TortsProf Blog

Keanu's Excellent Adventure In Punitive Damages

A photographer has filed a personal injury suit against actor Keanu Reeves based on allegations that Reeves struck the photographer with his car.  The suit brings negligence and assault & battery claims.   The complaint seeks an unspecified amount in compensatory and punitive damages.  Yesterday, Judge Elizabeth Grimes of the L.A. Superior Court denied Reeves's motion to strike the punitive damages claim. 

(Via California Punitive Damages).

- SBS

Utah AG Calls for Punitive Damages Cap

On Monday, Utah Attorney General Mark Shurtleff stated that he is open to a cap on punitive damages awards. 

To help improve the state's legal climate, Shurtleff said caps on punitive damage awards would, among other things, help prevent physicians from being driven from Utah by skyrocketing medical malpractice premiums, as has happened in Nevada.

"A lot of times those punitive damages awards are outrageous, and the cumulative effect, particularly when it comes to medical malpractice litigation, can create a situation like they have in Nevada," Shurtleff said.

Doctors are just leaving the Silver State because they can't afford their insurance premiums anymore, "and a big part of that is because of these horrific damage awards that are being awarded in some of these cases," he said.

Via Legal Newsline.

- SBS

Hot Off the Presses! Charleston Law Review Punitive Damages Symposium Volume

The Charleston Law Review has published its 2008 symposium volume, which contains articles and essays from the punitive damages symposium that we held back in September.  Check out the contents:

Sheila B. Scheuerman, Introduction, Punitive Damages, Due Process & Deterrence:  The Debate After Philip Morris v. Williams.  (Provides an overview and summary of each essay and article in the volume).  Download a copy of the Introduction:  Download 4_scheuerman_introduction.pdf

Anthony J. Sebok, After Philip Morris v. Williams:  What is Left of the "Single-Digit" Ratio?  Download a copy of Sebok's Essay [pdf file]:  Download 5_sebok.pdf

Anthony J. Franze, Clinging to Federalism:  How Reluctance to Amend State Law-Based Punitive Damages Procedures Impedes Due Process.  Download a copy of Franze's Essay [pdf file]:  Download 6_franze.pdf

Neil Vidmar & Matthew W. Wolfe, Fairness Through Guidance:  Jury Instruction on Punitive Damages After Philip Morris v. Williams.  (Available through SSRN). 

Christopher J. Robinette, Peace:  A Public Purpose for Punitive Damages.  (Available through SSRN).

Keith N. Hylton, Due Process and Punitive Damages:  An Economic Approach.  Download a copy of Hylton's Article:  Download 9_hylton.pdf

Victor E. Schwartz & Christopher E. Appel, Putting the Cart Before the Horse:  The Prejudicial Practice of a "Reverse Bifurcation" Approach to Punitive Damages.  Download a copy of Schwartz's Article:  Download 10_schwartz.pdf

Elizabeth J. Cabraser & Robert J. Nelson, Class Action Treatment of Punitive Damages Issues After Philip Morris v. Williams:  We Can Get There From Here.  Download a copy of Cabraser's Article:  Download 11_cabraser.pdf

Byron G. Stier, Now It's Personal:  Punishment and Mass Tort Litigation After Philip Morris v. Williams.  Download a copy of Stier's Article:  Download 12_stier.pdf

Michael L. Rustad, The Uncert-Worthiness of the Court's Unmaking of Punitive Damages.  Download a copy of Rustad's Article:  Download 13_rustad.pdf

My thanks again to the symposium participants for a lively and enjoyable discussion.  And my congratulations to Charleston 3Ls Matt Kendall (Editor in Chief), and Christy Fargnoli (Symposium Editor) as well as the entire Charleston Law Review staff for a very interesting collection of essays and articles!

- SBS

Oregon Supreme Court Sets 4 to1 Ratio on Punitive Damages in Economic Injury Cases

In a decision released last week, the Oregon Supreme Court has set a presumptive 4 to 1 ratio for punitive damages in economic injury cases:  "[A]s a very general rule of thumb, the federal constitution prohibits any punitive damages award that significantly exceeds four times the amount of the injured party's compensatory damages, as long as the injuries caused by the defendant were economic, not physical."   

In sharp contrast to the Philip Morris remand decision upholding an nearly 100 to 1 ratio (prior posts here, here, and here), the court noted " we think that, if a nine-to-one ratio between punitive and compensatory damages is at the limit of what the Due Process Clause normally will allow a court to impose on any tortious conduct [including physical injury], then the limit must be significantly lower for conduct that causes or risks only economic injury."  This language certainly seems to support Tony Sebok's position that the Philip Morris remand was a results-oriented outcome designed to avoid giving a "win" to an unpopular defendant.

- SBS

Valdez Case: Closure Soon?

So suggests the Washington Post story today, covering the imminent Supreme Court argument (ScotusWiki page is here).

--BC

Sebok Chastizes Oregon Supreme Court in Philip Morris Remand

In his latest FindLaw column, Tony Sebok addresses the Oregon Supreme Court's decision to again affirm a $79.5 million punitive damages award against Philip Morris following remand by the U.S. Supreme Court.   

As Sebok points out, "[t]he Oregon Supreme Court held that reinstatement of the award was appropriate because there were independent and adequate state law grounds for doing so."  But, as Sebok notes, "[t]hose grounds had never been previously identified by the Oregon Supreme Court in its two earlier decisions (the ones that had been reversed by the U.S. Supreme Court.)"   Sebok argues that the Oregon Supreme Court put "form over substance" in a results-oriented fashion in order to avoid "giving a victory to a hated tobacco-company defendant."    While Sebok finds it unlikely that the U.S. Supreme Court will grant cert in this case for the third time, he expresses his hope that the USSC will GVR the case because "[t]hat would be a fitting response to a state court that seems to think that winning is the only thing that matters."

- SBS

Record-Setting $28 Billion Punitive Damages Award Reversed Under Williams

The California Court of Appeals recently issued its decision in Bullock v. Philip Morris USA, where the jury originally awarded a land-mark $28 billion (yes - billion with a "B") punitive damages award against Philip Morris.   The trial court reduced the award to $28 million, and the case has gone up and down the California appellate system in light of State Farm and now Williams.

In the latest opinion [pdf], the California Court of Appeals reversed the punitive damages judgment based on the trial court's refusal to give the company's proposed instructions.  The first instruction stated "You are not to impose punishment for harms suffered by persons other than the plaintiff before you."  The second instruction stated "You are not to punish defendant for the impact of its conduct on individuals in other states or other countries."   The court noted that "Philip Morris had no duty to qualify its proposed instruction in order to encompass a rule of law favorable to [plaintiff] concerning the permissible use of evidence of harm caused to others."   The court has ordered a new trial on the amount of punitive damages. 

- SBS

Bashman on Williams

Howard Bashman has a Law.com column about the Oregon Supreme Court's affirmance of the $79.5 million punitive damages award against Philip Morris.  He ends with some advice (directed at junior associates, but it's likely as well directed to senior folks too):

It is worth emphasizing, in closing, that the reason Philip Morris failed to benefit from the U.S. Supreme Court's punitive damages ruling in its favor in this very case is that the trial lawyers for Philip Morris tried to slant their proposed punitive damages instruction too far in the defendant's favor. Had the company's proposed punitive damages instruction faithfully tracked the applicable Oregon statute, the Supreme Court of Oregon's ruling would have likely set aside the jury's punitive damages award and granted a new trial. The next time young litigation associates are pondering how far to twist the law in the client's favor in proposed jury instructions, it's best if they remember: Attempting to gain your client some subtle, modest advantage could backfire and eventually cause your client to lose its ability to overturn a nearly $80 million punitive damages award.

--BC

Valdez Plaintiffs Launch "Whole Truth" Campaign in Advance of Punitives Argument

A group of plaintiffs in the still-going-and-going-and-going litigation against Exxon for the massive damage caused by the Exxon Valdez oil spill has launched The Whole Truth website (warning! starts talking at you without warning!). The site is part of what seems to be an effort to keep the damage clear in the public eye and to, one assumes, try to justify the punitive damages awarded and at issue before the Supreme Court later this month.

--BC

Williams Punitives Upheld Again

The Oregon Supreme Court has yet again affirmed the nearly 100-to-1 ratio of punitive damages in the Williams v. Philip Morris case (opinion, Turkewitz); the affirmance focuses on the failings of Philip Morris's proposed jury instruction.

--BC

Waiting for Exxon Valdez Payments

The Juneau Empire has a story about plaintiffs' lawyers in the Exxon Valdez case starting to prepare their clients for wise investment choices and the like.  The work is leading up to the possibility that a payout is forthcoming after the Supreme Court rules this spring on the much-litigated case and its punitive damages.  The story also notes that Senator Lisa Murkowski of Alaska got Senate approval of legislation that would encourage investing the money in retirement accounts and ease the potential tax burden.

--BC

Wrongful Death Damages Calculations

A recent Chicago trial over the admittedly wrongful shooting of a young man by the Chicago police, frames damages discussions well.  The case involved no issue of liability -- the city acknowledged that the shooting was unjustified once a security camera tape undermined its original theory and the officer admitted he did not fear for his safety -- and focused solely on the amount of damages:

In her closing argument, city attorney Patricia Kendall urged jurors to not view their verdict as a measure of how much Pamela Pleasance loved her son.

Under the law, the key issue was how much Michael Pleasance would have contributed to the family if he lived, Kendall argued.

Pleasance had a learning disability, both sides agreed. He had never held a job for more than a few months and spent time in prison on a drug conviction.

"Emotion is not supposed to be part of the decision-making process here," Kendall said. "Do your duty as fair and impartial jurors."

But Pleasance's lawyers bristled at the suggestion that the family should receive a lower jury award because of Pleasance's problems.

"They want you to think that this was just some worthless South Side kid whose life isn't worth as much as the rest of us," Schwartz said. "That is a path we must never travel."

The jury ultimately awarded $12.5 million and, in interviews, said that it focused on love and companionship.

--BC

$2.5 Million for Unneeded HIV/AIDS Treatments

The Boston Globe has the story of Audrey Serrano, who was given HIV treatment for nine years when, it turned out, she was not in fact infected. 

In her lawsuit against a doctor who treated her, Audrey Serrano said the powerful combination of drugs she took triggered a string of ailments, including depression, chronic fatigue, loss of weight and appetite and inflammation of the intestine.

I'm not sure how the damages are broken out, but it may be one where a cap on non-economic damages would have reduced it dramatically.  Would that be desirable?  (My inclination is "no.")

--BC

NY Appellate Court OKs Punitive Damages for Privacy Breach

An intermediate appellate court in New York has affirmed the award of punitive damages in a breach of privacy case where a medical practice failed to keep a patient's abortion private from her parents.

The patient had an abortion at Long Island Surgi-Center in 1999 and verbally instructed the staff to contact her on her cell phone because she did not want her parents to know about it, court records show. But after the procedure, a nurse called the patient's home to check on her and spoke with her mother. The nurse didn't mention the abortion but shared enough information for the mother to surmise what occurred.

Judges acknowledged that the breach didn't appear intentional but found enough evidence that the facility's conduct could be considered grossly negligent -- a standard sufficient to warrant punitive damages.

"There was no justification whatsoever offered for the remarkably casual way in which the center handled the plaintiff's sensitive medical information, and the need to deter other medical providers from engaging in similar conduct could hardly be clearer," the Sept. 25 opinion states.

The conduct was evidently violative of state law relating to medical privacy.  The court ordered a new trial because the defendant was not permitted to argue that the incident was an isolated event, which would be relevant to determining the punitive damages amount.

--BC

Tort Awards

Two interesting recent posts/newsletters related to damage awards in tort litigation:

• The Maryland Injury Lawyer Blog discusses a 2003 study that found interesting -- and not necessarily intuitive -- relations among a plaintiff's race, a plaintiff's income, and damage awards.
• Prof. David Frankel (Iowa State econ) of MedMalReports.com -- a commercial entity assisting in evaluating the value of med mal cases based on a large database of settlements and verdicts -- sent along the first issue of the site's newsletter, which gives some big picture information about what affects award amounts.  You can download it here: Download newsletterV1N1.pdf.  While it's in part an ad for their services, it's interesting reading nonetheless.

--BC

BP Blast Trial Starts Today in Galveston

The March 2005 explosion at a BP refinery in Texas City, Texas, killed 15 workers and resulted in numerous lawsuits.  BP has admitted responsibility and most suits have been settled; the first trial starts today in Galveston.  Famed plaintiffs' lawyer Mark Lanier is trying the case and alleges "breathtaking . . . criminality" in the permitting process, specifically relating to a former regulator working for BP on obtaining permits for the refinery. 

BP has entered into a plea agreement to resolve criminal charges; workers are attempting to derail that deal as insufficient punishment.

The story suggests that BP could have punitive damages exposure of up to $1 billion based on the alleged fraud in permitting, but that number appears untethered to anything other than, perhaps, Lanier's suggestion as to how much he'll ask for.

(Past discussion of the BP case is here.)

--BC

Dole Ordered to Pay $2.5M in Punitives in Pesticide Case

The LA Times has the story. 

A Los Angeles jury ordered Dole Food Co. on Thursday to pay five Nicaraguan banana plantation workers $2.5 million as punishment for concealing the dangers of a pesticide that rendered them unable to have children.

The verdict, which awarded far less in punitive damages than some observers expected, was hailed as a victory by attorneys on both sides. It follows a Nov. 5 jury award of $3.2 million in compensatory damages.

--BC

Noneconomic Damage Caps Discriminatory?

That's the argument summarized by Ron Miller (Maryland Injury Lawyer Blog) from Rebecca Korzec (Baltimore), Maryland Tort Damages: A Form of Sex-Based Discrimination 37 U. Balt. L.F. 97 (2007).  Miller's summary (the article is not on SSRN or otherwise online for free, so far as I can tell):

The essential premise is that limiting non-economic damages disproportionately affects female litigants, because women earn less, in large measure due to women spending more time on unpaid child care and taking care of the children and the house. Accordingly, limiting pain and suffering damages does not allow juries to award fair compensation. Non-economic damage caps solidify bias by rewarding economic losses over non-economic ones, intensifying the gender bias of tort law.

--BC

Judge Throws Out Illinois Malpractice Caps As Unconstitutional

The Chicago Sun Times (via AP) reports that a Cook County Circuit Judge has struck down Illinois's caps on non-economic damages in medical malpractice cases.  A 2005 law limits non-economic damages such as pain and suffering to $500,000 against doctors and $1 million against hospitals.  The judge reportedly concluded that the caps violate due process and equal protection (via ABA Law Journal).   

- SBS

Dole & Dow Liable to Some Workers for Continued Use of Discontinued Pesticide

...and a jury is considering punitive damages, too.

Dole Food Co. deliberately exposed unwitting Nicaraguan field hands to a pesticide that made them sterile so the company could boost profits on its banana plantations, a lawyer for the workers argued this morning.

But lawyers for Dole said the firm acted responsibly in continuing to use the pesticide after production was stopped in 1977 by Dow Chemical Co. because of concerns about its impact on reproductive health.

Six workers won the suit, while six lost; compensatory damages were set at $3.2 million.

Evidence focused on Dole's continued use of the pesticide even after Dow ceased production due to concerns about reproductive health, and on whether Dole gave workers the appropriate instructions to avoid harm.

The LA Times has an investigative piece about the suit's development.

--BC

USSC Grants Cert in Exxon Valdez Case

The New York Times reports that the U.S. Supreme Court has granted cert in the Exxon punitive damages case arising out of the Exxon Valdez oil spill in Alaska back in 1989:

A jury in Federal District Court in Alaska had awarded $5 billion, which the United States Court of Appeals for the Ninth Circuit cut in half in a decision issued last December. It was the biggest punitive damages award ever ordered by a federal appeals court, and was five times the economic damage of $500 million suffered by the class of 32,000 plaintiffs.

Exxon argued in its appeal to the Supreme Court that given the nearly $3.5 billion the company had already paid in environmental cleanup costs, fines and settlements of private claims, the $2.5 billion was outside the boundary of constitutional due process that the court has drawn in recent decisions overturning other punitive damage awards.

In accepting the appeal, however, the justices granted review only on three statutory questions focused on maritime law.  As a result, while the case will be of interest to the shipping industry, the decision will shed little light on the constitutional framework that the Supreme Court intends to apply to the question of punitive damages. The case is scheduled to be argued in February and decided by early summer. 

SCOTUSblog has a thorough post analyzing the cert grant with links to the briefs.

- SBS

Briefing Continuing on Valdez Cert Petition

MarketWatch has details, including an interesting intersection of respondeat superior with punitive damages law:

In the court documents, Exxon Mobil argued the case hinges partly on whether punitive damages should be imposed under maritime law against a ship owner for the conduct of a ship's master at sea...even when the conduct was contrary to policies established and enforced by the owner.

--BC

Big Damages in Colorado

Colorado Confidential has a detailed post about a recent case against Qwest Communictions for injuries to a lineman who was left a paraplegic after a utility pole collapsed.  Somewhat surprisingly, the trial judge increased an already-large punitive damage award (from $18 million to $45 million, if I'm doing my math in my head right).

--BC

"Punitive Damages, Retribution, and Due Process"

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.

--BC

If You Weren't In Charleston Last Friday. . .

. . . then you missed the punitive damages symposium at the Charleston School of Law.   

What a fun day!  We had an exceptionally distinguished group of panelists and moderators including Elizabeth J. Cabraser of Lieff Cabraser, Robin Conrad of the U.S. Chamber of Commerce, Theodore Eisenberg of Cornell University Law School, Andrew L. Frey of Mayer Brown (and counsel for Philip Morris in the USSC), John Y. Gotanda of Villanova Law, Laura J. Hines of University of Kansas Law, Keith Hylton of Boston University School of Law, Robert S. Peck of the Center for Constitutional Litigation (and counsel for Mayola Williams in the USSC), Chris Robinette of Widener, Michael Rustad of Suffolk University Law School, Victor Schwartz of Shook Hardy, Tony Sebok of Cardozo, Cathy Sharkey of NYU, Byron Stier of Southwestern, Neil Vidmar of Duke Law and the Hon. William Wilkins of the Fourth Circuit.

My thanks to all our panelists and moderators for an exceptionally lively and engaging day.   I should have some photos and audio of the panels later this week.

- SBS   

$13M Settlement in Rhode Island Nightclub Fire

CNN has more on the settlement, tentatively reached between the plaintiffs and some of the multiple defendants.  The settling defendants include the maker of soundproofing material, the pyrotechnics maker and vendor, the company that leased the building, and an alarm company.  The parties have recommended that Francis McGovern (Duke) oversee the distribution of the money as a special master.

A number of defendants remain, including concert promoters and Home Depot.

--BC

Exxon Valdez Punitives Fight Still Going

I'm not so good at math, but I'm pretty sure the Exxon Valdez punitive damages rulings have gone up and down the appellate chain about 400 times.  Make that 401.

Plaintiffs in the long-running case surrounding the 1989 Exxon Valdez oil disaster this week asked the U.S. Supreme Court to restore a $5 billion punitive fine against Exxon Mobil Corp, a petition filed with highest U.S. court shows.

The petition, filed Tuesday, followed one filed last week by Exxon Mobil that asked the Supreme Court to overturn the $2.5 billion punitive fine assessed by the 9th Circuit Court of Appeals.

--BC

Punitives For Wrong -- And Unwashed -- Sperm

A North Carolina InjuryBoard blog has more. The basic facts:

The plaintiff was inseminated with two-day-old unwashed sperm from an unknown donor. A nurse practitioner used an unlabeled syringe from the clinic's incubator without checking her logbook or verifying the donor and used it for the insemination. This unidentified sperm was used instead of a prepared specimen from the sperm bank.

This injection triggered a severe allergic reaction in the plaintiff and caused her emotion distress over the possible exposure to HIV and other sexually transmitted diseases.

According to the story, the plaintiff terminated the pregnancy and decided to adopt.

Liability was found via summary judgment, so the jury considered only damages, awarding $85,000 in compensatory damages and $350,000 in punitives.  That amount exceeds the state statutory cap of $250,000, and so the award has been reduced accordingly, per the story.

--BC

"The Airline Almost Never Skates..."

That's the main message in a story today relating to wrongful death suits arising out of the crash of a Comair airplane in Kentucky a year ago.  The story suggests that liability is almost certain (which seems likely, if the facts as alleged are true), and focuses on punitive damages.  The story does a better-than-average job of discussing the various procedural issues involved as well.

--BC

Record-Breaking Malicious Prosecution Award

U.S. Dist. Judge Nancy Gertner (D. Mass) awarded two men and the families of two other men $101 million in damages arising from their wrongful imprisonment for a 1965 murder.  The family alleged that the FBI was aware that a key witness was lying to protect another person who was cooperating with the FBI.  Judge Gertner rejected as "absurd" the FBI's argument that it had no duty to the state government.

--BC

Goldman v. OJ: Wanting to Publish an Execrable Book to Try to Recover Damages

The WSJ Law Blog has the details of Fred Goldman's ongoing effort to obtain the rights to OJ Simpson's proof that he's pretty much evil "hypothetical" book If I Did It.  Goldman hopes to use any proceeds to go towards the $38 million Simpson owes him from the wrongful death suit.

--BC

LDS Church Ordered to Reveal Financial Information

Kenneth I. Johnson Jr. alleges in an Oregon lawsuit that he was repeatedly sexually molested by a Mormon "home teacher" in the late 1980s, and is seeking $45 million in punitive damages.  In connection with that request, he's sought discovery of the church's financial status, which has been kept secret since 1959.  The Oregon Supreme Court rejected emergency relief (I assume a mandamus position or the like) on Monday, refusing to block the discovery.

The church settled the last case that came close to revealing that information, though the causal connection is not clear (i.e., it's not clear that the settlement was a way to avoid its release or simply a settlement).

--BC

Taxation of Non-Economic Harm

Our neighbor TaxProf blog has extensive coverage of the D.C. Circuit's revised opinion [PDF] in the Murphy case, which upheld the taxation of non-economic tort damages.

--BC

Accutane Trial Starting in Madison County; Corporations Heart Delaware

Well, the Accutane trial will probably start soon, anyway, once the judge decides whether punitives are available.  The plaintiff alleges the drug caused his inflammatory bowel disease.  It's the second case (of 400 or so pending) to go to trial; the first one ended in a plaintiff's verdict for $2.6 million.

The story suggests that the case will be seen as a second test for Madison County, known as a plaintiff-friendly jurisdiction.  On the other side of that coin, companies like Delaware courts, for reasons that are, of course, debated.

--BC

Punitives Possible in Clergy Abuse Case

So reports the AP, with one of the more confused explanations for punitive damages I've seen ("Punitive damages generally are far greater than damages to compensate victims for pain and loss.").

--BC

Damages and the Supremes

LegalNewsLine has an article addressing the recent punitives remand and suggesting that it may be part of a trend of remands based on vague instructions rather than concerns about the constitutionality of the size of the damages awarded.

(The article is written with a definite point of view, incidentally.  Note the conclusion explicit in this sentence: "For the second time in three months on Monday, the U.S. Supreme Court (USSC) sent a lawsuit with an excessive punitive damages awards [sic] back to a lower court to review the amount." (emphasis added))

$55M Punitives Verdict Remanded

A few years back, a California plaintiff got a judgment for a total of $82.6 million ($55 million of it in punitive damages) in a Ford Explorer rollover case.  (The jury had awarded a total of just shy of $370 million; both the compensatory and punitive verdicts were reversed at the trial and appellate levels.)  Yesterday, the Supreme Court remanded it [PDF] for further consideration under the Williams case.

The LA Times piece has more on the story.

Sunstein on "Illusory Losses"

Cass Sunstein has a piece up on SSRN addressing the growing literature about hedonic losses and that literature's implications for the tort system.  The abstract:

Recent empirical work demonstrates that people's self-reported happiness is remarkably resilient to many large changes in life conditions; apparently significant adverse events often inflict little or no hedonic damage. One reason for this surprising result is people's power of adaptation. An additional and perhaps more fundamental reason involves attention: Most of the time, people go about their lives without attending to, or focusing on, adverse conditions, and hence those conditions inflict little hedonic harm. If people make “hedonic forecasting errors” about their own lives, they are highly likely to make such errors when assessing hedonic losses experienced by other people. These findings have important implications for the legal system, especially in the context of awards for pain, suffering, and hedonic losses. A special problem is that if people adapt to adverse changes because they cease to focus on them, the context of litigation will produce a serious distortion, because the attention of juries and judges is specifically focused on adverse changes. But there are two qualifications. First, some losses inflict significant hedonic damage, because people cannot help focusing on them; chronic pain, anxiety, and depression are the most obvious examples. Second, people may suffer “capability loss” without suffering hedonic loss, and the legal system should award compensation for “capability damages.”

These claims have broader implications for questions of law and policy, including appropriate priority-setting for governments concerned with the welfare of their citizens. For example, increases in Gross Domestic Product are not correlated with increases in self-reported happiness, in a way that raises serious questions about the focus on GDP; but perhaps GDP growth is connected with social gains that are not captured by self-reported happiness. There are also fundamental questions about the relationships among hedonic consequences, meaning, and the ingredients of a good life. The simplest conclusion is that pervasive existence of hedonic forecasting errors raises the possibility that both economic and regulatory policies are misdirected.

Tax Impact of Tort Recoveries for Noneconomic Harm

Paul Caron has a report looking forward to today's argument in the rehearing of the Murphy case.

"Punitive Damages and Valuing Harm"

A new SSRN posting from Alexandra Klass (Minnesota) (forthcoming Minnesota Law Review) addresses valuing harm (i.e., the denominator in the 9:1 punitives: compensatory ratio) under State Farm and its progeny.  The abstract:

In 2003, the Supreme Court created a presumption that only single-digit ratios of punitive damages to compensatory damages would satisfy substantive due process limits. The exception to this presumption is when the defendant's misconduct results in only a small amount of compensatory damages or when harm is difficult to value. This Article proposes that while lower courts have properly departed from single-digit ratios where the compensatory damage are small, they have had more difficulty doing so when harm is difficult to value. As a result, lower courts are mechanically applying a single-digit ratio in cases where the Court's current framework and the purposes of punitive damages justify departure from that ratio. This Article uses actions involving intentional torts on the one hand and private party actions involving environmental harm on the other to illustrate how lower courts have failed to fully implement the exception to single-digit ratios. This Article proposes that in conducting a due process analysis of punitive damages, courts should focus on the existence of uncompensated harm to either depart from single digit ratios or, in the alternative, calculate punitive damages based on the full amount of harm even if that exceeds the compensatory damage award. To avoid “windfalls” to plaintiffs in cases involving harm to public natural resources, state legislatures or state courts should utilize a “split-recovery” approach to direct a significant portion of punitive damages based on public harm to governmental or nonprofit coffers for environmental remediation. Such an approach is consistent with due process while still fulfilling the purposes of punitive damages.

A Middle Ground on Punitives

That's the suggestion of Keith Hylton (BU) in this SSRN entry.  The abstract:

This essay is a series of reflections on the implications of Philip Morris for the tort reform movement. I make an effort below to find a middle ground between the positions of the plaintiff and defendant in Philip Morris. That middle ground involves largely returning to the Supreme Court's pre-Gore treatment of punitive damages and introducing new procedural devices for defendants to challenge awards. I close with a few observations on the implications of this case law for pain and suffering awards.

Incidentally, I am traveling, yet again, for the rest of this week, so posting may be sporadic.  Wish the WNEC team luck in the Rendigs Products Liability moot court competition.

9/11 Compensation Part 2

Part 2 of Tony Sebok's Writ column about the potential expansion of the 9/11 fund is up now.

Debate on Williams

Point of Law is featuring a debate on the Supreme Court's punitives caselaw (focusing on Williams, but not exclusively).  The participants are David Wagner (Regent) and Michael Krauss (George Mason).

ABA Journal on Tobacco Settlement

This month's ABA Journal has a lengthy article about "how greed, hubris and high-stakes lobbying laid waste to the $246 billion tobacco settlement."

And the website also has a piece addressing the practical implications (or lack thereof) of the Williams case.

Amar on Williams

Yet another good Writ column on Williams, this one from Vikram David Amar (Hastings), looking at it as a more generally helpful device for examining the current Court's tendencies and makeup.

Sebok on Williams

Tony Sebok has a Writ piece on the Williams case that makes close to the same argument I made ("I would wager it will make exactly zero difference in the outcome.") -- that is, that the result of Williams may be minimal, and certainly far less important than the more problematic hard cap.  As he puts it:

In the future, when issues of punitive damages return to the Court, a lot will depend on whether the "nuance" identified by Breyer is real or illusory. The Court sent Philip Morris back to the Oregon Supreme Court for further proceedings consistent with its decision. As noted above, a new trial for damages seems overwhelmingly likely, if settlement is not reached. The question at that next trial will be whether it will make a practical difference to the jurors whether they are asked to assess punitive damages against Philip Morris based on the reprehensibility of the firm's defrauding an unknown number of Oregon smokers, and being asked to punish Philip Morris for defrauding an unknown number of Oregon smokers.

It is easy to see, then, why corporate America is nervous about the victory it achieved in Philip Morris. Granted, it is theoretically possible to imagine that a jury that returned $80 million in order to punish would return less than that in order to measure the reprehensibility of the same corporate act. Still, I doubt that many defense lawyers for the automobile and pharmaceutical industries want to be the guinea pigs to find out whether this possibility might also be a practical reality.

The End of Punitive Damage Class Actions?

That's what Beck & Herrmann think, due to the Williams case.  The basic jump they propose -- and it has some appeal -- is that if you can't get punitives for people who really aren't before the court, you shouldn't be able to get punitives for people who for all realistic purposes aren't before the court. 

Of course, we at least pretend in class litigation that the class members are represented and thus, in some sense, present.  That makes to me a shift to the outright end of punitives in class action to be more of a leap than they would suggest.

B&H also note the potential problem -- now Constitutional -- of being precluded from presenting all possible defenses, and its special applicability in bifurcated class actions (where individualized issues are left to a secondary phase). 

I think they may put a bit more weight than warranted on a particular "first" -- so long as final judgment comes after an opportunity to present defenses, my guess is that it's okay -- but it's an interesting argument, especially if there's a case where the first phase of the trial doesn't just consider the availability of punitive damages but also the amount of them.

Both arguments (and others they note) will certainly be popping up and may have some traction.

Punitives & Multiple Damages

Nicely-timed, thanks to the Williams case, comes this article on SSRN (actually several years old, published in the Minnesota Law Review, but just posted) from Thomas Colby (GWU).  The abstract:

The practice of using punitive damages to punish a tort defendant, in a single case brought by a single one of many victims, for the full scope of societal harm caused by its entire course of wrongful conduct has become increasingly common in modern tort cases. This practice presents the troubling possibility that more than one victim will recover punitive damages awards that were each designed to punish the defendant fully for the same course of wrongful conduct, resulting in unjustly severe cumulative punishment. Many courts and commentators have responded to this “multiple punishment” problem with complex and far-reaching proposals designed to protect against it. This Article argues that these observers have been asking the wrong question. The proper question is not whether awarding these “total harm” punitive damages to more than one victim can sometimes lead to unconstitutional results, but rather whether awarding these damages to even a single victim is itself unconstitutional. This Article argues that it is.

These “total harm” punitive damages awards are a product of the modern conception of punitive damages, which imagines them as punishment for public, societal wrongs. This Article challenges the historical accuracy of this modern theoretical account, and reveals that historically, punitive damages were considered to be punishment only for the distinct, private legal wrong done to the individual victim. When the same conduct harmed more than one victim, the courts limited each plaintiff's recovery of punitive damages to the amount necessary to punish the defendant only for the private wrong done to the individual plaintiff. This Article argues that both historically and presently, the constitutionality of punitive damages is dependant [sic] upon their existence as punishment for individual, private wrongs, rather than public, societal wrongs. Thus, the revolutionary proposals offered by commentators seeking to solve the multiple punishment problem go both too far (by declaring that the Constitution requires radical alterations to traditional punitive damages practice) and not far enough (by assuming that the constitutional infirmity of “total harm” punitive damages lies only in multiple awards of them). This Article argues that the constitutional concerns are best addressed by returning to the roots of punitive damages doctrine and re-implementing the historical conception of punitive damages as punishment for the private wrong done to the individual plaintiff.

Discounting Future Pain

There's an interesting Note in a recent Virginia Law Review issue challenging part of the fundamental idea of the per diem approach to future pain and suffering.  The summary:

Outside the legal academy, the debate over tort reform rages on. In the political arena, advocates on both sides of the aisle often use empty rhetoric in an attempt to persuade voters that tort reform as a whole is “good” or “bad.” Of course, this over-simplistic view of tort reform does not take into account the multifaceted nature of tort law. This Note examines one method of calculating noneconomic damages and attempts to provide a theoretical justification for why a plaintiff’s use of the per diem (or time-unit) method to compute future pain and suffering damages cannot be justified under any reasonable theory. The debate over the per diem method to calculate these damages has largely stagnated in the past forty years. During this same time period, nothing less than a revolution has occurred in the understanding of pain and pain management therapy in medical and psychological fields. However, these advances have not been incorporated into the per diem discussion. This Note analyzes and introduces the “cognitive-behavioral treatment” (CBT) model of pain to the legal literature with the hope of supplying a theoretical foundation for why the per diem argument should be impermissible in the many jurisdictions that allow such a method. The basic flaw of the time-unit perspective is that it improperly assumes a constant dollar unit for futur