Politico reports that the House Judiciary Committee voted along party lines (18-15) to approve a medical malpractice reform bill which, among other things, would limit punitive damages in med mal cases to $250,000 or two times compensatory damages, whichever is greater. The bill would apply to all med mal lawsuits in federal and state courts. If passed, the bill would have an impact in California, where we have a cap of $250,000 on non-economic damages in med mal cases, but no cap on punitive damages. (And contrary to what the AP might tell you, there is a difference between non-economic damages and punitive damages.)
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South Carolina House of Representatives approves bill to cap punitive damages
Bloomberg reports that a bill to cap punitive damages was overwhelmingly approved in the South Carolina House of Representatives, by a vote of 100-7. The bill would limit punitive damages to $350,000 or three times compensatory damages, whichever is higher. A similar bill was approved by the state House of Representatives last year, but never won approval in the state Senate.
If this bill wins approval, it’ll be a little too late for Fortis Insurance Company. Fortis was on the losing end of a $10 million punitive damages award in a South Carolina insurance bad faith case a little over a year ago.
To the best of my knowledge, South Carolina would become the 27th state to have a cap on punitive damages, including those states that prohibit punitive damages altogether. Wisconsin recently became number 26. So 2011 marks the year in which uncapped punitive damages awards became the minority position among state legislatures. If this trend continues, this blog may become obsolete. Please, no tears. I think we’ve got a few years left.
The latest proposal to cap punitive damages in California is awaiting the decision of the Assembly Commission on the Judiciary, but I’ve seen no indication that it will fare any better than last year’s proposal, and the one before that, and the one before that . . .
Hat tip: TortsProf Blog.
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Smoker asks for $10 billion in punitive damages; jury awards $260,000
Bloomberg reports that a Florida jury has awarded $260,000 in punitive damages to a smoker in a lawsuit against RJ Reynolds, rejecting the plaintiff’s request for $10 billion. The Bloomberg story quotes the disappointed plaintiffs’ lawyer: “It could have been and should have been more . . . [b]ut this is my first tobacco trial.”
The plaintiff’s lawyer may have thought that, just by asking for $10 billion, he would get at least a few million bucks out of the jury. After all, as our friends at Cal Biz Lit have noted, research shows that the most significant predictor for a large punitive damages award is a large request. That principle apparently did not work in the plaintiff’s favor here, although we’ll never know how much the jury would have awarded if the plaintiff had asked for something within the realm of reason.
Related posts:
Plaintiffs break losing streak in Florida smoker lawsuits, win $72 million punitive damages award
Philip Morris wins sixth straight trial in Florida smoker litigationFlorida jury awards relatively modest punitive damages in smoker lawsuit
Another punitive damages award in Florida tobacco litigation
Florida jury awards $20 million in punitive damages to smoker’s widow
Smoker’s widow wins $12.5 million in punitive damages
Florida trial judge cuts $244 million punitive damages award
Florida jury awards $25 million in punitive damages to smoker’s widow
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Court of Appeal publishes opinion on punitive damages against Johnson & Johnson for ibuprofen warnings
The California Court of Appeal (Second Appellate District, Division Four) has ordered publication of this previously unpublished opinion we blogged about a few weeks ago. The Court of Appeal’s online docket says publication was requested by the plaintiff and by “Non-parties Brakefield.” I’m not sure who or what Brakefield is, but presumably they’re seeking punitive damages in some other action and they sought publication of this opinion to chip away at the usual strict standards for punitive damages claims in California.
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California lawyer wins another big punitive damages award against BDO Seidman
The Miami Herald reports that a Florida jury has awarded $91 million, including $55 million in punitive damages, to the estate of philanthropist/aviation pioneer George Batchelor in a lawsuit against accounting firm BDO Seidman. The plaintiff claimed that BDO Sediman fraudulently concealed information about a company in which Batchelor had invested.
The California connection here is the plaintiff’s lawyer: Steven Thomas of Thomas, Alexander & Forrester in Venice. Thomas scored an even bigger punitive damages award ($351 million) against the same defendant in another Florida case in 2009 (see this post), but that award was reversed on appeal.
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Green v. Laibco: $1.2 million in punitive damages affirmed
In this published opinion, the California Court of Appeal (Second Appellate District, Division Eight), affirms a punitive damages award of $1.2 million. There was only one appellate issue regarding the punitive damages award: whether the plaintiff met her burden of presenting meaningful evidence of the defendant’s financial condition. The plaintiff presented evidence that the defendant earned a profit of $670,000 in the most recent 12-month period, and was “in the black” (although the actual amount of net worth was unspecified). The court said this evidence was sufficient to sustain the award, considering that the defendant had delayed in responding to discovery requests for financial information, and the defendant’s CEO was unable to personally calculate the defendant’s actual net worth.
Full disclosure: Horvitz & Levy represents the defendant in this appeal, and we will not comment on the opinion because the litigation is ongoing.
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Another year, another proposal to cap punitive damages in California
Stop me if you’ve heard this one before: a California lawmaker has introduced a bill to limit punitive damages. AB 157, introduced by assembly member Linda Halderman (R-Fresno), would cap punitive damages in California at three times the amount of compensatory damages.
The bill would also eliminate punitive damages in products liability cases in which the defendant could establish that its product was in compliance with applicable regulations.
Oh, and one more little thing. It would put a $250,000 cap on noneconomic damages in all negligence cases (i.e., it would expand the MICRA limit on nonecomonic damages to all cases).
If this sounds familiar, that’s because it’s essentially the same as a bill Assemblyman Roger Niello (R-Fair Oaks) introduced last year (AB X8 40). That bill failed to get past the Assembly Judiciary Committee. A similar bill was rejected by the Senate Judiciary committee in 2008.
You can track the status of the bill here, but I think you all have a pretty good idea how this sequel is going to end. California is not Wisconsin.
UPDATE: The proposal is actually AB 158, and it can be tracked here.
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AP story illustrates confusion about punitive damages
Earlier this week, the Associated Press reported about a case in which the Fifth Circuit asked the Mississippi Supreme Court to decide whether that state’s cap on punitive damages is constitutional.
When I saw the story, it seemed like good material for this blog. But further investigation revealed that the case in question (Learmonth v. Sears, Roebuck & Co.) has nothing to do with punitive damages. The Fifth Circuit’s opinion asks the Mississippi Supreme Court to decide the constitutionality of a cap on noneconomic damages (emotional distress, pain & suffering, etc.).
The AP reporter clearly didn’t understand that noneconomic damages are a form of compensatory damages, and are quite different from punitive damages. In fact, the AP story actually says noneconomic damages are “also called punitive damages.” Umm, no. The AP ran a correction the following day.
I don’t want to be too critical of the AP for making this mistake. Since we launched this blog over two years ago, I have seen a number of other stories making the same mistake. In fact, if you read a comment page for almost any story about a proposal to cap noneconomic damages, there’s a good chance you’ll see several comments mistakenly assuming the cap applies to punitive damages. Apparently, despite all the discussion of punitive damages in the press in recent years, many members of the public (and even a few reporters) are unclear on the basic concept.
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Wisconsin governor signs law capping punitive damages
The Milwaukee Journal-Sentinel reports that Wisconsin governor Scott Walker has signed the bill limiting punitive damages in that state to the greater of $200,000 or double the amount of compensatory damages. The law will undoubtedly be subject to court challenges, but similar laws in other jurisdictions have mostly survived such attacks.
Related posts:
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Johnson & Johnson v. Superior Court; plaintiffs can seek punitive damages for incomplete ibuprofen warnings
We have a pretty high threshold for imposing punitive damages in California. The plaintiff has to prove by clear and convincing evidence that the defendant committed intentional fraud or engaged in “despicable” conduct with a “conscious disregard” for the rights others. When a plaintiff’s allegations to meet those standards, courts often strike the punitive damages claims from the complaint, or grant summary adjudication on the issue of punitive damages.
It’s a little hard to see how the claims in this case made it through. The plaintiff is seeking punitive damages against Johnson & Johnson for failing to warn of the possibility of a severe allergic reaction that causes a potentially fatal skin condition. Johnson & Johnson did warn about the possibility of severe allergic reactions, but didn’t specifically warn about skin reddening, blisters, or rash.
The plaintiff also claims Johnson & Johnson should be punished for withholding information from the FDA. Johnson & Johnson did provide all the information in question to the FDA, but allegedly acted with malice by including the information in a voluminous submission without specifically highlighting this particular risk.
The trial court denied Johnson & Johnson motion for summary adjudication on the issue of punitive damages, and Johnson & Johnson petitioned the Court of Appeal for writ relief. The Court of Appeal (Second Appellate District, Division Four) issued an alternative writ and called for briefing on the merits, but then issued an unpublished opinion upholding the trial court’s order. There court concludes there are sufficient facts to create a triable issue on the question of malice.
Maybe there are some additional facts not included in the opinion, but I just don’t see how the a reasonable jury could conclude that the evidence described in the opinion amounts to clear and convincing evidence of “despicable conduct” or “conscious disregard.”