jury verdicts, exorbitant jury verdicts, jury awards

Are Billion-Dollar Jury Verdicts a Thing of the Past?

January 11, 2009 07:58 AM
by findingDulcinea Staff
No juries issued awards of more than one billion dollars last year. Have changes in legal rulings made exorbitant jury verdicts more difficult?

Courts Limit Punitive Damages

Bloomberg analyzed data that found that in 2008, for the second year in the past three years, no juries gave out awards of more than one billion dollars.

“We’re seeing the effects of a campaign that has been ongoing for the last 10 to 12 years of trying to eliminate punitive damages against corporate interests,” said attorney Robert Cunningham of Cunningham Bounds Yance Crowder & Brown in Mobile, Ala., to Bloomberg. “It appears to have worked.”

State and federal limits, and the financing by business interests of conservative judges, are partially responsible. A 2003 Supreme Court ruling that punitive damages can’t exceed more than 10 times actual damages, except in “particularly egregious” cases, also plays a part. Judges are now more cautious, and juries more skeptical, and lawyers say that they are making more moderate demands in court.

Appeals courts are now more likely to throw out exorbitant punitive awards. “That leads plaintiffs’ lawyers to adopt a sort-of Three-Bears approach in their submissions to jury: don’t award too little, don’t award too much,” commented Drew Hasselback at National Post.

Nevertheless, 2008 did see some large punitive damages. Overall, the top 10 totaled $960 million, and the top verdict overall was an award of $606.6 million against Boeing Co. and a subsidiary.

Opinion & Analysis: “Are jury awards too high?”

High-profile punitive damages cases have inspired a public backlash in recent years.

In 2006, the issue came to the forefront of public debate when the Supreme Court’s 2003 ruling on excessive damages was put to the test in the case of Philip Morris v. Mayola Williams, the widow of an Oregon smoker who was awarded $79.5 million from the tobacco company by a lower court.

Philip Morris’ lawyers contended that the award was “constitutionally excessive and fundamentally unfair.” But Williams’ supporters argued that damage sums should be up to juries and state lawmakers, not the Supreme Court, and claimed that the tobacco company had deceived the general public and committed fraud with its product.

Bloomberg’s recent report suggests that excessive punitive damages are on the wane. However, argues that the furor over America’s litigious society is misguided, citing the much-mocked case of 79-year-old Stella Liebeck, who was awarded $2.7 million from McDonalds after suffering third-degree burns from her coffee. In the McDonald’s incident, the chain had been aware of 700 similar incidents from scalding coffee, and had initially refused Liebeck’s request for $20,000 in compensation, making it liable for “willful, reckless, malicious or wanton conduct,” according to the court. points out that most lawsuits involving large punitive damages are brought against corporations, not individuals. “What will tort reform accomplish? It will limit our ability to hold corporations accountable for their misdeeds. Corporate America has succeeded to a great extent in buying up our legislators and capturing regulatory bodies. We must not let them wrest control of the judicial system as well,” writes Jon Greenbaum.

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