extraterritorial punishment

License Plate1Tomorrow marks the twentieth anniversary of the Supreme Court’s decision in BMW of North America. Inc. v. Gore, the first time the Court had ever held that a punitive damages award was unconstitutionally excessive under the Due Process Clause.

In the ensuing 20 years, the decision has proved to be a foundational case in punitive damages jurisprudence.  It has been cited in hundreds, if not thousands, of lower court decisions; it has been the subject of dozens of scholarly articles; and it is featured in virtually every tort and remedies case book used in law schools.

Far from being “a road to nowhere,” as Justice Scalia charged in his dissenting opinion, BMW has served as a constraining force on punitive damages from the moment it was issued.  Before BMW, no court anywhere had held that a punitive award was unconstitutionally excessive.  After BMW, hundreds of punitive awards have been reduced after being found excessive under the “guideposts” announced in that decision.

Having been fortunate enough to have represented BMW in that historical case, we thought it appropriate to provide some reflections on the occasion of the decision’s twentieth anniversary.
Continue Reading Reflections on the Twentieth Anniversary of BMW v. Gore

Hip ImplantIn a post last month, we reported on a district court’s rulings on motions in limine in the first bellwether hip implant trial against Wright Medical Technology Incorporated. The case subsequently went to trial, and last week a federal jury in Atlanta returned a jaw-dropping verdict of $1 million in compensatory damages and $10 million in punitive damages.

The jury found that the plaintiff’s hip implant was defectively designed and that the defendant negligently misrepresented how long the device would last. In addition, the jury found that, in marketing the hip implant, the defendant demonstrated knowing and reckless indifference to the rights of others—the standard for imposition of punitive damages under the applicable state law (Utah).
Continue Reading Federal Jury Awards $1 Million In Compensatory Damages And $10 Million In Punitive Damages In Bellwether Hip Implant Trial

directional sign USA statesThe Supreme Court held in BMW v. Gore that states may not use punitive damages awards to punish a defendant for the impact of its conduct in other states. BMW involved an obvious violation of that principle: The plaintiff introduced evidence of approximately 1,000 vehicles that BMW had sold around the country without disclosing pre-sale refinishing, asked the jury to punish BMW $4,000 for each vehicle, and then received a punitive award of exactly $4 million—1,000 X $4,000.

But in many other cases, the violation is more opaque. Sometimes evidence of the number of “victims” of the conduct is introduced, but the punitive award does not bear a precise or readily ascertainable relationship to that number. In other cases, the plaintiff doesn’t introduce the number at all, but merely emphasizes that there are many other victims around the country and then receives an outsized punitive award.

How then is a court to know whether the award constitutes impermissible punishment for harms suffered by out-of-state victims?

Continue Reading Using Supreme Court Commerce Clause Doctrine To Demonstrate That A Large Punitive Award Effects Improper Extraterritorial Punishment