This article in the National Law Journal discusses a new study released by the John D. and Catherine T. MacArthur Foundation Research Network of Law and Neuroscience, housed at Vanderbilt University.  The participants in the study were asked to determine the appropriate punishment for different types of misconduct, and were unable to draw distinctions between knowing and reckless misconduct.  Sometimes they punished reckless conduct more harshly than knowing conduct. 

The study involved criminal conduct, but the there’s no reason to believe that jurors are any better at making this sort of determination in civil cases involving punitive damages.  As appellate lawyers we see plenty of cases where the punishment doesn’t seem to fit the crime.  We see jurors awarding punitive damages at the high-end of the single-digit ratio spectrum, even though the conduct at issue can’t be characterized as highly reprehensible in relation to other types of punishable conduct.  (See, for example, this recent case in which a jury awarded $1,000,000 in punitive damages to a plaintiff who was allegedly slandered by a family member, but according to the jury’s findings suffered no out-of-pocket loss.)  Fortunately, our experience has been that judges are more attuned to these types of distinctions, and are often able to bring these awards into line.

No, that heading isn’t a typo.  That’s $150 billion in punitive damages.  According to this story in the Salt Lake Tribune, a Texas jury awarded $370 million in compensatory damages and $150 billion in punitive damages (a ratio in excess of 400 to one) against a man who allegedly sexually assaulted the plaintiffs’ son and set him on fire.  The defendant did not even bother to show up for trial. 

The verdict is reportedly the largest in U.S. history, topping the $145 billion award in the Engle class action against the tobacco industry (which was later reversed by the Florida Supreme Court).

This award won’t have any practical significance, since it’s obviously uncollectible.  It’s not likely to have much legal significance either; the defendant who didn’t show up for trial probably won’t bother to challenge the award through post-trial motions or an appeal, so we’re not going to end up with any judicial opinion evaluating the propriety of the award.  Thus, the impact of the award is largely symbolic, as a reflection of the jury’s outrage at the defendant’s extraordinarily reprehensible conduct. 

There may also be a more subtle effect as well.  As I have noted before, I think these  massive awards, even if they are uncollectible and uncontested, have a tendency to seep into the public perception of our judicial system, contributing to the impression that awards like this are within the range of acceptable outcomes in civil litigation. 
If you are a plaintiff or a plaintiff’s lawyer, you may view that as a good thing.  If you’re a defendant or a defense lawyer, not so much.

Los Angeles superior court judge Rex Heeseman, who frequently writes opinion pieces on insurance law and punitive damages, has written an op-ed that appears in today’s Daily Journal (subscription required to access article).  Judge Heeseman’s piece examines the likely impact of the recent Bullock opinion, which upheld a 16 to 1 ratio of punitive to compensatory damages.  Interestingly, he writes that the majority opinion’s analysis is “arguably contrary to Campbell,” to the extent that the majority folded the defendant’s financial condition into the BMW guidepost analysis.   (We struck the same note in our amicus filing on behalf of the U.S. Chamber of Commerce.) 

Ultimately, Judge Heeseman predicts that plaintiffs will cite Bullock to show that ratios can exceed 9 to 1 in cases of “extreme” reprehensibility, and defendants will argue that Bullock should be limited to its particular facts.  That sounds about right with respect to trial court litigation. I would add that, when those cases go up on appeal, defendants will argue that the majority opinion in Bullock should not be followed by other appellate courts because it is out of step with federal and state law, as pointed out in Justice Kitching’s dissenting opinion.

Last month we had two eight-figure punitive damages in California (see our posts here and here).  Now we have another one.   According to this story in Rafu Shimpo, a jury in Los Angeles has awarded $32.8 million in damages – – including $17.5 million in punitive damages – – in a dispute over the development of a $2 pen.  The plaintiff alleged that Pentel of America and its Tokyo-based parent company maliciously stole the concept of the HyperG, a smooth-writing gel pen.      

I should have posted this three weeks ago, but better late than never.  My colleague Felix Shafir, occasional contributor to this blog, has written a short paper for the Washington Legal Foundation article entitled Class Action Certification of Punitive Damages Claims After Wal-Mart v. Dukes.

California juries are in a giving mood when it comes to punitive damages lately.  On top of last week’s mega-verdict against Ford, a jury in L.A awarded $65 million in punitive damages yesterday against the Encino-Tarzana Regional Medical Center, according to this report in the Contra Costa Times.  The plaintiff alleged she was sexually abused by a male nursing assistant at the hospital.

The compensatory damages award is $2.36 million, resulting a punitive-to-compensatory damages ratio of roughly 27.5 to one, which will be very difficult for the plaintiff to defend in post-trial motions and on appeal.  Not surprisingly, the article says the hospital is already planning to appeal.

I’m a little late in reporting this story.  The Sacramento Bee reported last week that a jury in San Francisco awarded $73 million in damages against Ford, including $50 million in punitive damages, in a lawsuit arising from a fatal accident involving an Econoline van.  The plaintiffs accused Ford of despicable conduct in failing to notify consumers of a tire recall notice from Goodyear. Ford took the position that the deaths would not have occurred if the plaintiffs had been wearing their seat belts.

The Washington Legal Foundation has published a Legal Backgrounder attacking a recent pro-plaintiff report on punitive damages.  The WLF report, authored by Victor Schwartz and Cary Silverman at the Shook Hardy firm, takes aim at a white paper released earlier this year by the Center on Justice & Democracy.

The WLF report makes some of the same points we made in our post about the white paper, including the observation that the white paper, despite claiming that limits on punitive damages are bad for society, offers no actual evidence that society is worse off in the majority of states that have now adopted caps or other limitations on punitive damages.

We blogged last year about a whopping $500 million punitive damages award out of state court in Las Vegas, based on allegations that the manufacturers and suppliers of the anesthetic Propofol acted with malice by supplying the drug in vials larger than necessary for single use, thereby tempting healthcare providers to reuse the vials.  That case is currently pending before the Nevada Supreme Court. 

Bloomberg now reports that another Vegas jury has awarded an additional $162 million in another lawsuit based on the same allegations.  And stay tuned, because a separate jury in the same courthouse has just awarded $14 million in compensatory damages in a similar case, and will consider punitive damages later this week.  (The defendants in these cases are Teva Parenteral Medicines Inc., Baxter Healthcare Corp., and McKesson Corp.)

UPDATE (10/13/11):  Bloomberg reports that jury #3 has awarded another $90 million in punitive damages.  So the defendants are looking at a combined $752 million in punitive damages in these three cases.

We previously reported on the appellate decision that allowed a plaintiff to proceed with a punitive damages claim against Johnson & Johnson for allegedly failing to provide sufficiently specific warnings for its pain reliever Motrin, and allegedly withholding information about Motrin from the FDA.  As we noted in May, the California Supreme Court denied Johnson & Johnson’s petition for review (and our request for depublication.)

Today’s Daily Journal (subscription required) reports that, after a six-and-a-half week trial, a jury awarded the plaintiff $48.2 million in damages, including $15.6 million in punitive damages.