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Corporate Financial Liability Capped by Ohio Supreme Court

The debate continues after the Ohio Supreme Court voted 5-2 to uphold a financial cap on monetary awards given by trial juries. The high court said its ruling does not deprive the citizens of Ohio of their constitutional guarantee of a fair trial by jury when seeking compensation through corporate lawsuits.

Business groups naturally sided with the court's ruling as a victory for the Ohio economy. They said that outlandish awards over defective medications, unsafe cars and slip-and-fall accidents were forcing business to leave the state. The Court’s ruling does not apply to medical-malpractice lawsuits, although the General Assembly already has set a financial cap in those cases. On the other hand, trial lawyers said the verdict makes it easier for companies to ignore quality control, pass faulty products onto the consumer and escape financial liability, according to the Columbus Dispatch.

The impetus for the Supreme Court’s ruling was a case in Cincinnati. Melisa Arbino had experienced life-threatening blood clots from using a birth-control patch by Johnson & Johnson. Arbino sued the company. Her attorneys challenged Ohio's limits on non-economic damages from product lawsuits. The law caps awards at $250,000 or three times the amount of economic damages, whichever is greater, up to a total of $350,000 per plaintiff or $500,000 per occurrence. The limits don't apply in cases where someone suffers permanent disability or loss of a limb or organ system.

Arbino's attorney, Janet G. Abaray, said the limits help unscrupulous businesses but do nothing for the state's economy. "They don't have to be a business in Ohio to benefit from this decision," Abaray said. "All they have to do is hurt people in Ohio."

What is Best for Businesses Isn’t for the Litigant

The Supreme Court decision upheld the state legislature's 2005 lawsuit reforms but failed to address whether Arbino and 2,000 other plaintiffs suing over Johnson & Johnson's Ortho Evra patch had a valid claim. The case is pending in U.S. District Court for the Northern District of Ohio in Toledo. Johnson & Johnson claims the patch is safe when used as prescribed.

State Sen. Steve Stivers, R-Columbus, chief sponsor of the 2005 lawsuit reform law, said the Supreme Court ruling aids Ohio businesses and curbs escalating insurance rates for Ohio consumers.

"The jury still has the freedom to decide what they think is fair for them, and then the limits are imposed after the damages are awarded." But Abaray said a multimillion-dollar verdict is meaningless if a company doesn't have to pay it, thanks to the cap on financial liability.

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