November 14, 2017

Ninth Circuit reduces $2.5 million punitive damages award to $1 million (King v. GEICO)

This unpublished memorandum disposition from the Ninth Circuit does not have much factual detail, so we can't tell exactly what GEICO did to warrant punitive damages.  But whatever it was, the Ninth Circuit found GEICO's conduct to be "of low to moderate reprehensibility."

As a result, the court concluded that the jury's $2.5 million punitive damages award was unconstitutionally excessive when compared to the $266,000 in compensatory damages (a nine to one ratio).  The court observed: "This is significantly higher than the four-to-one proxy that we apply in similar contexts."  The court then reduced the award to a little over $1 million, right at the four-to-one benchmark.

The panel consisted of Judges McKeown, Gould, and Rothstein (a district court judge for the Western District of Washington, sitting by designation).