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Wollersheim v. Church of Scientology of California

By June 2, 2010October 24th, 2018Jorge Hurtado, Published Decisions

6 Cal.Rptr.2d 532
Cal.App. 2 Dist.,1992.
March 20, 1992. (Approx. 20 pages)

Review Granted
Previously published at: 4 Cal.App.4th 107410 Cal.App.4th 370 15 Cal.App.4th 1426
(Cal.Const. art. 6, s 12; Cal. Rules of Court, Rules 28, 976, 977, 979)
Former member of religious organization brought action against organization alleging intentional and negligent infliction of emotional injury. The Superior Court, Los Angeles County, No. C332827, Ronald Swearinger, J., entered judgment on jury verdict awarding $30 million in compensatory and punitive damages. Religious organization appealed. The Court of Appeal, 212 Cal.App.3d 872, 260 Cal.Rptr. 331, reversed in part and affirmed in part as modified. After the California Supreme Court denied petitions for review, the United States Supreme Court, 499 U.S. 914, 111 S.Ct. 1298, 113 L.Ed.2d 234, granted certiorari, vacated judgment, and remanded case for consideration in light of intervening case law. On remand, the Court of Appeal, Johnson, J., held that: (1) California procedures for determining punitive damage awards past constitutional muster under due process standards announced in Haslip ; (2) punitive damages award was appropriate, but amount, which equaled 150% of organization’s net worth at time of trial, was excessive, and would be reversed unless former member accepted remittitur of punitive damages judgment to $2 million; (3) it was both proper and constitutional for court to reduce award through remittitur rather than reverse entire punitive damages award for excessiveness; and (4) religious organization was not exempt from punitive damages for acts which were not constitutionally protected religious practices.
Affirmed in part and reversed in part with remittitur.
*534 Rabinowitz, Boudin, Standard, Krinsky & Lieberman, and Eric M. Lieberman and Terry Gross, New York City, Lenske, Lenske & Heller, and Lawrence E. Heller, Woodland Hills, and Michael Lee Hertzberg, New York City, for defendant and appellant.
Cummins and White, Barry Van Sickle, Robert S. Horwitz, and Tina B. Fisher, Los Angeles, for plaintiff and respondent.JOHNSON, Associate Justice.
This case is on remand from the United States Supreme Court to reconsider the punitive damage award modified and approved in our earlier opinion (Wollersheim v. Church of Scientology (1989) 212 Cal.App.3d 872, 260 Cal.Rptr. 331, rev. den. Oct. 26, 1989, cert. grtd., vac. and remd. (1991) 499 U.S. 914, 111 S.Ct. 1298, 113 L.Ed.2d 234,) in the light of the high court’s decision in Pacific Mut. Life Ins. Co. v. Haslip (1991) 499 U.S. 1, 111 S.Ct. 1032, 113 L.Ed.2d 1. To facilitate review of this question, we ordered supplemental briefing and heard oral argument from the parties. Upon reconsideration, we conclude the California procedures for determining punitive damage awards pass constitutional muster under Haslip. We further conclude, as we did in our prior opinion, the jury acted appropriately in imposing a punitive damage award in this case but the amount it awarded is excessive under the standards established by California law. Consequently, we affirm the judgment, subject to a remittitur. [FN1]FN1. Our prior opinion dealt exhaustively with the tort, freedom of religion, evidentiary and procedural issues appellant raised in its
appeal. Our rationale for and disposition of those issues remain the same. We see no virtue in repeating that discussion in this opinion. Accordingly, except as we may touch some of these topics tangentially in the course of addressing the question of the punitive damages award and its constitutionality, as to all these issues the original opinion remains and is incorporated intact and unaltered in this decision. The punitive damages section and the disposition paragraph of the original opinion, however, are replaced in their entirety by this opinion.*535 I. THE PROCEEDINGS THUS FAR.
The original appeal followed a jury award of $30 million in compensatory and punitive damages to Larry Wollersheim (Wollersheim), a former member of the Church of Scientology (Scientology). The complaint alleged Scientology intentionally and negligently inflicted severe emotional injury on Wollersheim through certain practices, including “auditing,” “disconnect,” and “fair game.” Since the trial court granted summary adjudication that Scientology is a religion and “auditing” is a religious practice, the trial proceeded under the assumption they were. In our original opinion we concluded there was substantial evidence to support a finding Scientology had committed the tort of intentional infliction of emotional injury against Wollersheim. We also found sufficient evidence the “auditing” and other practices in this case were conducted in a coercive environment. Thus, none of them qualified as “voluntary religious practices” entitled to constitutional protection under the First Amendment religious freedom guarantees. At the same time, we concluded both the compensatory and punitive damages the jury awarded in this case were excessive. Consequently, we reduced the compensatory damages to $500,000 and the punitive damage award to $2 million.
The California Supreme Court denied the petitions for review unanimously. (Oct. 26, 1989.) The United States Supreme Court, however, granted certiorari on the punitive damages issue and held this case along with ten others (see fn. 4, infra ) awaiting its disposition of the lead case on the constitutionality of punitive damages–Pacific Mut. Life Ins. Co. v. Haslip, supra, 499 U.S. 1, 111 S.Ct. 1032. After deciding Haslip, the Supreme Court remanded all 11 punitive damage cases it was holding for the lower courts to review in light of Haslip.
Since the Haslip opinion was limited solely to the issue of the constitutionality of punitive damage awards, our reconsideration of our prior decision likewise is confined to that issue. [FN2] We first review the *536 procedures and standards California courts apply in deciding the appropriateness and amount of punitive damage awards and determine whether that process is constitutional under Haslip. We then examine the specific punitive damage award in this case, as reduced by this court, and determine whether it passes constitutional muster.FN2. After this court filed its original opinion in the instant case the United States Supreme Court decided Employment Div. Dept. of Human Res. of Oregon v. Smith (1990) 494 U.S. 872, 110 S.Ct. 1595, 108 L.Ed.2d 876. In this decision, the high court altered the constitutional standard for judging whether a state law which impinges on a citizen’s free exercise of religion violates the First Amendment. No longer must there be a compelling interest in applying the state law to those whose religion prohibits compliance. After Smith it is sufficient the law is a valid, neutral law of general applicability and not aimed at a specific religion or at religion in general. “To make an individual’s obligation to obey such a law contingent upon the law’s coincidence with his religious beliefs, except where the State’s interest is ‘compelling’–permitting him, by virtue of his beliefs, ‘to become a law unto himself,’ (citation omitted)–contradicts both constitutional tradition and common sense.” (Id. 110 S.Ct. at p. 1603.) The California Supreme Court presently has before it the issue whether the religious guarantees of the state Constitution are to fall into line with the Smith decision. Our state’s highest court recently granted review of an appellate decision holding the “compelling state interest analysis
still applies under state constitutional law.” (Donahue v. Fair Employment & Housing Comm. (1991) 1 Cal.App.4th 387, 401, 2 Cal.Rptr.2d 32, rev. gr. Feb. 27, 1992. See also People v. Woody (1964) 61 Cal.2d 716, 40 Cal.Rptr. 69, 394 P.2d 813 and Molko v. Holy Spirit Assn. (1988) 46 Cal.3d 1092, 252 Cal.Rptr. 122, 762 P.2d 46, pre- Smith decisions applying compelling interest balancing test to free exercise issues and arguably decided under California Constitution as well as United States Constitution.) We need not reenter this particular thicket, however. To the extent we reached that step of the analysis, this court applied the compelling interest test to its review of the constitutionality of imposing tort liability on Scientology’s “fair game,” “disconnect,” and “auditing” practices. (See Wollersheim v. Church of Scientology, supra, 212 Cal.App.3d at pp. 887-899, 260 Cal.Rptr. 331.) For the most part, as will be recalled, we found these activities were not constitutionally protected religious practices because Wollersheim was coerced into participating in them. Accordingly, in most instances it was unnecessary to ask the next question–whether the state had a “compelling interest” which overrode the “free exercise” concerns. Where that question was reached, however, we used the stricter, pre-Smith standard. Having upheld the constitutionality of the state’s tort laws under this tougher standard, it
is unnecessary to reconsider whether those laws would survive the lesser standard suggested in Smith. For the same reason, we also need not bother pondering the intriguing question whether the religious guarantees of the state Constitution will continue to impose a compelling interest test on state laws of general application even though the federal Constitution no longer does.II. THE PROCESS CALIFORNIA USES FOR DETERMINING AND REVIEWING PUNITIVE DAMAGES AWARDS IS CONSTITUTIONAL UNDER THE RECENT UNITED STATES SUPREME COURT DECISION IN PACIFIC MUTUAL INSURANCE CO. v. HASLIP.
[1] This court and other California appellate courts already have ruled this state’s procedures for determining punitive damages comply with the “due process” standards enunciated in Haslip. (Liberty Transport, Inc. v. Harry W. Gorst Co. (1991) 229 Cal.App.3d 417, 280 Cal.Rptr. 159; Las Palmas Associates v. Las Palmas Center (1991) 235 Cal.App.3d 1220, 1 Cal.Rptr.2d 301.) None of these opinions, however, had occasion to consider this question in depth. Consequently, we examine the Haslip opinion in some detail and the Alabama punitive damages procedures approved in that decision as background for reviewing the punitive damage award the jury levied on Scientology. As further background for our review, we also have included an appendix containing a table of appellate opinions in which California courts evaluated punitive damage awards. This table updates a similar table which appears in Devlin v. Kearney Mesa AMC/Jeep/Renault, Inc. (1984) 155 Cal.App.3d 381, 393-396, 202 Cal.Rptr. 204.
In Haslip an insurance agent was accredited by at least one other insurance carrier as well as the defendant, Pacific Mutual. The plaintiffs were employees of a company this agent signed up for a group combined health and life insurance policy. Pacific only supplied the life insurance portion of this policy and another of this agent’s companies provided the health insurance component. Later the agent embezzled premiums plaintiffs’ employer had forwarded to him instead of paying them over to the insurance companies. The policies were cancelled. So when these plaintiffs became sick they suddenly and unhappily found out they had no health coverage. (111 S.Ct. at p. 1036.)
The plaintiffs sued the agent and Pacific for fraud. The other three plaintiffs only received compensatory damages, but Haslip won “general damages” in the amount of $1,040,000. (111 S.Ct. at p. 1037.) The Supreme Court concluded at least $840,000 of this represented punitive damages. (Id. at fn. 2.) Pacific appealed and the Alabama Supreme Court affirmed, including the punitive damages portion of the award, by a divided vote. After granting certiorari the United States Supreme Court also affirmed in a majority opinion signed by five Justices. Two Justices separately concurred and one dissented. (The ninth Justice did not participate in the decision.)
In assessing the constitutionality of the punitive damages award in Haslip, the United States Supreme Court traced the long history and important role of punitive damages in Anglo-American law. On the basis of this historical review, the high court ruled, “So far as we have been able to determine, every state and federal court that has considered the question has ruled that the common-law method for assessing punitive damages does not in itself violate due process. [Citation omitted.] In view of this consistent history, we cannot say that the common-law method for assessing punitive damages is so inherently unfair as to deny due process and be per se unconstitutional.” (Id. 499 U.S. at p. —-, 111 S.Ct. at p. 1043, 113 L.Ed.2d at p. 19.)
Having ruled punitive damages awards are constitutional in concept, the Supreme Court considered whether the specific award in the Haslip case was constitutionally acceptable. The justices set forth the general considerations that are to guide the decision of whether a specific award is *537 constitutional. “[U]nlimited jury discretion–or unlimited judicial discretion for that matter–in the fixing of punitive damages may invite extreme results that jar one’s constitutional sensibilities…. [G]eneral concerns of reasonableness and adequate guidance from the court when the case is tried to a jury properly enter into the constitutional calculus.” (Id. 499 U.S. at p. —-, 111 S.Ct. at p. 1043, 113 L.Ed.2d at p. 20.)
The Supreme Court described several attributes of the Alabama process for determining punitive damage awards and, on that basis, concluded “the award here did not lack objective criteria…. [I]n this case it does not cross the line into the area of constitutional impropriety.” (Id. 499 U.S. at p. —-, 111 S.Ct. at p. 1046, 113 L.Ed.2d at p. 23.) The high court did not, however, hold nor imply the Alabama process was the one and only system which accords due process. Nor did it suggest any particular attribute of the Alabama process was absolutely essential to constitutionality. [FN3] All the Supreme Court held was that the Alabama process achieved the constitutional requirement of “reasonableness” and “adequate guidance to the jury.” [FN4]FN3. “Other than explaining that Alabama’s procedure passes constitutional muster, Haslip offers little guidance as to what would be necessary to render a different system unconstitutional.” (George v. International Society for Krishna Consciousness of California, etc. (1992) 3 Cal.App.4th 52, 119, 4 Cal.Rptr.2d 473, 515.)

FN4. It is clear we are not alone in construing Haslip to allow a variety of punitive damage systems which do not necessarily mimic the Alabama system under review in that particular case. According to our research, four of the eleven cases the Supreme Court remanded after
Haslip have been decided thus far and another sixteen other cases (other than those decided by California courts) have considered the constitutionality of their state punitive damages processes under the Haslip opinion. In all four remanded cases the courts upheld the state punitive damages system under review and affirmed the particular award. Thus, the punitive damages procedures of Alabama, Georgia, and Mississippi as well as California have passed constitutional muster at least at the first level of appeal in these remanded cases. (Alabama: Southern Life and Health Insurance Co. v. Turner (Ala.1991) 586 So.2d 854; Georgia: Hospital Authority of Gwinnett County v. Jones (Ga.1991) 261 Ga. 613, 409 S.E.2d 501; California: George v. International Society for Krishna Consciousness of California, supra, 3 Cal.App.4th 52, 4 Cal.Rptr.2d 473); Mississippi: Eichenseer v. Reserve Life Ins. Co. (5th Cir.1991) 934 F.2d 1377.) Of the 16 other cases evaluating the constitutionality of punitive damages awards under Haslip, 11 upheld the jurisdiction’s process and the specific award outright, two upheld the process but found the specific award excessive (as we do in the instant case), and 3 found their state’s process defective in some way. In total, in these 16 cases state or federal courts have applied Haslip and approved the punitive damage procedures in 10 states (in addition to California): Alabama (once
again): Yamaha Motor Co. Ltd. v. Thornton (Ala.1991) 579 So.2d 619; Killough v. Jahandarfard (Ala.1991) 578 So.2d 1041; Braswell v. Conagra, Inc. (11th Cir.1991) 936 F.2d 1169; Louisiana: Galjour v. General American Tank Car Corp. (E.D.La.1991) 764 F.Supp. 1093; Minnesota: Bradley v. Hubbard Broadcasting, Inc. (Minn.App.1991) 471 N.W.2d 670 [procedure approved although specific award found excessive]; Missouri: Wolf v. Goodyear Tire & Rubber Co. (Mo.App.1991) 808 S.W.2d 868; Oregon: Oberg v. Honda Motor Co. (1991) 108 Or.App. 43, 814 P.2d 517; Pennsylvania: Coyne v. Allstate Insurance Co. (E.D.Pa.1991) 771 F.Supp. 673; South Carolina: [Gamble v. Stevenson, (S.C.1991) 406 S.E.2d 350; Texas: Glasscock v. Armstrong Cork Co. (5th Cir.1991) 946 F.2d 1085; State Farm Mutual Auto Insurance Co. v. Zubiate (Tex.App.1991) 808 S.W.2d 590 [procedure approved although specific award found excessive]; Wisconsin: Heideman v. American Family Ins. Group (App.1991) 163 Wis.2d 847, 473 N.W.2d 14.; Arkansas: Robertson Oil Co., Inc. v. Phillips Petroleum Co. (W.D.Ark.1991) 779 F.Supp. 994. Several of these courts found procedures constitutional which deviated substantially from the Alabama punitive damage system approved in Haslip. For instance, the Fifth Circuit held the Texas procedure constitutional even though juries and courts only consider three factors–
nature of the wrong, degree of culpability, and extent the conduct offends propriety and justice–all of them relate solely to the reprehensibility of the defendant’s conduct. (Glasscock v. Armstrong Cork Co., supra, 946 F.2d 1085.) The Pennsylvania and Missouri procedures were found to satisfy Haslip even though the jury awards are reviewed for “excessiveness” without any specific, articulated standards. (Coyne v. Allstate Insurance Co., supra, 771 F.Supp. 673; Wolf v. Goodyear Tire & Rubber Co., supra, 808 S.W.2d 868.) And, the Oregon procedure was approved even though the state Constitution severely limits the review of jury awards of punitive damages by allowing reversal only when a reviewing court finds a lack of any evidence to support the award. (Oberg v. Honda Motor Co., supra, 814 P.2d 517.)The Supreme Court found several features of the Alabama process worthy of *538 mention. We consider each and consider how the Supreme Court’s observations about Alabama criteria and procedures relate to the constitutionality of California’s punitive damages process.
A. The Adequacy of Jury Instructions.
The Supreme Court observed the Alabama jury instructions adequately described the purposes of punitive damages as punishing the defendant and deterring “the defendant and others from doing such wrong in the future,” rather than compensating the plaintiff. The instructions gave the jury “significant discretion” in determining punitive damages, but that discretion was limited to the amount needed to advance the “state policy concerns” of “deterrence and retribution.” Moreover, the degree of discretion allowed “is no greater than that pursued in many familiar areas of the law.” (The Supreme Court listed several examples including “reasonable care,” “due diligence,” and “appropriate compensation for pain and suffering or mental anguish.”) (Id. 111 S.Ct. at pp. 1044.)
We note in the instant case the trial court gave the standard instructions on punitive damages which reflect California law on the same basic subjects as the Alabama instructions endorsed in Haslip. Indeed the California instructions given here were, if anything, more extensive and more precise than the Alabama instructions described in Haslip. Not only did these instructions describe the purposes of punitive damages and distinguish them from compensatory damages, they also informed the jury the amount of damages awarded should bear a reasonable relation to the injury the plaintiff sustained and to the defendant’s financial condition.
Scientology does not claim the trial court failed to give the instructions defining the purposes and scope of punitive damages which the Supreme Court found important in Haslip. Instead Scientology complains the trial court failed to give an instruction appellant’s counsel requested which it now claims was meant to implement the corporate responsibility provision found in Civil Code section 3294, subdivision (b). This provision limits punitive damages against corporations to acts an officer, director or managing agent ordered, ratified or knew about before they happened. [FN5]FN5. Civil Code section 3294, subdivision (b) reads in pertinent part as follows: “With respect to a corporate employer, the advance knowledge and conscious disregard, authorization, ratification or act of oppression, fraud or malice must be on the part of an officer, director or managing agent of the corporation.”Scientology’s requested instruction, however, did not address the “corporate responsibility” issue covered in Civil Code section 3294, subdivision (b). The request did not mention the clause “officer, director, or managing agent” nor suggest Scientology’s liability for punitive damages was limited to actions this class of agent personally did or authorized, ratified, or knew of in advance. Instead the proposed instruction advised jurors they “may not award punitive damages against the defendant Church for the intentional oppressive or malicious acts of its members, employees, or agents, unless you find that the defendant Church of Scientology directed, authorized or ratified such intentional oppressive acts.” As proffered, the requested instruction in no way even hinted only an officer, director or managing agent” could make the “defendant Church of Scientology” liable for punitive damages.
It is not absolutely clear from the record why Scientology did not request a “corporate responsibility” instruction. Perhaps it was because appellant wanted the jurors to think of it as a religious “church” and not a secular “corporation.” In any event, the “corporate responsibility” instruction was not relevant to the issues framed by the pleadings or raised in the evidence. Scientology did not base its defense on a contention Wollersheim’s alleged injuries were inflicted by out of control lower level employees. Instead its pleadings and evidence emphasized the harmful acts, if any, were constitutionally protected religious practices. The evidence was undisputed the “auditing,” “fair game,” and “disconnect” actions *539 taken in regard to Wollersheim were official practices of the Church of Scientology promulgated by its leaders, not some ad hoc aberrational acts of individual employees. Thus, it is not surprising Scientology did not bother to request an instruction it was only liable in punitive damages for what its “officers, directors, or managing agents” personally, authorized or ratified.
[2] By failing to tender a “corporate responsibility” instruction, Scientology is foreclosed under California law from claiming the trial court committed “reversible error” when it neglected to give such an instruction. (Agarwal v. Johnson (1979) 25 Cal.3d 932, 951, 160 Cal.Rptr. 141, 603 P.2d 58 [when defendant corporation failed to tender and the trial court failed to give a “corporate responsibility” instruction in a punitive damage case] the court concluded “[the defendants] have waived their right to complain that a qualified instruction distinguishing between … vicarious liability for compensatory and for punitive damages should have been given”.)
[3][4] Despite having itself failed to propose a “corporate responsibility” instruction during trial Scientology now claims it was denied federal “due process” under Haslip because the trial court also failed to give such an instruction. That the court’s failure to instruct on “corporate responsibility” is not a constitutional violation under Haslip is apparent from the facts of that case. There the United States Supreme Court held a punitive damage award against an insurance company afforded constitutional due process even though the award was imposed for liability for punitive damages was predicated solely respondeat superior. Indeed Alabama law, specifically found to satisfy due process in Haslip, permits punitive damages to be assessed against corporations without any proof the senior corporate officials authorized or ratified the offensive conduct. (Pacific Mut. Life Ins. Co. v. Haslip, supra, 111 S.Ct. at p. 1041.) Thus, it is apparent federal due process does not prohibit the imposition of punitive damages on a corporation just because the corporation’s leadership remains ignorant of the egregious acts of its lesser employees or agents. It is California law–not constitutional due process–which limits corporate liability for punitive damages to acts done, authorized, or ratified by senior corporate officials. Accordingly, the consequences for failing to give a “corporate responsibility” instruction likewise are determined under California law.
[5] Scientology offers a further argument the failure to give this “corporate responsibility” instruction rises to the level of a federal “due process” violation. This argument likewise is without merit. It treats language in Haslip pointing out the “jury was adequately instructed” in that case as if the Supreme Court had held the failure to give any possibly relevant instruction in a punitive damages case automatically violates the federal “due process” clause. For reasons explained above, while it may have been preferable for the trial court to have given a “corporate responsibility” instruction in the instant case, Scientology waived its right to complain by failing to request the instruction. Moreover, under the pleadings and evidence in this case “corporate responsibility” was not a significant issue. Consequently, the “jury was adequately instructed.” The instructions the Supreme Court mentioned in Haslip were those the Alabama court delivered advising the jurors on the purposes of punitive damages and the criteria they were to apply in fixing the amount of those damages. The trial court in the instant case gave instructions covering those same topics. That is the most Haslip and the “due process” clause require.
[6] Finally, after reviewing the total evidence offered in this trial and the actual issues involved, we find that even if it were error to fail to give a “corporate responsibility” instruction that error was not prejudicial. (Henderson v. Harnischfeger Corp. (1974) 12 Cal.3d 663, 670, 117 Cal.Rptr. 1, 527 P.2d 353; Williams v. Carl Karcher Enterprises, Inc. (1986) 182 Cal.App.3d 479, 489, 227 Cal.Rptr. 465; see 9 Witkin, Cal. Procedure (3d ed. 1985) Appeal, § 352, pp. 355-356.) There is nothing to suggest the giving of these instructions would have *540 substantially enhanced the chances Scientology would have prevailed.
B. Evidence of Defendant’s Financial Condition.
The Supreme Court noted with apparent approval Alabama law excludes any evidence of a defendant’s wealth even in punitive damages cases. Thus, “the fact finder must be guided by more than the defendant’s net worth. Alabama plaintiffs do not enjoy a windfall because they have the good fortune to have a defendant with a deep pocket.” (Id. 499 U.S. at p. —-, 111 S.Ct. at p. 1045, 113 L.Ed.2d at p. 22.)
[7] For good reason, Scientology does not claim the California punitive damages process violates due process because it permitted–and now mandates– evidence of a defendant’s financial condition in all punitive damages cases. (Adams v. Murakami (1991) 54 Cal.3d 105, 284 Cal.Rptr. 318, 813 P.2d 1348.) As our Supreme Court has pointed out, the defendant’s financial condition is an essential limitation on the jury’s discretion in this state. The jury is instructed it may only award punitive damages which, taking account of the defendant’s financial condition, are enough to punish and deter but not so high as to impair the defendant’s ability to continue functioning. We do not read the United States Supreme Court opinion in Haslip to suggest a state punitive damages procedure which admits evidence of financial condition for this purpose and with these limiting instructions denies due process to defendants.
C. Review of Punitive Damages at the Trial Court Level.
In Alabama, the posttrial review of punitive damages awards at the trial court level requires the trial judge to scrutinize the amount of those awards for possible “excessiveness.” The criteria the Alabama Supreme Court has set forth to guide this trial court review include “culpability of the defendant’s conduct,” “desirability of discouraging others from similar conduct,” and “impact on the parties.”
California law likewise provides for trial court review of the possible excessiveness of punitive damage awards. The criteria guiding this review, however, are more precise in many ways than those the United States Supreme Court found “meaningful and adequate” in Haslip. As the California Supreme Court listed them in Neal v. Farmers Ins. Exchange, (1978) 21 Cal.3d 910, 148 Cal.Rptr. 389, 582 P.2d 980, and as reemphasized in Adams v. Murakami, supra, 54 Cal.3d. 105, 284 Cal.Rptr. 318, 813 P.2d 1348, these criteria fall in three main categories–first, the relative egregiousness of the defendant’s conduct, as measured by the consequences of its acts, second, whether the punitive damages award bears a reasonable relationship to the plaintiff’s injury, and third, whether the punitive damages award bears a reasonable relationship to the defendant’s financial condition–enough to punish and deter the egregious conduct, but not so much as to destroy the defendant. Nearly all of the individual factors the Alabama courts employ are subsumed under one or the other of the main categories the California courts use.
[8] There is a slight difference between California and Alabama in the procedure required of trial courts after they have completed their review of a punitive damage award. According to Haslip, Alabama requires trial judges to state their findings and reasoning on the record, whether they affirm, modify or reverse the award. (111 S.Ct. at p. 1044.) California has not had such a requirement, although trial judges frequently do so on their own.
Scientology complains the trial judge in this case denied its lengthy new trial and judgment non obstante verdicts (JNOV) motions by filing a simple minute order noting those motions were “denied.” Among other things, these posttrial motions raised punitive damage issues. Scientology seizes upon language in Haslip to the effect Alabama trial courts reflect “on the record” the reasons for refusing to interfere with a jury’s punitive damage award. It interprets this to be a federal “due process” requirement and argues the *541 trial court’s failure to give a detailed account of its reasoning “on the record” denied Scientology its constitutional right.
We first observe that at no place in Haslip did the Supreme Court suggest a state punitive damages procedure had to match the Alabama procedure in each and every aspect if it were to satisfy federal due process requirements. (See fn. 3, supra.) It neither said nor implied it was essential every state require trial judges to state their reasons on the record.
Indeed the Supreme Court seemed to place far more importance on the existence of a set of criteria the trial court is to apply in judging whether the jury’s verdict was excessive than whether the trial court places its reasoning on the record. After mentioning the fact Alabama requires judges to reflect their reasons on the record and then listing the criteria they are to apply in evaluating punitive damage awards, the Supreme Court emphasizes: “[This] test ensures meaningful and adequate review by the trial court whenever a jury has fixed the punitive damages.” (111 S.Ct. at p. 1044, italics added.)
In the instant case, the trial court patiently entertained a lengthy hearing on the new trial and JNOV motions which took several hours spread over several days. The judge fully heard Scientology’s presentation challenging the punitive damages award. These arguments addressed the criteria California law establishes for evaluating the propriety and amount of these awards. A full transcript exists of the arguments made and the evidence relevant to evaluating the propriety and amount of punitive damages. [FN6] Thus the record is complete and sufficient for this court on appeal to review the jury verdict on punitive damages and the trial court’s disposition of Scientology’s claim those damages were excessive. The fact the trial court found it unnecessary to set forth its reasoning on the record only means the court deviated in this one detail from the procedure Alabama apparently follows. It does not mean Scientology was denied a “meaningful and adequate review” of the punitive damage award by the trial court or that it was denied due process.FN6. The posttrial hearing assumes special importance in Alabama. Unlike California, some of the facts essential to meaningful review of the punitive damages award do not appear in the trial record. In particular, Alabama law does not permit either party to introduce any evidence of the defendant’s financial condition at the trial itself. In contrast, California has always allowed such evidence and now requires it. (Adams v. Murakami, supra, 54 Cal.3d 105, 284 Cal.Rptr. 318, 813 P.2d 1348.) Trial courts in Alabama accept this sort of evidence for the first time at the posttrial hearing on excessiveness of the punitive damage award.
Thus, it is only the evidence introduced at this posttrial hearing which allows Alabama’s trial and appellate courts to conduct a “meaningful review” of whether the damages awarded bear a reasonable relation to defendant’s conduct and financial resources.

The record produced in the trial court was more than ample for purposes of that court’s consideration of the punitive damage award and for appellate review by this court. We would have gained little had it reflected the trial court’s reasoning. Indeed that record was sufficient for this court to determine the punitive damages award should be reduced. (See p. 535, supra.)
The trial court here did not violate California law by failing to place its reasoning on the record nor does California law run afoul of the Constitution by failing to require this particular procedural step. This is not to say it would not be a preferable practice for trial judges to do so. It is merely to conclude the failure to make a record of the reasoning behind the trial court’s ruling does not deny the parties of due process under the U.S. constitution. Nor does it constitute reversible error under California law.
There is empirical evidence trial court review in California is “meaningful and adequate” which was not available or at least not mentioned by the Supreme Court in its evaluation of the Alabama process. The high court found trial court review of punitive damages in Alabama to be “meaningful and adequate” without citing any specific examples where trial courts in that state actually had reversed or reduced punitive damages awards. (The high court, on the other hand, specifically mentioned *542 cases where such awards had been reduced at the appellate level.) (Pacific Mut. Life Ins. Co. v. Haslip, supra, 111 S.Ct. at p. 1053.) By way of contrast, the tables incorporated in Devlin v. Kearny Mesa AMC/Jeep Renault, Inc., supra, 155 Cal.App.3d 381, 202 Cal.Rptr. 204 and the appendix to this opinion document numerous cases in which California trial courts have reduced punitive damages awards, a fact which reinforces our finding trial court review of punitive damages awards in California is at least as “meaningful and adequate” as is true in Alabama.
This conclusion is bolstered further by a recent Rand Corporation study of posttrial reductions of jury awards in selected California and Illinois courts. [FN7] (Shanley and Peterson, Posttrial Adjustments to Jury Awards (Rand Institute for Civil Justice (1987).) The study revealed verdicts which include punitive damage awards are reduced over twice as much on average as those limited to compensatory damages–by 43 percent in those with punitive damages versus 18 percent in those without. (Id. at pp. 38-39.) [FN8] Furthermore, courts reduce damage awards far more drastically than they are through posttrial settlements–by 54 percent on average compared to 33 percent. (Id. at pp. 43-46.) The study further found “[m]ore of those cases [in which courts reduced damage awards] resulted from motions to the trial court than from the appeals process.” (Id. at p. 45.) Thus, this empirical data supplies strong evidence California trial courts afford “meaningful and adequate” review of punitive damages awards in practice as well as theory.FN7. The study was based on data from three jurisdictions–Cook County, Illinois, City and County of San Francisco, California, and the ring of counties surrounding it, and “all California counties greater than 150,000 in population but outside the largest metropolitan areas.” (Shanley and Peterson, Posttrial Adjustments to Jury Awards, (Rand Institute for Civil Justice, 1987) at p. 3., fn. 15.) (Despite their size, the latter category included cities as large as Sacramento and Bakersfield.) Although the study included a non-California jurisdiction, the authors report “[r]esults appear to vary little across the three locations in the study.” (Id. at p. ix.) Consequently, the findings discussed in this opinion represent valid evidence of what is happening in this state.

FN8. “In the 165 cases where punitive damages constituted a part of
the total award, final payments were only .57 of the total. In contrast, when only compensatory damages were involved, final payments were .82 of the total…. This result is not just a function of the larger award size of punitive damage cases, but holds for all cases with verdicts greater than $100,000…. [F]or cases with verdicts between $100,000 and $999,000, those with punitive damages paid an average proportion of .61 [a reduction of 39 percent], while those without such damages paid an average proportion of .86 [a reduction of 14 percent]. For cases exceeding $1 million, the difference is about the same. With punitive damages the payout rate was . 55 [a reduction of 45 percent], while without punitive damages the payout was .76 [a reduction of 24 percent]. (Shanley and Peterson, Posttrial Adjustments to Jury Awards, supra, at p. 38.) These findings are corroborated by another Rand study which was confined to punitive damage cases in San Francisco, California, and Cook County, Illinois. That study reported punitive damages were reduced an average 50 percent in the sample it covered from the 1979-1983 period. (Peterson, Sarma and Shanley, Punitive Damages: Empirical Findings (Rand Institute for Civil Justice (1987).)D. Review of Punitive Damages at Appellate Level.
[9] The United States Supreme Court also emphasized the Alabama Supreme Court conducted its own review of the possible excessiveness of the punitive damage award. California likewise provides one and sometimes two levels of appellate review of these awards.
By the time of its review of the Haslip award the list of criteria the Alabama high court applied had been refined to include the “relationship between the punitive damages award and the harm likely to result from the defendant’s conduct as well as the harm that actually has occurred,” “degree of reprehensibility” and “duration” of that conduct, “defendant’s awareness” or “concealment” of the conduct, “existence and frequency of past conduct,” “profitability to the defendant of the wrongful conduct and the desirability of removing that profit and of having the defendant also sustain a loss,” defendant’s “financial position,” “all costs of litigation,” and “imposition of criminal sanctions” or “other civil awards … for the same conduct … these also to *543 be taken in mitigation.” (111 S.Ct. at p. 1045.)
Most but not all of the above criteria are subsumed in the three major categories of criteria California appellate courts as well as trial courts apply in reviewing punitive damages awards. The United States Supreme Court did not hold or imply that each and every one of the criteria the Alabama Supreme Court now applies is essential to due process. It merely held this particular set of criteria was sufficient to satisfy due process, not that another set would fail to do so. The nation’s high court emphasized Alabama’s appellate review “ensures that punitive damages awards are not grossly out of proportion to the severity of the offense and have some understandable relationship to compensatory damages…. Alabama plaintiffs do not enjoy a windfall because they have the good fortune to have a defendant with a deep pocket…. [¶] The standards provide for a rational relationship in determining whether a particular award is greater than reasonably necessary to punish and deter.” (111 S.Ct. at pp. 1045-1046.)
Scientology complains the California criteria do not specifically highlight two factors it deems important–“impact on innocent third parties,” and “punitive damage awards imposed in prior cases for the same conduct.” Nothing in Haslip suggests these two particular factors are essential to the constitutionality of a formula for reviewing punitive damage awards. But it is worthwhile to note both of them can be subsumed under the existing California formula and its overall goal of producing an award that is sufficient to punish and deter harmful conduct but not so severe it destroys the defendant. Evidence of prior punitive damage awards for the same conduct or the impact on “innocent third parties” both bear on that ultimate question and would be admissible under one or the other of the three major categories.
What the United States Supreme Court concluded about the purpose and effect of appellate review of punitive damages awards in Alabama is equally true in California. Our high court has emphasized and reemphasized both trial and appellate courts should scrutinize these awards to ensure the amount is not beyond that required to punish and deter the offending conduct. The United States Supreme Court found appellate review in Alabama had “real effect” primarily because it could point to two cases in which the Alabama Supreme Court had reduced punitive damage awards. A survey of California appellate decisions reveals many reversals and reductions of punitive damages even in cases where the trial court had refused to interfere with the jury’s verdict. (See appendix, infra, and Devlin v. Kearny Mesa AMC/Jeep Renault, Inc., supra, 155 Cal.App.3d at pp. 393-396, 202 Cal.Rptr. 204.)
Scientology complains about the standard of review this court and other California courts apply under California law–the traditional “passion and prejudice” standard. Scientology equates California’s “passion and prejudice” standard with the Vermont and Mississippi standards which the Haslip opinion noted had warranted expressions of “concern” from individual Justices in other opinions. (Pacific Mutual Life Ins. Co. v. Haslip, supra, 111 S.Ct. at p. 1045, fn. 10, citing Browning-Ferris Industries of Vermont, Inc. v. Kelco Disposal, Inc. (1989) 492 U.S. 257, 109 S.Ct. 2909, 106 L.Ed.2d 219 and Bankers Life & Casualty Co. v. Crenshaw (1988) 486 U.S. 71, 108 S.Ct. 1645, 100 L.Ed.2d 62.)
Setting aside the fact the Haslip court only mentioned the Vermont and Mississippi formulations had raised “concerns” and in no way held they violated due process, Scientology is mixing apples and oranges in comparing California’s version of a “passion and prejudice” standard with what exists in these two jurisdictions. Vermont allows punitive damages to be modified or set aside only if “manifestly and grossly excessive” while Mississippi modifies or sets aside a punitive damages verdict only if the award “evinces passion, bias and *544 prejudice on the part of the jury so as to shock the conscience.”
It is true California uses the rubric of a “presumption the jury acted out of passion and prejudice” to justify setting aside or modifying jury awards of punitive damages. But in reality, as discussed earlier, that standard now stands for a set of specific criteria, detailed jury instructions, and procedures which define “passion and prejudice” in a way which is far more precise and far less subjective than the Vermont and Mississippi formulations. [FN9] Indeed as highlighted earlier, the California criteria closely parallel–and in some respects are more precise and less subjective–than the Alabama criteria found constitutional in Haslip. We find nothing in Haslip suggesting California’s version of a “presumption of passion and prejudice” standard of review is unconstitutional. (Accord: Las Palmas Associates v. Las Palmas Center, supra, 235 Cal.App.3d 1220, 1 Cal.Rptr.2d 301.) Accordingly, we have no reservations about applying this standard to the punitive damage award the jury imposed in the instant case.FN9. It is interesting but not essential to our decision in this case to note a federal appellate court has held the Mississippi standard of review is constitutional under Haslip despite the expressions of “concern” reflected in that opinion. Eichenseer v. Reserve Life Ins. Co., supra, 934 F.2d 1377 was one of the other cases the United States Supreme Court was holding at the time it decided Haslip and remanded for reconsideration in the light of Haslip. On remand the Fifth Circuit Court of Appeal evaluated the Mississippi procedures and the specific punitive damage award. The court upheld that award even though it was 500 times compensatory damages and even though Mississippi courts only reverse when an award evinces passion, bias, or prejudice sufficient to “shock the conscience.” (Id. at p. 1386.) “As long as there is some meaningful procedural assurance that the amount of the award is not an impulsive reaction to the wrongful conduct of the defendant, the award survives the procedural protection aspect of the due process analysis….” (Id. at p. 1385.)E. The Preponderance of the Evidence Standard as Applied to Punitive Damages Issues.
[10] The United States Supreme Court expressly approved the use of a “preponderance of the evidence” standard in deciding punitive damages issues. (Pacific Mutual Life Ins. Co. v. Haslip, supra, 111 S.Ct. at p. 1046, fn. 11.) California law has been amended to require the higher standard of “clear and convincing” evidence. (Civ.Code, § 3294, subd. (a).) However, at the time of the trial in the instant case the standard was still “preponderance of the evidence.” Yet, as the nation’s high court held, “the lesser standard prevailing in Alabama–‘reasonably satisfied from the evidence’–when buttressed, as it is, by the procedural and substantive protections outlined above is constitutionally sufficient.” (Pacific Mutual Life Ins. Co. v. Haslip, supra, 111 S.Ct. at p. 1040, fn. 11.) For reasons expressed above, California law supplies the same “buttress” of procedural and substantive protections, and did so at the time the instant case was tried. Accordingly, the use of a “preponderance of the evidence standard” in this case was constitutionally sufficient under Haslip.
Having determined California punitive damages law is constitutional, we now apply that law to the punitive damages award in this case. We first review the guiding principles of California law on this subject, most of which have been mentioned in the course of the constitutional discussion.
A. Applying the California Criteria.
[11] “It is well established that a reviewing court should examine punitive damages and, where appropriate, modify the amount in order to do justice.” (Gerard v. Ross (1988) 204 Cal.App.3d. 968, 980, 251 Cal.Rptr. 604; Allard v. Church of Scientology (1976) 58 Cal.App.3d 439, 463, 129 Cal.Rptr. 797.) In reviewing a punitive damages award, the appellate court applies *545 a standard similar to that used in reviewing compensatory damages, i.e., whether, after reviewing the entire record in the light most favorable to the judgment, the award was the result of passion or prejudice. (See Bertero v. National General Corp. (1974) 13 Cal.3d 43, 64, 118 Cal.Rptr. 184, 529 P.2d 608; Devlin v. Kearny Mesa AMC/Jeep/Renault, Inc., supra, 155 Cal.App.3d at p. 388, 202 Cal.Rptr. 204.) However, as discussed earlier the test here is more refined, employing three factors to evaluate the propriety of the award.
The first factor is the degree of reprehensibility of the defendant’s conduct. (Neal v. Farmers Ins. Exchange (1978) 21 Cal.3d 910, 928, 148 Cal.Rptr. 389, 582 P.2d 980.) “[C]learly, different acts may be of varying degrees of reprehensibility, and the more reprehensible the act, the greater the appropriate punishment, assuming all other factors are equal.” (Ibid.)
The second factor is the relationship between the amount of the award and the actual harm suffered. (Ibid.; Seeley v. Seymour (1987) 190 Cal.App.3d 844, 867, 237 Cal.Rptr. 282.) This analysis ordinarily focuses upon the ratio of compensatory damages to punitive damages; the greater the disparity between the two awards, the more likely the punitive damages award is suspect. (Seeley v. Seymour, supra, 190 Cal.App.3d at p. 867, 237 Cal.Rptr. 282; see Little v. Stuyvesant Life Ins. Co. (1977) 67 Cal.App.3d 451, 469-470, 136 Cal.Rptr. 653.)
Finally, a reviewing court will consider the relationship of the punitive damages to the defendant’s financial condition. (Adams v. Murakami, supra, 54 Cal.3d 105, 284 Cal.Rptr. 318, 813 P.2d 1348; Neal v. Farmers Ins. Exchange, supra, 21 Cal.3d at p. 928, 148 Cal.Rptr. 389, 582 P.2d 980; Devlin v. Kearny Mesa AMC/Jeep/Renault, Inc., supra, 155 Cal.App.3d at p. 390, 202 Cal.Rptr. 204.) In applying this factor courts must strike a proper balance between inadequate and excessive punitive damage awards. “While the function of punitive damages will not be served if the wealth of the defendant allows him to absorb the award with little or no discomfort, the function also will not be served by an award which is larger than necessary to properly punish and deter.” (Devlin v. Kearney Mesa AMC/Jeep/Renault, Inc., supra, 155 Cal.App.3d at p. 391, 202 Cal.Rptr. 204.)
[12] In this case, we need not go beyond the third factor–the ratio between punitive damages and the defendant’s financial condition. The evidence admitted at trial supported the finding the appellant church had a net worth of $16 million at the time of trial. Accepting these figures as true, the punitive damages award was 150 percent of appellant’s net worth. Under prevailing standards established in prior appellate cases, this ratio is clearly excessive. (Seeley v. Seymour, supra, 190 Cal.App.3d at p. 869, 237 Cal.Rptr. 282 [punitive damages reversed; award was 200 percent of defendant’s net worth]; Burnett v. National Enquirer, Inc. (1983) 144 Cal.App.3d 991, 1012, 193 Cal.Rptr. 206 [punitive damages reduced; initial award was 35 percent of defendant’s net worth]; Egan v. Mutual of Omaha Insurance Co. (1979) 24 Cal.3d 809, 824, 169 Cal.Rptr. 691, 620 P.2d 141 [punitive damages reversed; award was 58 percent of defendant’s net income]; Allard v. Church of Scientology, supra, 58 Cal.App.3d at pp. 445-446, 453, 129 Cal.Rptr. 797 [punitive damages reversed; award was 40 percent of defendant’s net worth]; compare Devlin v. Kearney Mesa AMC/Jeep/Renault, Inc., supra, 155 Cal.App.3d at pp. 391-392, 202 Cal.Rptr. 204 [punitive damages affirmed where award was 17.5 percent of defendant’s net worth]; Schomer v. Smidt (1980) 113 Cal.App.3d 828, 836-837, 170 Cal.Rptr. 662 [punitive damages affirmed; award was 10 percent of defendant’s net worth]; Downey Savings & Loan Assn. v. Ohio Casualty Ins. Co. (1987) 189 Cal.App.3d 1072, 1100, 234 Cal.Rptr. 835 [punitive damages affirmed; award was 7.2 percent of defendant’s net income].) Accordingly, we reverse the punitive damage award unless the plaintiff accepts a remittitur of that judgment to $2 million.
*546 B. It Is Both Proper and Constitutional to Reduce Rather Than Reverse the Punitive Damage Award in This Case.
[13] Scientology questions a court’s authority to reduce a punitive damages award even under a remittitur where it has concluded the award was excessive under a “presumption of passion and prejudice” standard. According to Scientology, we should be required to reverse the entire punitive damages judgment unconditionally.
Scientology relies for this proposition on a single decision of the United States Supreme Court, Minneapolis, etc. Ry. v. Moquin (1931) 283 U.S. 520, 521, 51 S.Ct. 501, 502, 75 L.Ed. 1243. There are several grounds on which Moquin–and its holding that “no verdict can … stand which is found to be in any degree the result of appeals to passion and prejudice”–could be distinguished. However, that is not necessary since Moquin, is in no sense binding on this or any other California court. Moquin was not announcing a rule of federal due process to guide litigation in state courts. Rather this case arose in a federal action tried in state court. It sets forth a rule of federal law and is limited in its application to federal cases. Indeed the United States Supreme Court was careful to highlight the rule it was announcing had nothing to do with the rules Minnesota courts apply in state litigation. Accordingly, there is no merit to Scientology’s claim Moquin supersedes the many California Supreme Court and Court of Appeal cases which have reduced punitive damage awards rather than setting them aside after finding those awards were excessive and thus “presumed to be the product of passion and prejudice.” (See, e.g., Neal v. Farmers Ins. Exchange, supra, 21 Cal.3d 910, 148 Cal.Rptr. 389, 582 P.2d 980; (Gerard v. Ross, supra, 204 Cal.App.3d. 968, 980, 251 Cal.Rptr. 604; Allard v. Church of Scientology, supra, 58 Cal.App.3d at p. 453, 129 Cal.Rptr. 797.) See also other appellate cases in which punitive awards were reduced rather than set aside in the appendix to this case and the earlier chart in Devlin v. Kearney Mesa AMC/Jeep/Renault, Inc., supra, 155 Cal.App.3d 381, 202 Cal.Rptr. 204.)
C. Scientology Is Not Exempt From Punitive Damages for Acts, Such as Those Involved in This Case, Which Are Not Constitutionally Protected Religious Practices.
[14] In a final challenge, Scientology claims the First Amendment bars the imposition of punitive damages on religious organizations for their “religious expressions” or, at a minimum, the First Amendment in combination with the due process clause requires closer scrutiny of any punitive damage award than would be true for other persons or entities. To support these arguments, Scientology cites cases actually involving freedom of speech or press not freedom of religion but which it claims “express reservations” about the use of punitive damages which might inhibit First Amendment activity (i.e., Gertz v. Robert Welch (1974) 418 U.S. 323, 94 S.Ct. 2997, 41 L.Ed.2d 789; Electrical Workers v. Foust (1979) 442 U.S. 42, 99 S.Ct. 2121, 60 L.Ed.2d 698.) Notably, several opinions, including one cited by Scientology, uphold punitive damage awards in private defamation actions. (Gertz v. Robert Welch, supra; 418 U.S. 323, 94 S.Ct. 2997, 41 L.Ed.2d 789; Dun & Bradstreet v. Greenmoss Builders, Inc. (1985) 472 U.S. 749, 105 S.Ct. 2939, 86 L.Ed.2d 593; Curtis Publishing Co. v. Butts (1967) 388 U.S. 130, 87 S.Ct. 1975, 18 L.Ed.2d 1094.)
The first of Scientology’s arguments ignores the fact this court found the patterns of activities which justified punitive damages in this case were either found not to qualify as “religious expression” at all (i.e., “fair game”) (Wollersheim v. Church of Scientology, supra, 212 Cal.App.3d at pp. 891-899, 260 Cal.Rptr. 331) or were found not to be constitutionally protected because forced on participants like Wollersheim through emotional, economic and physical coercion (i.e., “auditing,” “disconnect.”) *547 (Id. at pp. 891-899, 260 Cal.Rptr. 331.) Thus, the imposition of punitive damages for this conduct does not impinge on constitutionally protected religious expression. It only punishes and deters reprehensible activities which visit serious harm on others in society. Under California law, punitive damages could be imposed on other individuals and entities which engaged in this conduct. Therefore, such damages can be imposed on those who claim to have done these constitutionally unprotected actions out of religious motivation. (Employment Div. Dept. of Human Res. of Oregon v. Smith, supra, 494 U.S. 872, 110 S.Ct. 1595.)
The “heightened scrutiny” argument merely resurrects the contention and many of the authorities Scientology marshalled in support of its earlier position the court must closely scrutinize liability claims based on actions which may constitute “religious expression.” Once again, the cases cited involve freedom of speech not free exercise of religion (i.e., Young v. American Mini Theatres (1976) 427 U.S. 50, 96 S.Ct. 2440, 49 L.Ed.2d 310; New York Times Co. v. United States (1971) 403 U.S. 713, 91 S.Ct. 2140, 29 L.Ed.2d 822; Speiser v. Randall (1958) 357 U.S. 513, 78 S.Ct. 1332, 2 L.Ed.2d 1460.) Moreover, these cases focus on the process the court uses in determining whether the speech involved qualifies for constitutional protection at all, not whether it warrants a punitive damage award.
Nonetheless, setting these problems aside, the fundamental problem with Scientology’s argument is that we already have applied this “heightened scrutiny” to the activities for which Scientology claims constitutional protection. We found those activities did not qualify as “voluntary religious expression” or in some instances did not qualify as “religious expression” at all. (See Wollersheim v. Church of Scientology, supra, 212 Cal.App.3d at pp. 891-899, 260 Cal.Rptr. 331.) We already subjected these activities to “heightened scrutiny” and found them to lack constitutional protection under the free exercise of religion clause. Consequently, there is no reason to subject them to another round of “heightened scrutiny” in order to determine whether they are immune from punitive damages. The reason for “heightened scrutiny” of the punitive damage award evaporated with the finding the acts themselves were not constitutionally protected.
Alternatively, even if we follow Scientology’s request and subject the punitive damage award in this case to “heightened scrutiny” we arrive at the same conclusion as when we subjected the acts themselves to “heightened scrutiny.” There is a compelling state interest in punishing and deterring this constitutionally unprotected, harmful conduct just as there is a compelling state interest in compensating the victims.
The judgment is reversed as to the cause of action for negligent infliction of emotional injury. The judgment as to the cause of action for intentional infliction of emotional injury is affirmed with the exception the compensatory damage award and the punitive damage award are modified to reduce the compensatory damages to $500,000 and the punitive damages to $2 million. Each party to bear its own costs on appeal.
LILLIE, P.J., and FRED WOODS, J., concur.

Cal.App. 2 Dist.,1992.
Wollersheim v. Church of Scientology of California
6 Cal.Rptr.2d 532 Review Granted, Previously published at: 4 Cal.App.4th 1074, 10 Cal.App.4th 370, 15 Cal.App.4th 1426, (Cal.Const. art. 6, s 12; Cal. Rules of Court, Rules 28, 976, 977, 979)
Copr. (C) West 2002 No Claim to Orig. U.S. Govt. Works