitutionally acceptable and the con- both because the amount was excessive stitutionally unacceptable that would fit ev- product and because it was the of an unfair ery case.” procedure. Id. at 113 S.Ct. argued TXO the award 2711. Instead, was the “fundamentally result of a unfair “gen- Court maintained that a procedure because the was not ade ... eral of reasonableness prop- concer[n] instructed, quately because its award was erly into the constitutional enter[s] calcu- adequately not reviewed the trial or the (citing supra, lus.” Id. Haslip, 499 U.S. at court, appellate and because TXO had no 1032) added). (emphasis S.Ct. The jury might advance notice that the be al recognized Haslip Court that the large lowed return such a award or to award was four amount times the of com- “ rely potential on harm as basis for its ‘may pensatory damages and be close to 462-63, calculation.” Id. at 2711. S.Ct. line’ of constitutional permissibility,” upholding award of $10 Id. 2711 (citing Haslip, S.Ct. million and only award of 1032), 499 U.S. at but 526:1 ratio —the Court followed —a noted that it ap- also had “eschewed an the rationale of Haslip, examined both entirely that concentrates proach on the adequate whether fair procedures relationship between actual and punitive were followed and whether there was a damages.” Id. at 2711. S.Ct. reasonable between relationship the award Specifically, the “did not consider (or harm that likely occurred the dramatic disparity between the actual occur) from the defendant’s conduct. and the award control- 458, 113 Id. at S.Ct. ling a case of this character.” Id. at In addressing challenge pro- 462, 113 2711. The Court S.Ct. deter- cedure, the Court reasoned that “[assum- that, mined “in light amount of ing followed, that fair procedures were stake, money potentially bad faith of judgment product that is a of that process petitioner, the fact scheme em- is entitled to strong presumption of va- ployed part this larger case was of a lidity.” Id. at 113 S.Ct. 2711 (empha- fraud, deceit, trickery pattern added). sis Viewing the fact that the trial wealth, petitioner’s persuaded was] [it judge did not his articulate reasons for ‘grossly award was so excessive’ award, upholding the the Court concluded beyond to be power the State to that “we certainly prepared are not added). (emphasis allow.” Id. The Court judge’s characterize the trial failure to ar- upheld relying in large ticulate the his basis for denial of the principles Haslip, on part set forth not- motions for judgment notwithstanding the withstanding pu- the fact that the ratio of verdict and for remittitur as constitution- al violation.” nitive to compensatory Id. at was 526:1 judge gave compared Court concluded that the Haslip. TXO to 4:1 in by en- TXO, rights defendants’ protects review in Hon Haslip In contrast jury is a check on discre- suring that there Co., Oberg, U.S. Motor Ltd. da time, juris- the Court’s (1994), At the same tion. the 129 L.Ed.2d 336 114 S.Ct. to draw a reluctance prudence evinces punitive the overturned Supreme Court reviewing for awards ratio “bright-line” the of inadequacy on the award based the instead focuses process the but under reviewing such for procedures State the award is reason- whether inquiry on punitive dam jury imposed The awards. to both the actual compared able when of times the amount than five ages of more and the State’s harm suffered potential in Both the damages. the public by deter- protecting in interest Oregon Supreme appellate termediate conduct. ring future unlawful without re jury upheld Courts However, held Supreme Court view. punitive of Continuing its examination review of judicial of “Oregon’s that denial challenges in BMW excessiveness damage vio damages awards punitive of the size 559, 574, Gore, Am., N. Inc. v. of the Four the Due Process Clause lates (1996), 134 L.Ed.2d 809 116 S.Ct. 114 S.Ct. Id. teenth Amendment.” de- reiterated and further Supreme Court that: reasoned Supreme The Court from its earlier veloped principles dan- pose an acute damages [PJunitive clearly more articulated cases and property. arbitrary deprivation ger fair- “[ejlementary notions of principle that jury leave Jury typically instructions juris- constitutional ness enshrined in our choosing in with wide discretion fair person that a receive prudence dictate amounts, evi- presentation will only of the conduct that notice not net creates of a worth dence defendant’s but subject punishment, him to also use their juries that will potential may severity penalty that State big express biases verdicts Gore, the reasoned impose.” Court businesses, those without particularly adequate no- that not receive “BMW did review presences. Judicial strong local of the sanction magnitude tice of the one of the the amount awarded was impose” for fraud adher- might Alabama which the procedural safeguards few policy to a nationwide of non-disclosure ing provided against law dan- common as new. selling repainted automobiles that safe- ger. Oregon removed ha[d] court 1589. The trial Id. any substitute guard providing without post-trial motion to denied the defendant’s any and without indication procedure Howevei', reduce the award as excessive. arbitrary if awards had danger that the concluded Supreme the Alabama Court way over time. Id. any subsided improperly computed the jury it recal- punitive damages, and amount of uphold Supreme The Court declined damages to a “consti- culated the damage award and reversed tutionally reasonable” Oregon Supreme Court remanded to Id. at award of million. $2 Id. at proceedings. for further S.Ct. 2331. in Gore articulated early puni- The Court together, read these

When TXO, reviewing courts to cases, guideposts three for Haslip, tive Honda, evaluating whether dam- pre- use concern show Court’s unconstitutionally exces- are by upholding ages awards venting “wild” awards on are based guideposts through sive. Gore awards that have been reviewed in its expressed by concerns process, because such adequate” “fair and punitive 586, earlier awards cases. These further proceedings. Id. at 116 S.Ct. 1) 1589.15 guideposts degree are: reprehen- 2) conduct; sibility the ratio of the The guideposts Gore were applied and

punitive damages to the actual harm in- expounded upon by the Court State 3) flicted on the plaintiff; compari- Farm Mut. Campbell, Auto. Ins. Co. v. son of the punitive damages award and the 1513, U.S. 123 S.Ct. 155 L.Ed.2d 585 (2003). penalties civil or criminal that could be incorporated Court also imposed comparable principles punitive misconduct.14 Id. its earlier award cases, There, 574-75, discussed supra. the Camp- 116 S.Ct. 1589. In applying bells, Farm, who were by insured State guideposts, these the Court determined a complaint against filed State Farm alleg- that BMW’s conduct sufficiently was not faith, fraud, ing bad and intentional inflic- reprehensible because the harm was not distress, tion of emotional because State related, performance safety but rather Farm taking insisted on a wrongful death economic,” “purely plaintiff and the was against case Campbells to trial instead financially vulnerable. Id. at of settling plaintiffs with the within the Therefore, 1589. S.Ct. the Court reasoned (all policy limit while assuring the Camp- that the conduct did not show an “indiffer- bells that they did not need to obtain ence to or disregard reckless for the counsel). separate When the Campbells safety health or of others.” Id. The Court were found liable and judgment was en- reject continued to the notion of drawing a tered them in an amount more constitutional line “marked a simple $180,000 than offer, over the settlement formula,” mathematical but noted that the State Farm refused to cover the excess punitive award “breathtaking” at 500 liability. 413-14, Id. at 123 S.Ct. 1513. In times the amount of actual harm and bore action brought by fraud Campbells no reasonable relationship to compen- Farm, against State awarded $2.6 satory damages 582-83, awarded. Id. at million in compensatory damages and $145 Finally, S.Ct. 1589. con- Court million in damages, which the trial cluded that the million $2 was “substantial- court million, reduced to million and $1 $25 ly greater” than the statutory fines avail- respectively. Id. at able in Alabama and elsewhere for similar The Supreme Utah Court reinstated 583-84, malfeasance. Id. at 116 S.Ct. million punitive damages $145 award after Holding that the award was uncon- applying the guideposts. Gore Id. Revers- stitutionally excessive, the Court reversed ing Court, Supreme Utah the United the judgment and remanded the case for Supreme States Court reiterated its con- 14. The Court cases 15. The Court guideposts reiterated the in Coo- Indus., Inc., opinions per have all been divided supra with the dis- note 532 U.S. at senting concurring justices where the expressing Court held appellate skepticism apply courts should about de novo whether constitutional re- standard of assessing review when the consti- view of the amount of awards is tutionality punitive damage awards. Be- Scalia, Notably, warranted. Justice who con- cause the Ninth applied Circuit abuse 7X0, judgment Haslip curred in standard, discretion the Court did not address Gore, expressed dissented in his view that the $4.5 million guideposts' "‘[Gore] mark a road to no- awarded under the Lan- where; they provide guidance no real at all.” Act; ham instead it remanded for the Court of Gore, supra, 517 U.S. at 116 S.Ct. 1589 Appeals apply the de novo standard of (Scalia, J., dissenting). review. Gore, the reiterated cited in lip and reasonableness about the cern close to the “might be awards that such principles stressing that by “[t]he awards but also impropriety,” of constitutional line implemented be in must forth Gore set “[wjhile ratios are these that noted care, reasonableness ensure both with instructive[,] [t]hey dem- they are binding, 428, 123 S.Ct. Id. proportionality.” and multipli- [s]ingle-digit ... [that] onstrate 1513. comport with due likely to are more ers guidepost, the first Gore applying In achieving State’s while still process, on how guidance additional provided Court retribution, than and of deterrence goals the level evaluate reviewing court should of 500 to range with ratios awards con of the defendant’s reprehensibility of case, (citing 1.” Id. or, of 145 to in this whether evaluating in Specifically, duct. Gore, 116 S.Ct. 517 U.S. Camp- toward Farm’s conduct State added). 1589) Further, (emphasis sufficiently reprehensible, was bells Fa,rm went on to note State Court 1) “the harm whether: factored Court rigid no benchmarks there are “because opposed to econom physical was as caused may not 2) ic”; evinced an tortious conduct “the we have greater than those surpass, ratios disregard reckless to or a indifference with due may comport upheld previously 3) others”; “the safety of the health or act particularly egregious ‘a process where financial vulnera had target of the conduct only in a small amount resulted has 4) repeated “the conduct involved ” bility”; However, damages.’ Id. economic 5) incident”; and actions or was an isolated Campbells’ found the Court of intentional “the harm was the result “were appellees award “substantial” deceit, malice, or mere acci trickery, or a half of year million for a awarded $1 1513. The Id. at 123 S.Ct. dent.” 426, 123 Id. at S.Ct. emotional distress.” Farm’s that State conduct Court concluded held that the Ultimately, the Court 1513. to warrant reprehensible was not so propor- “neither reasonable nor award was be damages awarded committed, ... wrong tionate harm economic and “not cause the was arbitrary deprivation” an irrational and trauma; physical assault or from some re- property, Farm’s so Court State State physical injuries; were no there and remanded to judgment versed the excess verdict before paid Farm proceed- Supreme Court for further Utah [appellees] filed so the suf complaint appropriate amount to determine ings injuries for the only minor economic fered Id. at damages. in which State Farm re period 18-month them.” against resolve the claim

fused to and State The Court’s decisions Gore 426, 123 Id. at S.Ct. Farm,, attempt to articulate an reflect its guidepost, the second applying seemingly high check additional punitive award to ac- compared the its continued concern awards and harm, awards, again impose though properly declined to reviewed tual some However, adequate” process, the Court “bright-line” ratio. a “fair and through compared when practice, that “in few awards unreasonable recognized may still be the conduct pu- egregiousness between single-digit ratio to the level of exceeding potential harm sig- to a and the actual compensatory damages at issue nitive and concern, Notwithstanding this satisfy process.” will due suffered. degree, nificant to articulate a con- still refused (emphasis add- the Court Id. at 123 S.Ct. 1513 awards ed). limit for Has- stitutional the 4:1 ratio from Referencing over- steadfastly again reiterating exercised restraint its concern for a fair has turning punitive awards.16 process gives a presumption which rise to legitimacy, that “the concluded Due Philip Morris USA

More recently,17 Williams, requires provide Process Clause States to (2007), Court, once juries L.Ed.2d 940 assurance that are not ... seeking 16. The Court's restraint likely dissenting three opinions this area is one of in State Farm, Supreme puni Ginsburg due to the fact discrepancy that the Court’s Justice noted the damages di jurisprudence has remained Haslip tive the upheld between award in of more whether vided on the issue of the Constitution compensatory damages, than 4 times and punitive damages of and constrains the size upheld the award in more TXO of than 526 whether the warranted in Court is overturn 430, damages. actual times the Id. at 123 ing properly awards that were scrutinized Ginsburg S.Ct. 1513. Justice holds the view consistently Scalia state courts. Justice has that Court "the has no warrant to reform held the view it has "[s]ince that been governing punitive state law awards dam- practice of to traditional American courts 438-39, 1513, ages,” at Id. 123 S.Ct. and that " damages punitive leave ... to the discretion particular 'the of a laws State must suffice jury; process ... that a since superintend punitive damages [to un- awards] with a tradition and not accords such does legislators judges til or authorized to do so ” Rights necessarily violate the Bill consti 431, system-wide change.’ initiate Id. at 123 inquiry process,” ‘due’ tutes into "fairness” (quoting Haslip, supra, S.Ct. 1513 499 U.S. at of awards and "reasonableness” is unwar 42, J., (Kennedy, 111 S.Ct. concurring 1032 24-25, Haslip, supra, ranted. 499 at 111 U.S. judgment)). J., (Scalia, concurring judg S.Ct. 1032 ment). Gore, In Justice Scalia reiterated his 17. The Court most recently addressed the is procedure consistent view "a state trial that punitive damage sue of awards in federal impose that commits the decision whether to Baker, Shipping maritime cases in Exxon Co. v. amount, punitive damages, to U.S. -, 2605, 128 S.Ct. 171 L.Ed.2d - subject jury, judicial to discretion of the some (2008). There, 570 it held that "the federal ‘reasonableness,’ review of furnishes a defen statutory punitive law damage does not bar a " Gore, process dant with all the that is 'due.' loss, top damages award on for economic 598, supra, (citing 517 U.S. at 116 S.Ct. 1589 but the award [] should be limited [] to an TXO, 443, 470, supra, 509 113 S.Ct. U.S. equal compensatory damages.” amount to 2711, (Scalia, J., concurring 125 L.Ed.2d 366 Id. at 2611. We do not on focus Exxon in our judgment); supra, Haslip, in 28, 499 U.S. at 25- analysis holding because the Court's is limited (Scalia, J., concurring 111 S.Ct. 1032 to federal maritime cases. See Duckworth v. judgment)). Locke, 30, F.Supp.2d ex rel. United States 705 13, 49 n. 2010 WL 1499490 *15 n. 13 Thomas, consistently Justice has held the (D.D.C.2010) ("However, Shipping Exxon in view that “the does not Constitution constrain punitive damages volved under federal mari Philip the size of awards.” law, penalties, time not civil Williams, enforcement 346, 361, Morris USA v. here.”); applicability has no see also 1057, Valore v. (2007) 127 S.Ct. L.Ed.2d 166 940 Iran, Rep. F.Supp.2d. J., Farm, Islamic 700 (Thomas, 90 n. dissenting) (quoting State (D.D.C. WL 429-30, 2010 1244552 at *32 n. 17 supra, 538 U.S. at 1513 123 S.Ct. 2010) (“To J., plaintiffs may extent that some (Thomas, dissenting)) (quoting Cooper In dus., punitive a damages higher share in award supra note U.S. at 121 S.Ct. 532 award, (Thomas, J., than their concurring)). Notably, thus Jus compensatory damages ratio of to joined Thomas Justice tice Scalia’s concur 1:1, higher distinguishable than Exxon is rence in dissent in well. from TXO and his Gore as First, Ginsburg this case. Exxon concerned expressed Justice has also con- damages "foray awarded under maritime law ... cern with the Court's into damages 'territory traditionally explicitly holding, Court within the limited its " Farm, supra, noting upper domain.’ U.S. 'a 1:1 ... is a States' State ratio fair J., ") (Ginsburg, (citing limit in such maritime dissent- cases.' Exxon Gore, 2633) ing) (quoting Shipping at (emphasis 517 U.S. at added in Val- J., ). (Ginsburg, dissenting)). In ore cases, Monis, as previous strang- Philip harm caused punish [to]

... for The continued look first Id. at 127 S.Ct. 1057. Court ers.” question of process did not address which the punitive Court under damage held whether were levied and reviewed. Court when million was excessive dollars process was $79.5 flawed $821,000in compensatory- compared the de- judge trial refused ensure that ratio) negli- in a (nearly a 100:1 being for con- punished fendant was against ciga- and deceit lawsuit gence from non-parties. glean duct against We knowingly for rette manufacturer ju- jurisprudence allowing Court’s to believe that falsely leading the decedent plaintiff the de- compensate ries to smoking was The issue before the safe. in- non-parties conduct fendant’s Constitution’s “[w]hether vites awards and “wild” unreasonable permits Process to base Due Clause notice prevents having the defendant from in its part upon pun- award desire to that possible of sanctions that could be levied harming persons who ish the defendant for against him in the suit. not the court victims (e.g., are before in opinions The Court’s divided parties represent).” not Id. whom the do supra each the cases have discussed 349, 127 held at S.Ct. 1057. Court made for to challenging reviewing it courts “that such an award would amount to a views excessive distill the Court’s on the from the taking ‘property’ defendant think that ness of awards. We process.” In reaching due Id. its without the opinions divided caution us to exercise decision, the noted that the trial Court overturning in that jury restraint awards rejected proposed court defense counsel’s have been reviewed under fair and ade jury instruction that that “the specified quate procedures processes. State and

jury punish Philip could not seek to Morris Nevertheless, mathe beyond we look the to injury persons other not the before the matical ratio to determine whether Id. In- court.” at S.Ct. 1057. punitive damages is excessive. award stead, the the judge instructed that “ relying ra Rather than on mathematical are ‘[p]unitive damages awarded alone, tios on principles we focus the dis punish defendant to misconduct and cases, Supreme cussed and Court misconduct,’ ‘are not deter and intended to 1) specifically the concern that: courts compensate plaintiff anyone or the else for “meaningful adequate conduct a re and damages by the con- caused defendant’s jury’s punitive view” damage of a Id. duct.’” S.Ct. 1057. The both at the trial and level to appellate that, “[a]lthough Court concluded the the award product ensure that is the of a flexibility have States some determine process strong pre that is entitled to a they what kind of procedures imple- will 2) sumption validity; punish the award ment, federal obligates constitutional law 3) conduct; truly reprehensible pu es the protection provide them to some form in nitive damage award has some relation to Id. at appropriate cases.” (included by the plaintiff harm suffered the original). Holding in that proportion evidences the “reasonableness applied wrong the State court constitu- ality,” although “bright-line” there appeal, is no tional standard to the Court ratio, to ensure that is not vacated the the award judgment remanded grossly severity out of Oregon Supreme ap- proportion case to Court to 4) offense; 357-58, ply proper Id. award advances a standard. policy protection State concern such as S.Ct. 1057. public deterring principles gleaned defendant or we have from the wrong jurisprudence, from in the fu- Court we doing others such conclude in that this case are ture. grossly excessive violative of due process. B. appellants’ We disagree with argu case, examining

In the instant wheth- that ment awards reflect the awarded to er Wil- jury’s attempt punish them for their unconstitutionally excessive, are son we do previous with non-parties transactions mindful of the we principles so have dis- (which subject were the of the RICO from the key Supreme tilled Court cases claims that were dismissed and never sub application principles of those mitted to the jury).19 Contrary to appel federal numerous and state cases as well assertions, lants’ Philip Mortis ap is not Many our own cases. more plicable reaching here. its conclusion in federal, state, recent and District of Co- Morris, Philip noted analyze punitive lumbia cases order to ensure juries do not use the using awards the framework of the Gore “rubric of reprehensibility” punish guideposts, which reflect the Supreme defendant for harm caused to others concerns, process Court’s afford a “where the risk of ... misunderstanding is “meaningful adequate” review of a because, significant instance, for one— punitive jury damage award and that the the sort of evidence that was introduced at award evince “reasonableness and propor- argument trial or the plaintiff kinds of the tionality.” court, made to the jury upon request, —a case, In this appellants rely on must protect risk.” Id. at Morris, Philip supra, 549 U.S. at 127 357, added). 127 (emphasis S.Ct. 1057 Un 1057, to support their contention that like the Philip Morris, defendant in appel they prejudiced were the by admission of lants did not request that the trial court evidence one regarding the hundred simi give jury to disregard instruction the transactions, pre-foreclosure which, lar pre-foreclosure-transactions other evi contend, they jury resulted in the inflating involving lawsuit,” dence “strangers the punitive the damages punish awards to after the were RICO claims dismissed. for appellants their conduct unrelated appellants Nor did objection renew their transactions with non-parties.18 Appel request jury a curative instruction to lants’ reliance on Philip Mortis this they correct or avoid argue what now may Further, is misplaced. context have jury been regarding confusion the punitive the damage comport awards with evidence.20 other pre

18.The evidence preserve transactions appeal cumstances order lo for support sented of Wilson’s RICO claims. any contention based on the record as modi judge Once dismissed those claims at tri States, fied.” v. United 947 A.2d Comford al, appellants request jury did instruc Medrano-Qui (D.C.2008) (quoting 1189 disregard previously tion to admitted evi States, (D.C. v. United A.2d roz Thus, dence about the other transactions. 1997)). they failed to heed rule that "where the judge prayer has denied a defendant’s 8, supra. See note trial, during stage relief an of a earlier changed where the have circumstances as the 20. The instruction read to progressed, has case a defendant must renew stated: request changed his of the on the basis cir made the Appellants tionally acceptable.

C. here arguments punitive on same challenge further Appellants in their motion they did written on damages awards validity punitive to consid- In addition trial court for JNOV. are unconsti that the awards grounds motion, opposi- ering pleadings face. The on their tutionally excessive tions, hearing judge held a where the trial have scruti should they argue, judge, trial to advance opportunity had the appellants damages. reduced the nized and make here on they arguments to set the trial court moved Appellants the concerns appeal. have considered We awards, denied the court but aside cases in Supreme Court and raised motion, finding that “there was appellants’ carefully scruti- jurisdiction and have our regarding presented evidence sufficient consider- light the awards in of these nized re sale/lease-baek/option to [appellants’] ations, are reflected Gore which jury’s support transaction purchase to structure our guideposts that we use award.” that the analysis, and we conclude rulings a trial court’s review We are constitu- in this case damages awards damages de on excessiveness tionally acceptable. Farm, supra, 538 U.S. See State novo. Indus., (citing Cooper 123 S.Ct. Reprehemsibility 532 U.S. at supra note McCrae, examines guidepost first 1678); Daka, Gore Inc. v. see also (2003). ac reprehensibility defendant’s have had Appellants A.2d reflects the Su guidepost tions. This the excessiveness opportunity to raise concern that the conduct appeal. preme Court’s trial and on challenge both pun punitive damage award seeks to trial court argue that the appellants While sufficiently reprehensible. ish must be and reduced should have scrutinized here—a Clearly, the conduct involved on [their] awards as “excessive punitive out of the title to face[s],” dupe scheme to Wilson question a close we view this as case, years twenty-two she owned for in this that the home ultimately conclude and keep—was rep- to fought desperately and damages awards are constitu- punitive may acted damages, You conclude that the defendant In addition to punitive justifying punitive of plaintiff also seeks an award with a state of mind Punitive damages the defendant. damages on direct evidence or based based beyond damages the amount are above from the facts of on circumstantial evidence you damages compensatory [or nominal] of the case.... damages may are award- award. Punitive you plaintiff entitled to an If find that the is her punish for his or ed to the defendant you damages must punitive then award of example as an to conduct and to serve deter- the amount of the award. To decide acting way. in a prevent others from similar may you amount of the award mine the damages only may punitive if award You worth, of net relative wealth consider the proved with clear and con- plaintiff has trial, the at the time of the the defendant vincing evidence: committed, wrong of the state nature of (1) with evil mo- the defendant acted That wrong when the was mind of the defendant malice, tive, violence or actual deliberate committed, of the the cost and duration injure, oppression, or or with intent litigation, any attorney fees that the disregard rights plain- for the willful plaintiff in this case. has incurred tiff; and (2) itself was That the defendant’s conduct fraudulent, outrageous, grossly or reckless safety plaintiff. toward the of the important most repeated rehensible. indici- involved actions or was an isolat- “[T]he e) incident”; um of of a ed the reasonableness “the harm was the is damages degree reprehen malice, award result of intentional trickery, or deceit, sibility Farm, conduct.” defendant’s State mere accident.” State Farm, supra, 538 U.S. at S.Ct. 123 S.Ct. 1513. added) Gore, (quoting 1513 (emphasis su Appellants mischaracterize this 1589). pra, 517 U.S. at In S.Ct. case as one where the harm “purely was cases, expressed our we have a concern they economic” “simply bought a that plaintiffs conduct must meet a house it and rented back without paying high of wrongfulness justify standard enough for its value.” This an is under Lawlor, award. Chatman appellants statement of the harm caused sufficiency where this court discussed the Wilson and further underscores the reck an supporting puni evidence award of less with indifference which appellants act damages, recognized “[p]uni- tive we The harm to purely ed. Wilson was may tive be if ‘only awarded it is economic, though harm economic was by convincing shown clear evidence clearly key element appellants’ by the tort committed the defendant “[Ijnfliction scheme. of economic injury, aggravated by was egregious conduct and especially done intentionally when through a state of that justifies punitive mind dam affirmative ... acts misconduct or when ” (D.C.2003) (cita ages.’ 831 A.2d vulnerable, target financially is can omitted). tions The trial here judge Gore, warrant a substantial penalty.” su high wrongful mindful of the standard of pra, U.S. at 1589 (citing necessary ness imposing TXO, supra, 509 U.S. at damages awards. Accordingly, trial 2711). Appellants “trickery utilized or de judge properly instructed the in their dealings ceit” business with Wilson it only by if found with providing paperwork confusing convincing clear appel evidence that TXO, was purposely mislabeled. See motive, lants “acted with evil actual mal supra, 509 U.S. 113 S.Ct. 2711 ice, deliberate violence or oppression, or (upholding million $10 with injure, intent or in willful disre award in an action for slander title gard rights for the of the plaintiff’ and the appellant’s “part because scheme was that appellants’ conduct was “outrageous” larger fraud, a of pattern trickery of “grossly fraudulent.” trial judge’s deceit”). Appellant sought Baltimore out jury instruction to the the evinces court’s upon hearing Wilson of her imminent fore longstanding mindfulness of the principle misrepresented closure and himself as a truly that only reprehensible conduct and, “money Abell, lender” along with punished by imposition puni should be of urged the In Byrd transaction forward. damages. tive Jackson, punitive we held that the dam ages justified The factors we when consider ex amount was the when trial amining reprehensibility the appellant include whether: court found that had “orches a) “the harm physical op gain caused was to [a] trated scheme title to home [a] b) economic”; posed to “the tortious con for a its fraction of value.” 902 A.2d (internal (D.C.2006) duct evinced an indifference to or a reck quotation 782-83 omitted). less disregard safety health or marks We affirmed the trial c) others”; target “the judge’s the conduct had award of treble and punitive dam d) vulnerability”; ages financial “the conduct where the trial that judge found the that should be awarded to deter ma- amount “particularly defendant’s actions were from [they were] ... calculated the defendant future similar conduct. licious frail, Farm, elderly at advantage supra, take to See State Similarly, at 783. widow.” Id. vulnerable disabled,

here, caring for her Wilson was appellants’ that We are satisfied actions mother, work, to and suffer- elderly unable degree are to a that com- reprehensible of her dire financial weight under the ing first ports guidepost. with the Gore We selling tricked into situation. Wilson guidepost. next the second address Gore twenty- for over home that she owned Damages Compared to the Punitive $5,000, for a mere years exchange two Harm testimony trial estab- though expert even that market value of lished fair guidepost, the second we Under Gore $300,000 at the time of the house was compare to the actual award impartial jury An transaction plaintiff inflicted (compensato- on harm appellants’ reasonably could find conduct Gore, ry damages). supra, See U.S. at reprehensible to sufficiently support guidepost 1589. This re- 116 S.Ct. awards. principle supra flects the discussed that a damage be award must reason-

Further, although the evidence of harm Abell, proportional able suf- in which prior similar transactions has Management, and were fered. While the Court rec- Modern Baltimore may ognized comparison not be “a between the allegedly pun involved used that for harm caused to other home ish Abell and the owners, may it considered when assess significant,” be has award is also actions. ing reprehensibility Abell’s rejected “consistently the notion Morris, Philip U.S. See by line is a simple constitutional marked (“Evidence of harm 127 S.Ct. 1057 actual 581-82, mathematical formula.” Id. at show nonparties help can the S.Ct. 1589. plaintiff also conduct that harmed evaluating posed substantial risk harm to the first, this guidepost, awards under we general public, particularly was so must numbers to proper determine ... a reprehensible.... may Yet compare. Examining the differences further than and use a go this purpose types behind various dam punish verdict to defendant di ages may guid plaintiff provides receive rectly alleged on harms it is account of “Compensatory damages ance. ‘are in nonparties.”); have visited on see also loss tended to redress the concrete Gore, supra, 517 U.S. plaintiff has reason of the suffered (“Our may that a recidivist holdings ” wrongful conduct.’ State defendant’s punished severely than a first be more Farm, at supra, U.S. recognize repeated miscon offender Indus., Inc., Cooper supra 1513 (quoting than reprehensible duct is more an individ 1678). malfeasance.”). at note 121 S.Ct. pur ual instance of The provi damages The of the treble purpose damages provision pose punitive of the is “By retribution; therefore, sion is remedial. con CPPA deterrence trast, damages punitive serve broader have appellants may employed fact that function; they are aimed at deterrence number of the same scheme before Id. appellants em and retribution.” “When treble dam other transactions where for ages purposes, awarded remedial is relevant to the are ployed same scheme for they (emphasis origi- are not a substitute dam 116 S.Ct. 1589 heightened proof require nal); ages and Ayala see also v. Washington, 679 punitive damages apply.” for do not (D.C.1996). ments A.2d It follows Bassin, Ltd. v. P’ship Dist. Cablevision that, CPPA, within the context of the we (D.C.2003) 714, 727 828 A.2d remedial compare figure would the treble to the damages, of treble as distin purpose award, because the treble figure punitive damages, from guished particu is the legislature’s reflects desire to ensure larly given the fact that the tre apparent Cablevision, compensation.” “full Dist. CPPA, damages provision ble of the Therefore, supra, 828 A.2d at 727. 28-3905(k)(l), § D.C.Code authorizes ratio of punitive compensatory to treble court to treble plain without the damages for each appellant respectively is: having anything beyond tiff establish Abell, 11.1:1 for 6:1 for Manage- Modern violation itself: it CPPA is “[0]nce ment, and 1.1:1 for Baltimore.21 established that a consumer suffered [has] any damage, the CPPA authorizes Although recognized [the] award treble without court[] Farm “[s]ingle-digit multipli- State findings.” Byrd, supra, 902 A.2d ers are likely comport more with due further added) (emphasis (quoting at 782 Dist. Ca process, while achieving still the State’s 729). blevision, supra, 828 A.2d There goals retribution,” of deterrence and fore, the treble damages, “[b]oth which Court also reasoned that the award in each under the CPPA ‘serve as remedial rath case upon “must be based the facts and er than purpose,’ separate and the circumstances of the defendant’s conduct punitive damages” justified. Byrd, are su and the harm plaintiff.” to the State Here, pra, 902 A.2d at 782-83. neither the Farm, supra, 538 U.S. at $60,000 $180,000 award nor the award af “Indeed, low compensato- awards of trebling ter is a “substantial” award when ry damages may properly support higher considering the equity Wilson lost in awards, if, high compensatory ratio than her house and the non-economic harm that example, particularly egregious act she suffered. only has resulted a small amount of economic A damages. higher may ratio applying guide

When the second post, also comparing justified award to be cases in which the harm, injury we look at both “actual poten monetary is hard to detect or the Gore, damages.” tial See value might U.S. of noneconomic harm have Appellants proper contend that the com challenged tion case where the defendant trial parison is remittitur, judge's denial of the motion for awards, why which is claiming that the award was excessive and in Abell, they complain of a 33:1 ratio for 18:1 violation of "fundamental standards of fair Management, ratio for Modern and 3.3:1 for process"); ness and due see also Swinton v. However, Baltimore. even if we were to (9th Corp., Potomac 270 F.3d Cir. adopt appellants’ pre-treble view and use the 2001) (upholding a 28:1 ratio where an em figure comparison, amounting a 33:1 ployer failing found liable for to address adopt ratio —and we do not it—we would still employee’s daily an claims of offensive racial persuaded punitive damage not be that the workplace); harassment in the see also Deters unconstitutionally here are awards excessive Servs., Inc., Equifax Credit 202 F.3d Info. upheld by as similar ratios have been this 1262, (10th Cir.2000) (upholding 1273 a 59:1 court and others where the conduct has been ratio in a Title VII sexual harassment claim See, Daka, sufficiently reprehensible. e.g., employer's "particu where the conduct was Breiner, 86, 1998) (D.C. v. Inc. 711 A.2d 102 larly egregious"). (upholding age a 39:1 ratio in an discrimina 58 See, Gore, e.g., award. compensatory times the supra, difficult to determine.”

been Co., Inc., in Elevator 513 Bagby 1589. While v. 116 S.Ct. Goldsmith Cir.2008) (11th Daka, a upheld (up v. Breiner we 39:1 Inc. 1283-84 F.3d ratio, it did not exceed concluding where the conduct was holding a 9.2:1 ratio ” a digit “significant degree ratios to single Zhang v. “exceedingly reprehensible”); in in and then question, the conduct given Inc., Seafoods, 339 F.3d Am. Gem McCrae, Daka, a v. we concluded that Inc. (2003) (a “slightly” more than 1044 ratio digit ratios single 26:1 did exceed ratio of excessive); unconstitutionally was not 7:1 explanation is significant degree, ato Assoc., Legal 'l 594 Thomas v. Nat’l Prof damages that compensatory found (“[T]he (D.D.C.2009) 31, 34 F.Supp.2d the ratios Numerically, were awarded. certainty’ that say ‘legal cannot with Court compensatory dam- differed because Plaintiffs a ratio of 6.5:1 between $10,000 only in Breiner and ages were De compensatory violated McCrae, despite in the fact that (citations rights.” process fendants’ due upon workplace were based discrimi- both omitted)). interpreted Others have further by company. nation the same This binding, par not language guide, as a but importance looking be- evidences reprehensible ticularly when the conduct is yond specific the ratio at the awards digit the triple and the ratio is far below relation to the conduct for each case.22 Supreme Court. ratios reviewed guide- applying Other courts Gore See Planned Parenthood Colum posts upheld range have a wide of ratios. bia/Willamette, Inc. Am. Coal. Life Express Corp., v. Fed. 513 F.3d EEOC (9th Activists, Cir.2005); 422 F.3d (4th Cir.2008), the Fourth Circuit Int’l, 233 also Romano v. U-Haul F.3d see “[n]otwithstanding [the noted that defen- Cir.2000) (1st ratio); (upholding a 19:1 contention, the 12.5:1 ratio between dant’s] 21, supra. These cases dem see also note compensatory no onstrate that there is set number not, law, does a matter of ren- awards as award, an unconstitutional is indicative of punitive damages der the award unconsti- that the ratios involved in proving further tutionally excessive.” The court reasoned necessarily are not excessive on this case explained that “the face, Our fo appellants their contend. Gore, [that] evaluating the here cus in awards relationship bear some reasonable should on the reasonableness of the remains corresponding compensato- award of award, considering degree repre ry damages, relationship only but such a is hensibility of the conduct and interest analysis.” one factor an excessiveness deterring the conduct. (citations omitted). Id. Some courts have recognized, court has al Our interpreted “single-digit ratio” lan- context, that exces- justify any than 10 in a different guage “[a]n award less beit (there against “presumption” ratio 123 S.Ct. 1513 is 22. The 11.1:1 Abell exceeds 145:1); ratio, “single-digit” “significant award with a ratio of but but not to a an TXO, Farm, degree." supra, U.S. at supra, State 538 U.S. at see See (a ("[F]ew "jar did exceed- ratio of 526:1 one’s 123 S.Ct. 1513 awards considering ing single-digit sensibilities” when ratio between constitutional money at damages, significant as "the amount of to a de- factors such stake, appellant], satisfy the fact gree, process.” (emphasis [the due add- the bad faith will n Gore, 582-83, ed)); employed part of a supra, the scheme 517 U.S. at cf. deceit, fraud, (ratio trickery and larger pattern of of 500:1 was "breathtak- S.Ct. 1589 wealth”). Farm, 425-26, petitioner’s ing”); 538 U.S. at State

59 beyond scheme, is one which ‘is all appellants’ sive verdict about the jury conclud reason, great or ... is so as to shock the ed that the awards were warrant ” Corp., conscience.’ Scott v. Fin. Crestar ed in the specified. amounts 680, (D.C.2007) (affirming 928 A.2d 688 Here, just Wilson suffered more than trial court’s decision to set aside the com the financial harm. only She not lost the pensatory “extraordinarily award that was house, equity in her but she also suffered disproportionate injuries and losses the emotional harm being evicted from claimed,” plaintiffs after the counsel asked the home that she had maintained for over jurors message” through “send twenty-two years,25while she was physical- award) (citations omitted).23 ly, emotionally financially vulnerable. “ purpose ‘Because the dam This is a case where the compensatoiy ages punish is to a tortfeasor and deter very award was not large, compared to the conduct, future the amount of [harmful] equity that Wilson lost in her house. damages enough such should be to inflict Therefore, the ratio to compen- punishment, great while not so ex satory damages comports with the second punishment ceed the boundaries of guidepost Gore and does not indicate that Breiner, lead to bankruptcy.’”24 the awards are unconstitutionally exces- (citing 711 A.2d at 101 Jonathan Woodner sive. Breeden, (D.C.1995)). 929, v. 665 A.2d 941 Comparable Penalties for Conduct appellants might plausibly argue While that the award Abell should “raise We turn now to the third and final TXO, suspicious judicial eyebrow,” su guidepost Gore compares which the puni 2711, pra, 509 at U.S. Abell tive damages award and the “civil or crimi fifty seventy testified he owned penalties nal that could be imposed for houses one-hundred-and-fifty apart comparable Gore, misconduct.” supra, 517 units, ment and that he and his wife had a U.S. guide S.Ct. 1589. This net approximately combined worth of post is the $10 most difficult to apply, because million dollars. punitive damages “[A] inquiry excessiveness must be careful award must remain of ly sufficient size to considered based on specific facts of achieve the twin purposes punishment question; case in thus it is hard to and deterrence.” Saunders v. Branch comparison draw a to fines imposed in Va., Banking and Indus., Trust Co. 526 F.3d other cases. Cooper See supra (4th Cir.2008). The jury note U.S. 121 S.Ct. 1678. instructed to consider the net worth Although when guidepost this given is less determining what weight two,26 would be suffi than the first it reflects the cient to serve as a deterrent. After con Court’s concern sidering all of presented the evidence damages awards advance a policy State awarded, 23. Punitive were not be- appellants house even if the had not con- plaintiff's cause the trial court struck the tacted her. punitive damages. claim for Co., Kemp 26.See v. Am. Tel. & Tel. 393 F.3d Notably, part net worth is not a (11th Cir.2004) (giving the third challenge analysis. excessiveness See Motoro guidepost weight less than the first two but Uzan, (2d Corp. la Credit 509 F.3d reversing award on the Cir.2007). ground that the relationship award had no fairness, however, recognize we must occurred). the amount of harm that Wilson, likelihood, in all would have lost 60 does question. the conduct in The CPPA public by of the protection

concern such from damages specifical- or others limit allowable deterring the defendant not in the future. “The wrong penalties that the are “cumula- doing ly provides such penalty a] a criminal [has existence “shall nothing tive” and that CPPA which [the the seriousness with bearing on a injured by who is prevent any person action,” but wrongful legislature] views in violation of a practice trade law a criminal sanction possibility of “the [] exercising ... from of Columbia District automatically sustain not does seeking any remedy to which any right or ” Farm, supra, State damages award.” person might be entitled.... 428, 123 articulating 1513. In at U.S. 28-3905(k)(2) (emphasis § add- D.C.Code Court focused guidepost, this ed); Breiner, at 711 A.2d see also en reviewing fact that “a court on the (noting specific that the D.C. statute whether an award of determining in gaged was found lia- under which the defendant excessive should ‘ac damages is damages, ble did not limit allowable legislative deference to cord substantial upholding although the award it exceeded concerning appropriate sanc judgments in comparable the maximum fine found ” Gore, at su for the conduct issue.’ tions federal statute because of the need to de- (quoting 116 S.Ct. 1589 pra, 517 U.S. conduct). ter future Vt., Indus. Inc. v. owning-Ferris Br fines, statutory ap- In addition to when Inc., Disposal, Kelco guidepost, the third we also look to plying (O’Connor, J., in concurring S.Ct. 2909 involving comparable the awards in cases also note dissenting part)); see part McCrae, supra, 839 similar conduct. See demonstrates the concern supra. This Byrd, supra, A.2d at 700. We note that is that the award is not ensuring for juris- factually the most similar case this arbitrary and is tied to a State’s interest diction, although specifically it does not victims from defen protecting potential damage address the amount of the reprehensible conduct. dants’ There, we affirmed award. imposed, At the time the award was $148,175 (representing eq- imposing no statute a fine for there was home), in her the treble uity the victim lost In a specific conduct at issue. broader (after $315,026 subtracting a set- context, penalty the most relevant civil is $129,500 with a co- off of from settlement 3909(b) CPPA, §in which found defendant), punitive dam- and additional Corpo- authorizes the District Columbia violated the ages appellant where $1,000 for up ration to recover Counsel a “foreclo- by advertising CPPA himself as CPPA, § each violation of 3904 of gain specialist” sure under “scheme practices.27 which covers unlawful trade home for a ‘fraction of criminal do title to Statutory penalties [victim’s] civil and ” 902 A.2d at 782. always Byrd, supra, account for the seriousness of its value.’ provides cu- Although that the remedies available “are we do not consider it our any remedy analysis it became effective after this mulative and do not restrict tried, currently, § 42- case was the most relevant D.C.Code is otherwise available." 2434(d). violating in issue here is the penalty statute to scheme The criminal for $10,000 § Equity Act D.C.Code 42- Home Protection fine the Act is a maximum and/or (2009 specifically Supp.), which is refer- year single imprisonment up for a for to one of the CPPA at violation, enced in the current version maximum fine and a (2009 28-3904(gg) Supp.). § D.C.Code years imprisonment up for and/or CPPA, subsequent violations. See Equity second Like the the Home Protection 42-2435(a) (b). § & Act not limit allowable D.C.Code does Here, $60,000 (D.C.1996) (internal in compen- Wilson received 673 A.2d omitted)). satory damages, which is far than citations less the $106,000 equity that she had appeal, On both parties agree that a closing.28 home at the time of The puni- appropriate. setoff is They disagree, how- tive comports award with the third guide- ever, on when the setoff amount should be post, notwithstanding given that it is less subtracted from the compensatory dam- two, than weight the first since there was ages. Wilson appellants contends that are no statute imposing a civil fine addressing $180,000 entitled to a set-off from the tre- conduct issue or limit on the amount compensatory award, bled damage while awards for the conduct at the appellants argue the amount should be Further, noted, (which time. as we have subtracted before trebling would award here reduce compensatory satisfies the first two damages Gore $20,000). In its guideposts. denying order appellants’ motion trial, or JNOV for a new light In of the Supreme juris- Court’s trial court was “unable to determine prudence, above, discussed and the Gore whether Defendant is pro entitled to a rata guideposts, which reflect the guid- Court’s credit based on Plaintiff’s settlement with ing principles, we conclude that puni- tortfeasor, the joint [Houlon be- Berman] tive damages awards against entered cause of the absence of judicial either a appellants are not grossly excessive or vio- determination or a stipulation among the process. lative of due parties that [Houlon joint Berman] was a

tortfeasor with the other Defendants.” Having record, reviewed the III. however, we note that the “General Release Agree- Appellants are entitled ment” states recovered $40,000 to a setoff the lawsuit “are hereby by reduced amount of the paid consideration for this Appellants’ final argument release, or to the extent pro rata concerning the damages awards is that the Berman], share of [Houlon whichever is trial court erred in reducing the com greater” and that Houlon Berman “is to be pensatory $60,000 by a joint considered any tortfeasor with oth- $40,000 the amount of the settlement that er tortfeasors liable to Claimant for dam- (the Wilson reached with Houlon Berman ages arising out of the Claims to the same firm transaction, law involved with extent ifas Party adjudi- Released settled). whom Wilson agree We and di cated to a joint be tortfeasor a final rect the trial apply court to the setoff to judgment of a court of record after a trial the trebled compensatory award. “The on the merits.” question of ‘how to credit the judgment upon jury entered a against verdict a non- We have previously recognized settling defendant with proceeds a set that a setoff—“a demand which the defen tling paid defendant to the plaintiff is dant plaintiff, has arising out of purely question law, which this court a transaction extrinsic to the plaintiffs Bier, reviews de novo.” Paul v. 758 A.2d cause of applied action”—is after the initial (D.C.2000) 40, Footer, (citing Berg damages are multiplied.29 District Cablev equity $300,000 28. The by subtracting was calculated fair market value of at the time of $194,000 mortgage balance from transaction. contrast, recoupment is "a reduction is defined “Consumer” ision, (empha 730 n. 828 A.2d at 28-3901(a)(2), CPPA, § (citations omitted), D.C.Code in original) included sis pur who does or would person “mean[ ] Therefore, appel n. 22. id. at 731 see also (from), chase, or receive consumer lease from rata setoff pro to a lants are entitled including co-obligor goods or services award, treble or would person or a who does surety, $140,000 in liability to reducing appellants’ demand for a trade provide the economic damages. ‘consumer’ de adjective, as an practice; which exception, without anything, scribes IV. household, or personal, for primarily is added). pur family (emphasis use[.]” is a “consumer” Wilson protect consumers pose of the is to CPPA under the CPPA unscrupulous of spectrum from a broad by appel unpersuaded areWe merchants, therefore the stat practices by the trial court erred contention that lants’ broadly be read to assure ute should of jury, question as a submitting to the carried out. District purposes are See qualified fact, Wilson the issue whether Cablevision, supra, 828 A.2d at 722-23 meaning of the as a “consumer” within omitted). (citation Thus, statute CPPA, which was the statute under Wilson conjunction other should be read with both treble and able to recover clarify provisions within the CPPA which argue that Wil damages.30 Appellants meaning “primarily personal, for from precludes a landlord her son’s role as household, family or use.” D.C.Code “consumer,” being considered (a)(2). example, “goods § For 28-3901 room in the house shows her rental of a are services” under statute defined primary resi that the house was not “any parts output all of the economic the house was not “con dence and thus or or neces society, any stage related good” “primarily because it was not sumer sary process, in the economic point household, family or use.” personal, franchises, for credit, includes consumer busi misplaced. The Appellants’ argument is estate transac opportunities, ness real of whether the home was Wilson’s question tions, types.” and consumer services of all 28-3901(a)(7) and whether her house primary § residence add (emphasis D.C.Code ed). noted, “personal, house primarily previously was used we have “the As inquiries. hold, family are two different specific use” inclusion of ‘franchises’ and ‘busi ChartOne, 908 Ford v. A.2d in this definition dem opportunities’ ness Cf . (D.C.2006) unequivocally mo that the consumer (reasoning that onstrates “[a] person be in a consumer transaction is allowed to may pecuniary tive be and still Ford, al”). have a financial motive.” you're going part Well that of the Court: means or rebate the defendant your you element that don’t think withdraw right plaintiff's claim because of being applicable is in terms of her consid- arising defendant out of the same transac- only a consumer since that was the ered Cablevision, supra, 828 A.2d at tion.” District your argument for consumer as to basis for 730 n. not. whether she would be a consumer or going to with- Defense Counsel: "We're not argument waived because trial 30. This is argument. going to with- draw that We're agreed to submit the consumer issue counsel (sic) insisting that that be decided— draw object jury trial and did not before (sic) going agree can be we’re that that jury instructions. jury.” submitted to the (D.C. Son, 83; plaintiff. & Inc. 549 A.2d A.2d at see also Weschler (D.C.1989) Klank, 1988) (substance, form, A.2d transac an (holding person purchasing that a an tions was critical determination that in a tique engaged from an auction they loans within meaning were within mean “consumer transaction” Act). Sharking Loan CPPA). ing of the Since, evidence presented during tri- presented, Given the evidence contested, al on the consumer issue was reasonably could have concluded that Wil depended upon weighing outcome son the transaction prevent entered into credibility evidence and determining foreclosure that she could continue to so the witnesses trial —functions which are live in the house that she had owned for the squarely purview within the trier of alternative, over In the twenty years. the Further, jury fact. because the instruc- jury that en could have concluded Wilson by the on given judge tion trial the con- prevent tered into the transaction to fore quoted directly sumer question from the closure on her home and to to continue statute, jury the was properly instructed tenants, rent earning the house to income legal on the correct with framework which from a she over house that owned for to determine the facts evaluate the conclusion, twenty years. In either one disputed evidence. thing the purpose remains the same: which into Wilson entered the transaction Therefore, we that given conclude was to maintain her the ownership of trial, disputed presented the facts the Therefore, purpose home. the the of whether qualified issue Wilson as a Wilson; personal transaction was to she ques “consumer” under the CPPA was a appellants contracted the as a with not properly tion of fact to jury submitted the to gain profit, landlord order but as a supported by and the verdict is the evid consumer to “receive” ser seeking their ence.31 self-proclaimed spe vices as “foreclosure lenders,” “money help cialists” her to V. ownership ap maintain of her house. We conclude, for all We of the reasons set plied analysis a similar Dis Browner v. above, Columbia, punitive damages forth that the trict where we considered Act, against whether awards were not Sharking appellants the Loan D.C.Code 26-901, addition, § unconstitutionally applied to a who defendant excessive. money claimed that he had never to we that court loaned conclude trial did not reject appellants argument 31. We that told that the sale Wilson documents were a jury weight “legal verdict was of the after that fiction” she told them she did house, deny evidence. The trial court did not err in not want to sell her then induced ing appellants’ agreement lease/buy-back motion for JNOV a enter into a because to jury, viewing they reasonable knew she afford. evidence could not Wilson Wilson, $5,000 light only to most favorable could have also received a check for the appellants found mortgage liable for common law fraud and remained house liable for statutory juror viewing fraud under the Dis A reasonable CPPA. See debt. this evi Cooper, light trict Columbia v. 445 A.2d dence in most to favorable Wilson (D.C. banc); Allen, 1982) (en see also Liu v. could have reached a verdict in Wilson's favor (D.C.2006) (citations 894 A.2d n. 10 on both common law fraud and CPPA omitted) Ass'n., presented jury The was evi See Fort with claims. Lincoln Civic Inc. v. appellants represented Corp., dence New themselves Fort Lincoln Town A.2d Lenders,” omitted); (D.C.2008) (citations "Money tendered a as Wilson host 1073-74 n. titles, (r). 28-3904(e) § confusing improper with D.C.Code documents see also home- and vulnerable financially distressed pursue to Wilson initially permitting err in owner, they richly deserve and for claims, not does as the record her RICO judgment. of a sting jury claims that appellants’ support that Wilson also indicates But the record punitive awards inflated the improperly that she willing to execute documents ap- evidence. of the RICO the transaction as she knew mis-described rata setoff pro to are entitled pellants of the court opinion it. As understood trebled from recounts, sign to docu- was asked Wilson $40,000 settle- in the amount a sale of her whose title “indicated ments law firm Houl- with the co-defendant ment only obtain a intended home when she Berman, compensa- which reduces on ante at stop the foreclosure.” See loan to $140,000. Finally, tory damage award to being upon the documents signed 43. She submitting err in the trial court did only ‘legal that the “sale was informed con- Wilson was a of whether question speed up pro- ... necessary fiction’ jury under the CPPA sumer willing Wilson was Apparently, cess.” Id. fact, verdict find- and the question protest deceptive without agree law fraud liable for common ing appellants to obtain the funds she charade in order was not of the CPPA and for violations case, then, my in If that needed. is the evidence. We weight view, diminishes complicity somewhat issues, remand for the on all but affirm appel- reprehensibility of comparative compensa- the treble court to reduce trial agree, enough I not (though, lants’ conduct to by the setoff amount tory damages entirely the appellants escape entitle to $140,000. awards). There is also (which note in the particular the fact is of So ordered. sub-prime mortgage wake of the so-called THOMPSON, with Judge, Associate involving only predatory lenders crisis SCHWELB, Judge joins, Senior whom irresponsibly who took but also borrowers concurring: they they knew would be unable out loans appellants told she repay) that Wilson opinion of the court because join I $1,800 month and pay per could afford to analy- Judge Blackburne-Rigsby’s detailed reason, then, “failed to make for whatever me that persuaded sis has ... at 43 any payments.” of the See ante in were not damages awards this case so added). would (emphasis I believe courts constitutionally I to be excessive. large instructing juries, well to consider do however, why, separately, explain write here, those that not- circumstances such as case, I am particular on the facts of this pu- purpose the deterrent withstanding of the feeling left size complicity is a fac- damages, nitive victim wind- awards amounts to an unwarranted assessing may which be considered tor (who poised Wilson was appellee fall for damages. such home, in which she had about lose her law, of our howev- That is not the state $100,000 equity, appellants even before awards er. size involved, recovered or became and who jury to under the stan- for the determine appellants recover from over $3 stands to I that the prescribed, agree dards and so through million awards must stand undisturbed. awards, compen- in addition to satory damages). dispute appellants be no

There can Wilson as

recognized and on preyed

Case Details

Case Name: MODERN MANAGEMENT CO. v. Wilson

Court Name: District of Columbia Court of Appeals

Date Published: Jun 3, 2010

Citation: 997 A.2d 37

Docket Number: 08-CV-18, 08-CV-85, 08-CV-187

Court Abbreviation: D.C.