Just two days ago we noted that California appellate courts often reverse punitive damages awards because the plaintiff failed to introduce meaningful evidence of the defendant’s financial condition. Here’s a case in which the trial court vacated a jury’s punitive damages award on the same ground, and the Court of Appeal affirmed.
In this defamation case, the jury ruled for the plaintiffs and awarded $44,500 in compensatory damages and $55,000 in punitive damages. The trial court vacated the punitive damages award because the plaintiff failed to present evidence of the defendants’ financial condition.
The plaintiffs appealed, arguing their evidence of financial condition was sufficient. The Court of Appeal (Fourth District, Division Three) disagreed. It noted that plaintiffs presented evidence that one defendant was a Mercedes-Benz dealership, and the other defendant was a salesman who sold 9,000 vehicles a year. But the plaintiffs presented no evidence of the defendants’ expenses or liabilities: ” ‘we may not infer sufficient wealth to pay a punitive damages award from a narrow set of data points, such as ownership of valuable assets or a substantial annual income.’ “