author: . Justice Marshall Justice White, Justice O’Connor, Justice Scalia, Justice Blackmun,

text:
    BANKERS LIFE & CASUALTY CO. v. CRENSHAW
    No. 85-1765.
    Argued November 30, 1987
    Decided May 16, 1988

      Marshall, J., delivered the opinion of the Court, in which Rehnquist, C. J., and Brennan, J., joined, in all but Part II of which White, J., joined, in all but Part II and n. 1 of which O’Connor and Scalia, JJ., joined, and in all but Part III of which Blackmun, J., joined. White, J., filed an opinion concurring in part, in which Scalia, J., joined, post, p. 85. O’Connor, J., filed an opinion concurring in part and concurring in the judgment, in which Scalia, J., joined, post, p. 86. Scalia, J., filed an opinion concurring in part and concurring in the judgment, post, p. 89. Blackmun, J., filed an opinion concurring in part and 'dissenting in part, post, p. 89. Stevens and Kennedy, JJ., took no part in the consideration or decision of the case.

      Theodore B. Olson argued the cause for appellant. With him on the briefs were Larry L. Simms and Terence P. Ross.

      Bruce J. Ennis, Jr., argued the cause for appellee. With him on the brief were Paul R. Friedman, Ernest R. Schroeder, and Vincent J. Castigliola, Jr.

      Briefs of amici curiae urging reversal were filed for the Alliance of American Insurers et al. by Ellis J. Horvitz and S. Thomas Todd; for the American Council of Life Insurance et al. by Erwin N. Griswold, Jack H. Blaine, and Phillip E. Stano; and for Johnson & Higgins by John Calvin Jeffries, Jr., George Clemon Freeman, Jr., and William F. Kennedy.

      Briefs of amici curiae urging affirmance were filed for the Association of Trial Lawyers of America by Jeffrey Robert White and Robert L. Habush; for the Consumers Union of the U. S. et al. by Andrew F. Popper; for the Insurance Consumer Action Network by Marian Haycock Tully; for the Mississippi Trial Lawyers Association by Paul S. Minor; and for the National Insurance Consumer Organization.
      Briefs of amici curiae were filed for the State of Mississippi by Edwin Lloyd Pittman, Attorney General, and Robert L. Gibbs, Assistant Attorney General; for Aetna Life Insurance Co. et al. by George C. Montgomery, Darrell S. Richey, and Thomas J. Norman; for the Arizona Trial Lawyers Association et al. by G. David Gage and Amy Langerman; and for CBS Inc. et al. by P. Cameron DeVore, Marshall J. Nelson, Douglas P. Jacobs, Lawrence Gunnels, Boisfeuillet Jones, Bruce W. Sanford, Harvey L. Lipton, and Diana M. Daniels.

   . Justice Marshall

delivered the opinion of the Court.

In this case we must decide whether a Mississippi statute imposing a 15% penalty on parties who appeal unsuccessfully from a money judgment violates the Equal Protection Clause.

I

This action grows out of allegations that appellant Bankers Life and Casualty Company refused in bad faith to pay appel-lee Lloyd Crenshaw’s insurance claim for loss of a limb. According to testimony at trial, appellee was injured on January 6, 1979, when a car alternator he was repairing rolled off his workbench and landed on his foot. Three days later, after the injury had not responded to home treatment, appellee went to the emergency room of the local Air Force base hospital. Hospital doctors prescribed a splint, crutches, and pain medication, and told appellee to return in a week. Ap-pellee revisited the hospital three times over the next five days, each time complaining of continuing pain in his foot. By the last visit, appellee’s foot had swollen and begun to turn blue, and the examining doctor recommended a surgery consultation. Appellee was admitted to the hospital, where, on January 17, an Air Force general surgeon determined that a surgical amputation was necessary. The following day, ap-pellee’s leg was amputated below the knee.

At the time of the amputation, appellee was insured under a group policy issued by appellant. The policy provided a $20,000 benefit for loss of limb due to accidental bodily injury. In April 1979, appellee submitted a claim under the policy. Appellant denied the claim. The apparent basis for the denial was an opinion of appellant’s Medical Director, Dr. Nathaniel McParland, that the cause of the amputation was not appellee’s accident but a pre-existing condition of arteriosclerosis, a degenerative vascular disease. Appellee responded to the company’s denial by furnishing a statement signed by three doctors who treated him at the hospital. They stated that appellee’s arteriosclerosis was “ ‘an underlying condition and not the immediate cause of the gangrenous necrosis. The precipating [sic] event must be considered to be the trauma which initially brought him to the Emergency Room on 9 January.’” 483 So. 2d 254, 261 (Miss. 1985). Dr. McParland and a company analyst concluded that this statement was inconsequential, and appellant adhered to its position that the arteriosclerosis was responsible for the loss of limb.

Appellee persisted in his efforts to recover under the policy, eventually hiring an attorney, and appellant persisted in its intransigence. In its correspondence with appellee and his attorney, appellant repeatedly asserted that appellee had not suffered an injury as defined in the policy, that is, a “‘bodily injury, causing the loss while this policy is in force, directly and independently of all other causes and effected solely through an accidental bodily injury to the insured person.’” Id., at 262, quoting letter of Apr. 8, 1980, from Wm. Herzau to appellee. In contemporaneous internal memoranda, however, appellant noted that notwithstanding the policy language, appellee was entitled to recovery under Mississippi law if his injury had “‘“aggravate^], rendered] active, or set in motion a latent or dormant pre-existing physical condition or disease.”’” Id., at 262, 263. The memo-randa also demonstrated that appellant knew its flies were incomplete yet never attempted to obtain appellee’s medical records, most notably his emergency room report, even though Mississippi law and internal company procedures required such efforts.

After appellant again denied the claim on the ground that there was no evidence that appellee’s “ ‘injury caused this loss “directly and independently of all other causes,””’ see id., at 263, appellee brought this suit in Mississippi state court. His complaint requested $20,000 in actual damages, and, as amended, $1,635,000 in punitive damages for the tort of bad-faith refusal to pay an insurance claim. The jury awarded appellee the $20,000 provided by the policy and punitive damages of $1.6 million.

The Mississippi Supreme Court affirmed the jury verdict without modification. It concluded that the punitive damages award was not excessive in light of appellant’s financial worth and the degree of its wrongdoing. See id., at 279. Because the money judgment was affirmed without modification, a penalty of $243,000, or 15% of the judgment, was assessed against appellant and added to appellee’s recovery in accordance with Mississippi’s penalty statute. See Miss. Code Ann. § 11-3-23 (Supp. 1987). In its appeal to the Mississippi Supreme Court, appellant did not raise a federal constitutional challenge to the size of the punitive damages award. Following the affirmance of the jury verdict, appellant filed a petition for rehearing. Appellant argued in the petition that “[t]he punitive damage verdict was clearly excessive, not reasonably related to any legitimate purpose, constitutes excessive fine, and violates constitutional principles.” App. to Juris. Statement 139a. An accompanying brief asserted that the punitive damages award violated “due process, equal protection, and other constitutional standards.” Id., at 151a. Appellant also filed a Motion to Correct Judgment in which it alleged that the 15% penalty under § 11-3-23 “violated] the rights of equal protection and due process of Bankers Life” guaranteed in the Federal and State Constitutions. App. to Juris. Statement 106a-107a. The Mississippi Supreme Court, without opinion, denied the petition for rehearing and overruled the Motion to Correct Judgment.

II

Appellant focuses most of its efforts in this appeal to challenging the punitive damages award of $1.6 million. It contends foremost that the award violates the Eighth Amendment’s guarantee that “excessive fines [shall not be] imposed.” Appellant argues first, that the Excessive Fines Clause applies to punitive damages awards rendered in civil cases, and second, that the particular award in this case was constitutionally excessive. In addition to its excessive fines claim, appellant challenges the punitive damages award in this case on the grounds that it violates the Due Process Clause and the Contract Clause. Although we noted probable jurisdiction as to all of the questions presented in appellant’s jurisdictional statement, appellant’s challenges to the size of the punitive damages award do not fall within our appellate jurisdiction. See 28 U. S. C. §1257(2). We therefore treat them as if contained in a petition-for a writ of cer-tiorari, and our unrestricted notation of probable jurisdiction of the appeal is to be understood as a grant of the writ as to these claims. See Mishkin v. New York, 383 U. S. 502, 512 (1966). We conclude, however, that these claims were not raised and passed upon in state court, and we decline to reach them here. See ibid. (“The issue thus remains within our certiorari jurisdiction, and we may, for good reason, even at this stage, decline to decide the merits of the issue, much as we would dismiss a writ of certiorari as improvidently granted”).

Appellant maintains that it raised its various challenges to the size of the punitive damages award in its petition for rehearing before the Mississippi Supreme Court. In urging us to entertain the claims, appellant relies on our decision in Hathorn v. Lovorn, 457 U. S. 255, 262-265 (1982), in which we accepted certiorari jurisdiction of claims that were raised, but not passed upon, in the Mississippi Supreme Court on petition for rehearing. Hathom would be apposite were we to conclude that appellant had adequately raised its claims on rehearing. But appellant’s petition for rehearing alleged only that the punitive damages award “was clearly excessive, not reasonably related to any legitimate purpose, constitutes excessive fine, and violates constitutional principles.” App. to Juris. Statement 139a. The vague appeal to constitutional principles does not preserve appellant’s Contract Clause or due process claims. A party may not preserve a constitutional challenge by generally invoking the Constitution in state court and awaiting review in this Court to specify the constitutional provision it is relying upon. Cf. Taylor v. Illinois, 484 U. S. 400, 407, n. 9 (1988) (“A generic reference to the Fourteenth Amendment is not sufficient to preserve a constitutional claim based on an unidentified provision of the Bill of Rights . . .”).

Appellant’s reference to the excessiveness of the punitive damages award more colorably raises a cognizable constitutional challenge to the size of the award, one based on the Excessive Fines Clause of the Eighth Amendment. But this language as well is too oblique to allow us to conclude that appellant raised before the Mississippi Supreme Court the federal claim it now urges us to resolve. As this Court stated in Webb v. Webb, 451 U. S. 493, 501 (1981), “[a]t the minimum. . . there should be no doubt from the record that a claim under & federal statute or the Federal Constitution was presented in the state courts and that those courts were apprised of the nature or substance of the federal claim at the time and in the manner required by the state law.” Although the petition for rehearing alleges that the fine is excessive, it does not indicate that the fine is excessive as a constitutional matter, be it state or federal. It certainly does not identify the Excessive Fines Clause of the Eighth Amendment to the Federal Constitution as the source of appellant’s claim. Indeed, the crucial language from appellant’s petition contains no reference whatsoever to the Eighth Amendment, the Federal Constitution, or federal law. This failure to invoke the Federal Constitution is especially problematic in this case because the Mississippi Constitution contains its own Excessive Fines Clause. Miss. Const., Art. 3, §28. Thus, even if the Mississippi Supreme Court understood appellant to be offering a constitutional challenge, it may very well have taken that challenge to be anchored in the State Constitution. Cf. Webb, 451 U. S., at 496-498 (finding that party’s reference to “full faith and credit” in state-court proceedings had failed to raise a federal constitutional claim even though the State Constitution contained no full faith and credit clause); id., at 502-503 (Marshall, J., dissenting). We therefore conclude that appellant’s Eighth Amendment challenge, like its other challenges to the size of the punitive damages award, was not properly raised below.

Whether appellant’s failure to raise these claims in the Mississippi courts deprives us of all power to review them under our certiorari jurisdiction is an unsettled question. As then Justice Rehnquist wrote for the Court in Illinois v. Gates, 462 U. S. 213 (1983), the cases have been somewhat inconsistent in their characterization of the “not pressed or passed upon below” rule. Early opinions seemed to treat the requirement as jurisdictional, whereas more recent cases clearly view the rule as merely a prudential restriction that does not pose an insuperable bar to our review. See id., at 218-219 (discussing cases). We are not called on today to conclusively characterize the “not pressed or passed upon below” rule, however, because assuming that the rule is merely prudential, we believe that the more prudent course in this case is to decline to review appellant’s claims.

In determining whether to exercise jurisdiction over ques-. tions not properly raised below, the Court has focused on the policies that animate the “not pressed or passed upon below” rule. These policies are first, comity to the States, and second, a constellation of practical considerations, chief among which is our own need for a properly developed record on appeal. See Webb v. Webb, supra, at 500-501. Because the chief issue appellant would have us resolve — whether the Eighth Amendment’s Excessive Fines Clause serves to limit punitive damages in state civil cases — is a question of some moment and difficulty, these policies apply with special force. See Illinois v. Gates, supra, at 224 (“Where difficult issues of great public importance are involved, there are strong reasons to adhere scrupulously to the customary limitations on our discretion”); Mishkin v. New York, 383 U. S., at 512-513 (“The far-reaching and important questions tendered by this claim are not presented by the record with sufficient clarity to require or justify their decision”). Our review of appellant’s claim now would short-circuit a number of less intrusive, and possibly more appropriate, resolutions: the Mississippi State Legislature might choose to enact legislation addressing punitive damages awards for bad-faith refusal to pay insurance claims; failing that,' the Mississippi state courts may choose to resolve the issue by relying on the State Constitution or on some other adequate and independent non-federal ground; and failing that, the Mississippi Supreme Court will have its opportunity to decide the question of federal law in the first instance, while any ultimate review of the question that we might undertake will gain the benefit of a well-developed record and a reasoned opinion on the merits. We think it unwise to foreclose these possibilities, and therefore decline to address appellant’s challenges to the size of the punitive damages award.

Ill

There remains appellant’s challenge to Mississippi’s “penalty statute,” which requires unsuccessful appellants from money judgments, as well as from several other categories of judgments whose value may readily be determined, to pay an additional assessment of 15% of the judgment. Appellant argues that the penalty statute violates the Equal Protection Clause of the Fourteenth Amendment because it singles out appellants from money judgments, and because it penalizes all such appellants who are unsuccessful, regardless of the merit of their appeal. This claim is properly before us under our appellate jurisdiction because the Mississippi Supreme Court, in denying appellant’s Motion to Correct Judgment, upheld the validity of § 11-3-23 against appellant’s federal constitutional claim. See 28 U. S. C. § 1257(2).

Under this Court’s equal protection jurisprudence, Mississippi’s statute is “presumed to be valid and will be sustained if the classification ... is rationally related to a legitimate state interest.” Cleburne v. Cleburne Living Center, Inc., 473 U. S. 432, 440 (1985). The state interests assertedly served by the Mississippi statute were detailed by the Mississippi Supreme Court in Walters v. Inexco Oil Co., 440 So. 2d 268 (1983). The penalty statute, some version of which has been part of Mississippi law since 1857, “expresses the state’s interest in discouraging frivolous appeals. It likewise expresses a bona fide interest in providing a measure of compensation for the successful appellee, compensation for his having endured the slings and arrows of successful appellate litigation.” Id., at 274-275. In a similar vein, the statute protects the integrity of judgments by discouraging appellant-defendants from prolonging the litigation merely to “squeeze a favorable settlement out of an impecunious” appellee. Id., at 275. Also, the penalty statute “tells the litigants that the trial itself is a momentous event, the centerpiece of the litigation, not just a first step weighing station en route to endless rehearings and reconsiderations.” Ibid. Finally, in part because it serves these other goals, the penalty statute furthers the State’s interest in conserving judicial resources. Ibid.

The legitimacy of these state interests cannot seriously be doubted, and this Court has upheld statutes that serve similar interests. See, e. g., Life & Casualty Ins. Co. v. McCray, 291 U. S. 566 (1934) (upholding additional assessment on insurance companies that wrongfully refuse to pay policy benefits); see also, Louisville & Nashville R. Co. v. Stewart, 241 U. S. 261, 263 (1916) (State may make appeal “costly in cases where ultimately the judgment is upheld”) (Holmes, J.). Cf. Lindsey v. Normet, 405 U. S. 56, 78 (1972) (“We do not question here reasonable procedural provisions to safeguard litigated property ... or to discourage patently insubstantial appeals”) (citation omitted). The statute therefore offends the Equal Protection Clause only if the legislative means that Mississippi has chosen are not rationally related to these legitimate interests.

In arguing that § 11-3-23 violates equal protection, appellant seeks to draw support from the Court’s opinion in Lindsey v. Normet, supra. Lindsey addressed the constitutionality of an Oregon statute that required tenants challenging eviction proceedings to post a bond of twice the amount of rent expected to accrue pending appellate review. The bond was forfeited to the landlord if the lower court decision was affirmed. We agreed with the appellants that the double-bond requirement violated the Equal Protection Clause. We noted that the requirement was “unrelated to actual rent accrued or to specific damage sustained by the landlord.” 405 U. S., at 77. Moreover, the requirement, which burdened only tenants, including tenants whose appeals were nonfrivolous, erected “a substantial barrier to appeal faced by no other civil litigant in Oregon.” Id., at 79. We therefore concluded that the requirement bore “no reasonable relationship to any valid state objective” and that it discriminated against the class of tenants appealing from adverse decisions in wrongful-detainer actions in an “arbitrary and irrational” fashion. Id., at 76-77, 79.

As Lindsey demonstrates, arbitrary and, irrational discrimination violates the Equal Protection Clause under even our most deferential standard of review. Unlike the statute in Lindsey, however, Mississippi’s penalty statute does not single out a class of appellants in an arbitrary and irrational fashion. First, whereas the statute in Lindsey singled out the narrow class of defendant-tenants for discriminatory treatment, the sweep of § 11-3-23 is far broader: the penalty applies both to plaintiffs and defendants, and it also applies to all money judgments as well as to a long list of judgments whose money value may readily be determined. See n. 6, infra. Second, and more generally, there is a rational connection between the statute’s objective and Mississippi’s choice to impose a penalty only on appellants from money judgments or judgments the money value of which can readily be determined. If Mississippi wanted similarly to deter frivolous appeals from other kinds of judgments, it either would have to erect a fixed bond that bore no relation to the value of the underlying suit, or else it would have to set appropriate penalties in each case using some kind of individualized procedure, which would impose a considerable cost in judicial resources, exactly what the statute aims to avoid. Mississippi instead has chosen a partial solution that will deter many, though not all, frivolous appeals without requiring a significant commitment of governmental resources. Appellants from money judgments, and from the other types of judgments delineated in the statute, are a rational target of this scheme because the value of their claims, and thus of a proportional penalty, may be readily computed without substantial judicial intervention. Cf. Lindsey, supra, at 78 (“We discern nothing in the special purposes of the [wrongful detainer] statute or in the special characteristics of the landlord-tenant relationship to warrant this discrimination”). The Constitution does not prohibit Mississippi from singling out a group of litigants that it rationally concludes is most likely to be deterred from bringing meritless claims at the least cost to the State.

In addition, Mississippi’s statute is less likely than was the statute in Lindsey to discourage substantial appeals along with insubstantial ones. Because the penalty operates only after a judgment has been affirmed without modification, there is less risk than in Lindsey of discouraging appellants who believe they have meritorious appeals but simply lack the funds to post a substantial bond during the appellate process. And whereas the assessment in Lindsey “automatically doubled the stakes,” 405 U. S. at 79, the 15% penalty here is a relatively modest additional assessment. Cf. McCray, 291 U. S., at 571 (12% additional assessment not oppressive). Although Mississippi may not have succeeded in eliminating all danger of deterring meritorious claims, we cannot say that the residual danger is sufficient to render the statutory scheme irrational.

In short, unlike the double-bond provision condemned in Lindsey, the means chosen in § 11-3-23 are reasonably related to the achievement of the State’s objectives of discouraging frivolous appeals, compensating appellees for the intangible costs of litigation, and conserving judicial resources. See Lindsey, 405 U. S., at 70. It of course is possible that Mississippi might have enacted a statute that more precisely serves these goals and these goals only; as we frequently have explained, however, a state statute need not be so perfectly calibrated in order to pass muster under the rational-basis test. See, e. g., Vance v. Bradley, 440 U. S. 93, 108 (1979). We are satisfied that the means that the State has chosen are “reasonably tailored to achieve [the State’s legitimate] ends.” Lindsey, supra, at 78. We therefore affirm the judgment of the Mississippi Supreme Court denying appellant’s equal protection challenge to § 11-3-23.

It is so ordered.

Justice Stevens and Justice Kennedy took no part in the consideration or decision of this case.

Justice White,

with whom Justice Scalia joins, concurring in part.

I join Parts I and III of the Court’s opinion but not Part II. I continue to believe that “the statute which gives us jurisdiction in this cause, 28 U. S. C. §1257(3), prevents us from deciding federal constitutional claims raised here for the first time on review of state-court decisions. Cardinale v. Louisiana, 394 U. S. 437, 438-439 (1969).” Illinois v. Gates, 462 U. S. 213, 247 (1983) (White, J., concurring in judgment). Thus, I disagree with the Court’s analysis — under “prudential” standards — of appellant’s preservation of its challenge to the punitive damages award here. Ante, at 79-80. Ultimately, because the majority properly declines to address claims which I believe are not within this Court’s jurisdiction, I concur in Part II’s result, but not its reasoning.

Justice O’Connor,

with whom Justice Scalia joins, concurring in part and concurring in the judgment.

I do not agree with the Court’s analysis of our jurisdiction over appellant’s federal due process claim. I therefore do not join Part II or footnote 1 of the Court’s opinion. I join the remainder of the opinion, and I agree with the analysis of Part II insofar as claims under the Excessive Fines Clause and Contract Clause are concerned. Moreover, for the reasons given below, I ultimately concur in the Court’s judgment with respect to the due process claim as well.

In its brief on appeal to the Mississippi Supreme Court, appellant expressly invoked the Due Process Clause of the Fourteenth Amendment and argued that Mississippi law chilled its fundamental right of access to the courts by authorizing unlimited punitive damages. App. to Juris. Statement 135a. The Court does not acknowledge this argument in its discussion of why the due process claim was not raised and passed upon below, but only notes that appellant did not present a due process argument clearly in its petition for rehearing. Ante, at 77. The Court suggests that it need not consider the due process argument raised in appellant’s brief to the Mississippi Supreme Court because it is “distinct from the attack on the size of the particular award that appellant has waged before this Court.” Ante, at 75, n. 1. Standing alone, this observation is insufficient to deprive this Court of jurisdiction over appellant’s due process claim. “Parties are not confined here to the same arguments which were advanced in the courts below upon a Federal question there discussed.” Dewey v. Des Moines, 173 U. S. 193, 197-198 (1899). See Illinois v. Gates, 462 U. S. 213, 248 (1983) (White, J., concurring in judgment).

Accordingly, the Court should examine the federal due process argument that appellant makes in this Court to determine whether it is “only an enlargement” of the due process argument it raised below. See Dewey, supra, at 197. In its principal brief in this Court, appellant contends that the Mississippi Supreme Court changed its standard forjudg-ing when an insurer may be liable for punitive damages and applied the new standard retroactively to this case. Appellant explains that it therefore had no advance notice of what conduct could render it liable for punitive damages. Citing cases in which this Court has struck down criminal statutes as void for vagueness, e. g., Roberts v. United States Jaycees, 468 U. S. 609 (1984); Giaccio v. Pennsylvania, 382 U. S. 399 (1966), appellant maintains that this violated the Due Process Clause. Brief for Appellant 40-43. Then, in a supplemental brief filed after argument with the Court’s leave, appellant expands the due process argument pressed below and mounts a more general attack on permitting juries to impose unlimited punitive damages on an ad hoc basis. Postargument Brief for Appellant 4-10.

Appellant has touched on a due process issue that I think is worthy of the Court’s attention in an appropriate case. Mississippi law gives juries discretion to award any amount of punitive damages in any tort case in which a defendant acts with a certain mental state. In my view, because of the punitive character of such awards, there is reason to think that this may violate the Due Process Clause.

Punitive damages are awarded not to compensate for injury but, rather, “to punish reprehensible conduct and to deter its future occurrence.” Gertz v. Welch, Inc., 418 U. S. 323, 350 (1974). Punitive damages are not measured against actual injury, so there is no objective standard that limits their amount. Hence, “the impact of these windfall recoveries is unpredictable and potentially substantial.” Electrical Workers v. Foust, 442 U. S. 42, 50 (1979). For these reasons, the Court has forbidden the award of punitive damages in defamation suits brought by private plaintiffs, Gertz, supra, at 349-350, and in unfair representation suits brought against unions under the Railway Labor Act, Electrical Workers, supra, at 52. For similar reasons, the Court should scrutinize carefully the procedures under which punitive damages are awarded in civil lawsuits.

Under Mississippi law, the jury may award punitive damages for any common law tort committed with a certain mental state, that is, “for a willful and intentional wrong, or for such gross negligence and reckless negligence as is equivalent to such a wrong.” 483 So. 2d 254, 269 (Miss. 1985) (opinion below). Although this standard may describe the required mental state with sufficient precision, the amount of the penalty that may ensue is left completely indeterminate. As the Mississippi Supreme Court said, “the determination of the amount of punitive damages is a matter committed solely to the authority and discretion of the jury.” Id., at 278. This grant of wholly standardless discretion to determine the severity of punishment appears inconsistent with due process. The Court has recognized that “vague sentencing provisions may pose constitutional questions if they do not state with sufficient clarity the consequences of violating a given criminal statute.” United States v. Batchelder, 442 U. S. 114, 123 (1979). Nothing in Mississippi law warned appellant that by committing a tort that caused $20,000 of actual damages, it could expect to incur a $1.6 million punitive damages award.

This due process question, serious as it is, should not be decided today. The argument was not appellant’s principal submission to this Court. The analysis in the briefs and the discussion at oral argument were correspondingly abbreviated. Although the Court could assert jurisdiction over the due process question on the theory that the argument made here was a “mere enlargement” of the due process argument raised below, it would not be prudent to do so. Accordingly, I concur in the Court’s judgment on this question and would leave for another day the consideration of these issues.

Justice Scalia,

concurring in part and concurring in the judgment.

I join Part I (except for footnote 1) and Part III of the opinion of the Court, and concur in its judgment. As to Part II, I agree with Justice White that the question of our entertaining the issues there discussed should be resolved as a matter of law, and not of discretion, and I therefore join his opinion. The Court having chosen not to follow that course, I agree with Justice O’Connor regarding the basis on which our discretion should be exercised concerning the due process claim, and therefore join her opinion.

Justice Blackmun,

concurring in part and dissenting in part.

I join Parts I and II of the Court’s opinion, for I agree that the Court should refrain from addressing appellant’s challenge to the punitive damages awarded against it. I also agree with the Court’s conclusion that appellant’s challenge to Mississippi’s “penalty statute,” Miss. Code Ann. § 11-3-23 (Supp. 1987), is properly before the Court under its appellate jurisdiction. See 28 U. S. C. § 1257(2). Nonetheless, because I conclude that the statute cannot survive scrutiny under the Equal Protection Clause of the Fourteenth Amendment, I dissent from the Court’s conclusion to the contrary.

Section 11-3-23 “‘is in the nature of a penalty, or a condition of appeal.’” Pearce v. Ford Motor Co., 235 So. 2d 281, 283 (Miss. 1970), quoting Meek v. Alexander, 137 Miss. 117, 121, 102 So. 69, 70 (1924). Not all unsuccessful appellants, however, are subject to its penalizing effect. The statute imposes lump-sum “damages,” calculated at 15% of the value of the underlying judgment, on an appellant who unsuccessfully appeals to the Mississippi Supreme Court a money judgment or possessory action. Although the penalty applies to both the defendant and the prevailing but unsatisfied plaintiff who unsuccessfully appeals, it does not apply to the plaintiff who unsuccessfully appeals an adverse judgment or to the unsuccessful cross-appellant.

There can be little doubt that this damages assessment burdens the statutory right of a litigant to appeal a money judgment. The statute makes it substantially more expensive to exercise the right if the judgment is ultimately affirmed, and it thereby obviously creates a disincentive to appeal. The Court concludes that “the means chosen in § 11-3-23 are reasonably related to the achievement of the State’s objectives of discouraging frivolous appeals, compensating appellees for the intangible costs of litigation, and conserving judicial resources.” Ante, at 85. In my view, the 15% automatic penalty provision is not at all “reasonably related” to any of these interests. To the contrary, the relationship of the statutory classification of a money-judgment appellant to the asserted governmental goals “is so attenuated as to render the distinction arbitrary [and] irrational.” Cleburne v. Cleburne Living Center, Inc., 473 U. S. 432, 446 (1985).

There is no rational relationship between the statute and the State’s asserted desire to compensate a prevailing appel-lee for “having endured the slings and arrows of successful appellate litigation,” Walters v. Inexco Oil Co., 440 So. 2d 268, 274-275 (Miss. 1983), whether the costs of that litigation are measured in economic or noneconomic terms. There is no reasonable justification for compensating only plaintiffs who prevail against an appeal. Defendants who have successfully defended in trial court against suits seeking money damages and who are subjected to appeals that prove unsuccessful are similarly burdened by the added emotional and financial costs of the appellate process. Yet, under the statute, they receive no “compensation” because the penalty is not imposed on nonprevailing plaintiffs who unsuccessfully appeal. The statute arbitrarily discriminates against defendant-appellants of money judgments, and the State offers no justification for the distinction so drawn.

Not surprisingly, then, the Court makes no attempt to justify § 11-3-23 based upon the “compensation” objective, despite its reference to that state interest. Instead, it upholds the penalty statute as reasonably related to Mississippi’s interest in discouraging frivolous appeals and thereby protecting the Mississippi Supreme Court “from being required to spend its time and energy and resources on appeals thoughtlessly taken.” Walters v. Inexco Oil Co., 440 So. 2d, at 275. See ante, at 81-82. In Lindsey v. Normet, 405 U. S. 56 (1972), the Court explained that a State might adopt “reasonable procedural provisions ... to discourage patently insubstantial appeals, if these rules are reasonably tailored to achieve these ends and if they are uniformly and non-discriminatorily applied.” Id., at 78. But §11-3-23 does not meet this standard. The penalty is neither applied in a uniform and nondiscriminatory manner, nor reasonably tailored to discourage “patently insubstantial appeals.”

Section 11-3-23 does not permit the Mississippi Supreme Court to determine whether an appeal is frivolous; the 15% penalty is imposed on certain unsuccessful appellants whenever the judgment is affirmed, regardless of the substantial merit of the appellant’s case. Thus, even if, as in this very case, a money judgment is affirmed by a narrow 5-4 majority of the Supreme Court, the assessment automatically is made. Such a provision obviously sweeps substantial appeals as well as frivolous appeals within its deterrent net.

The claim that §11-3-23 operates to screen out frivolous appeals is no more persuasive than was the same claim advanced in Lindsey in support of the Oregon double-bond requirement. This Court found the argument “unpersuasive” in Lindsey because the Oregon requirement “bars nonfriv-olous appeals by those who are unable to post the bond but also allows meritless appeals by others who can afford the bond.” 405 U. S., at 78. Similarly, § 11-3-23 not only discourages nonfrivolous appeals by those who would avoid the risk of additional damages, but also allows meritless appeals by those who can afford to assume that risk. More strikingly, the statute allows an entirely frivolous' appeal by a nonprevailing plaintiff without the incursion of any risk of an appeal penalty. The Court provides no support for its con-clusory assertion that Mississippi rationally concluded that the group of litigants susceptible to the penalty are those “most likely to be deterred from bringing meritless claims.” Ante, at 84.

At bottom, the majority’s reasoning in sustaining Mississippi’s mandatory penalty statute amounts to an assessment that § 11-3-23 applies to a larger group of appellants and burdens their right to appeal less heavily than the statute struck down by the Court on equal protection grounds in Lindsey. See ante, at 83-85. But Lindsey is not the benchmark by which we measure the constitutionality of a discriminatory state statute burdening the right to appeal. Each such statute must be justified by reference to the governmental objectives it purportedly seeks to further. Mississippi has failed to demonstrate that § 11-3-23 is rationally related to its stated goals. The discrimination against appellants from money judgments is arbitrary and irrational. Accordingly, the judgment of the Mississippi Supreme Court denying appellant’s equal protection challenge to §11-3-23 should be reversed.

I dissent.

       Appellant did offer on appeal a federal due process challenge based on the alleged “chilling effect” of unrestricted punitive damages awards on the exercise of a litigant’s'right of access to the courts. See App. to Juris. Statement 135a. We read this attack on the alleged open-endedness of Mississippi’s punitive damages awards to be distinct from the attack on the size of the particular award that appellant has waged before this Court.

       Similarly, appellant’s challenges in this Court to the size of the punitive damages award in no way qualify as “mere enlargements” of claims made before the Mississippi Supreme Court. Under the mere enlargement doctrine, “[p]arties are not confined here to the same arguments which were advanced in the courts below upon a Federal question there discussed.” Dewey v. Des Moines, 173 U. S. 193, 198 (1899). See also Stanley v. Illinois, 405 U. S. 645, 658, n. 10 (1972). Dewey makes clear, however, that the federal question must be brought to the attention of the court below in some manner. “A claim or right which) has never been made or asserted cannot be said to have been denied by a judgment which does not refer to it.” 173 U. S., at 200.

       Several States have enacted limits on punitive damages in specified types of causes of action. See, e. g., Fla. Stat. Ann. § 713.31(2)(c) (1988) (fraudulent filing of mechanics’ lien); Wash. Rev. Code § 9A.36.080 (1987) (malicious harassment); Cal. Civ. Code Ann. § 1787.3 (West 1985) (consumer credit denial).

       Section 11-3-23 of Miss. Code Ann. (Supp. 1987) provides:
      “In case the judgment or decree of the court below be affirmed, or the appellant fails to prosecute his appeal to effect, the supreme court shall render judgment against the appellant for damages, at the rate of fifteen percent (15%), as follows: If the judgment or decree affirmed be for a sum of money, the damages shall be upon such sum. If the judgment or decree be for the possession of real or personal property, the damages shall be assessed on the value of the property. If the judgment or decree be for the dissolution of an injunction or other restraining process at law or in chancery, the damages shall be computed on the amount due the appellee which was enjoined or restrained. If the judgment or decree be for the dissolution of an injunction or other restraining process as to certain property, real or personal, or a certain interest in property, or be a judgment or decree for the sale of property, or some interest in it, to satisfy a sum out of the proceeds of sale, or to enforce or establish a lien or charge or claim upon or some interest in property, and the only matter complained of on the appeal is the decree as to some particular property or claim on it, the damages shall be computed on the value of the property or the interest in it, if the value of the property or interest in it be less than the judgment or decree against it; but if the value of the property or interest in it be greater than the amount of the judgment or decree against it, the damages shall be upon the amount of the judgment or decree; provided, however, the above penalty shall not be assessed against any condemnee appealing from a special court of eminent domain in any circumstances.”
      The penalty would appear to apply to both defendant-appellants, such as Bankers Life, and plaintiff-appellants, who might choose to challenge a recovery they view as too meager. See Eagle Lumber & Supply Co. v. Robertson, 161 Miss. 17, 135 So. 499 (1931) (applying former Mississippi penalty statute to unsuccessful plaintiff-appellant).

       The appellants in Lindsey also attacked the constitutionality of provisions of the statute that required tenants challenging eviction proceedings to proceed to trial within six months and to bring only certain claims and defenses. The Court upheld these provisions against appellants’ facial challenge. Lindsey v. Normet, 405 U. S., at 64-69.

       Appellant argues that § 11-3-23 impermissibly burdens some litigants’ access to the State’s appellate system. Although the Court indicated in Lindsey that the effective foreclosure of a state right to appeal as to some litigants only — for example, indigent litigants — might well violate equal protection guarantees under even deferential scrutiny, see Lindsey, supra, at 77, 79, appellee rightly notes that appellant lacks standing to challenge § 11-3-23 on this basis, because appellant has not alleged that its own right to appeal has been foreclosed by the statute. See Broadrick v. Oklahoma, 413 U. S. 601, 610 (1973).

       Mississippi does not have an intermediate appellate court. Appeals are taken directly from the State’s 40 trial courts to the Mississippi Supreme Court, which has appellate jurisdiction over all matters originating in any of the trial courts, as well as those coming to the trial courts from numerous administrative agencies. See Brief for Mississippi Trial Lawyers Assn, as Amicus Curiae 4-5, and n. 4. Thus, “[e]very losing litigant is given an automatic right of appeal” to the Mississippi Supreme Court. Walters v. Inexco Oil Co., 440 So. 2d 268, 275 (Miss. 1983). That tribunal has observed that this “unfettered automatic right of appeal brings its own evils.” Ibid.

       The Court asserts that the 15% penalty is “a relatively modest additional assessment,” ante, at 84, when compared to the Oregon double-bond requirement for a defendant tenant, which the Court struck down in Lindsey v. Normet, 405 U. S. 56 (1972). This assertion is facile. Pursuant to § 11-3-23, the Mississippi Supreme Court imposed a mandatory $243,000 penalty against appellant in the instant case; this was in addition to extraordinary punitive damages. It is difficult to see the modesty in this imposition.
      It is true that the Oregon statute at issue in Lindsey was more burdensome on the right to appeal in the sense that, by requiring that the bond be posted before an appeal was taken, it effectively foreclosed appeals to indigent defendants. See 405 U. S., at 79. But surely a penalty need not foreclose an appeal before it is recognized as burdensome. Cf. ibid, (disapproving the Oregon scheme because it raises the stakes of appealing an adverse judgment).

       Because I conclude that § 11-3-23 is not reasonably related to the state interests advanced in its defense, I need not address whether those interests are “legitimate” for purposes of equal protection analysis.

         The unnecessarily broad sweep of § 11-3-23 is illuminated by comparison to Mississippi Supreme Court Rule 38, adopted July 6, 1987, and effective January 1, 1988, which provides for sanctions for the taking of a frivolous appeal in any civil ease to which § 11-3-23 does not apply. It clearly reflects Mississippi’s recognition that frivolous appeals can be specifically identified, and further demonstrates the irrationality of distinguishing between appeals taken from money judgments and other appeals.


source: Caselaw Access Project

author: Justice Marshall

license: Public Domain

text:
    PATRICK v. BURGET et al.
    No. 86-1145.
    Argued February 22, 1988
    Decided May 16, 1988

      MARSHALL, J., delivered the opinion for the Court, in which all other Members joined, except Blackmun;' J., who took no part in the consideration or decision of the ease.

      Barbee B. Lyon argued the cause for petitioner. With him on the brief was Don H. Marmaduke.

      Thomas M. Triplett argued the cause and filed a brief for respondents.

      Briefs of amici curiae urging reversal were filed for the United States by Solicitor General Fried, Assistant Attorney General Rule, Deputy Solicitor General Cohen, Deputy Assistant Attorney General Starling, Roy T. Englert, Jr., Robert B. Nicholson, Laura Heiser, and Robert D. Paul; for the American Psychological Association by Donald N. Bersoff and David W. Ogden; and for the Association of American Physicians & Surgeons, Inc., et al. by Russell Iungerich and Kent Masterson Brown.

      Briefs of amici curiae urging affirmance were filed for the American Medical Association et al. by Rex E. Lee, Carter G. Phillips, Jack R. Bierig, Douglas R. Carlson, Linda A. Tomaselli, Harold J. Bressler, Raymond F. Mensing, Jr., and Joseph Onek; and for the Federation of State Medical Boards of the United States, Inc., by Robert C. Bass, Jr.

      Briefs of amicus curiae were filed for the Board of Medical Quality Assurance of the State of California et al. by Ellis J. Horvitz, Peter Abra-hams, James E. Ludlam, and David E. Willett; and for the Central and South West Corporation by Jeffrey H. Howard and Ferd. C. Meyer, Jr.

   Justice Marshall

delivered the opinion of the Court.

The question presented in this case is whether the state-action doctrine of Parker v. Brown, 317 U. S. 341 (1943), protects physicians in the State of Oregon from federal antitrust liability for their activities on hospital peer-review committees.

I

Astoria, Oregon, where the events giving rise to this lawsuit took place, is a city of approximately 10,000 people located in the northwest comer of the State. The only hospital in Astoria is the Columbia Memorial Hospital (CMH). Astoria also is the home of a private group-medical practice called the Astoria Clinic. At all times relevant to this case, a majority of the staff members at the CMH were employees or partners of the Astoria Clinic.

Petitioner Timothy Patrick is a general and vascular surgeon. He became an employee of the Astoria Clinic and a member of the CMH’s medical staff in 1972. One year later, the partners of the Clinic, who are the respondents in this case, invited petitioner to become a partner of the Clinic. Petitioner declined this offer and instead began an independent practice in competition with the surgical practice of the Clinic. Petitioner continued to serve on the medical staff of the CMH.

After petitioner established his independent practice, the physicians associated with the Astoria Clinic consistently refused to have professional dealings with him. Petitioner received virtually no referrals from physicians at the Clinic, even though the Clinic at times did not have a general surgeon on its staff. Rather than refer surgery patients to petitioner, Clinic doctors referred them to surgeons located as far as 50 miles from Astoria. In addition, Clinic physicians showed reluctance to assist petitioner with his own patients. Clinic doctors often declined to give consultations, and Clinic surgeons refused to provide backup coverage for patients under petitioner’s care. At the same time, Clinic physicians repeatedly criticized petitioner for failing to obtain outside consultations and adequate backup coverage.

In 1979, respondent Gary Boelling, a partner at the Clinic, complained to the executive committee of the CMH’s medical staff about an incident in which petitioner had left a patient in the care of a recently hired associate, who then left the patient unattended. The executive committee decided to refer this complaint, along with information about other cases handled by petitioner, to the State Board of Medical Examiners (BOME). Respondent Franklin Russell, another partner at the Clinic, chaired the committee of the BOME that investigated these matters. The members of the BOME committee criticized petitioner’s medical practices to the full BOME, which then issued a letter of reprimand that had been drafted by Russell. The BOME retracted this letter in its entirety after petitioner sought judicial review of the BOME proceedings.

Two years later, at the request of respondent Richard Harris, a Clinic surgeon, the executive committee of the CMH’s medical staff initiated a review of petitioner’s hospital privileges. The committee voted to recommend the termination of petitioner’s privileges on the ground that petitioner’s care of his patients was below the standards of the hospital. Petitioner demanded a, hearing, as provided by hospital bylaws, and a five-member ad hoc committee, chaired by respondent Boelling, heard the charges and defense. Petitioner requested that the members of the committee testify as to their personal bias against him, but they refused to accommodate this request. Before the committee rendered its decision, petitioner resigned from the hospital staff rather than risk termination.

During the course of the hospital peer-review proceedings, petitioner filed this lawsuit in the United States District Court for the District of Oregon. Petitioner alleged that the partners of the Astoria Clinic had violated §§ 1 and 2 of the Sherman Act, ch. 647, 26 Stat. 209, 15 U. S. C. §§ 1, 2. Specifically, petitioner contended that the Clinic partners had initiated and participated in the hospital peer-review proceedings to reduce competition from petitioner rather than to improve patient care. Respondents denied this assertion, and the District Court submitted the dispute to the jury with instructions that it could rule in favor of petitioner only if it found that respondents’ conduct was the result of a specific intent to injure or destroy competition.

The jury returned a verdict against respondents Russell, Boelling, and Harris on the § 1 claim and against all of the respondents on the § 2 claim. It awarded damages of $650,000 on the two antitrust claims taken together. The District Court, as required by law, see 15 U. S. C. § 15(a), 38 Stat. 731, trebled the antitrust damages.

The Court of Appeals for the Ninth Circuit reversed. 800 F. 2d 1498 (1986). It found that there was substantial evidence that respondents had acted in bad faith in the peer-review process. The court held, however, that even if respondents had used the peer-review process to disadvantage a competitor rather than to improve patient care, their conduct in the peer-review proceedings was immune from antitrust scrutiny. The court reasoned that the peer-review activities of physicians in Oregon fall within the state-action exemption from antitrust liability because Oregon has articulated a policy in favor of peer review and actively supervises the peer-review process. The court therefore reversed the judgment of the District Court as to petitioner’s antitrust claims.

We granted certiorari, 484 U. S. 814 (1987), to decide whether the state-action doctrine protects respondents’ hospital peer-review activities from antitrust challenge. We now reverse.

II

In Parker v. Brown, 317 U. S. 341 (1943), this Court considered whether the Sherman Act prohibits anticompetitive actions of a State. Petitioner in that case was a raisin producer who brought suit against the California Director of Agriculture to enjoin the enforcement of a marketing plan adopted under the State’s Agricultural Prorate Act. That statute restricted competition among food producers in the State in order to stabilize prices and prevent economic waste. Relying on principles of federalism and state sovereignty, this Court refused to find in the Sherman Act “an unexpressed purpose to nullify a state’s control over its officers and agents.” Id., at 351. The Sherman Act, the Court held, was not intended “to restrain state action or official action directed by a state.” Ibid.

Although Parker involved a suit against a state official, the Court subsequently recognized that Parker’s federalism rationale demanded that the state-action exemption also apply in certain suits against private parties. See, e. g., Southern Motor Carriers Rate Conference, Inc. v. United States, 471 U. S. 48 (1985). If the Federal Government or a private litigant always could enforce the Sherman Act against private parties, then a State could not effectively implement a program restraining competition among them. The Court, however, also sought to ensure that private parties could claim state-action immunity from Sherman Act liability only when their anticompetitive acts were truly the product of state regulation. We accordingly established a rigorous two-pronged test to determine whether anticompetitive conduct engaged in by private parties should be deemed state action and thus shielded from the antitrust laws. See California Retail Liquor Dealers Assn. v. Midcal Aluminum, Inc., 445 U. S. 97 (1980). First, “the challenged restraint must be ‘one clearly articulated and affirmatively expressed as state policy.’” Id., at 105, quoting Lafayette v. Louisiana Power & Light Co., 435 U. S. 389, 410 (1978) (opinion of Brennan, J.). Second, the anticompetitive conduct “must be ‘actively supervised’ by the State itself.” California Retail Liquor Dealers Assn. v. Midcal Aluminum, Inc., supra, at 105, quoting Lafayette v. Louisiana Power & Light Co., supra, at 410 (opinion of Brennan, J.). Only if an anticompetitive act of a private party meets both of these requirements is it fairly attributable to the State.

In this case, we need not consider the “clear articulation” prong of the Midcal test, because the “active supervision” requirement is not satisfied. The active supervision requirement stems from the recognition that “[wjhere a private party is engaging in the anticompetitive activity, there is a real danger that he is acting to further his own interests, rather than the governmental interests of the State. ” Hallie v. Eau Claire, 471 U. S. 34, 47 (1985); see id., at 45 (“A private party. . . may be presumed to be acting primarily on his or its own behalf”). The requirement is designed to ensure that the state-action doctrine will shelter only the particular anticompetitive acts of private parties that, in the judgment of the State, actually further state regulatory policies. Id., at 46-47. To accomplish this purpose, the active supervision requirement mandates that the State exercise ultimate control over the challenged anticompetitive conduct. Cf. Southern Motor Carriers Rate Conference, Inc. v. United States, supra, at 51 (noting that state public service commissions “have and exercise ultimate authority and control over all intrastate rates”); Parker v. Brown, supra, at 352 (stressing that a marketing plan proposed by raisin growers could not take effect unless approved by a state board). The mere presence of some state involvement or monitoring does not suffice. See 324 Liquor Corp. v. Duffy, 479 U. S. 335, 345, n. 7 (1987) (holding that certain forms of state scrutiny of a restraint established by a private party did not constitute active supervision because they did not “exerft] any significant control over” the terms of the restraint). The active supervision prong of the Midcal test requires that state officials have and exercise power to review particular anticompeti-tive acts of private parties and disapprove those that fail to accord with state policy. Absent such a program of supervision, there is no realistic assurance that a private party’s anticompetitive conduct promotes .state policy, rather than merely the party’s individual interests.

Respondents in this case contend that the State of Oregon actively supervises the peer-review process through the State Health Division, the BOME, and the state judicial system. The Court of Appeals, in finding the active supervision requirement satisfied, also relied primarily on the powers and responsibilities of these state actors. Neither the Court of Appeals nor respondents, however, have succeeded in showing that any of these actors reviews — or even could review — private decisions regarding hospital privileges to determine whether such decisions comport with state regulatory policy and to correct abuses.

Oregon’s Health Division has general supervisory powers over “matters relating to the preservation of life and health,” Ore. Rev. Stat. §431.110(1) (1987), including the licensing of hospitals, see §441.025, and the enforcement of health laws, see §§431.120(1), 431.150, 431.155(1). Hospitals in Oregon are under a statutory obligation to establish peer-review procedures and to review those procedures on a regular basis. See §§441.055(3)(c), (d). The State Health Division, exercising its enforcement powers, may initiate judicial proceedings against any hospital violating this law. See §§ 431.150, 431.155. In addition, the Health Division may deny, suspend, or revoke a hospital’s license for failure to comply with the statutory requirement. See §441.030(2). Oregon law specifies no other ways in which the Health Division may supervise the peer-review process.

This statutory scheme does not establish a state program of active supervision over peer-review decisions. The Health Division’s statutory authority over peer review relates only to a hospital’s procedures; that authority does not encompass the actual decisions made by hospital peer-review committees. The restraint challenged in this case (and in most cases of its kind) consists not in the procedures used to terminate hospital privileges, but in the termination of privileges itself. The State does not actively supervise this restraint unless a state official has and exercises ultimate authority over private privilege determinations. Oregon law does not give the Health Division this authority: under the statutory scheme, the Health Division has no power to review private peer-review decisions and overturn a decision that fails to accord with state policy. Thus, the activities of the Health Division under Oregon law cannot satisfy the active supervision requirement of the state-action doctrine.

Similarly, the BOME does not engage in active supervision over private peer-review decisions. The principal function of the BOME is to regulate the licensing of physicians in the State.. As respondents note, Oregon hospitals are required by statute to notify the BOME promptly of a decision to terminate or restrict privileges. See Ore. Rev. Stat. § 441.820(1) (1987). Neither this statutory provision nor any other, however, indicates that the BOME has the power to disapprove private privilege decisions. The apparent purpose of the reporting requirement is to give the BOME an opportunity to determine whether additional action on its part, such as revocation of a physician’s license, is warranted. Certainly, respondents have not shown that the BOME in practice reviews privilege decisions or that it ever has asserted the authority to reverse them.

The only remaining alleged supervisory authority in this case is the state judiciary. Respondents claim, and the Court of Appeals agreed, that Oregon’s courts directly review privilege-termination decisions and that this judicial review constitutes active state supervision. This Court has not previously considered whether state courts, acting in their judicial capacity, can adequately supervise private conduct for purposes of the state-action doctrine. All of our prior cases concerning state supervision over private parties have involved administrative agencies, see, e. g., Southern Motor Carriers Rate Conference, Inc. v. United States, 471 U. S. 48 (1985), or State Supreme Courts with agency-like responsibilities over the organized bar, see Bates v. State Bar of Arizona, 433 U. S. 350 (1977). This case, however, does not require us to decide the broad question whether judicial review of private conduct ever can constitute active supervision, because judicial review of privilege-termination decisions in Oregon, if such review exists at all, falls far short of satisfying the active supervision requirement.

As an initial matter, it is not clear that Oregon law affords any direct judicial review of private peer-review decisions. Oregon has no statute expressly providing for judicial review of privilege terminations. Moreover, we are aware of no case in which an Oregon court has held that judicial review of peer-review decisions is available. The two cases that respondents have cited certainly do not hold that a physician whose privileges have been terminated by a private hospital is entitled to judicial review. In each of these cases, the Oregon Supreme Court assumed, but expressly did not decide, that a complaining physician was entitled to the kind of review he requested. See Straube v. Emanuel Lutheran Charity Board, 287 Ore. 375, 383, 600 P. 2d 381, 386 (1979) (“We have assumed (but not decided) for the purpose of this case that plaintiff is entitled to ‘fair procedure’ as a common law right”); Huffaker v. Bailey, 273 Ore. 273, 275, 540 P. 2d 1398, 1399 (1975) (“In view of our conclusion that petitioner cannot prevail even assuming the case is properly before us, we find it unnecessary to decide these interesting questions [of reviewability]. Therefore, we assume, but do not decide, that the hospital’s decisions are subject to review by mandamus . . .”).

Moreover, the Oregon courts have indicated that even if they were to provide judicial review of hospital peer-review proceedings, the review would be of a very limited nature.' The Oregon Supreme Court, in its most recent decision addressing this matter, stated that a court “should [not] decide the merits of plaintiff’s dismissal” and that “[i]t would be unwise for a court to do more than to make sure that some sort of reasonable procedure was afforded and that there was evidence from which it could be found that plaintiff’s conduct posed a threat to patient care.” Straube v. Emanuel Lutheran Charity Board, supra, at 384, 600 P. 2d, at 386. This kind of review would fail to satisfy the state-action doctrine’s requirement of active supervision. Under the standard suggested by the Oregon Supreme Court, a state court would not review the merits of a privilege termination decision to determine whether it accorded with state regulatory policy. Such constricted review does not convert the action of a private party in terminating a physician’s privileges into the action of the State for purposes of the state-action doctrine.

Because we conclude that no state actor in Oregon actively supervises hospital peer-review decisions, we hold that the state-action doctrine does not protect the peer-review activities challenged in this case from application of the federal antitrust laws. In so holding, we are not unmindful of the policy argument that respondents and their amici have advanced for reaching the opposite conclusion. They contend that effective peer review is essential to the provision of quality medical care and that any threat of antitrust liability will prevent physicians from participating openly and actively in peer-review proceedings. This argument, however, essentially challenges the wisdom of applying the antitrust laws to the sphere of medical care, and as such is properly directed to the legislative branch. To the extent that Congress has declined to exempt medical peer review from the reach of the antitrust laws, peer review is immune from antitrust scrutiny only if the State effectively has made this conduct its own. The State of Oregon has not done so. Accordingly, we reverse the judgment of the Court of Appeals.

It is so ordered.

Justice Blackmun took no part in the consideration or decision of this case.

       Petitioner originally named all of the partners of the Astoria Clinic as defendants. One partner, however, was dismissed from the suit at the close of petitioner’s case at trial.

       The court below did not address any issues arising from petitioner’s decision to resign from the hospital staff prior to the ad hoc committee’s determination, and respondents did not raise this matter in their response to the petition for certiorari. Accordingly, we do not address the significance, if any, of petitioner’s resignation.

       Viewing the evidence in the light most favorable to petitioner, as appropriate in light of the verdicts rendered by the jury, the Court of Appeals characterized respondents’ conduct as “shabby, unprincipled and unprofessional.” 800 F. 2d, at 1509.

       The Court of Appeals also determined that respondent Russell’s activities as a member of the BOME likewise were immune from antitrust liability under the state-action doctrine. As we read the petition for writ of certiorari in this case, petitioner has declined to challenge this holding of the Court of Appeals. Indeed, petitioner asserts that this holding makes no difference to him because he suffered little or no damage from the BOME proceedings or respondent Russell’s participation therein. Be-eause petitioner has not brought this aspect of the Court of Appeals’ decision before us, we express no view as to its correctness.

       The petition for certiorari also presented the question whether, assuming that respondent Russell’s activities as a member of the BOME constitute state action and thus cannot directly form the basis for antitrust liability, evidence of those activities is admissible insofar as it indicates the presence of a nonimmune conspiracy in which Russell and others engaged. A close reading of the opinion below, however, reveals that the Court of Appeals did not address this question. This Court usually will decline to consider questions presented in a petition for certiorari that have not been considered by the lower court. See, e. g., Youakim v. Miller, 425 U. S. 231, 234 (1976) (per curiam). We see no reason to depart from this practice in the case at bar. Accordingly, we take no position on the eviden-tiary question raised by petitioner.

       Indeed, the statutory scheme indicates that the Health Division has only limited power over even a hospital’s peer-review procedures. The statute authorizes the Health Division to force a hospital to comply with its obligation to establish and regularly review peer-review procedures, but the statute does not empower the Health Division to Review the quality of the procedures that the hospital adopts.

       The statutory provision requiring hospitals to inform the BOME of a decision to terminate privileges is only one of several statutory reporting requirements involving the BOME. Oregon law also provides that hospitals and licensees shall report medically incompetent conduct to the BOME. See Ore. Rev Stat. §677.415(2) (1987). Further, malpractice insurers must report all medical malpractice claims to the BOME. See § 743.770. All of these reporting requirements appear designed to ensure that the BOME will learn of instances of substandard medical care so that it can decide whether official action is warranted.

       Congress in fact insulated certain medical peer-review activities from antitrust liability in the Health Care Quality Improvement Act of 1986, 42 U. S. C. § 11101 et seq. (1982 ed., Supp. IV). The Act, which was enacted well after the events at issue in this case and is not retroactive, essentially immunizes peer-review action from liability if the action was taken- “in the reasonable belief that [it] was in the furtherance of quality health care.” § 11112(a). The Act expressly provides that it does not change other “immunities under-law,” § 11115(a), including the state-action immunity, thus allowing States to immunize peer-review action that does not meet the federal standard. In enacting this measure, Congress clearly noted and responded to the concern that the possibility of antitrust liability will discourage effective peer review. If physicians believe that the Act provides insufficient immunity to protect the peer-review process fully, they must take that matter up with Congress.