When is it possible to receive punitive damages in a lawsuit?
As their name suggests, punitive damages are meant to “punish” a defendant’s actions. In almost all states, punitive damages can be awarded if there have been (a) actual damages incurred amounting to at least one dollar (sometimes awarded as ‘nominal damages’) and (b) egregious conduct by the defendant.
How does “punitive” action play a role in fair and blind justice?
Once someone’s wrongdoing has been established in court, the claims against a defendant go from being “alleged” to proven. So when ‘punitive’ actions are allowed, they are aimed (a) to ensure that especially offensive behavior is not repeated by the defendant and (b) to send a message to others that the conduct carries a severe penalty (in which case punitive damages are called “exemplary” damages).
Who usually decides if a punitive award is fair?
Judges in most states have been given special authority to keep punitive damage awards from becoming unfair or “excessive.” State appellate courts have some power in almost all jurisdictions to review the fairness of some awards of punitive damages, especially if awarded solely by jury discretion. The United States Supreme Court, in dictum, suggests that a ratio of punitive damages to compensatory awards of 10:1 probably violates Constitutional guarantees of due process under the First and Fifth Amendments [(State Farm Auto Ins. v. Campbell (2003)].
Are there types of cases that are eligible for punitive awards?
Yes. Some classes of conduct provide an automatic right of eligibility for punitive damages. This does not mean punitive damages must be awarded, but that they do not have to be “specially plead.” Many discrimination cases or civil rights violations give this kind of protection. The Americans with Disabilities Act (ADA) claims, for example, encourage exemplary awards to further lawsuits on the part of people with disabilities.
Are there certain cases that tend to be ineligible for punitive damages?
Yes. Breaches of contract (with the exception of insurance cases) are usually not eligible for punitive awards.
How can I determine my own state’s rules regarding punitive damages?
Punitive damage rules vary from state to state and are subject to change.