Punitive Damages Theory

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As my colleague Andy Frey and I reported in an earlier post, an Illinois federal jury in July returned a $150 million punitive verdict against AbbVie without awarding the plaintiff any compensatory damages.  That verdict is likely to be thrown out because Illinois does not permit punitive damages to be recovered in the absence of compensatory damages.

Now, less than three months later, another Illinois federal jury has imposed $140 million in punitive damages against AbbVie for the same alleged conduct—namely, failure to disclose that its low-T medication AdroGel can cause heart attacks. Even putting aside AbbVie’s other challenges to the verdict—which include attacks on the admission of expert testimony and the sufficiency of the evidence that the plaintiff’s heart attack was caused by his two months of AndroGel use—the punitive award is unlikely to stand because it is 1000 times the jury’s $140,000 compensatory award.
Continue Reading Federal Jury Returns $140 Million Punitive Verdict Against AbbVie In Second AndroGel Trial

Inevitably, when conscientious judges delve into the multi-dimensional issue of excessive punitive damages, they get some things right and other things wrong. Such is the case with the Fourth Circuit’s recent decision in Daugherty v. Ocwen Loan Servicing, LLC. Unfortunately, as a doctrinal matter at least, the erroneous aspects of the decision predominate.  
Continue Reading Fourth Circuit Issues Mixed-Bag Decision On Punitive Damages In FCRA Cases

They don’t call the California Superior Court in Los Angeles “The Bank” for nothing. Late last month, a jury held Johnson & Johnson liable for $70 million in compensatory damages and $347 million in punitive damages in a case brought by an individual plaintiff who alleges that her terminal ovarian cancer was caused by using J&J’s talcum powder.
Continue Reading California Jury Returns $417 Million Award—Of Which $347 Million Constitute Punitive Damages—In Individual Case Alleging That Talcum Powder Causes Ovarian Cancer

You’ve likely seen by now media reports about an Illinois federal jury’s $150 million punitive award against AbbVie in a case brought by a plaintiff who alleged that AbbVie’s low-T medication AndroGel caused his heart attack.

The jury found against the plaintiff on his strict-liability and negligence claims. It found in favor of the plaintiff on his fraudulent-misrepresentation claim.  However, the jury awarded no compensatory damages on that claim; nevertheless, it imposed $150 million in punitive damages.
Continue Reading Federal Jury Returns $150 Million Punitive Verdict Against AbbVie—Without Awarding Any Compensatory Damages For The Plaintiff’s Injury—As A Result Of Multiply Flawed Jury Instructions

Application of the Supreme Court’s excessiveness guideposts to cases involving multiple defendants is one of the more confounding problems that arises in punitive damages jurisprudence. The Supreme Court of Texas got the issue right in Horizon Health Corp. v. Acadia Healthcare Co., a case in which several defendants were jointly liable for compensatory damages but individually liable for separate punitive awards.
Continue Reading Texas Supreme Court Issues Important Decision On How To Calculate Ratio Of Punitive To Compensatory Damages In Multi-Defendant Cases

Just about a week after suffering its third punitive award in pelvic-mesh litigation, Johnson & Johnson found itself on the wrong end of a $105 million punitive award—close to 20 times the $5.4 million compensatory award—in litigation alleging that its iconic talcum powder causes ovarian cancer in women.
Continue Reading Punitive Damages Overkill Redux: J&J Hit With Another Massive Disproportionate Punitive Award In Talc Litigation

800px-Judge_Henry_FriendlyAs early as 1967, Judge Friendly worried about the phenomenon of punitive damages overkill in mass tort litigation. Fifty years later, the problem persists.

Last week, a Philadelphia, Pennsylvania, jury awarded a plaintiff $2.5 million in compensatory damages and $17.5 million in punitive damages—seven times the compensatory damages—in the latest of a large series of cases alleging that Johnson & Johnson subsidiary Ethicon had failed to warn about the risks of its pelvic-mesh device. In previous cases, juries had imposed punitive awards of $5 million, $7 million, and $10 million.
Continue Reading Punitive Damages Overkill: J&J Hit With Still Another Disproportionate Punitive Award In Pelvic-Mesh Litigation

A bankruptcy judge in the Eastern District of California recently issued a decision that is sure to raise appellate eyebrows.

Concluding in In re Sundquist that the defendant bank had violated the automatic stay by foreclosing on the home of a bankrupt mortgagor and enraged by what it perceived to be heavy-handed behavior both before and after the stay violation, the court awarded the plaintiffs $1,074,581.50 in compensatory damages and ordered the defendant to pay a whopping $45 million in punitive damages—i.e., nearly 42 times the quite substantial compensatory award.

But concerned that such a massive amount of punitive damages would be a windfall to the plaintiffs, the judge ordered the plaintiffs to pay $40 million, minus applicable taxes, to two non-profit organizations whose stated mission is to advance the interests of consumers in litigation and bankruptcy proceedings—the National Consumer Law Center and the National Consumer Bankruptcy Rights Center—and the five California state law schools. Specifically, the judge decided to bestow $10 million each (before taxes) on the two consumer law centers and $4 million each (before taxes) on the five law schools.
Continue Reading Bankruptcy Court Imposes Massively Disproportionate $45 Million Punitive Exaction, Then Plays Santa Claus With $40 Million Of It

Car insuranceSeemingly minor legal issues sometimes can have a surprisingly significant effect. That is particularly true with the ratio guidepost because the effect of any dispute about the guidepost’s application is literally multiplied. We recently filed an amicus brief on behalf of a group of organizations in an Eighth Circuit appeal that proves the point: Dziadek v. The Charter Oak Fire Insurance Company, No. 16-4070.
Continue Reading Mayer Brown Submits Amicus Brief For Chamber Of Commerce, American Tort Reform Association, And American Insurance Association In Eighth Circuit Appeal Involving Proper Application Of Punitive Damages Guideposts