Thursday, September 13, 2007
That's the title of NYU's Mark Geistfeld's new SSRN posting (forthcoming Southern California Law Review), which argues for less of a connection between compensatory damages and punitive damages in the context of wrongful death or other settings where compensatory damages are inherently insufficient. The abstract:
Tort law provides awards of punitive damages for reasons of retribution and deterrence. In light of a recent decision by the U.S. Supreme Court in Phillip Morris USA v. Williams, the retributive rationale for punitive damages will inevitably come under heightened scrutiny. The case involves a punitive award of $79.5 million that is 97 times greater than the compensatory damages, making it presumptively unconstitutional under the Court's punitive damages jurisprudence. The Court, though, has never addressed the constitutional issue in a case involving serious bodily injury or death, and so Williams poses a number of new questions. How can compensatory damages provide an appropriate baseline for evaluating punitive damages in a case of wrongful death, given that monetary damages provide no compensation to a dead person? What is the appropriate baseline? Any future deterrence provided by a punitive award cannot protect the decedent's tort right, and so the award must be justified exclusively in terms of retribution. Is retribution inherently subjective and arbitrary, unless constrained by some objective measure such as the single-digit ratio between the punitive and compensatory damages? Or is there some way to translate retribution into dollars? These questions are not limited to wrongful-death cases and must be resolved by any court trying to determine whether a punitive award is unconstitutional for exceeding the presumptively required single-digit ratio between punitive and compensatory damages. These questions can all be answered once retribution is tied to the inherent limitations of compensatory damages, which yields a method for quantifying this form of punitive damages. Based upon government data and methodology involving the monetization of fatal risks, this method shows why vindication of the decedent's tort right in Williams justifies the $79.5 million punitive award. When formulated in this manner, vindictive damages satisfy the requirements of both substantive and procedural due process and provide a baseline for reviewing courts to determine whether any given punitive award, like one based on general deterrence, is excessive in violation of substantive due process. This method fully accounts for the reprehensibility factors that determine the constitutionality of a punitive award, while also explaining why the Court could defensibly rely upon procedural due process to reverse and remand Williams back to state court.
Our damages archive includes many posts about Williams and other damages issues.