Karma is a bitch, a very expensive bitch…
Using the rest to pay off other random debtors on said bastard company’s books would be fucking hilarious, I have to say.
Hi, and thank you for question. It is probably no surprise to anyone that the lawyer is excited to get to talk about the law in an academic way (albeit in a rather truncated fashion to avoid the TL:DR comments). So, without addressing this case in particular (because I don’t know anything about it) and keeping in mind that I am using an extremely broad brush:
What could happen if the award is reduced. If the reward is reduced for whatever reason (here in California there are a couple of mechanisms by which that could feasibly happen), then that is the amount of the judgment, and (unless there is an additional award made, for instance for attorney’s fees or the like) that is all they will have to pay.
Charities. I am only personally aware of one statute which allows for a judgment to be paid to a charity, and that is California’s Art Preservation act. Basically, if you manage to violate the code and break/damage artwork under a particular set of circumstances, then the court could award money to a charity. I am sure there are other similar statutes, but I don’t know of any, and I don’t think it is very common.
Relationship between punitive damages and general award. This can be a frustrating area to say the least, particularly when someone is found to have behaved very very badly. That being said, it seems pretty obvious (to me at least) that there has to be some kind of protection for society against judgments which yield a $1 award for damages, and 1 trillion in punitive damages. I think the courts have also sort of struggled with where on the spectrum these kind of punitive damage awards go from being reasonable to unreasonable. A fun dinner party conversation to be sure.
Thanks again for your thoughts.
Is there any standard concerning whose conscience we are talking about when we say ‘shock the conscience’? Given that the jury decided on the award, it certainly didn’t shock their consciences, likely in large part because the defendant was such a puppy-kicking comic book villain; but is there some conscience that they could have failed to accurately consult, or is that phrase basically just handwaving?
Hello, and thanks for your question.
So, the really short version is that we are in really deep water here, and I could easily spend the next couple of hours trying (and probably failing) to explain punitive damages in a cogent way.
In the meantime, here is the incredibly short/simplistic version: The idea of limiting (in some way) punitive damages is based on the idea that a person should not be deprived of life, liberty, or property without due process of law in violation of the 14th Amendment of the Federal Constitution (yes, I know that it seems like “due process” would be satisfied merely by dent of the fact that the award was made by a jury after a trial, but again. Complicated.)
However, under our federalist system, states are allowed to provide more protections of personal rights than the US Constitution (just not less) and so for many situations, a person would have to engage in two legal analyses. By way of example, California has a press shield law which (arguably) serves to extend the First Amendment protections to the extent that it provides additional legal protections for journalists in some situations, the Constitution on the other hand does not provide any particular protections for journalists that aren’t afforded to “regular” citizens. In short, under our federalist system, the Constitution serves as a sort of braking mechanism on what kind of law state governments can pass (a sort of Maginot Line of personal rights) --states can enlarge those rights, but cannot diminish them.
Ok, with that prologue out of the way, when considering whether a punitive damages award is excessive, one would (generally, depending on what kind of case it was) first look at the state rulings on how to interpret the Due Process Clause in this context to determine if they offer additional protections. Then, if for instance the state in question had adopted no “extra” protection, you would turn to the Federal, or straight Constitutional interpretation standard.
Again, in California you would (generally) look for punitive damages that were a single digit multiple of the actual award. Other states may have different standards or even no standard at all.
After the state analysis, you would turn to the Federal. This (in an instance where you are resorting to a straight Constitutional analysis) is where the “shocks the conscience” standard might come in. I’m frankly not even sure if that it is still the standard. I dug around on the internet for a minute, and it wasn’t totally clear.
Finally, to try and answer your exact question; my understanding is that determining whether the Due Process Clause had been violated (under the Federal standard) would be a “matter of law”, meaning it would be up to the judge and not the jury to decide whether the punitive damages award was reasonable. That being said, I am not totally sure about that, because its a bit of an obscure legal issue (at least to me; again, not a regular part of my practice).
In any event, now that I’ve written a whole bunch of stuff that no one will ever actually read, if you are interested in learning more about punitive damages, I found a law review article that gives a pretty decent introduction to the Constitutional issues.
Thanks again for your thoughts.
I’m wondering if that metaphor is intentionally ironic, considering how the historical Maginot Line performed…
The company added that, unless the verdict is reduced or overturned, “the verdict could have a material adverse effect on the Company’s financial condition and/or operations.”
Not seeing the downside to that.
Yeah, isn’t that the whole point of punitive damages?
“Since a corporation doesn’t have a back to be whipped, or a body to get incarcerated, I guess we just have to take a bunch of its money away as punishment, because that’s what hurts it.”
The problem there is, unless the ruling is so damaging it kills the beast, it just raises it’s prices and passes the pain on to the customer. The solution is obvious: While the corporation doesn’t have backs to whip…the CEO and owners do…
Hey, I read them–thanks for the informed explanation! My mind is still boggled though that punitive and damages are not treated separately, though as a matter of course. Seems so obvious (and so much better PR) that punitive amounts should go somewhere that will help mitigate the effects of the wrong-doing rather than inordinately rewarding an individual.
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