August 27, 2007
3rd Circuit Adheres to Single Digit Ratio for Punitive Damages
The Legal Intelligencer (via Law.com) reports that the Third Circuit appears to be adhering strictly to the Supreme Court's admonition regarding single-digit ratios. Reducing a punitive damages award to a 7:1 ratio between punitive damages and compensatory damages, the Third Circuit stated:
"Heeding the Supreme Court's admonition that few awards exceeding the single-digit threshold will satisfy due process, we conclude that the 18:1 ratio in this case crosses the line into constitutional impropriety," U.S. Circuit Judge Kent A. Jordan wrote in CGB Occupational Therapy Inc. v. RHA/Pennsylvania Nursing Homes Inc.
The trial judge had reduced the jury's $30 million punitive award to $2 million - a 19:1 ratio - finding the reduced amount "is not constitutionally excessive given the facts of this case -- including the wealth of [the] defendant and the state's interest in punishment and deterrence."
The Third Circuit, however, disagreed, and further reduced the award to $750,000.
Has the Supreme Court created a presumptive constitutional ceiling at a 9:1 ratio? (Interested in this topic? Come to the punitive damages symposium next week here in Charleston. Registration is still open.).
(Thanks to Tony Sebok for the tip).
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Most of the judges on the court do not agree on a 9:1 roof on punitives. See my post on this here:
Posted by: Eric @ New York Personal Injury Law Blog | Aug 27, 2007 6:41:46 AM