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• W1507572069 abstract "The U.S. Supreme should speak more definitively extent to which conduct in other instances and net worth may be used against defendants OVER THE last decade, there has been marked shift in manner in which American courts award punitive damages. While it remains goal of judicial system to maintain two-fold purpose of punitive damages-punishment of offending party and deterrence of others-the U.S. Supreme Court recently laid down rules in State Farm Mutual Automobile Insurance Co. v. Campbell1 that such damages may be awarded only if defendant's constitutional rights are protected. Defendants facing punitive damages must have procedural and substantive due process protections to ensure against arbitrary deprivation of property. What factors are juries to consider in assessing and later appellate courts in reviewing punitive damages awards? To what extent may conduct outside relevant jurisdiction be considered? This conduct is commonly referred to as constituting extraterritoriality considerations. The State Farm decision answered some of questions regarding extraterritoriality, but allowed others to remain-specifically, whether and to what extent juries may consider defendant's wealth in computing punitive damages, and decision's applicability to products liability cases. PUNITIVE DAMAGES JURISPRUDENCE IN THE UNITED STATES A. In Beginning In American law, concept of punitive damages has been recognized as a well-established principle of common law.2 In its earlier jurisprudence, Supreme Court left regulation of punitive damages awards to state legislatures and discretion of judges and jurors in state courts. But in 1986 in Aetna Life Insurance Co. v. Lavoie,3 it intimated that it would begin to review punitive damages awards based due process. While Court disposed of case alternative grounds, it noted that Aetna's due process arguments relating to punitive damages award raise important issues which, in an appropriate setting, must be resolved.4 One of Court's first opportunities post-Lavoie came in 1989 in Browning-Ferris Industries of Vermont Inc. v. Kelco Disposal Inc.,5 in which Court held that punitive damages award is not subject to invalidation under fines clause of Eighth Amendment, which, Court ruled, is applicable only to criminal sanctions. Then Court began holding that imposition of punitive damages must conform to both procedural (Honda Motor Co. v. Oberg)6 and substantive (BMW of North America Inc. v. Gore)7 due process requirements. In Pacific Mutual Life Insurance Co. v. Haslip8 and TXO Production Corp. v. Alliance Resources Corp.,9 Court began to examine size of punitive awards compared to compensatory award. While it upheld punitives in both cases, it noted some uneasiness and concerns about due process and uneven ratios of punitive to compensatory damages. B. BMW and Cooper Industries In 1996 in BMW, Court finally articulated due process framework within which judges could work in considering punitive damage awards and invalidated an award that was grossly excessive in relation to compensatory damages. The plaintiff in BMW sued carmaker after learning that his new car had been repainted, common practice BMW. He sued in Alabama state court based fraud, alleging that repainting diminished car's value some $4,000. The jury found for plaintiff, awarding him that amount but tacking $2 million in punitive damages. Recognizing elementary notions of fairness, Court held that person must receive fair not only of conduct that will subject him to punishment but also of severity of penalty that state may impose, Court invalidated punitive award. BMW was not on notice of severity of punishment, Court stated, and it set out three guideposts for lower courts to consider in awarding punitive damages: (1) the degree of reprehensibility of harm; (2) the disparity between harm or potential harm suffered by plaintiff and amount of punitive damages; and (3) the difference between [the punitive damages] remedy and civil penalties authorized or imposed in comparable cases. …" @default.
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• W1507572069 date "2003-10-01" @default.
• W1507572069 modified "2023-09-28" @default.
• W1507572069 title "Extraterritoriality and Punitive Damages: Is There a Workable System? the U.S. Supreme Should Speak More Definitively on the Extent to Which Conduct in Other Instances and Net Worth May Be Used against Defendants" @default.
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