December 21, 2011

Texas jury awards $150 billion in punitive damages

No, that heading isn't a typo.  That's $150 billion in punitive damages.  According to this story in the Salt Lake Tribune, a Texas jury awarded $370 million in compensatory damages and $150 billion in punitive damages (a ratio in excess of 400 to one) against a man who allegedly sexually assaulted the plaintiffs' son and set him on fire.  The defendant did not even bother to show up for trial. 

The verdict is reportedly the largest in U.S. history, topping the $145 billion award in the Engle class action against the tobacco industry (which was later reversed by the Florida Supreme Court).

This award won't have any practical significance, since it's obviously uncollectible.  It's not likely to have much legal significance either; the defendant who didn't show up for trial probably won't bother to challenge the award through post-trial motions or an appeal, so we're not going to end up with any judicial opinion evaluating the propriety of the award.  Thus, the impact of the award is largely symbolic, as a reflection of the jury's outrage at the defendant's extraordinarily reprehensible conduct. 

There may also be a more subtle effect as well.  As I have noted before, I think these  massive awards, even if they are uncollectible and uncontested, have a tendency to seep into the public perception of our judicial system, contributing to the impression that awards like this are within the range of acceptable outcomes in civil litigation. 
If you are a plaintiff or a plaintiff’s lawyer, you may view that as a good thing.  If you’re a defendant or a defense lawyer, not so much.