Donald W. Ricketts (SBN 39825)
28855 Kenroy Ave.
Santa Clarita, CA 91351
(805)250-3091

Attorneys for Plaintiff and Plaintiff in Pro Per

Superior Court  of the State of California
For the County of Los Angeles, Central District

Donald W. Ricketts, etc., Plantiff
v.
Farmers Group, Inc. etc. et al,
Defendants

Case No. BC 165961
Order Denying Defendants
Motion For New Trial
And To Vacate Judgment;
Amendment To Statement Of Decision

ORDER

  The motions of Farmers Insurance Exchange and Early, Maslach & Price for a new trial on the issue of damages and to vacate the judgment entered by the court came on for hearing on April 13, 2000. Having considered the moving and opposing papers, and the argument of counsel, the motions and DENIED.
  Briefing and argument on these motions centered on whether the punitive damages awarded by the court were grossly excessive under principles enunciated by the United States Supreme Court in Pacific Mutual Life Insurance Co. V. Haslip (1991) 499 U.S. 1 TX) Prod. Alliance Resources (1993) 509 U.S. 443, and BMW North America, Inc. V. Gore (1996) 517 U.S. 559.The Court amends its Statement of Decision previously filed herein to reflect the consideration the court has given to these cases and the principles enunciated herein as follows:

AMENDMENT TO STATEMENT OF DECISION

  Following the filing of the Court's Statement of Decision herein, and entry of judgment, defendants filed motions for a new trial as to the issue of damages and to vacate the judgment and substitute a judgment in favor of defendants. Central to the motions was the contention that the court's award of punitive damages was grossly excessive and in violation of the Due Process Clause of the California and United States Constitutions based upon principles enunciated by the United States Supreme Court in Pacific Mutual Life Insurance Co. v. Haslip (1991) 499 U.S. 1, TXO Productions Corp. v, Alliance Resources (1993) 509 U.S. 433., and BMW North America, Inc. v. Gore (1996) 517 U.S. 559. The court has carefully considered these opinions and the arguments of the parties regarding the application of the principles enunciated therein, and has denied the post-trial motions.
  The court finds that an award of exemplary damages of $2,500,000 is not grossly excessive, does not violate due process and is necessary to punish defendants for their willful, malicious, fraudulent, oppressive, illegal and reprehensible conduct. In fixing the exemplary damages at approximately 9 times the amount of compensatory damages awarded by the court the court has considered the fact that this amount is far less than 1% of the net assets of defendants and far less than one week's earnings of defendants. The court finds that a lesser amount would not provide a significant punishment to the defendants, would not provide a deterrence to a  repetition of their conduct, and is necessary to enforce the important public polices enunciated in California's Rules of Professional Conduct and the State Bar Act of California, violations of which plaintiff pointed out to defendants and suggested change and for which was terminated. Those statutes provide criminal penalties for their violation. The court finds that the punitive damages awarded are necessary to deter defendants from punishing their attorneys for expressing questions and cancel regarding ethical and legal obligations they, and defendants have. Defendants should be encouraging open discussion on these important matters of public policy, not suppressing them and punishing those who do seek to discuss them.
  While defendants deny that their conduct constituted violations of the Rules of Professional Conduct and the State Bar Act, their denials took the form, only, of testimonial denials by the employees who testified on these manners, Joseph Fern and Stephen Price.Plaintiff testified otherwise and submitted documentary evidence in support, The Court finds that Merrs. Fern and Price were not credible witnesses and that plaintiff was. Accordingly, the court, in response to repeated requests by defendants that it do so, finds that defendants Farmers Insurance Exchange and Early, Maslach & Price, by their use of non-attorney personnel to control the defense of insureds did engage in the illegal practice of law, and that supervising attorney-employees of defendants, including Stephen Price, engaged in the illegal practice of law and/or assisted in the illegal practice of law.

Dated: 4-13-2000

Soussan G. Bruguera
Judge