Caps on punitive damages are routine in proposals to rewrite state tort law -- whether for product liability, medical malpractice, or any other area of law. Yet, evidence shows that these damages are rarely awarded in tort cases and are generally proportionate to the injuries in the case. Caps on punitive damages are an unnecessary intrusion into a legal area best handled on the state level, and which is already being addressed in the courts.
What are Punitive Damages?
Punitive damages are damages awarded to punish wrongful behavior by a defendant. Often, punitive damages are awarded in cases where there is evidence that the defendant intentionally caused the injury, such as a physician sexually abusing his patients, or recklessly failed to prevent an injury. Punitive damages serve to punish wrongdoers who a jury decides acted immorally, rather than just negligently, and to deter others from acting in a similar fashion. Manufacturers and others who are afraid of punitive damages are more likely to act prudently to improve the safety of their products by better design and clear warnings about possible hazards.
Punitive Damages are Rare
A study by the American Bar Foundation of civil court verdicts in representative sites from 1988-1990 found that punitive damages were awarded in only 4.5% of all civil cases. Nearly half of these were cases of intentional tort, where the defendant intended to hurt the plaintiff. Almost 1 in 10 business or contract case ended in an award of punitive damages. But in conventional personal injury cases, only 1.5% of all cases were awarded punitive damages. Product liability cases seem to be in line with these findings. A 1992 Bureau of Justice Statistics survey found that only 2.2% of product liability verdicts won by plaintiffs received a punitive award.
Punitive Damages are Not Excessive
The courts recognize Constitutional limits apply to the amount of punitive damages that can be awarded. The Supreme Court in BMW of North America v. Gore gave guidance to courts on the constitutional limits of punitive awards. Thus, the vast majority of punitive awards fall within a predictable range, and the court system has precedent to act in cases where awards are significantly outside of that range.
Punitive Damages are Awarded Appropriately
Professor Theodore Eisenberg of Cornell Law School writes in his study, The Predictability of Punitive Damages: "It is easier to predict when punitive damages will not be awarded than when they will be. Unless the case involves an intentional tort or a business-related tort (such as employment claims), punitive damages will almost never be awarded."
Republished with permission of the Association of Trial Lawyers of America.