September 19, 2011

Plaintiffs' group issues white paper purporting to dispel "myths" about punitive damages

The Center for Justice & Democracy, an advocacy group founded by plaintiffs' lawyers, has released a white paper which, according to the press release, debunks common myths about punitive damages.  The paper argues that punitive damages serve a vitally important role in deterring unsafe practices, and it takes aim at critics of punitive damages by reciting Department of Justice statistics showing that punitive damages are rarely awarded, and are usually awarded only in modest amounts.  (We reported on the same stats in 2009.)

The article fails to explain, however, how the cited statistics dispel any actual "myths" about punitive damages.  The unstated premise of the paper is that critics of punitive damages are claiming that punitive damages are awarded in a high-percentage of cases, and that most of those awards are excessive.  But that's not really what critics are saying.  The real criticism is that punitive damages are awarded arbitrarily and irrationally.  The CJ&D response seems to be, "Yeah, but not very often."  That doesn't seem like much of a myth-buster.

If the CJ&D really wants to prove that punitive damages are necessary to deter unsafe practices, they should study whether such practices are more common in countries and jurisdictions that don't allow punitive damages. Or they could prove the value of unlimited punitive damages by showing a greater incidence of unsafe practices in jurisdictions that have imposed statutory caps.  That kind of study could take the debate beyond mere rhetoric and into the realm of actual substance.  But as far as I know, no advocacy group on either side has attempted to perform that type of study.