Whenever a state high court agrees to consider whether a punitive award is excessive, it is big news. So we were pleased to see the Wisconsin Supreme Court making some good news when it reduced the punitive damages award from $1 million to $210,000 in Kimble v. Land Concepts, Inc., __ N.W.2d __, 2014 WL 1584454 (Apr. 22, 2014).
Even better, the court correctly interpreted several aspects of the Supreme Court’s reprehensibility, ratio, and comparative-fines guideposts that often give courts trouble. See BMW of N. Am., Inc. v. Gore, 517 U.S. 559 (1996); State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408 (2003).
Kimble involved a title company that concealed the absence of an easement providing access to a parcel of land and refused to defend the owner’s title when the lack of access was discovered. The absence of an easement contributed to the owner losing a sale, although the property later sold after the owner purchased an easement providing access for $40,000. Following trial, the plaintiffs were awarded $29,738.49 for their legal expenses in securing the easement and $1,000,000 in punitive damages.
After granting discretionary review, the Wisconsin Supreme Court started on the right foot by noting that a punitive award is excessive not only when it is disproportionate to the defendant’s wrongdoing but also when it “is more than necessary to serve the purposes of punitive damages.”
We often have argued that, when a lesser award would serve the state’s interest in punishment and deterrence, then the award must be reduced to that lesser amount because anything more violates due process. Too often courts fail to recognize this substantive limit on the amount of a punitive award.