California Punitives by Horvitz & Levy
  • “Smokers, tobacco, both winners in early Engle cases”

    Reuters has this report about the results thus far in the series of individual smoker lawsuits taking place in Florida.

    As mentioned in prior posts, these suits are taking place as a result of the Florida Supreme Court’s 2006 decision in Engle v. Liggett Group, which reversed a $145 billion class action punitive damages award and ruled that the plaintiffs had to bring their own individual cases to prove that cigarettes caused their illnesses.

    According to the Reuters story, the plaintiffs have prevailed in seven of the nine cases to go to trial thus far, winning damages ranging from $600,000 to $30 million. Only two of the plaintiffs have recovered punitive damages.

  • New Mexico Appeals Court Reverses $50 Million Punitive Damages Award

    Back in 2007, a New Mexico jury awarded $3.2 million in compensatory damages and $50 million in punitive damages for the alleged neglect of a nursing home patient. The defendant appealed, arguing, among other things, that the punitive damages were unconstitutionally excessive, since the ratio of punitive damages to compensatory damages exceeded 15 to 1.

    Last week, the New Mexico Court of Appeals issued an opinion (Keith v. ManorCare, Inc.) reversing the entire judgment and ordering a new trial. The court did not reach the ratio issue because it concluded that the trial court made a prejuducial instructional error that affected both liability and damages, requiring a complete new trial.

  • Microsoft Hit With $40 Million in Punitive Damages for Patent Infringement

    U.S. District Judge Leonard Davis of the Eastern District of Texas has entered judgment against Microsoft for $200 million in compensatory damages and $40 million in punitive damages, based on Microsoft’s willful infringement of a patent owned by i4i Limited Partnership. Judge Davis has also ordered Microsoft to stop selling any version of Microsoft Word that is capable of opening an XML file. In other words, Microsoft can no longer sell Microsoft Word 2003 or Microsoft Word 2007.

    Hat tip: Patently-O.

  • Hold the Gravy: No Punitive Damages in Fosamax Litigation

    Bloomberg is reporting that U.S. District Judge John Keenan intends to dismiss the plaintiffs’ punitive damages claims in a massive lawsuit against Merck & Co.

    The lawsuit alleges that Merck’s osteoporosis drug Fosamax causes irreversible “jaw rot.” (I don’t know exactly what that is, but it doesn’t sound good.) Merck is facing more than 850 lawsuits over Fosamax. Judge Keenan’s ruling comes in connection with three bellwether trials set to begin on August 11.

    The plaintiffs’ lawyers are downplaying the dismissal of their punitive damages claim. “The punitive damages are just the gravy,” said plaintiffs’ counsel Timothy O’Brien.

  • L.A. Jury Awards $370 Million Against Co-Founder of Guess Inc.

    The Associated Press is reporting that a Los Angeles jury has awarded a $370 million verdict, including $25 million in punitive damages, in a defamation lawsuit against Georges Marciano, co-founder of Guess, Inc.

    The plaintiffs in the action are five former employees of Marciano. He sued them in 2007, accusing them of stealing from him. His claims were dismissed, but the ex-employees counter-claimed for defamation.

  • Texas Jury Awards $145 Million in Punitive Damages

    Law.com is reporting that a Texas jury has awarded $178.7 million, including $145 million in punitive damages, against NL Industries (a holding company) and its general counsel (who is personally liable for $5 million of the punitive damages). The Law.com story says the plaintiffs were minority shareholders in a subsidiary of NL Industries. They claimed they lost most of their investment when the holding company improperly stripped the subsidiary of its assets. Not suprisingly, NL is planning an appeal.

  • Huge Punitive Damages Award Brewing in Kentucky

    A press release on PR Newswire reports that a Kentucky jury has ruled in favor of the plaintiffs in a mass tort action against DuPont arising out of the release of toxic fumes from a chemical plant.

    So far, the jury has awarded $1.25 million in compensatory damages and $12.5 million in punitive damages. But those awards are for only 6 of 179 plaintiffs. The other 173 cases remain to be tried. Apparently, the trial court has ordered that the liability findings from this trial will be binding in the subsequent trials. The subsequent trials will apparently focus only on causation and compensatory damages. Any plaintiff who recovers compensatory damages will automatically be entitled to a punitive damages award of ten times the amount of compensatory damages.

    Based on the awards to the first 6 plaintiffs, this case is on pace to generate awards totaling $37.3 million in compensatory damages and $373 million in punitive damages.

  • Turnabout in Dole Banana Litigation: Now Dole is Asking for Punitive Damages

    We’ve been blogging about California litigation brought by Nicaraguan banana workers against Dole, based on alleged exposure to pesticides. Early on, the plaintiffs obtained (and then lost) a punitive damages award against Dole. The litigation has taken some bizarre twists and turns since then, including a disciplinary proceeding instigated by the Ninth Circuit against one set of plaintiffs’ lawyers, and a dismissal of another action, prompted by the revelation that many of the plaintiffs in that action never worked on a banana farm and/or had fathered children, despite their claims of sterility.

    The latest news in this saga is that Dole is bringing a lawsuit of its own. According to LABIZObserved, Dole has sued a filmmaker who made a pro-plaintiff documentary about Dole’s conduct and the subsequent litigation. Dole claims the filmmaker (Fredrik Gertten) ignored the truth, even after the California court proceedings unfolded and revealed the falsity of the plaintiffs’ claims. Dole is asking for punitive damages.

  • Foreign Corporation Not Liable for Punitive Damages Against U.S. Affiliate

    Earlier this week, a trial judge in Miami ruled that BDO International, a Brussels-based corporation, cannot be liable for a $351 million punitive damages award against its U.S. affiliate, BDO Seidman.

    The punitive damages were awarded in a lawsuit by a Portugese bank that accused BDO Seidman of bungling the audits of the bank’s subsidiary. The jury awarded $170 million in compensatory damages and $351 in punitive damages, for a total verdict of $521 million, the largest verdict ever against a U.S. accounting firm. BDO Seidman appealed. The bank then sued BDO Seidman’s parent company, BDO International, seeking to hold them liable for the punitive damages award, but Miami-Dade circuit judge John Schelsinger issued a directed verdict in favor of the defendant.

    Am Law Litigation Daily has more details.

    This case has a California connection. The plaintiffs’ lawyer, Steven W. Thomas, has a small firm in Venice. Coincidentally, my daughter went to preschool with his child a few years ago, but I never met Steve. His wife told me he was off trying some big case in Miami. I had no idea it was this big.

    UPDATE (6/18/09 at 6:13 pm): After the trial court ruled that BDO International was not liable for the punitive damages award against BDO Seidman, the court allowed the jury to decide BDO International’s liability for the compensatory damages. According to the Legalizer, the jury today ruled in favor of BDO International, finding it not liable for the compensatory damages award.

  • Sotomayor – a puzzle on punitive damages?

    Greg Stohr reports for Bloomberg that “Sotomayor on High Court May Mean Looser Limits on Damage Awards.” The article describes a couple of cases in which Sotomayor voted to affirm punitive awards (including the $1 billion award in Motorola Credit Corp. v. Uzan (2d Cir. 2007) 509 F.3d 74 ). The article notes, however, that the constitutional challenges to those awards may not have been very strong on the particular facts of those cases, so the rulings do not necessarily suggest hostility to court review of out-of-whack punitive damages.

    But defendants in punitive damages cases might be more disturbed to hear that the judge is on record as being unfavorably disposed to legislative caps on compensatory damages. Stohr’s article quotes Judge Sotomayor’s 1996 comments in the Suffolk University Law Review in Boston, criticizing lawmakers who “introduced bills that place arbitrary limits on jury verdicts in personal injury cases.” She wrote that such laws are “inconsistent with the premise of the jury system,” and that laws’ focus “must be shifted back to monitoring frivolous claims, uncovering pervasive misrepresentation in court and educating the public that no system of justice is perfect.” This doesn’t bode well for those who rely on courts’ de novo review of the constitutionality of punitive damages to protect against excessive awards.

    Related musings on the effect of President Obama’s replacement for Justice Souter can be found in earlier posts on this blog (“Will Justice Souter’s Retirement Revolutionize Punitive Damages Litigation?”; “Souter Favored Limits on Punitive Damages” and “The Effect of Justice Souter’s Retirement on Punitive Damages”).