IRAC Hypos

IRAC Hypos
Use the FIRAC format for each case analysis. TIP: just use the information from the court case and summarize the higher court’s decision using the 5 steps, nothing else. There is no need to do any research.

112 F.3d 1052 (1997)
United States Court of Appeals, Ninth Circuit

Appeals from the United States District Court for the District of Nevada

WIGGINS, Circuit Judge:

During a convention at the Las Vegas Hilton, Navy Lieutenant Paula Coughlin was attacked by a group of men in a hotel hallway outside several convention-related hospitality suites. She sued several defendants, including the hotel and the organization which hosted the convention. A jury awarded her several million dollars in compensatory and punitive damages against the Las Vegas Hilton Corporation (“LVHC”) and Hilton Hotels Corporation (“HHC”). LVHC and HHC (collectively,”Hilton”) appeal.

The infamous 1991 Tailhook Convention served as the stage for the despicable event that led to this lawsuit. Hosted by the Tailhook Association (“Association”), the Tailhook Convention was an annual symposium and convention primarily directed at military aviators and held at the Las Vegas Hilton in Las Vegas, Nevada. Navy Lieutenant Paula A. Coughlin, a decorated helicopter pilot, attended the 1991 Tailhook Convention in her capacity as an aide to Rear Admiral John Snyder.

After attending a banquet at the Las Vegas Hilton on the evening of Saturday, September 7, 1991, Coughlin returned to her nearby hotel to change out of her military uniform. She then returned to the Las Vegas Hilton to socialize with friends at one of the many convention-related social events at the hotel. Looking for her friends, she entered a third-floor area where several hospitality suites hosted by various Navy squadrons were located. As she started to walk down the hallway–now notoriously known as the “gauntlet”–she was attacked, groped, grabbed, and handled by a throng of men. Fearing she was about to be gang-raped, Coughlin frantically tried to escape. After several minutes, she was eventually able to fight her way into an empty suite.

After the attack, Coughlin experienced post-traumatic stress disorder and other psychological problems related to the attack. Although she remained in the Navy for a couple of years, these psychological problems as well as other problems stemming from the attack hampered her ability to perform her duties. Ultimately, she was compelled to resign from the United States Navy.

Coughlin brought this action against the Association, HHC, LVHC, and several other Hilton entities. Coughlin’s negligence and punitive damages claims survived pre-trial motions against the Association, LVHC, and HHC only. The Association settled with Coughlin for $400,000 just before trial. After a trial lasting several weeks, an eight-person jury found HHC and LVHC negligent and awarded Coughlin compensatory damages of $1,695,000. After bifurcated proceedings mandated by Nevada law, the jury also assessed punitive damages of $2,625,000 against LVHC and $2,325,000 against HHC. Because of Coughlin’s settlement with the Association, the district judge subsequently reduced the compensatory damages award by $400,000 to $1,295,000 and also reduced the punitive damages award to $3,885,000 under Nev.Rev.Stat. § 42.005(1).


Hilton contends that Coughlin failed to show the requisite “malice in fact” required under Nevada law in order to obtain an award of punitive damages. The Nevada statute under which punitive damages may be obtained by a tort plaintiff provides as follows:

In an action for the breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud or malice, express or implied, the plaintiff, in addition to the compensatory damages, may recover damages for the sake of example and by way of punishing the defendant. Nevada Revised Statutes Sec. 42.005(1) (1996).

The district court concluded that Coughlin had a viable claim for punitive damages because she alleged that the appellants had acted with conscious disregard for known safety standards and measures. Conceding that “if malice in fact is required, the punitive damages claim of Coughlin’s Complaint must be dismissed,” the district court concluded that Coughlin’s allegations, if proven, indicated implied malice, and her claim of punitive damages remained viable under Nevada law. We must determine whether the district court correctly interpreted Nevada law.

In Granite Constr. Co. v. Rhyne, 817 P.2d 711 (Nev. 1991), the Nevada Supreme Court upheld a punitive damages award to a motorist injured when her car struck a wayward bull on an interstate highway. The defendant construction company had failed to honor a provision of its state highway construction contract requiring it to erect a protective fence to prevent livestock from wandering onto the highway. The two-justice plurality held that the “facts show that Granite `consciously and deliberately disregarded known safety procedures,’ safety procedures which Granite expressly agreed to take care of when it signed the highway construction contract.â? Thus, the plurality held that the trial judge “properly concluded that punitive damages are allowable under such circumstances.” The concurring justice agreed with the plurality that a jury finding of conscious and deliberate disregard for known safety procedures could support an award of punitive damages.

Moreover, in 1995, the Nevada Legislature enacted 42.001 to define malice for punitive damages purposes in accordance with Granite. Subsection (3) defines “malice, express or implied” as follows: “conduct which is intended to injure a person or despicable conduct which is engaged in with a conscious disregard of the rights or safety of others.” To the extent this newly-enacted provision says anything about the state of law in 1994 when this case was tried, it indicates that Granite’s definition of “malice, express or implied” was correct.

Hilton seeks to avoid the effect of Granite by focusing on a previous Nevada decision. Less than two years before Granite was decided, the Nevada Supreme Court overturned a punitive damages award in Craigo v. Circus-Circus Enterprises, Inc., 786 P.2d 22 (Nev. 1990). In that case, the plaintiff was the victim of an assault and robbery in a casino parking lot. He sued the casino and recovered compensatory and punitive damages. A two-justice plurality, consisting of different justices from that in Granite, essentially read the words “or implied” out of the Nevada punitive damages statute. Focusing exclusively on “malice in fact,” the plurality stated that “it is this court’s intention to restrict awards of punitive damages attributable to malice in fact to those extreme cases that convincingly demonstrate conduct motivated by hatred and ill-will and the deliberate intent to injure.” Further, the plurality stated that:


e disapprove our prior pronouncements that would indicate that malice in fact can be shown by a willful disregard of the rights of others or a conscious disregard of safety measures unless it can be shown that in connection therewith there was a deliberate intention to injure, vex, annoy or harass.

The two-justice plurality was unable, however, to convince a third justice to adopt this position. The concurring justice in Craigo agreed with the plurality’s result, but disagreed with the plurality’s conclusion that Nevada law limited awards of punitive damages to cases in which the evidence showed the defendant harbored a deliberate intention to injure, vex, annoy, or harass. According to the concurrence, malice required a broader definition than the one offered by the plurality.

Since Granite, the Nevada Supreme Court has not returned to the issue of what showing of malice is sufficient to uphold a punitive damages award. We conclude that Granite reflects the current state of Nevada authority on this issue. Three justices in Granite agreed that punitive damages were justified where a jury “found that the defendant consciously and deliberately disregarded known safety procedures–procedures designed to protect the public from serious harm–to save a few dollars.”

Craigo’s language limiting punitive damages to cases where the evidence shows malice in fact was not signed by a majority of the Nevada Supreme Court, leaving it with no precedential value. Furthermore, the position of the Craigo plurality was effectively rejected by the Granite majority. Also, 42.001(3), although enacted after the trial in this case, codified Granite ‘s definition of malice. Accordingly, we conclude that the district court did not err when it allowed Coughlin’s punitive damages claim to proceed to the jury on the theory that the appellants showed a “conscious disregard for the safety of others ” amount to implied malice.


The verdict and judgment in Coughlin’s favor is AFFIRMED. Coughlin may execute her damage award to the extent of the district court’s judgment.

  1. Smith v. Store problem solution (found in the course materials folder).
    Due Monday night (Day 7) by midnight Arizona time to ASSIGNMENTS folder as an ATTACHMENT.

Smith v. Store

Smith was a part-time checker for a store. During one particular sale, she and a customer, had a disagreement about the sale price of a particular item; the customer left her merchandise at the counter and went to check the listed price on the shelf. While waiting for the customer to return, Smith voided out that sale and put the merchandise aside in order to continue helping the other customers in line. When the customer returned, she accused Smith of taking $10.00 that she had left on the counter with her merchandise. Smith denied even seeing the money. The store manager searched Smithâ??s coat pockets and did not find any money. He then balanced her cash drawer, and it balanced perfectly. The customer was still convinced that Smith had taken her money and continued to cause a loud scene. The store manager asked a female employee to accompany Smith to the washroom in order to strip search her for the money. Smith was asked to strip down to her briefs, and there was no sign of any money. The customer claimed that she had between $500-600 dollars in her purse; she wouldn’t count it out, but she maintained her belief that Smith had stolen her money. Smith quit her job soon after this incident and filed charges based on invasion of privacy against the store.

Please use the FIRAC format.