Ordinarily, a ratio of 25:1 would ring the death knell for a punitive damages award. But just as a 1:1 ratio is not always a safe harbor, a double-digit ratio is not always indicative of a punitive award that exceeds constitutional bounds.
Last week, I posted the first installment of a two-part series on recent excessiveness decisions. In this second installment, I discuss two additional excessiveness decisions.
This case involves allegations that Volkswagen used so-called defeat devices to evade federal and state emissions test procedures. After more than 1,000 vehicle owners sued Volkswagen, alleging fraud and California statutory claims, the company entered into two settlements. Ten vehicle owners opted out.
Continue Reading An Update On Recent Excessiveness Decisions: Part II
During the past couple of months, courts have been busy addressing excessiveness challenges to punitive damages awards. In this post, I discuss two recent decisions. In a second post, I will cover two additional decisions.
This is a class action under the Fair Credit Reporting Act (“FCRA”). In essence, the plaintiffs alleged that TransUnion included in their credit reports an erroneous notification that they are on a government terrorist watch list.
Continue Reading An Update On Recent Excessiveness Decisions: Part I
Last summer, my colleague C.J. Summers and I posted a report about Saccameno v. U.S. Bank National Association, a Seventh Circuit case in which we had filed an amicus brief on behalf of the Chamber of Commerce of the United States.
In late November 2019, the Seventh Circuit issued an opinion reducing the punitive damages to a 1:1 multiple of the compensatory damages, agreeing with both the bottom line and a good deal of the analysis in our brief. And in late January 2020, the court denied the plaintiff’s rehearing petition.
Continue Reading Seventh Circuit Agrees With Mayer Brown Amicus Brief That $3 Million Punitive Damages Award Was Unconstitutionally Excessive
Last October, I reported on the $8 billion punitive verdict returned by a Philadelphia jury against Johnson & Johnson in a case alleging that the company had failed to warn that its antipsychotic drug Risperdal could cause young men to develop breasts.
I expressed the view that a punishment of this size in an individual case is proof positive that the jury was animated by passion and prejudice and that a reduction of the punitive award would therefore be an inadequate remedy.
Regrettably, the trial court overlooked the fact that preposterous awards like this are indicative of a malfunctioning jury and instead merely reduced the punitive damages to $6.8 million—ten times the compensatory damages.
Continue Reading A $6.8 Million Band Aid
Although the Supreme Court identified three guideposts for evaluating whether a punitive award is unconstitutionally excessive 23 years ago in BMW v. Gore and refined those guideposts 16 years ago in State Farm v. Campbell, lower courts continue to make conceptual errors interpreting and applying the guideposts. The Seventh Circuit will have the opportunity to address and rectify several such errors made by a district court in upholding a $3 million punitive award in Saccameno v. U.S. Bank National Association.
Continue Reading Mayer Brown Submits Amicus Brief For Chamber Of Commerce In Seventh Circuit Appeal Involving Proper Application Of Punitive Damages Guideposts
Usually, when a defendant gets a punitive award reduced to the same amount as the compensatory damages, it considers that a victory. But while such a reduction recently saved Johnson & Johnson $15 million, I don’t think that it should be satisfied with the result.
Continue Reading Federal District Court Reduces Punitive Damages To Amount Of Compensatory Damages—But That’s Still Not Enough
Over the years, we have reported on many cases in which courts adhered to the Supreme Court’s guidance in State Farm (and Exxon Shipping Co. v. Baker) that, when compensatory damages are “substantial, a 1:1 ratio of punitive to compensatory damages may be the maximum that due process allows. Recently, however, two state courts deviated from that trend and held that a 2:1 ratio was the constitutional maximum.
Continue Reading Is 2:1 The New 1:1?
In State Farm Mutual Automobile Insurance Co. v. Campbell, the Supreme Court strongly implied that in some cases even a 1:1 ratio of punitive to compensatory damages might be too high. In Torres v. B/E Aerospace, Inc., the California Court of Appeal took that hint to heart.
Continue Reading California Court Of Appeal Affirms Remittitur Of Punitive Damages To Lower Than 1:1 Ratio
Only three months after AbbVie obtained a retrial of a case in which a jury had imposed $150 million in punitive damages without awarding any compensatory damages, a new jury awarded the same plaintiff $200,000 in compensatory damages and $3 million in punitive damages.
Continue Reading New Jury Imposes Disproportionate Punitive Award In AbbVie Retrial