Count Dracula Wants Punitive Damages

Apropos of the season, fake news service CarbolicSmokeBall has this story: "Dracula Files Products Liability Suit Against Wooden Stake Manufacturers."

Kausch v. Wimsatt: Attorney Not Liable for Punitive Damages in Dispute with Client

Things have been quiet lately in the California punitive damages arena. The California Court of Appeal (Second Appellate District, Division Three), issued this unpublished opinion yesterday, but it's not particularly noteworthy. The plaintiff was involved in a personal injury lawsuit and he sued his lawyer, claiming (among other things) the lawyer improperly deducted certain expenses from a settlement check. The trial court granted summary adjudication on punitive damages, finding no triable issue of fact on the question of malice. The Court of Appeal affirmed.

Judge Weighing Punitive Damages for Failure to Warn of Dangers of Baseball Bat

Is this really a punitive damages case? As reported by the Associated Press, a judge in Montana is deciding whether to impose punitive damages on a manufacturer of aluminum baseball bats. A jury has already found the defendant liable for failure to warn and awarded $850,000 in compensatory damages.

The plaintiffs' son was struck and killed by a baseball while playing in a baseball game. The article does not explain what warnings the plaintiffs contend should have been given, or how those warnings would have prevented the tragic death of the plaintiffs' son. Obviously I haven't heard the evidence presented to the jury, but I am skeptical that there could be any proof of malice here.

Jury Awards Undisclosed Amount of Punitive Damages Against Pfizer in Prempro Litigation

As reported by Bloomberg and the Associated Press (via the Seattle Times), a Philadelphia jury has awarded an undisclosed amount of punitive damages against Pfizer in litigation over its hormone replacement drug, Prempro. The judge has sealed the amount of the punitive damages award because another trial involving Prempro is pending in the same courthouse. Other lawsuits involving Prempro have resulted in some very large punitive awards.

An order sealing a punitive damages award is rare, but not unheard of. Last year a Los Angeles judge sealed the $50 million award against iPayment CEO Greg Daily. An anonymous source leaked the amount to the press immediately after the award was rendered. The court later ordered the award unsealed. (Full disclosure: Horvitz & Levy is now representing Mr. Daily in his effort to overturn that award.)

Oregon Supreme Court Accepts Certified Question on Split-Recovery Statute

In a previous post we reported that the Ninth Circuit had certified the following question to the Oregon Supreme Court:

When a jury has returned a verdict that includes an award of punitive damages
under Oregon law, is the State of Oregon’s consent necessary before a court may
enter a judgment giving effect to any settlement between the parties that would
result in a reduction or elimination of the punitive damages to which the State
would otherwise be entitled under Oregon Revised Statutes § 31.735?

As expected, the Oregon Supreme Court has accepted the question.

Federal Judge Allows Plaintiffs to Seek Punitive Damages in Class Action Against Allianz

As reported by Courthouse News Service, a federal judge in San Diego has ruled that a class of senior citizens can seek punitive damages against Allianz Life Insurance. The plaintiffs contend Allianz used deceptive sales tactics to sell derivative investments at senior centers.

We'll be keeping an eye on this case. The availability of punitive damages in a class action is a hot issue, as some academics and bloggers have argued that awarding punitive damages via class action is inconsistent with the U.S. Supreme Court's recent decisions on punitive damages. The availability of punitive damages by class action is currently pending before the Ninth Circuit in Dukes v. Wal-Mart.

For more discussion of this order, see this post at Bailey Class Action Daily.

Federal Judge Awards $300 Million In Punitive Damages Against Iran

As reported by Bloomberg, a federal district judge in Washington D.C. has awarded $310 million, including $300 million in punitive damages, to a victim of the 1984 embassy bombing in Lebanon. The judge determined that Iran was liable because it funded the Hezbollah terrorists who launched the attack.

The sheer size of this award and the 30-to-1 ratio would seem to raise some constitutional questions, but those questions will never be litigated because Iran is not defending itself. The Bloomberg story reports that U.S. courts have awarded $3.5 billion against Iran in the last few years. Iran has not contested any of the suits or paid any of the judgments. Like the $393 million judgment against Cuba earlier this year, this award is purely symbolic.

Although I have no sympathy for these particular defendants, I wonder whether these "funny money" awards are contributing to a culture that views 9-digit punitive damages awards as an accepted part of our legal system.

No Punitive Damages in NYC Suit Against Exxon Mobil

As reported by Bloomberg, a U.S. District Judge in Manhattan has ruled that New York City has not produced sufficient evidence to proceed with a claim for punitive damages in its lawsuit against Exxon Mobil Corp. for allegedly poisoning city wells with MTBE, a gasoline additive.

The City is seeking $250 million in compensatory damages. It probably would have asked for that much or more in punitive damages if the court had permitted it to do so. We'll apparently never know, because the city's lawyers are not commenting on the ruling.

Fariba v. Dealer Services: No Punitive Damages Where Liability Depends on Issue of First Impression

Here's a case defendants can cite whenever a plaintiff seeks punitive damages in a case involving a novel legal theory.

In this published opinion, the California Court of Appeal (Fourth Appellate District, Division One) affirmed a judgment that raised a liability issue of first impression in California.

(It has nothing to do with the topic of this blog, but in case you're curious, the issue of first impression was: Where a secured creditor of a business has actual knowledge that the business is substantially engaged in consignment sales, are the rights of the consignor superior to the secured creditor? Answer: yes.)

Although the Court of Appeal affirmed the award of compensatory damages based on this previously unresolved issue, the court also affirmed an order granting a directed verdict on the plaintiff's claim for punitive damages. Among other things, the court concluded that the plaintiff could not prove by clear and convincing evidence that the defendant acted with conscious disregard of the plaintiff's rights when the scope of the plaintiff's rights turned on an unsettled legal issue.

CBO Projects Savings from Capping Punitive Damages for Medical Malpractice

The Congressional Budget Office estimates that a package of medical malpractice reforms, including a $500,000 cap on punitive damages, would save $54 billion, as reported here in the Washington Post. On the other hand, USA Today reports that the CBO projects a savings of $11 billion.

I'm not sure why the two stories give different numbers, as they seem to be reporting on the same CBO projections. [UPDATE: The $54 billion figure is the CBO's estimated savings over 10 years, and the $11 billion figure is a one-year projection.] In any event, I am skeptical that a cap on punitive damages would generate any huge savings by itself, because punitive damages awards seem to be quite rare in medical malpractice actions.

Ford Files Cert. Petition in Buell-Wilson

Ford has filed a petition for certiorari in Buell-Wilson v. Ford Motor Co., a case with a long procedural history that has already included one stop at the U.S. Supreme Court. (See the long list of related posts below.)

Ford's petition asks the court to clarify the standard for resolving a claim that a state punitive damages statute is unconstitutionally vague as applied to the facts of a particular case. Specifically, Ford argues that California's punitive damages statute (Civil Code section 3294) is unconstitutionally vague as applied to cases involving manufacturers whose products comply with applicable regulatory standards and industry customs.

Ford's approach is a bold one. The Supreme Court has never addressed an as-applied vagueness challenge to a punitive damages statute, as far as I know. But there's a first time for everything. If Ford can get cert. in this case, it could be the same kind of game-changing event as BMW v. Gore.

Related posts:

California Supreme Court Denies Request to Re-Publish Buell-Wilson

The Largest Punitive Damages Award to Survive Appeal in California?

Cal. Supreme Court Dismisses Review in Buell-Wilson v. Ford

Plaintiff Asks California Supreme Court to Dismiss Review in Buell-Wilson v. Ford

Buell-Wilson v. Ford: Two of the Three Issues Raised in the Petition are Not Dependent on the United States Supreme Court's Opinion in Williams III

California Supreme Court Grants Review in Buell-Wilson v. Ford

Court of Appeal May Have Been Too Quick on the Trigger in Buell-Wilson Post-Opinion Order

Court of Appeal Denies Petition for Rehearing in Buell-Wilson v. Ford

Buell-Wilson v. Ford—Court of Appeal Says Ford Waived Due Process Protections Against Excessive Punitive Damages

U.S. Supreme Court Denies Cert. in Stevens v. Vons

The U.S. Supreme Court's on-line docket for Stevens v. Vons indicates that the court denied the petition for certiorari yesterday. As we noted in a prior post, the petitioner was essentially arguing that state courts are not permitted to reduce punitive damages awards under state law unless those awards are excessive under the Due Process Clause. Not surprisingly, the Supreme Court declined to take up that issue.

Related posts:

Stevens v. Vons: $16.7M in Punitive Damages Reduced to $1.2M, Ratio of 1-to-1

Stevens v. Vons: Unpublished Opinion Addresses Controversial Issue Regarding Punitive Damages Standard of Review