policy was in "good faith," the Court must reject defendant's "good faith" defense to the imposition of punitive damages.
27. Upon reconsideration of the entire record herein, the Court reaffirms its conclusion that punitive damages are appropriately assessed against defendant Allegheny for its fraudulent misrepresentation to plaintiff Nader that he had a "confirmed reservation" on Flight 864. First, it is well-established in this jurisdiction that "proof of fraudulent misrepresentation is itself sufficient to support an award of punitive damages, because of the state of mind rendering it fraudulent." Day v. Avery, 179 U.S. App. D.C. 63, 548 F.2d 1018, 1029 n.58, (1976); citing Harris v. Wagshal, 343 A.2d 283, 288 (D.C. App. 1975), and District Motor Co. v. Rodill, 88 A.2d 489, 492-93 (D.C. Mun. App. 1952).
Second, even if this principle were not applicable to the instant case, this case is plainly an appropriate case for the imposition of punitive damages against the defendant. The Court of Appeals expressly recognized in this case that it is appropriate to award punitive damages "to punish a defendant for the outrageous nature of his conduct and to deter the defendant and others from engaging in the same or similar acts." 512 F.2d at 549. And, the following year in Knippen v. Ford Motor Co., 178 U.S. App. D.C. 227, 546 F.2d 993, 1002 (1976), the Court of Appeals held that punitive damages are appropriate, even in the absence of actual malice, if the "defendant acts with such conscious and deliberate disregard of the consequences of his actions to others that his conduct is wanton." Here, this Court has found that Allegheny's nondisclosure of the existence of overbooking practice was the result of a conscious and deliberate policy, the intent of which was to deprive passengers of material information in order not to distinguish defendant Allegheny from its competitors. See Finding # 15 supra. Allegheny implemented this policy of nondisclosure despite its knowledge that its practice of overbooking can and does result in the disruption of passengers personal and business plans, even the loss of business opportunities, as well as severe inconvenience to passengers who, because of their reliance on defendant's representations with regard to "confirmed reservations," are deprived of the opportunity to take steps to protect themselves from the risk of bumping. The Court therefore finds that defendant Allegheny wantonly implemented its policy of nondisclosure and misrepresentation in conscious, deliberate, and callous disregard of the effect of its policy on its passengers, including plaintiff Nader.
28. Defendant has suggested two additional reasons why punitive damages are inappropriate in the instant case: First, it contends that nondisclosure was "a common industry practice," and that this fact precludes a finding of wantonness or outrageousness. Second, it contends that since the Board has recently managed general disclosure about the practice of overbooking, the imposition of punitive damages in this case would have no deterrent value.
The Court rejects both of these arguments. The mere fact that a fraudulent practice is common-place in a particular industry in no way deprives that practice of its outrageous character. Indeed, the more widespread the practice, the more appropriate is an award of punitive damages. Similarly, the fact that the Board has now adopted an interim rule requiring disclosure of all airlines' overbooking practices in no way vitiates the deterrent effect of a punitive damages award. Such an award will serve not only to deter future fraudulent misrepresentations with respect to reservation practices, but will also serve to deter defendant Allegheny from engaging in similar types of misrepresentations in other aspects of its business.
29. Having concluded that punitive damages are appropriately awarded herein, the Court must determine the appropriate amount of punitive damages to be awarded. In its initial decision, this Court assessed punitive damages in the amount of $ 50,000 against defendant Allegheny -- $ 25,000 in favor of plaintiff Nader, and $ 25,000 in favor of plaintiff CCAG. Upon reconsideration of the entire record herein, including defendant's submissions and arguments with respect to its asserted "good faith" defense, the Court concludes that an award of $ 15,000 punitive damages is appropriate in the circumstances of this case. In making this determination, the Court is guided by the considerations set forth in Afro-American Publishing Co. v. Jaffe, 125 U.S. App. D.C. 70, 366 F.2d 649, 662 (1966); Town Center Management Corp. v. Chavez, 373 A.2d 238, 245-46 (D.C. App. 1977); and Harris v. Wagshal, 343 A.2d 283, 288 (D.C. App. 1975). The Court finds that an award of $ 15,000 in punitive damages will adequately serve to punish defendant Allegheny for its willful and wanton policy of nondisclosure and misrepresentation and will adequately serve to deter defendant from engaging in such practices in the future. The Court is aware that in this jurisdiction it is appropriate in assessing punitive damages to consider the amount of attorneys' fees incurred by the prevailing plaintiff in the course of this litigation, Afro-American Publishing Co. v. Jaffe, supra; Town Center Management Corp. v. Chavez, supra, and the Court recognizes that the award of $ 15,000 will not fully compensate plaintiff Nader for the value of the many, many hours expended by his able counsel in pursuing this litigation to a successful conclusion. Nevertheless, in the circumstances of the present case, the Court concludes that the award of punitive damages should be limited to an amount adequate for the purposes of punishment and deterrence, and the Court concludes that the award of $ 15,000 in punitive damages is fair and reasonable and appropriate to satisfy the objectives of the law in applying punitive damages.
30. An Order in accordance with the foregoing will be issued of even date herewith.
Charles R. Richey
United States District Judge
ORDER - January 10, 1978, Filed
Upon consideration of the points and authorities and arguments of counsel for the respective parties on remand, the evidence adduced at trial and the supplementary evidence submitted to the Court on remand, and the entire record herein, and in conformance with the decisions of the United States Supreme Court and the United States Court of Appeals for the District of Columbia Circuit, and for the reasons set forth in this Court's Findings of Fact and Conclusions of Law on Remand, issued of even date herewith, it is, by the Court this day of January, 1978,
ORDERED, that judgment be entered for plaintiff Ralph Nader on both his statutory discrimination and his common-law misrepresentation claims in the total sum of $ 10.00 for compensatory damages and on his common-law misrepresentation claim in the sum of $ 15,000.00 for punitive damages; and it is
FURTHER ORDERED, that judgment be entered for defendant Allegheny Airlines Inc., on plaintiff Connecticut Citizen Action Group's common-law misrepresentation claim; and it is
FURTHER ORDERED that defendant Allegheny Airlines, Inc., shall pay to plaintiff Ralph Nader the sum of $ 15,010.00, representing the sum of $ 10.00 compensatory damages and $ 15,000.00 punitive damages, by no later than the close of business on Friday, January 27, 1978.
Charles R. Richey
United States District Judge
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