WASHINGTON (AP) -- The Supreme Court today refused to free a pharmaceutical company from having to pay $22 million because an Oregon man went blind after taking medicine for his heart.
The justices, without comment, rejected an appeal in which American Home Products Corp.'s lawyers said a jury's award of $20 million in punitive damages -- aimed at punishing and deterring misconduct -- violated the Constitution's ban on excessive fines.The Supreme Court ruled in 1989 that the ban on excessive fines does not apply to punitive damages awarded to private citizens, but under Oregon law nearly half of the $20 million in punitive damages won by heart patient Douglas Axen would go to the state.
"Clearly, the Eighth Amendment intended that if a state ... chooses by statute to profit from money extracted by its courts as punishment, it cannot escape the substantive protection against excessive fines," the appeal argued.
Axen was 56 when in August 1994 he began taking the drug amiodarone, marketed under the brand name Cordarone by American Home Products' pharmaceutical division, Wyeth-Ayerst Laboratories.
Within a month, he began noticing changes in his vision.
Cordarone had been on the market since 1985, when the Food and Drug Administration had approved the drug for medical use. But beginning in 1986, medical studies linked amiodarone with vision loss and optic neuropathy.
In 1994, a package insert listed "optic neuritis" -- optic nerve inflammation -- as a rare side effect. The insert did not list permanent vision loss as a possible side effect, and did not recommend regular eye examinations while using the drug.
By October of 1994, Axen suffered from optic nerve swelling and hemorrhaging in each eye. He stopped taking Cordarone that November but his vision continued to deteriorate until he became legally blind.
Axen sued in a Multnomah County, Ore., court and in 1997 won $407,000 in economic damages, $1.5 million for pain and suffering, and $20 million in punitive damages. The jury also awarded his wife, Sandra, $936,000 in damages but that amount later was reduced to $500,000.
The appeal acted on today challenged only the punitive-damages award, which was first upheld by the state Court of Appeals and then left intact by the Oregon Supreme Court.
The appeals court cited "clear and convincing evidence" to conclude that American Home Products "had acted with extraordinary disregard of, or indifference to, known or highly probable risks to others."
When Axen won his award, a state law required that 50 percent of all punitive-damages awards, minus attorney fees, be paid to the state's Criminal Injuries Compensation Account.
In urging the justices to reject American Home Products' appeal, lawyers for Axen noted that Oregon's award-splitting law has been struck down by a state trial judge for violating the rights of the private citizens who win punitive-damages awards.
"If the ruling .... is affirmed on appeal, Oregon's Criminal Injuries Compensation Account will have no right to share in punitive damages awarded to a private party to a civil action. In that event, the excessive-fines issue ... will be moot," Axen's lawyers said.
Lawyers for American Home Products disagreed, and said Oregon authorities are continuing to enforce the award-splitting law while appealing the trial judge's ruling.
The case is American Home Products Corp. vs. Oregon, 99-784.