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.
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WLF paper on class action certification of punitive damages claims
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.
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Arkansas Supreme Court declares cap on punitive damages unconstitutional, reinstates $42 million punitive damages award
Yesterday the Arkansas Supreme Court issued an opinion holding that the Arkansas legislature violated that state’s constitution by imposing a cap on punitive damages.
The cap, which was enacted in 2003, limits punitive damages to the greater of $250,000 or three times compensatory damages (not to exceed $1 million). Yesterday’s opinion (Bayer CropScience v. Schafer), says the cap violates a provision of the Arkansas constitution that provides: “no law shall be enacted limiting the amount to be recovered for injuries resulting in death or for injuries to persons or property.” The defendant argued that the language in question only applies to compensatory damages. The court disagreed, finding that punitive damages are part of the “amount to be recovered” within the meaning of the constitutional provision.
The court went on to hold that Bayer waived its right to challenge the excessiveness of the $42 million punitive damages award, because it failed to file a separate notice of appeal from the trial court’s post-trial order ruling on the excessiveness issue. Ouch. In light of the substantial compensatory damages award – – $5.9 million – – the defendant would have had a strong argument that the punitive damages couldn’t exceed the compensatory damages by more than a one-to-one ratio.
By our count there are 31 states with caps on punitive damages. I guess this makes it 30.
Related posts:
Arkansas Supreme Court considers constitutionality of caps on punitive damages
Arkansas Jury Awards $42 Million in Punitive Damages in Litigation Over Genetically Modified Rice
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Oregon Supreme Court rules against Philip Morris (again)
Believe it or not, the Williams case is still going. For anyone who missed it, Williams is the case in which an Oregon jury awarded $821,500 in compensatory damages and $79.5 million in punitive damages. The case bounced around in the appellate courts for years; the Oregon Supreme Court kept ruling against Philip Morris and the U.S. Supreme Court kept granting certiorari. On the third trip to the U.S. Supreme Court, certiorari was dismissed after oral argument, leaving the judgment intact.
Philip Morris paid the plaintiffs in 2009. That payment included 40 percent of the punitive damages award. The plaintiffs only got 40 percent because Oregon has a split recovery statute that requires the defendant to pay 60 percent of any punitive damages award to the state (as discussed here.)
Philip Morris argued that it shouldn’t have to pay the state in this case because Oregon gave up its right to collect further punitive damages from Philip Morris in 1998, when Oregon signed on to a master settlement between the states and the tobacco companies. Philip Morris won that argument in the intermediate appellate court but, as reported by the Associated Press, the Oregon Supreme Court reversed and ordered Philip Morris to pay Oregon it’s 60 percent share of the $79.5 million punitive damages award.
As a result of this decision and the California Supreme Court’s denial of review in Bullock, Philip Morris’s parent Altria Group Inc. will record a $119 million fourth-quarter charge, per this report in today’s Wall Street Journal.
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Review denied in Bullock v. Philip Morris
The California Supreme Court has denied review in Bullock v. Philip Morris (again). To recap, that’s the case in which the majority opinion upheld a $13.8 million punitive damages award that was 16 times the compensatory damages award of $850,000. Although the U.S. Supreme Court has instructed that the ratio of punitive damages to compensatory damages should be low (or even one-to-one) when compensatory damages are substantial, the majority held that $850,000 is not “substantial” when compared to the wealth of the defendant. Justice Kitching dissented, arguing the defendant’s wealth has nothing to do with whether a compensatory damages award is “substantial.” It will be interesting to see whether the next appellate opinion follows the majority or the dissent.
Related posts:
Plaintiffs answer petition for review in Bullock, amici line up to support petition
Petition for review filed in Bullock v. Philip Morris
Bullock v. Philip Morris Court of Appeal opinion affirms 16:1 punitive damages award
L.A. Jury Awards $13.8 Million in Punitive Damages to Smoker’s Daughter in Bullock Retrial
California Supreme Court Denies Review in Bullock v. Philip Morris
Parties in Bullock v. Philip Morris File Reply Briefs Supporting Petitions for Review
Answers to Petitions for Review in Bullock v. Philip Morris
Plaintiff Files Petition for Review in Bullock v. Philip Morris
Philip Morris Files Petition for Review in Bullock v. Philip Morris
More on Bullock v. Philip Morris: Curing Legal Error with a Remittitur?
More on Bullock v. Philip Morris
Bullock v. Philip Morris—California Court of Appeal Reverses $28 Million Punitive Damages Award
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Punitive damages default judgment affirmed (Akdot v. Olabuenaga)
When a defendant doesn’t bother to defend himself against a lawsuit, the plaintiff can get a default judgment for punitive damages only if the plaintiff serves the defendant with a statement of the amount of punitive damages sought. (See Code of Civil Procedure section 425.115.) In this case, the plaintiff got a default judgment for $25,000 in punitive damages, but never served a statement of damages. An easy reversal, right? Not so fast. The default judgment in this case was entered way back in 1990, well before the Legislature enacted the statute requiring a statement of damages (which happened in 1992). Accordingly, the California Court of Appeal (Second Appellate District, Division Two) affirms in an unpublished opinion.
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Los Angeles jury awards $65 million in punitive damages against hospital
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.
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San Francisco jury awards $50 million in punitives against Ford
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.
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WLF publication criticizes punitive damages “white paper” issued by plaintiffs’ group
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.
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Missouri Supreme Court considering caps on punitive damages
We recently reported that the Arkansas Supreme Court is considering a challenge to the constitutionality of that state’s cap on punitive damages. According to this press release published in the Kansas City Star, the Missouri Supreme Court is considering a similar challenge to that state’s law limiting punitive damages to $500,000. Stay tuned.