Monessen Southwestern R. Co. v. Morgan

486 U. S. 330

June 6, 1988

A railroad worker was permanently injured, allegedly due to the railroad’s negligence. He brought a federal action in Pennsylvania state court to recover lost future earnings. The court did two questionable things, the first based on a state law, and the second based on a state judicial ruling – first, it awarded ‘prejudgment interest,’ which gave the worker interest on damages that accrued prior to the verdict. Second, it instructed the jury not to find the present value of his lost future earnings, but the nominal value of it. Both these things were challenged as inconsistent with the federal law that formed the basis of the suit.

The Court ruled 7-2 that prejudgment interest could not be awarded. White said that state laws allowing prejudgment interest were substantial rules that could not be countenanced unless the federal law clearly allowed them. At the time the federal law was enacted, White contended, prejudgment interest was seen as suspect by most courts. Therefore, it could be presumed that Congress did not intend the law to allow prejudgment interest damages when it was passed. White also noted that Congress had ample opportunity in subsequent years to clearly include prejudgment interest within the law’s scope, but declined to do so.

Turning to the jury instruction question, the Court ruled unanimously that the Pennsylvania court had erred in instructing the jurors to merely find the nominal value. Precedents held that present value was the correct value to find for future earnings, and that the jury needed some freedom in determining the best formula for that calculation. By assuring the jury that the nominal value was legally presumed to be the same as the present value, the judge took this freedom away from the jury. O’Connor, joined by Rehnquist, only concurred in judgment on this issue. She felt that a judge could appropriately suggest that jurors compute nominal value if the judge had carefully studied the economics before doing so.

Blackmun, joined by Marshall, dissented from the prejudgment interest holding. He said the federal law should be interpreted liberally, and with an eye on its purpose of compensating injured workers with damages. Blackmun argued that prejudgment interest was an integral component of making the plaintiff whole, and that the alleged judicial aversion to interest at the time of the law’s passage was overblown. Finally, he felt prejudgment interest was especially appropriate given the rule that the present value should be found for future earnings – interest on pre-verdict lost earnings was simply the other side of that coin.

Once again, as in K mart v. Cartier, my brain is too taxed just from trying to understand this stupid decision to have much of an opinion about its soundness.

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