The current challenges to punitive damages awards

Abstract

The author reviews the practice of awarding punitive damages and the consequences of such awards on the business community. Concerns over proportionality were raised where a punitive damages award was 500 times greater than the underlying compensatory damages award, and therefore the punitive award was so excessive as to violate the business’s constitutional rights of due process. The Supreme Court was asked to rule on this award, and its decision ultimately raised many further questions in its aftermath, that still remain. The author recommends that there needs to be a closer balancing of the compensation for injury and punishment for egregious acts, along with business interests in a predictable legal environment, so that all parties are on notice as to expectations and precedent.