What Are Punitive Damages and When Are You Entitled to Them?
What is Punitive Damages?
Damages are an essential element of any personal injury lawsuit. Most personal injury cases focus on compensatory damages, which are designed to compensate the plaintiff for the injuries that the defendant caused. But occasionally, a personal injury plaintiff may be able to pursue both compensatory damages and what are known as punitive damages. Keep reading to learn more.
What Are Punitive Damages Designed to Do?
Punitive damages are a distinct type of damages that are available only in a few specified circumstances. Punitive damages serve two important functions:
- Punitive damages are meant to punish particularly egregious behavior by the defendant. See “When are punitive damages available” for more details on what kind of behavior qualifies.
- Set an example. Punitive damages are sometimes referred to as “exemplary” damages, because they also serve as an example to dissuade the defendant from behaving that way in the future, and to deter others from engaging in similar conduct.
When Are Punitive Damages Available?
Personal injury lawsuits only rarely involve awards of punitive damages. In fact, the law restricts the availability of punitive damages to cases in which the defendant acted:
- Intentionally; or
- Willfully and wantonly.
Most personal injury lawsuits are based on the claim that the defendant acted negligently, which is inconsistent with a claim that the defendant acted fraudulently or intentionally. However, in some cases, a defendant’s negligence may rise to the level of “willful and wanton” behavior, in which a defendant “intentionally inflicts a highly unreasonable risk of harm upon others in conscious disregard of it.”
Are There Limits on Punitive Damages?
Once a jury has determined that a defendant is liable for punitive damages, it must set the amount of punitive damages. To do so, it considers several factors, including:
- How reprehensible the defendant’s conduct was in light of:
- The plaintiff’s vulnerability;
- The duration and frequency of the defendant’s conduct;
- The type of harm posed by the defendant’s conduct (e.g., economic or physical);
- What actual harm the defendant’s conduct caused, and what potential harm it could have caused; and
- The amount of money necessary to punish the defendant and serve as an example for the defendant and others. On this final factor, the jury can consider the defendant’s net worth to decide how much would be necessary to deter the defendant from repeating the behavior.
However, the jury does not have unlimited discretion in setting the amount of punitive damages. The U.S. Supreme Court interprets the 14th Amendment’s Due Process Clause as imposing limits on punitive damage awards. Those limits are not absolute dollar amounts, but require a flexible factor analysis that mirrors some of the factors a jury considers, including:
- The reprehensibility of the defendant’s conduct;
- The ratio of punitive damages to compensatory damages; and
- How the punitive damage award compares to criminal penalties for similar conduct.
Regarding the second factor, the Supreme Court has stated that, “in practice, few awards exceeding a single-digit ratio . . . will satisfy due process,” and that punitive damages greater than four times the amount of compensatory damages “might be close to the line of constitutional impropriety.”
Punitive Damages Example
Punitive damages serve important functions in the law, but are rarely available to personal injury plaintiffs. When they are available, they are subject to constitutional limits. If you are interested in learning more about your scenario, or possible examples of punitive damages, contact us. To make sure that you receive all the damages you’re entitled to in a personal injury lawsuit, contact the Illinois personal injury attorneys at Costa Ivone today.