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: S.F. 1827 (1990)

Minnesota|1990

Provides the following punitive damage reforms a) raises the standard of

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Provides the following punitive damage reforms a) raises the standard of conduct for punitive damages from the current “willful indifference” to a standard of “deliberate disregard”; b) establishes the party’s right to insist on a bifurcated trial when a claim includes punitive damages; a separate proceeding is held to consider financial condition of the defendant and other evidence relevant only to punitive damages;
c) provides trial and appellate judges the power to review all punitive damage awards.


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Unchallenged

Punitive Damages Reform: H.B. 1 (1987)

Georgia|1987

Required 75% of all punitive damages awards to be paid

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Required 75% of all punitive damages awards to be paid to the State Treasury.


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Challenged and Struck Down

The Federal District Court for Georgia held the state fund provision for punitive damages unconstitutional in McBride v. General Motors Corp., M.D. Ga., No. 89‑110‑COL, April 10, 1990.

Punitive Damages Reform: H.B. 1369 (1995)

North Dakota|1995

Requires “clear and convincing” evidence that the defendant has been

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Requires “clear and convincing” evidence that the defendant has been guilty of oppression, fraud or actual malice.


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Unchallenged

Punitive Damages Reform: S.B. 2351 (1993)

North Dakota|1993

Limits punitive damages to the greater of $250,000 or two

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Limits punitive damages to the greater of $250,000 or two times compensatory damages; allows for a bifurcated trial on the issue of punitive damages; and prohibits a defendant’s financial worth from being admitted in the punitive damages portion of a trial.


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Unchallenged

Punitive Damages Reform: S.B. 0296 (2006)

Indiana|2006

Permitted the Attorney General’s office to negotiate and compromise the

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Permitted the Attorney General’s office to negotiate and compromise the portion of a punitive damages award that is to be paid to the state. Provided that the state’s interest in a punitive damages award is effective when a finder of fact announces a verdict that includes punitive damages.


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Unchallenged

Punitive Damages: S.B. 421 (2015)

West Virginia|2015

Requires a plaintiff, in order to recover punitive damages, to

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Requires a plaintiff, in order to recover punitive damages, to establish by clear and convincing evidence that the defendant acted with actual malice or a conscious, reckless and outrageous indifference to the health, safety and welfare of others.  Limits the award of punitive damages to $500,000 or four times the amount of compensatory damages, whichever is greater.


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Unchallenged

Punitive and Compensatory Damages Reform: S.B. 202 (2012)

Wisconsin|2012

Eliminates punitive and compensatory damages under the Wisconsin Fair Employment

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Eliminates punitive and compensatory damages under the Wisconsin Fair Employment Act (WFEA) – a 2009 invention in Wisconsin law.  This forced Wisconsin employers to not only defend WFEA claims in the administrative hearing process, but also then re-litigate the same case in State Court in a full jury trial (or in a new trial to the court) in defense of potential punitive and compensatory damages, and additional costs and attorney fees.  At the same time, Wisconsin employers continue to be forced to defend simultaneously cross-filed claims under federal laws based on the same facts and alleged types of claims before federal agencies, and then in state or federal court under federal law.  The types of damages WFEA made available are already accessible under several federal statutes under which much litigation comes.


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Challenged and Upheld

Punitive Damages Reform: SB 402 (1987)

Virginia|1987

Limits the award of punitive damages to $350,000.  The Virginia

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Limits the award of punitive damages to $350,000.  The Virginia Court of Appeals upheld the constitutionality of this statute in Wackenhut Applied Technologies Center Inc. v. Syngetron Protection Systems, No. 91‑1655, November 1992.


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Challenged and Struck Down

The Virginia Court of Appeals upheld the constitutionality of this statute in Wackenhut Applied Technologies Center Inc. v. Syngetron Protection Systems, No. 91‑1655, November 1992.

Punitive Damages Reform: SB 24 (1989).

Utah|1989

Requires a plaintiff to show by “clear and convincing” evidence

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Requires a plaintiff to show by “clear and convincing” evidence that a defendant’s actions were “knowing and reckless.”  (The law previously required only a showing that a defendant’s actions were “reckless.”)  Provides a government standard defense for FDA approved drugs.  Requires the determination of awards for punitive damages to be made in a separate proceeding on a defendant’s motion.  Requires 50% of all punitive damage awards over $20,000 to be paid to the state fund.


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Challenged and Struck Down

Smith v. Price Dev. Co., 125 P.3d 945 (Utah 2005).

Punitive Damages Reform: HB 4 (2003).

Texas|2003

Requires unanimous jury verdict to award punitive damages.  Specifies that

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Requires unanimous jury verdict to award punitive damages.  Specifies that jury must be so instructed.


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Challenged and Upheld

Waste Disposal Ctr., Inc. v. Larson, 74 S.W.3d 578 (Tex. App.-Corpus Christi 2002).

Punitive Damages Reform: SB 25 (1995): Tex. Civ. Prac. & Rem. Code §§ 41.003, 41.008.

Texas|1995

Limits the award of punitive damages to the greater of

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Limits the award of punitive damages to the greater of $200,000 or two times the award of economic damages plus non‑economic damages up to $750,000.  Requires a plaintiff to show by “clear and convincing” evidence that a defendant acted with malice, defined as the “conscious indifference to the rights, safety, or welfare of others.”  Requires the determination of awards for punitive damages to be made in a separate proceeding at the request of the defendant.


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Punitive Damages Reform: SB 5 (1987).

Texas|1987

Requires a plaintiff to show that a defendant’s actions were

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Requires a plaintiff to show that a defendant’s actions were fraudulent, malicious, or grossly negligent.  Limits the award of punitive damages to the greater of four times the amount of actual damages or $200,000.


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Punitive Damages Reform: S.B. 222 (2013)

Tennessee|2013

Authorizes the award of punitive damages in a civil action

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Authorizes the award of punitive damages in a civil action against a defendant based on vicarious liability only if the finder of fact determines by clear and convincing evidence that the act or omission was committed by a person employed in a management capacity while that person was acting within the scope of employment, the defendant was reckless in hiring or retaining the agent or employee, and the defendant authorized or approved the act with knowledge or conscious disregard that the act may result in the loss or injury.


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Punitive Damages Reform: HB 2008 / SB 1522 (2011); Amended Tenn. Code Ann. § 29-39-104.

Tennessee|2011

Limits punitive damages to two times compensatory damages or $500,000,

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Limits punitive damages to two times compensatory damages or $500,000, whichever is greater.  The limits on punitive damages do not apply if the defendant acted with intent to harm, falsified records or acted under the influence of drugs or alcohol.


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Challenged and Upheld

Lindenberg v. Jackson Nat’l Life Ins. Co., Case No. 2:13-cv-02657-JPM-cgc (W.D. Tenn. Sept. 28, 2016)

Punitive Damages Reform: H. 3775 (2011).

South Carolina|2011

Establishes procedure to claim punitive damages: (1) plaintiff must specifically

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Establishes procedure to claim punitive damages: (1) plaintiff must specifically plead for punitive damages in the complaint but may not specify an amount; and (2) bifurcated process to determine punitive damages.  Punitive damages are only awarded if plaintiff proves by clear and convincing evidence that harm was the result of defendant’s willful, wanton, or reckless conduct.  In second state of the bifurcated trial, jury determines if defendant liable for punitive damages, and amount, if applicable.  The factors for jury to consider in determining the amount of punitive damages: •       Defendant’s degree of culpability; •       Severity of the harm caused by the defendant; •       Extent to which the plaintiffs own conduct contributed to harm; •       Duration of the conduct, the defendant’s awareness, and any concealment; •       Similar past conduct; •       Profitability of the conduct to the defendant; •       Defendant’s ability to pay; •       Likelihood the award will deter the defendant or others from like conduct; •       Awards of punitive damages against the defendant for same act or course of conduct; •       Criminal penalties against defendant for same act or course of conduct; •       Civil fines against defendant for same act or course of conduct. Award must be specific to each defendant, and each defendant is liable only for the amount made against him or her.  With respect to limitations, these limitations cannot be disclosed to the jury.  If the jury returns a verdict that exceeds these limits, the court shall enter judgment for the maximum amount allowed for under this statute. First Limitation: punitive damages award may not exceed the greater of three times the amount of compensatory damages or $500,000. Second Limitations: punitive damages must not exceed the greater of four times the amount of compensatory damages or $2 million dollars if: (1) the wrongful conduct proven under this section was motivated primarily by unreasonable financial gain and determines that the unreasonably dangerous nature of the conduct, together with the high likelihood of injury resulting from the conduct, was known or approved by the managing agent, director, officer, or the person responsible for making policy decisions on behalf of the defendant; or (2) the defendant’s actions could subject the defendant to conviction of a felony and that act or course of conduct is a proximate cause of the plaintiffs damages Limitations on punitive damages are not applied if: (1) at the time of injury the defendant had an intent to harm and determines that the defendant’s conduct did in fact harm the claimant; or (2) the defendant has pled guilty to or been convicted of a felony arising out of the same act or course of conduct complained of by the plaintiff and that act or course of conduct is a proximate cause of the plaintiffs damages; or (3) the defendant acted or failed to act while under the influence of alcohol, drugs, other than lawfully prescribed drugs administered in accordance with a prescription, or any intentionally consumed glue, aerosol, or other toxic vapor to the degree that the defendant’s judgment is substantially impaired. The consumer price index is to be applied to the amount recoverable for punitive damages.


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Punitive Damages Reform: HB 2210 (1996).

Pennsylvania|1996

Limits punitive damages to 200% of compensatory awards.  Raises the

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Limits punitive damages to 200% of compensatory awards.  Raises the standard of defense in punitive damage cases to “willful or wanton misconduct or reckless indifference to the rights or others.”  Provides for bifurcated trials.


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Punitive Damages Reform: SB 482 (1995).

Oregon|1995

Requires 40% of punitive damages awards to be paid to

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Requires 40% of punitive damages awards to be paid to the prevailing party, 60% to the state fund, and no more than 20% to the attorney of the prevailing party.  Requires a plaintiff to show by “clear and convincing” evidence that a defendant “acted with malice or has shown a reckless and outrageous indifference to a highly unreasonable risk of harm and has acted with a conscious indifference to the health, safety and welfare of others.”  Provides for court review of jury-awarded punitive damages.  Bars the claiming of punitive damages in an original complaint.  Requires a plaintiff to show a prima facie case for liability before amending a complaint to include a punitive damages claim.  The split-recovery statute allocating 60% of punitive damages award to the state did not violate the right to a remedy, the right to a jury trial, the takings or tax provisions, or the separation of powers under the State Constitution.


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Challenged and Upheld

DeMendoza v. Huffman, 2002 WL 1827841 (Or. Aug. 8, 2002).

Punitive Damages Reform: SB 323 (1987).

Oregon|1987

Requires a plaintiff to prove punitive damages by “clear and

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Requires a plaintiff to prove punitive damages by “clear and convincing” evidence.  Provides an FDA standards defense to punitive damages.


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Challenged and Struck Down

The Oregon Supreme Court declared the $500,000 limit on noneconomic damages unconstitutional in the case of Larkin v. Senco Products, Inc. — P.2d. — , 1999 WL 498088 Or. July 15, 1999.

Punitive Damages Reform: SB 263 (1995)

Oklahoma|1995

Codifies factors that the jury must consider in awarding punitive

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Codifies factors that the jury must consider in awarding punitive damages.  Provides that when a jury finds by “clear and convincing” evidence that the defendant: (1) acted in “reckless disregard for the rights of others,” the award is limited to the greater of $100,000 or actual damages awarded; or (2) acted intentionally and with malice, the award is limited to $500,000; two times the award of actual damages; or the increased financial benefit derived by the defendant or insurer as a direct result of the conduct causing injury.  The limit does not apply if the court finds evidence beyond a reasonable doubt that the defendant acted intentionally and with malice in conduct life‑threatening to humans.


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Challenged and Upheld

Gilbert v. Sec. Fin. Corp. of Okla., Inc., 152 P.3d 165 (Okla. 2006).

Prejudgment Interest Reform: SB 488 (1986).

Oklahoma|1986

Prohibits the assessment of prejudgment interest on punitive damages awards. 

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Prohibits the assessment of prejudgment interest on punitive damages awards.  Sets the prejudgment interest rate at 4% above the U.S. Treasury Bill.


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Challenged and Upheld

Rodebush v. Okla. Nursing Homes, Ltd., 867 P.2d 1241 (Okla. 1993)

Punitive Damages Reform: SB 488 (1986).

Oklahoma|1986

Limits the award of punitive damages to the award of

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Limits the award of punitive damages to the award of compensatory damages unless the plaintiff establishes her case by “clear and convincing” evidence, in which case no limit applies.


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Punitive Damages Reform Bifurcated Trial: AM Sub SB 80 (2004).

Ohio|2004

Provides that in jury trials, if punitive damages are requested

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Provides that in jury trials, if punitive damages are requested by any party, the trial is bifurcated so that the jury considers compensatory damages in one stage, and punitive damages in a second stage.


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Challenged and Upheld

Havel v. Villa St. Joseph, 963 N.E.2d 1270 (Ohio 2012).

Punitive Damages Reform: AM Sub SB 80 (2004); ORC Ann. 2315.12.

Ohio|2004

Limits punitive damages to not more than two times compensatory

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Limits punitive damages to not more than two times compensatory damages.  Limits punitive damages for small businesses to the lesser of two times compensatory damages or 10 percent of a defendants net worth, not to exceed $350,000.  Small businesses are defined as having less than 100 employees or manufacturers that have less than 500 employees. Prohibits the award of punitive damages if punitive damages have already been awarded based on the same act or conduct that is alleged, except under certain circumstances.


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Punitive Damages Reform: HB 350 (1996)

Ohio|1996

Limits the amount of punitive damages recoverable from all parties

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Limits the amount of punitive damages recoverable from all parties except large employers to the lesser of three times the award of compensatory damages or $100,000.  Limits the amount of punitive damages recoverable from large employers (more than 25 employees on a full time permanent basis) to the greater of three times the award of compensatory damages or $250,000.  Requires the determination of awards for punitive damages to be made in a separate proceeding at the request of either party.  Limits multiple punitive damages awards based on the same act or course of conduct.  Expands the governmental defense standards to include non‑drug manufacturers and manufacturers of over‑the‑counter drugs and medical devices.  The comprehensive 1996 tort reform law violated the doctrine of separation of powers and the one-subject provision of the State Constitution.  State ex rel. Ohio Academy of Trial Lawyers v. Sheward, 715 N.E.2d 1062 (Ohio 1999).  The limit on punitive damages violated the jury trial provision of the State Constitution.  Crowe v. Owens Corning Fiberglas, 718 N.E.2d 923 (Ohio 1999).


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Challenged and Struck Down

Punitive Damages Reform: HB 1 (1987).

Ohio|1987

Requires a plaintiff to show by “clear and convincing” evidence

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Requires a plaintiff to show by “clear and convincing” evidence that she suffered “actual damages” because a defendant acted with “malice, aggravated or egregious fraud, oppression or insult” for the award of punitive damages.  Provides a government standard defense for FDA approved drugs.


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Punitive Damages Reform: AB 307 (1989).

Nevada|1989

Limits punitive damages awards to $300,000, where the award for

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Limits punitive damages awards to $300,000, where the award for compensatory damages is less than $100,000, and to three times the award for compensatory damages, where the award for compensatory damages is $100,000 or more.  The reform does not apply to cases against a manufacturer, distributor, or seller of a defective product; an insurer who acts in bad faith; a person violating housing discrimination laws; a person involved in a case for damages caused by toxic, radioactive, or hazardous waste; or a person for defamation.  Requires a plaintiff to show by “clear and convincing evidence” that a defendant acted with “oppression, fraud, or malice.”  Requires the determination of awards for punitive damages to be made in a separate proceeding.  Permits the admissibility of evidence of a defendant’s finances only during the proceeding for the determination of punitive damages.


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Punitive Damages Reform: Actual Malice: SB 2805 (1987).

New Jersey|1987

Requires a plaintiff to show that a defendant acted with

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Requires a plaintiff to show that a defendant acted with “actual malice” or “wanton and willful disregard” for the rights of others.  Requires the determination of awards for punitive damages to be made in a separate proceeding.  Provides for an FDA government standards defense to punitive damages.  The reform does not apply to cases involving environmental torts.


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Punitive Damages Reform: HB 729 (1995): N.C. Gen. Stat. §§ 10-15(b), 1D‑25 .

North Carolina|1995

Limits the award of punitive damages to the greater of

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Limits the award of punitive damages to the greater of three times the award of compensatory damages or $250,000, unless the defendant caused the injury by driving while impaired.  Requires a plaintiff to show by “clear and convincing” evidence that a defendant was liable for compensatory damages and acted with fraud, malice, willful or wanton conduct.  Requires the determination of awards for punitive damages to be made in a separate proceeding at the request of the defendant.  The statute limiting punitive damages awards to the greater of three times compensatory damages or $250,000 did not violate the right to a jury trial, separation of powers principle, open courts guarantee, prohibition against special legislation, or the principles of due process, equal protection or the right to enjoy the fruits of one’s labor under the State Constitution, and was not void for vagueness.  Rhyne v. K-Mart Corp., 2002 WL 553461 (N.C. App. Apr. 16, 2002).


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Punitive Damages Reform: HB 212 (2003); Amended Mont. Code Anno., § 27-1-221 (2010).

Montana|2003

Brings Montana statute into conformity with Supreme Court decision that

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Brings Montana statute into conformity with Supreme Court decision that punitive damages may be awarded by a two-thirds verdict rather than the previous requirement that punitive damages awards must be unanimous.  In Finstad v. W.R. Grace & Co., 2000 MT 228, 301 Mont. 240, 8 P.3d 778 (2000), the Montana Supreme Court held that the portion of section 27-1-221(6), MCA, which requires that an award of punitive damages must be unanimous as to liability and amount, violates Article II, section 26, of the Montana Constitution, guaranteeing a verdict by a two-thirds majority in all civil cases.


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Punitive Damages Reform: SB 363 (2003): Mont. Code Ann. § 27-1-220.

Montana|2003

Limits punitive damages, unless otherwise expressed by statute, to $10

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Limits punitive damages, unless otherwise expressed by statute, to $10 million or 3 percent of a defendant’s net worth, whichever is less.  It does not limit the amount of punitive damages that may be awarded in class action lawsuits.


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Punitive Damages Reform: HB 442 (1987): Mont. Code Ann. § 27-1-221(5).

Montana|1987

Requires a plaintiff to show by “clear and convincing” evidence

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Requires a plaintiff to show by “clear and convincing” evidence that a defendant acted with “actual fraud” or “actual malice.”  Requires the determination of awards for punitive damages to be made in a separate proceeding.  Permits the admissibility of evidence of a defendant’s net worth only during the proceeding for the determination of punitive damages.  Requires a judge to review all punitive damages awards and to issue an opinion on his decision to increase or decrease an award, or to let it stand.


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Punitive Damages Reform: HB 13 (special session) (2004); Amended Miss. Code Ann. § 11-1-65.

Mississippi|2004

Modifies and lowers some caps on punitive damages, based upon

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Modifies and lowers some caps on punitive damages, based upon the net worth of a defendant. $20 million for a defendant with a net worth of more than $1 billion; $15 million for a defendant with a net worth of more than $750 million but not more than $1 billion $5 million for a defendant with a net worth of more than $500 million but not more than $750 million (new law); $3.75 million for a defendant with a net worth of more than $100 million but not more than $500 million (new law); $2.5 million for defendants with a net worth of more than $50 million but not more than $100 million (new law); Two percent of the defendant’s net worth for a defendant with a net worth of $50 million or less (new law).


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Punitive Damages Reform: HB 1270 (1993): Miss. Code Ann. § 11-1-65(1)(a).

Mississippi|1993

Requires a plaintiff to prove punitive damages by “clear and

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Requires a plaintiff to prove punitive damages by “clear and convincing” evidence.  Requires the determination of awards for punitive damages to be made in a separate proceeding.  Prohibits the award of punitive damages in the absence of compensatory awards.  Prohibits the award of punitive damages against an innocent seller.  Establishes factors for the jury to consider when determining the amount of a punitive damages award.


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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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Punitive Damages Reform: (1990). Minn. Stat. Sec. 549.20.

Minnesota|1990

Requires a plaintiff to show that a defendant acted with

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Requires a plaintiff to show that a defendant acted with “deliberate disregard” for the award of punitive damages.  (The former standard required only a showing of “willful indifference.”)  Requires the determination of awards for punitive damages to be made in a separate proceeding at the request of the defendant.  Grants trial and appellate judges the power to review all punitive damages awards.


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Punitive Damages Reform: SB 2078 (1986).

Minnesota|1986

Prohibits plaintiffs from pleading punitive damages in an original complaint. 

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Prohibits plaintiffs from pleading punitive damages in an original complaint.  Requires a plaintiff to make a prima facie showing of liability before an amendment of pleadings is permitted by the court.


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Punitive Damages Reform: HB 20 (1996).

Louisiana|1996

Repeals the statute that authorized punitive damages to be awarded

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Repeals the statute that authorized punitive damages to be awarded for the wrongful handling of hazardous substances.  (The Louisiana courts had established precedents substantially expanding liability based upon the repealed statute.)


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Punitive Damages Reform: HB 551 (1988)

Kentucky|1988

Requires, for the award of punitive damages, a plaintiff to

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Requires, for the award of punitive damages, a plaintiff to show by “clear and convincing” evidence that a defendant acted with oppression, fraud or malice.  The 1988 punitive damages reform statute requiring a plaintiff to show that the defendant acted with “flagrant indifference to the rights of the plaintiff and with a subjective awareness that such conduct will result in human death or bodily harm” as a predicate for punitive damages liability violated “jural rights” provisions of the State Constitution.  Williams v. Wilson, 972 S.W.2d 260 (Ky. 1998).


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Challenged and Struck Down

The Kentucky Supreme Court held the “clear and convincing” evidence standard that conduct constituted oppression, fraud or malice unconstitutional in Terri C. Williams v. Patricia Lynn Herald Wilson, No. 96‑SC‑1122‑DG, April 16, 1998.

Punitive Damages Reform: HB 2731 (1988). Kan. Stat. Ann. § 60-3701.

Kansas|1988

Limits the award of punitive damages to the lesser of

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Limits the award of punitive damages to the lesser of a defendant’s annual gross income or $5 million.  (The 1992 legislature amended this statute to allow a judge who felt a defendant’s annual gross income was not a sufficient deterrent to look at 50% of the defendant’s net assets and award the lesser of that amount or $5 million.)  Requires a plaintiff to show that a defendant acted with willful or wanton conduct, fraud, or malice.  Requires the determination of awards for punitive damages to be made in a separate proceeding.


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Punitive Damages Reform: HB 2025 (1987).

Kansas|1987

Limits the award of punitive damages to the lesser of

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Limits the award of punitive damages to the lesser of defendant’s highest annual gross income during the preceding five years or $5 million.  Provides that if the defendant earned more profit from the objectionable conduct than either of these limits, the court could award 1.5 times the amount of that profit.  Requires the determination of awards for punitive damages to be made in a separate proceeding.  Requires a plaintiff to prove punitive damages by “clear and convincing” evidence.  Provides seven criteria for the judge to consider in punitive damages cases, including whether this is the first award against a given defendant.


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Punitive Damages Reform: HB 20 (1995).

Illinois|1995

Limits the award of punitive damages to three times the

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Limits the award of punitive damages to three times the award of economic damages.  Prohibits the award of punitive damages absent a showing that the defendant engaged in conduct “with an evil motive or with a reckless indifference to the rights of others.”  Requires the determination of awards for punitive damages to be made in a separate proceeding.  The reform is unconstitutional. Best v. Taylor Machine Works,Inc., 689 N.E.2d 1057 (Ill. 1997).


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Challenged and Struck Down

Punitive Damages Reform: SB 1200 (1986).

Illinois|1986

Prohibits a plaintiff from pleading punitive damages in an original

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Prohibits a plaintiff from pleading punitive damages in an original complaint.  Requires a subsequent motion for punitive damages to show at a hearing a reasonable chance that the plaintiff will recover an award for punitive damages at trial.  Requires a plaintiff to show that the defendant acted “willfully and wantonly.”  Provides discretion to the court to award punitive damages among the plaintiff, the plaintiff’s attorney, and the State Department of Rehabilitation Services.


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Punitive Damages Reform: HB 92 (2003)

Idaho|2003

Limits the award of punitive damages to the greater of

[…]

Limits the award of punitive damages to the greater of three times the award of compensatory damages or $250,000.  Raises the standard for the imposition of punitive damages to “clear and convincing” evidence.


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Unchallenged

Punitive Damages Reform: SB 1223 (1987).

Idaho|1987

Requires a plaintiff to show by a preponderance of evidence

[…]

Requires a plaintiff to show by a preponderance of evidence that a defendant’s conduct was “oppressive, fraudulent, wanton, malicious or outrageous” for the award of punitive damages.


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Punitive Damages Reform: SF 482 (1987).

Iowa|1987

Requires a plaintiff to show by a “preponderance of clear,

[…]

Requires a plaintiff to show by a “preponderance of clear, convincing, and satisfactory evidence that the conduct of the defendant from which the claim constituted willful and wanton disregard for the rights or safety of another.”


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Punitive Damages Reform: SB 2265 (1986): Iowa Code Ann. § 668A.1.

Iowa|1986

Requires a plaintiff to show that a defendant acted with

[…]

Requires a plaintiff to show that a defendant acted with “willful and wanton disregard for the rights and safety of another.”  (In 1987 the evidence standard was elevated to “clear, convincing, and satisfactory” evidence.)  Requires 75% or more of all punitive damages awards to be paid to the State Civil Reparations Trust Fund.  The statute directing 75% of punitive damages awards to a civil reparation trust fund did not violate the equal protection or due process clauses of the State or Federal Constitutions.  Shepherd Components, Inc. v. Brice Petrides-Donohue & Associates, Inc., 473 N.W.2d 612 (Iowa 1991).


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Medical Liability Reform: Nursing Homes: Punitive Damages: SB 1202 (2001).

Florida|2001

Requires a plaintiff to prove punitive damages by clear and

[…]

Requires a plaintiff to prove punitive damages by clear and convincing evidence in cases against nursing home facilities.  Limits punitive damages against nursing home facilities to the greater of three times the award of compensatory damages or $1 million.  Limits punitive damages against nursing home facilities to the greater of $4 million or four times the award of compensatory damages, where conduct is proven to be motivated by financial gain.  Sets no limit on the award of punitive damages against nursing home facilities, where intentional harm is proven.


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Punitive Damages Reform: HB 775 (1999)

Florida|1999

Limits punitive damages to the greater of three times the

[…]

Limits punitive damages to the greater of three times the award of compensatory damages or $500,000.  Limits punitive damages to he greater of four times compensatory damages or $2,000,000, where the defendant’s wrongful conduct was motivated by an unreasonable financial gain or the likelihood of injury was known.  Prohibits the award of multiple punitive damages awards based on the same act or course of conduct unless the court makes a specific finding that earlier punitive damages awards were insufficient.  Requires a plaintiff to prove by clear and convincing evidence that a defendant acted with intentional misconduct or gross negligence for the award of punitive damages.  Outlines circumstances when an employer is liable for punitive damages arising from an employee’s conduct.  The reform does not apply to cases involving abuses to the elderly or children, or cases where the defendant is intoxicated.


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Unchallenged

Punitive Damages Reform: SB 465 (1986).

Florida|1986

Limits punitive damages to three times the award of compensatory

[…]

Limits punitive damages to three times the award of compensatory damages, unless a plaintiff can demonstrate by “clear and convincing” evidence that a higher award would not be excessive.  Requires sixty percent of the award to be paid to the state’s General Fund or Medical Assistance Trust Fund.  (The reform was amended in 1992 so that 35% of any punitive damages award goes to the state’s General Fund or Medical Assistance Trust Fund.)


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Challenged and Struck Down

The punitive damages limit and “clear and convincing” evidence requirement is constitutional.  Smith v. Department of Insurance, 507 So.2d 1080 (Fla. 1987).  The statute requiring plaintiffs to pay 60% of any punitive damages award to the State did not violate State or Federal right to jury trial, equal protection, or due process protections, and was not unconstitutional special legislation.  Gordon v. State of Florida, 608 So. 2d 800 (Fla. 1992) cert. denied, 507 U.S. 1005 (1993).

Punitive Damages Reform: HB 1186 (2003).

Colorado|2003

Prohibits a plaintiff from filing a claim for punitive damages

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Prohibits a plaintiff from filing a claim for punitive damages unless the plaintiff can show evidence of willful or wanton action that would justify such a claim.


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Punitive Damages: FDA-Approved Drugs: HB 1093 (1991).

Colorado|1991

Expands 1990’s prohibition against seeking punitive damages in cases in

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Expands 1990’s prohibition against seeking punitive damages in cases in which FDA approved drugs are administered by a physician, to include medically prescribed drugs or products used on an experimental basis (when such experimental use has not received specific FDA approval) and when the patient has given informed consent.


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Punitive Damages Reform: HB 1069 (1990).

Colorado|1990

Bars the award of punitive damages in professional negligence lawsuits

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Bars the award of punitive damages in professional negligence lawsuits until discovery has been substantially completed.  Prohibits discovery from being reopened without an amended pleading.  Bars the award of punitive damages against physicians being sued for a bad outcome of a prescription medication, where the physician complied with FDA protocols.  Bars the award of punitive damages against a physician being sued for the act of another, where the physician neither directed nor ratified the act.


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Medical Liability Reform: Punitive Damages: HB 1069 (1990).

Colorado|1990

Provides that punitive damages shall not be alleged in a

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Provides that punitive damages shall not be alleged in a professional negligence suit until discovery is substantially completed. Provides that discovery cannot be reopened without an amended pleading. Provides that physicians cannot be held liable for punitive damages because of the bad outcome of a prescription medication as long as it was administered in compliance with current FDA protocols.  Prohibits punitive damages from being assessed against physicians because of the act of another unless he directed the act or ratified it.


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Punitive Damages Reform: HB 1197 (1986)

Colorado|1986

Provides that an award for punitive damages may not exceed

[…]

Provides that an award for punitive damages may not exceed an award for compensatory damages.  Permits a court to reduce a punitive damages award if deterrence can be achieved without the award.  Permits a court to increase a punitive damages award to three times an award for compensatory damages if misbehavior continues during trial.  Requires one-third of punitive damages awards to be paid to the state fund.  The law requiring plaintiff to pay one-third of any punitive damages award collected to the State general fund was an unconstitutional taking of property without just compensation under both the Federal and Colorado Constitutions.  Kirk v. Denver Publishing Co., 818 P.2d 262 (Colo. 1991).


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Challenged and Struck Down

The Colorado Supreme Court held the state fund portion of this statute unconstitutional in Kirk v. The Denver Publishing Company, 15 Brief Times Reporter, No. 88SA405, September 23, 1991.

Punitive Damages Reform: SB 241 (1987)

California|1987

Requires a plaintiff to show by “clear and convincing” evidence

[…]

Requires a plaintiff to show by “clear and convincing” evidence that a defendant acted with oppression, fraud, or malice.  Requires the determination of awards for punitive damages to be made in a separate proceeding, allowing evidence of defendants’ financial conditions only after a finding of liability.


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Unchallenged

Manufacturer Exemption from Punitive Damages: H.B. 2503 (2012)

Arizona|2012

Establishes reasonable liability rules for manufacturers, service providers and sellers

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Establishes reasonable liability rules for manufacturers, service providers and sellers of products with respect to punitive damages when their product or service is in compliance with state or federal laws/regulations.  Recognizes that the specific purpose of an award of punitive damages is to punish and deter unlawful conduct, and a defendant should not be punished in civil litigation when it is in compliance with applicable laws and regulatory requirements.  Does not apply if it can be demonstrated that the defendant engaged in the following conduct: (1) the business withheld or misrepresented information utilized to gain regulatory approval; (2) the defendant mad an illegal payment to an official to obtain approval of the product or service; or, (3) the defendant sold a product or service after the government ordered the product or service to be removed from the marketplace.


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Punitive Damages Reform: HB 1038 (2003).

Arkansas|2003

Raises the standard for the imposition of punitive damages to

[…]

Raises the standard for the imposition of punitive damages to “clear and convincing” evidence of actual fraud, malice, or willful or wanton conduct and charges.  Limits the award of punitive damages to the greater of $250,000 or three times compensatory damages, not to exceed $1,000,000.  Provides for a bifurcated proceedings for punitive damages.


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Challenged and Struck Down

The Arkansas Supreme Court held that the punitive damages limit of greater of $250,000 or three times compensatory damages, not to exceed $1 million, violated provision of State Constitution barring limits on recovery outside employment context, in Bayer CropScience LP v. Schafer, 2011 WL 6091323, December 8, 2011.

Punitive Damages Reform: SB 137 (1999)

Alabama|1999

Limits the award of punitive damages in most non-physical injury

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Limits the award of punitive damages in most non-physical injury cases to the greater of three times the award of compensatory damages or $500,000.  Limits the award of punitive damages in non-physical injury cases against businesses with a net worth of less than $2 million to the greater of $50,000 or 10% of the business’s net worth up to $200,000.  Limits the award of punitive damages in physical injury cases to the greater of three times the award of compensatory damages or $1.5 million.  Prohibits application of the rule of joint and several liability in actions for punitive damages, except for wrongful death actions, actions for intentional infliction of physical injury, and class actions.  Provides that the limit on punitive damages will be adjusted on January 1, 2003 and increased at three‑year intervals in accordance with the Consumer Price Index.


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Challenged and Struck Down

The Alabama Supreme Court held the $250,000 limit on punitive damages unconstitutional in Craig Henderson v. Alabama Power Co., case No. 1901875, June 25, 1993.

Punitive Damages Reform: (1987): Ala. Code § 6-11-20.

Alabama|1987

Requires a plaintiff to show by “clear and convincing” evidence

[…]

Requires a plaintiff to show by “clear and convincing” evidence that a defendant acted with “wanton” conduct for the recovery of punitive damages.  Limits the award of punitive damages to $250,000.  The statute setting a $250,000 limit on punitive damages awards violated the right to jury trial under the State Constitution.  Henderson v. Alabama Power Co., 627 So. 2d 878 (Ala. 1993).  Requires trial and appellate judges to review all punitive damages awards and reduce those that are excessive based on the facts of the case.  The Alabama Supreme Court held the judicial review of all awards unconstitutional in Armstrong v. Roger’s Outdoor Sports, Inc., May 10, 1991.


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Punitive Damages Reform: HB 58 (1997).

Alaska|1997

Limits the award of punitive damages in most cases to

[…]

Limits the award of punitive damages in most cases to the greater of three times the award of compensatory damages or $500,000.  Limits the award of punitive damages to the greater of four times compensatory damages, four times the aggregate amount of financial gain, or $7,000,000, when the defendant’s action is motivated by financial gain.  Limits punitive damages in unlawful employment practices lawsuits to: $200,000, when the employer has less than 100 employees in the state; $300,000, when the employer has more than 100, but less than 200 employees in the state; $400,000, when the employer has more than 200, but less than 500 employees in the state; and $500,000, when the employer has more than 500 employees in the state.  Requires a plaintiff to show by “clear and convincing” evidence that a defendant acted with “reckless indifference” or was engaged in “outrageous” conduct.  Requires the determination of awards for punitive damages to be made in a separate proceeding.  Requires that 50% of punitive damages awards be paid to the state treasury.


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Challenged and Upheld

The reform did not violate the right to a jury trial, the right to equal protection, or the right to substantive due process in the State or Federal Constitutions, the separation of powers doctrine, or the right of access to the courts or ban on “special legislation” in the State Constitution).  Evans v. State, 2002 WL 1998141 (Alaska Aug. 30, 2002).