Punitive Damages

Problem

While punitive damages awards are infrequent, their frequency and size have grown greatly in recent years.  More importantly, they are routinely asked for today in civil lawsuits.  The difficulty of predicting whether punitive damages will be awarded by a jury in any particular case, and the marked trend toward astronomically large amounts when they are awarded, have seriously distorted settlement and litigation processes and have led to wildly inconsistent outcomes in similar cases.

ATRA's Position:

ATRA supports state legislation that: establishes a liability “trigger” that reflects the intentional tort origins and quasi‑criminal nature of punitive damages awards ‑ “actual malice;” requires “clear and convincing evidence” to establish punitive damages liability; and requires proportionality in punitive damages so that the punishment fits the offense.   ATRA supports federal legislation that addresses the special problem of multiple punitive damages awards.  Such legislation would protect against unfair overkill, guard against possible due process violations, and help preserve the ability of future claimants to recover basic out‑of‑pocket expenses and damages for their pain and suffering.


Opposition Opinion:

The personal injury bar’s argument against punitive damages reform – that a jury should have broad discretion to award punitive damages in order to punish and deter misconduct – fails to address the quasi-criminal nature of punitive damages necessitating such procedural safeguards for the award of punitive damages as a showing that the defendant acted with “actual malice.”

MMPA and Punitive Damages Reform – S.B. 224

Missouri|2020

MISSOURI MERCHANDISING PRACTICES ACT (MMPA) REFORM A person seeking to

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MISSOURI MERCHANDISING PRACTICES ACT (MMPA) REFORM

A person seeking to recover damages for unlawful merchandising practices shall establish that the person acted as a reasonable consumer, that the alleged unlawful act would cause a reasonable person to enter into the transaction that resulted in damages, and the individual damages with sufficiently definitive and objective evidence to allow the loss to be calculated with a reasonable degree of certainty.  A court may dismiss a claim for failure to show a likelihood that the alleged unlawful act would mislead a reasonable consumer.  In a class action, any class representative shall establish these requirements.  All other members of the class shall establish individual damages in a manner determined by the court.  In addition to current damages available, a court may provide equitable relief as it deems necessary to protect the party from the unlawful acts.

No action may be brought under these provisions to recover damages for personal injury or death in which a claim arises out of the rendering of or failure to render health care services. Furthermore, this act provides that any award of attorney’s fees shall bear a reasonable relationship to the amount of the judgment.  However, when the judgment grants equitable relief the attorney’s fees shall be based on the amount of time reasonably expended.

PUNITIVE DAMAGES REFORM

Provides that punitive damages shall only be awarded if the plaintiff proves by clear and convincing evidence that the defendant intentionally harmed the plaintiff without just cause or acted with a deliberate and flagrant disregard for the safety of others, and the plaintiff is awarded more than nominal damages.  Punitive damages may be awarded against an employer due to an employee’s conduct in certain situations, as provided in the act.  When an employer admits liability for the actions of an agent in a claim for compensatory damages, the court shall grant limited discovery consisting only of employment records and documents or information related to the agent’s qualifications.

A claim for punitive damages shall not be contained in the initial pleading and may only be filed as a written motion with permission of the court no later than 120 days prior to the final pretrial conference or trial date.  The written motion for punitive damages must be supported by evidence.  The amount of punitive damages shall not be based on harm to nonparties.  A pleading seeking a punitive damage award may be filed only after the court determines that the trier of fact could reasonably conclude that the standards for a punitive damage award, as provided in the act, have been met.  The responsive pleading shall be limited to a response of the newly amended punitive damages claim.

The legislation provides that the defendant may also be credited for punitive damages paid in a federal court.

These provisions shall not apply to claims for unlawful housing practices under the Missouri Human Rights Act.

Modifies the definition of “punitive damages” as it relates to actions for damages against a health care provider for personal injury or death caused by the rendering of health care services.  In order to be awarded punitive damages, the jury must find by clear and convincing evidence that the health care provider intentionally caused damage or demonstrated malicious misconduct. Evidence of negligence, including indifference or conscious disregard for the safety of others, does not constitute intentional conduct or malicious misconduct.


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Unchallenged

Punitive Damages Reform: H.B. 393 (2005)

Missouri|2005

Limits punitive damages to $500,000 or five times the judgment,

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Limits punitive damages to $500,000 or five times the judgment, whichever is greater.  Limit does not apply to certain cases involving housing discrimination. The limit on punitive damages violated the jury trial provision of the State Constitution.  Lewellen v. Chad Franklin and Chad Franklin National Auto Sales North, LLC, Case No. No. SC92871 (Mo.Sup.Ct., decided Sept. 9, 2014).


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Challenged and Struck Down

Missouri Supreme Court struck down this bill as unconstitutional as it applies to common law claims in the case of Lewellen v. Franklin (Sept. 9, 2014).

Punitive Damages Reform: HB 700 (1987).

Missouri|1987

Requires the determination of awards for punitive damages to be

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Requires the determination of awards for punitive damages to be made in a separate proceeding.  Permits the jury to set the amount for punitive damages if, in the first stage, the jury finds a defendant liable for punitive damages.  Permits the admissibility of evidence of a defendant’s net worth only during the proceeding for the determination of punitive damages.  Requires 50% of all punitive damages awards to be paid to the state fund.  Prohibits multiple punitive damages awards under certain conditions.


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