Louisiana generally does not permit punitive damages. But if an accident happens on navigable waters, and the plaintiff brings a claim under federal maritime law, a Louisiana jury can award punitive damages, and Louisiana courts then must decide the full panoply of issues that arise in punitive damages cases.  That’s what happened in Warren v. Shelter Mutual Insurance Co.

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fraction (1)On June 9, 2016, the California Supreme Court issued its decision in Nickerson v. Stonebridge Life Insurance Co., holding that so-called Brandt fees should be treated as compensatory damages when calculating the ratio of punitive to compensatory damages even when they are awarded by the trial court after the jury has returned its punitive damages award.

As discussed in my post about our amicus brief for the Chamber of Commerce in Nickerson, Brandt fees are the attorneys’ fees incurred by an insured in obtaining policy benefits that an insurer has been held to have denied the insured in bad faith.  Accordingly, at first blush Nickerson may appear to be irrelevant outside the insurance context.  But that first impression may be mistaken.
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Seal_of_the_Supreme_Court_of_TexasAn issue that seems to be arising with increasing frequency is whether the defendant must plead applicability of a cap on punitive damages in its answer. We have already explained why the argument that the cap is an affirmative defense that must be pleaded is specious.

The Texas Supreme Court agreed with that position

The Due Process Clause of the Fourteenth Amendment requires procedural fairness in state trials, but that principle seems absent from a recent California Court of Appeal decision upholding a judgment against Kaiser Gypsum Company for almost $1.6 million in compensatory damages and close to $4 million in punitive damages.

Asbestos

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As we have observed in a prior post, defendants in punitive damages cases often fail to develop evidence in mitigation of the amount of punitive damages, enabling the plaintiff to focus the jury on evidence about the defendant’s wealth and to argue—essentially with no resistance—that a substantial award of punitive damages will be necessary to change the defendant’s conduct in light of that wealth.

Hip ImplantBucking this trend, Wright Medical Technology and Wright Medical Group, the defendants in multidistrict litigation alleging defects in their hip implants, have developed evidence designed to persuade juries that large punitive awards would be unnecessary and counterproductive. In particular, the Wright Medical defendants have developed evidence about the various deleterious effects that a large punitive award might have.  They also have developed evidence relating to their good “corporate character.”


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As we have noted in prior posts, many states require courts to bifurcate punitive damages trials upon the defendant’s request. The question therefore arises whether a federal court sitting in diversity must or, at least should, require bifurcation when the applicable state law requires bifurcation.

Shady GroveMost federal courts that have confronted the issue have concluded that bifurcation is procedural and that, under Erie, they therefore need not adhere to the bifurcation requirements of the state whose substantive law governs the case. While at first blush, the Supreme Court’s 2010 decision in Shady Grove Orthopedic Associates v. Allstate Insurance Co. may appear to reinforce that conclusion, on closer inspection it does not affect the analysis one way or the other.


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Self Employed ManThe Missouri courts seem to provide more than their share of material worthy of comment.  In Ross-Paige v. St. Louis Metropolitan Police Department, decided on June 30, a jury had found for the plaintiff, a St. Louis police officer, on her claim of retaliation under the Missouri Human Rights Act.  After the jury awarded $300,000 in compensatory damages and found the defendant liable for punitive damages, a second phase was held to set the amount of punitive damages.

The jury set punitive damages at a staggering and manifestly excessive $7.2 million, which was reduced under Missouri’s statutory cap of five times compensatory damages to about $2.5 million after attorneys’ fees were added to the compensatory damages.  (As noted in a prior post, the Missouri Supreme Court has declared the cap statute unconstitutional as applied to common-law actions, but has upheld it as applied to statutory causes of action such as that in the instant case.)


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Virginia_supreme_court_sealThe drafting of jury instructions on punitive damages presents unique challenges for defense lawyers.  On the one hand, it is generally necessary to ask for an instruction that goes beyond existing law in order to preserve the argument that the law should be changed.  That is how the harm-to-nonparties issue was teed up in Philip Morris v. Williams.  And just importantly, because most pattern instructions on punitive damages are fairly perfunctory, it is often necessary to propose a more expansive alternative to ensure that the jury is adequately apprised of even existing law.

On the other hand, proposing an instruction that goes too far can result in reversal of a favorable verdict if the trial court goes along and gives it.  That is what happened in Cain v. Lee, a case recently decided by the Virginia Supreme Court.


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West Virginia Flag as the territory Map on the Black BackgroundWest Virginia long has been at or near the top of the Chamber of Commerce’s and American Tort Reform Association’s lists of judicial hellholes. Last month, the State took a big step toward changing its image, enacting a series of laws that aim to eliminate “jackpot justice.”

Most pertinent to readers of this blog, the Legislature passed and the Governor signed a punitive damages statute that comprehensively reshapes the manner in which this remedy is administered in West Virginia.


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