February 13, 2008

Senator Obama Won Punitive Damage Case on Appeal in the Seventh Circuit

When he was a practicing lawyer, Senator Obama successfully defended an arbitration award of punitive damages in the Seventh Circuit. According to the Sun Times, "In 1994, Obama went before the 7th Circuit to defend Ahmad Baravati, a trader blackballed by his bosses after he reported them for fraud. An arbitrator awarded Baravati $60,000 in damages plus $120,000 in punitive damages against the former bosses. They appealed, saying arbitrators don't have the power to award punitive damages. Obama had a tough job because the same court had ruled a week earlier that an arbitrator could not award punitive damages. But Obama convinced them this case was different. 'You're suggesting that there's a federal common law that likes punitive damages, but this could be preempted by a state law that says 'no punitive damages,' Posner told Obama. 'I don't think I'm saying there's a federal law that 'likes punitive damages,' Obama responded, not dropping his tone of respect. 'I think what I'm saying is that there's a federal law that likes the notion that the same remedies that will be available in court will be available in arbitration.' Obama won, and Baravati got to keep the extra $120,000. He still is grateful. 'I found he's a very smart, innovative, skilled, relentless advocate for his client,' Baravati said. 'When I met him, he reminded me of Abraham Lincoln.'"