What Are Punitive Damages?

Are punitive damages available in a personal injury lawsuit?

Most personal injury cases won't include a claim for punitive damages

Punitive damages, meant to punish rather than to compensate, are rarely available in personal injury cases. But, when the defendant’s behavior is extreme or intentional, such damages may be available.

The main purpose of personal injury lawsuits is to return the injured party to the position they were in before their injury. However, in rare cases, the defendant’s behavior is so extreme that the court also rules to punish the defendant and deter others from behaving similarly. This is where punitive damages come into play.

In this article, we’ll take a look at what punitive damages are, when they’re awarded, and what limitations are typically placed on them. Finally, we’ll take a look at some notable cases where punitive damages were a factor.

Types of personal injury damages

When it comes to personal injury law, there are two types of damages: compensatory and punitive.

Compensatory damages are intended to compensate the plaintiff for the losses associated with their injuries. Compensatory damages can be further broken down into: special compensatory damages (intended to compensate economic losses, such as medical expenses) and general compensatory damages (intended to compensate non-economic losses, such as pain and suffering).

Punitive damages are money damages awarded to a plaintiff in addition to and apart from compensatory damages. In many states, the amount of punitive damages can’t even be considered until after the jury has awarded the plaintiff compensatory damages.

There are two primary purposes for awarding punitive damages:

  • To punish the defendant for outrageous misconduct
  • To deter others from engaging in similar misconduct in the future

Whether or not punitive damages actually work as a deterrent is subject to debate. One of the reasons it’s difficult to determine the impact of punitive damages is the lack of predictability in the amount of punitive damages awarded for various misconduct.

When are punitive damages available?

All states (with the exception of Nebraska) allow punitive damages in certain cases. In most states, punitive damages are only permitted in tort cases (e.g., personal injury or medical malpractice cases).

Enjuris tip: Some states allow punitive damages in insurance bad faith cases.

Regardless of the type of case, punitive damages are only awarded when the defendant’s conduct is egregious or intentional. The exact standard that must be met differs between states. But, generally speaking, the conduct must be either:

  • Grossly negligent: conduct that is extreme or reckless as opposed to careless or unreasonable; or
  • Willful and wanton: conduct that is intended to cause harm.

For example, let’s say a store owner forgets to tell an employee to shovel the snow from the store’s steps and a customer slips and falls. The store owner will likely be found negligent.

Now, let’s say the store owner is told that his steps are covered in snow and dangerous, but the store owner nevertheless instructs his employee not to shovel the snow from the store’s steps. A customer then slips and falls. In this case, the store owner is likely grossly negligent.

What is the standard of proof?

In most states, a plaintiff who is seeking punitive damages must meet a higher standard of proof than would be required if they were merely seeking compensatory damages. Most often, this standard is one of “clear and convincing evidence.”

Who gets the money?

Keeping in mind that one purpose of punitive damages is the greater societal good of deterring bad behavior, some states will share in the plaintiff’s award of punitive damages. In these states, this is done by:

  • Taxing the punitive award; or
  • Requiring a certain percentage of the award be paid directly to a state agency.
Georgia requires that 75% of any punitive damage award be paid to the Georgia State Treasury. Tweet this

How are punitive damage awards limited?

There are a number of limitations when it comes to punitive damages. As noted above, some states limit the type of cases where punitive damages can be awarded. Also, some states don’t allow punitive damages to be insured.

Perhaps most importantly, the United States Supreme Court (along with most states) has placed caps on the amount of punitive damages that can be awarded.

United States Supreme Court

The United States Supreme Court weighed in on the constitutionality of punitive damages. In State Farm Mut. Automobile Ins. Co. v. Campbell, 538 U.S. 408 (2003), the Court struck down a punitive damages award of $145 million where the compensatory damage award was only $1 million. In striking down the award, the Court held that ratios of punitive damages to compensatory damages that exceed 9:1 will generally be deemed unconstitutional.

State caps

Most states place specific caps on the amount of punitive damages that can be awarded. For example, in Missouri, a plaintiff cannot receive more than 5 times the amount of compensatory damages awarded—or $500,000, whichever is greater.

Additionally, in many states, punitive damages cannot be awarded at all if there are no compensatory damages.

Punitive Damage Caps By State

State

Dollar Cap

Multiple of Compensatory

Alabama

$1,500,000

3 x compensatory

Alaska

$500,000

3 x compensatory

Arkansas

$250,000

3 x compensatory

Colorado

None

1 x compensatory

Connecticut

Litigation expenses only

None

Florida

$2,000,000

4 x compensatory

Georgia

$250,000

None

Idaho

$250,000

3 x compensatory

Indiana

$50,000

3 x compensatory

Iowa

None

3 x compensatory

Kansas

$5,000,000

None

Maine

$75,000

None

Massachusetts

$100,000

None

Mississippi

$20,000,000

None

Missouri

$500,000

5 x compensatory

Montana

$10,000,000

3% of net worth

Nevada

$300,000 (if compensatory is less than $100,000)

3 x compensatory (if more than $100,000)

New Jersey

$350,000

5 x compensatory

North Carolina

$250,000

3 x compensatory

North Dakota

$250,000

2 x compensatory

Ohio

10% of net worth

2 x compensatory

Oklahoma

$500,000

2 x compensatory

Oregon

None

4 x compensatory

Rhode Island

None

2 x compensatory

Texas

$200,000

2 x compensatory

Utah

None

3 x compensatory

Virginia

$350,000

None

What are some case examples where punitive damages were awarded?

Cases involving punitive damages tend to make the news. This is due in part to the fact that the defendants in these cases often committed egregious acts. Let’s take a look at three famous cases involving punitive damages so that you can better understand the ideas discussed above.

Liebeck vs. McDonald’s Restaurants

You probably remember the McDonald’s hot coffee case of the early 1990s. In that case, 79-year-old Stella Liebeck spilled scalding hot coffee in her lap, resulting in 2nd and 3rd-degree burns.

Discovery in the case revealed that McDonald’s had received hundreds of prior complaints about the coffee causing severe burns. Nevertheless, McDonald’s chose not to change its policy of requiring their coffee to be kept at 180-190 °F.

At trial, the jury found that McDonald’s knew their product was dangerous but did nothing to correct the problem.

The jury awarded Stella $160,000 in compensatory damages, along with punitive damages in the amount of $2.7 million (later reduced to $480,000 by the judge).

William Cardoza v. City of New York

In this excessive force and malicious prosecution case, a jury awarded William Cardoza compensatory damages in the amount of $2.5 million, as well as punitive damages in the amount of $1.5 million.

However, the trial judge vacated the award after determining that William hadn’t met the burden of showing “clear and convincing evidence” that the arresting officers acted intentionally or recklessly.

Kenneth Vigneron v. DuPont Company

An Ohio jury ordered DuPont to pay $10.5 million in punitive damages to Kenneth Vigneron, a man who claimed he developed kidney cancer as a result of exposure to C-8, a toxic chemical used in the production of Teflon.

The jury found that DuPont acted maliciously by dumping C-8 into Kenneth’s local water supply. The jury determined that DuPont knew the C-8 could cause cancer but continued to dump the chemical into the water despite the existence of cheap, alternative disposal methods.

Do you have a case where punitive damages might be available? Wondering how much punitive damages to ask for? Use our free personal injury attorney directory to get in touch with an attorney near you.

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