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Personal Injury Punitive Damages

Fairfax Injury Lawyer Brien Roche Addresses Punitive Damage Awards

Brien Roche

The Virginia Supreme Court has dealt many times with the issue of punitive damage awards.  The basis for a punitive damage award is a conscious disregard.  That requires something beyond ordinary negligence.  It also requires something beyond gross negligence.  A conscious disregard can be seen when a person while driving an automobile, chooses to look at their phone or to text.  That is a choice that the driver makes.  That choice may be a conscious disregard.  When coupled with driving at a high rate of speed, it may be a basis for a punitive damage award.

Personal Injury Punitive Damages-Auto

Punitive damage awards in auto crash cases are tough to obtain.  Va. Code section 8.01-44.5 allows for punitive damages where there is a certificate of blood alcohol content (BAC) of 0.15% or more.  Other forms of proof may be allowed to establish that.  For instance if you have proof from lay witnesses as to the amount of alcohol consumed, the size and weight of the defendant and the period of consumption, then through expert testimony of a toxicologist, you may be able to prove that the BAC was over 0.15%.

The question in one case was whether an award was too high.  The jury awarded different amounts of compensatory damages to two plaintiffs.  One of the plaintiffs was the driver of an auto.  The other plaintiff was a passenger.  The party being sued was a drunk driver with an extensive history of drunk driving. He also had been found guilty of eluding the police at the time of this crash. In addition he had asked his girlfriend to lie about his actions.

Personal Injury Punitive Damages-Proportion

The jury awarded one plaintiff $5,000 in compensatory damages and the other plaintiff $14,000 in compensatory damages.  The jury awarded $100,000 in punitive damages to each of these two plaintiffs.  The trial court felt that the award was too high to the plaintiff that had the smaller amount of compensatory damages.  Compensatory damages are those damages that are designed to make the plaintiff whole for the injury.  Punitive damages are designed to punish for wrongful conduct.

The trial court felt that because the compensatory damage awards were different that the punitive damage awards should be different. Furthermore they should bear some relation to the compensatory award.

Personal Injury Punitive Damages-The Ratio

The ratio of punitive damages to compensatory damages in one case was approximately 17:1 and in the other case the ratio was nearly 8:1.
The Virginia Supreme Court determined that the ratio does not need to be a single digit amount.  The Virginia Supreme Court further stated that a trial court may not compare verdicts under any circumstances.  The case law in that regard states that in deciding whether a compensatory award is too high, the court may not compare that award with what was awarded in another case.  The thinking is that each case is unique.  Each case needs to be looked at on its own facts.  Likewise in looking at a punitive award, there can be no comparison with other cases.

One of the judges on the Virginia Supreme Court felt that the awards were arbitrary and/or prejudicial because they did not treat the two plaintiffs the same. The majority of the Court felt otherwise.  The majority felt that the jury has discretion in terms of awarding different amounts. In this case the Court felt that different ratios between the compensatory award and the punitive award may have been justified simply because the overall compensatory awards did not truly reflect the damage to that plaintiff.

In any event a punitive damage award 17 times the compensatory award is not excessive according to this case. Call, or contact us for a free consult.

Personal Injury Punitive Damage-Proof

In proving punitives there are many things to be aware of:

Focus on the Duty

The duties owed by the defendant you are suing may be quite broad. There may be a duty imposed on everyone within the company to report an injury or events that may lead to an injury. There may be a duty to structure the company in such a way so as to avoid these types of injury. The size of the company may be such that its duty is heightened because it impacts thousands of people. The elements for punitives are either intentional conduct or willful and wanton conduct. The latter calls for an act or constructive consciousness that injury will result from the act or omission. Wilby v. Gostel 365 Va. 437,445 (2003), Alfonso v Robinson 257 Va. 540,545

Is the Bad Conduct Continuing?

If the defendant is still denying fault or causation? If so, that should be pointed out as a factor.

Punitives Deter

Punitives punish and also deter. To know what amount to award in order to deter the jury must know the extent of bad conduct and what effect it could have. The risk may be small but the breach of the standard of care persists. This latter fact may be proof of deliberate indifference.

The Award Has To Make Sense

Not only must the award make sense in regard to the other damages but it should make sense in regard to the defendant itself. The jury has a right to know how much was spent to market the product during the time in question. Did the party being sued know the dangers of the product while they were pushing the product? During this same time how much did they spend on quality control? That financial motive may make the claim.

Know The Wealth

The wealth of the party you are suing may not just be net worth. It may also be gross receipts, cash flow, accounts receivable or value of the parent company. All of those should be looked at.

In terms of proving the net worth or assets of the defendant, there may be several things to keep in mind:

    • It’s a bit unclear in the case law as to whether or not the plaintiff has to prove net worth.  I think the better policy is to prove net worth, in particular if you have a defendant with substantial assets.  If the defendant has meager assets, there may be some logic in not presenting evidence of what those assets are.
    • There is an argument to be made that there is a constitutional issue relating to assets. That is, if the plaintiff fails to present any evidence of assets, then the jury has no basis upon which it can “punish” the defendant because it doesn’t know what amount would constitute a punishment. In that case a lack of proof of assets may give rise to a due process argument i.e., you’ve created a potential circumstance where the jury could award punitive damages that have no relationship to the defendant’s assets.

Insurance

  • Based on the case of Allstate v. Wade, 265 Va. 383, a UM carrier for the victim cannot inject insurance into the case and thereby argue that an award of punitive damages would not serve to deter since they are paid by the carrier and not the wrongdoer.
  • Any issue of admissibility of UM/UIM coverage needs to be looked at from the fact that the defendant may still be exposed to subrogation and therefore has liability indirectly.

Taxes

You need to be aware that punitive damages are taxable.  As such to the extent that the award can be lumped into the general damages there may be some logic in trying to do that. The general award of course has to be for what is called “personal physical injury”. Otherwise that too may be taxable.

Discoverability

The defendant has the right to present evidence as to net worth. If there is a lack of evidence of the defendant’s net worth, that does not defeat the punitive claim. Flippo v. CSC Associates, III, 262 Va. 48, 58 (2001) An award of punitives must not be so great as to produce bankruptcy. Johnson v. Hugo’s Skateway, 974 F.2d 1408, 1418 (4th Cir. 1992) As to exactly who has the burden of proof as to net worth, the 4th Circuit in Kunstler v. Britt, 914 F.2d 505 (4th Cir. 1990) addressed that issue. It analogized the burden to what exists in a Rule 11 Sections case. Inability to pay is a type of affirmative defense. In that instance, the burden of coming forward with evidence of financial status rests with the party to be sanctioned.
If the defendant fails to present evidence of financial worth, it cannot then complain that the award is excessive. Condo Services, Inc. v. First Owners Assoc., 281 Va. 561, 581 (2011); Kory v. McCluney, 59 Va. Cir., 74 (2002) The only way of course to determine what the defendant’s net worth is, is through discovery. Discoverability is not dependent upon a prima facie showing of merit. Turnage v. Clarity Services, Inc., 215 Lexis 106553 (E.D.VA 2015); Kovari v. Bevard Expeditions, LLC, Lexis 230032 (W.D.VA 2019); Hirsch v. CSP Nova, LLC, 98 Va. Cir. 286, 300-301 (Loudoun 2018)

In terms of questions to ask to discover assets, a good starting point is the Schedule of Assets used in bankruptcy court.  That can be found by Googling “Official Form 206A/B”.

Personal Injury Punitive Damages in Federal Court

In federal courts the ratio that is typically followed is a single digit ratio.  State court however is not bound by that federal case law.  One issue however in awarding punitive damages is what is referred to as due process i.e., under the Constitution has there been an improper taking of property without due process that may pose a constitutional problem.  The improper taking of property would be the excessive punitive damage award.
Punitive damages may be awarded where only nominal damages are granted at the compensatory level.  In the May 8, 2011 decision in Feld v. Feld, the U.S. District Court in the District of Columbia adopted the view from the Restatement Second of Torts Section 163, that an award of nominal damages is enough to support further award of punitive damages when the tort is committed for an outrageous purpose even though no significant harm resulted.

For information on the basis for punitive damages as reflected in Virginia case law see the highlighted article.   Call, or contact us for a free consult.

For more information on punitive damage awards and personal injury see the other pages on this site and see the pages on Wikipedia.

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Contact Us For A Free Consultation

Personal Injury Punitive Damages

Fairfax Injury Lawyer Brien Roche Addresses Punitive Damage Awards

Brien Roche

The Virginia Supreme Court has dealt many times with the issue of punitive damage awards.  The basis for a punitive damage award is a conscious disregard.  That requires something beyond ordinary negligence.  It also requires something beyond gross negligence.  A conscious disregard can be seen when a person while driving an automobile, chooses to look at their phone or to text.  That is a choice that the driver makes.  That choice may be a conscious disregard.  When coupled with driving at a high rate of speed, it may be a basis for a punitive damage award.

Personal Injury Punitive Damages-Auto

Punitive damage awards in auto crash cases are tough to obtain.  Va. Code section 8.01-44.5 allows for punitive damages where there is a certificate of blood alcohol content (BAC) of 0.15% or more.  Other forms of proof may be allowed to establish that.  For instance if you have proof from lay witnesses as to the amount of alcohol consumed, the size and weight of the defendant and the period of consumption, then through expert testimony of a toxicologist, you may be able to prove that the BAC was over 0.15%.

The question in one case was whether an award was too high.  The jury awarded different amounts of compensatory damages to two plaintiffs.  One of the plaintiffs was the driver of an auto.  The other plaintiff was a passenger.  The party being sued was a drunk driver with an extensive history of drunk driving. He also had been found guilty of eluding the police at the time of this crash. In addition he had asked his girlfriend to lie about his actions.

Personal Injury Punitive Damages-Proportion

The jury awarded one plaintiff $5,000 in compensatory damages and the other plaintiff $14,000 in compensatory damages.  The jury awarded $100,000 in punitive damages to each of these two plaintiffs.  The trial court felt that the award was too high to the plaintiff that had the smaller amount of compensatory damages.  Compensatory damages are those damages that are designed to make the plaintiff whole for the injury.  Punitive damages are designed to punish for wrongful conduct.

The trial court felt that because the compensatory damage awards were different that the punitive damage awards should be different. Furthermore they should bear some relation to the compensatory award.

Personal Injury Punitive Damages-The Ratio

The ratio of punitive damages to compensatory damages in one case was approximately 17:1 and in the other case the ratio was nearly 8:1.
The Virginia Supreme Court determined that the ratio does not need to be a single digit amount.  The Virginia Supreme Court further stated that a trial court may not compare verdicts under any circumstances.  The case law in that regard states that in deciding whether a compensatory award is too high, the court may not compare that award with what was awarded in another case.  The thinking is that each case is unique.  Each case needs to be looked at on its own facts.  Likewise in looking at a punitive award, there can be no comparison with other cases.

One of the judges on the Virginia Supreme Court felt that the awards were arbitrary and/or prejudicial because they did not treat the two plaintiffs the same. The majority of the Court felt otherwise.  The majority felt that the jury has discretion in terms of awarding different amounts. In this case the Court felt that different ratios between the compensatory award and the punitive award may have been justified simply because the overall compensatory awards did not truly reflect the damage to that plaintiff.

In any event a punitive damage award 17 times the compensatory award is not excessive according to this case. Call, or contact us for a free consult.

Personal Injury Punitive Damage-Proof

In proving punitives there are many things to be aware of:

Focus on the Duty

The duties owed by the defendant you are suing may be quite broad. There may be a duty imposed on everyone within the company to report an injury or events that may lead to an injury. There may be a duty to structure the company in such a way so as to avoid these types of injury. The size of the company may be such that its duty is heightened because it impacts thousands of people. The elements for punitives are either intentional conduct or willful and wanton conduct. The latter calls for an act or constructive consciousness that injury will result from the act or omission. Wilby v. Gostel 365 Va. 437,445 (2003), Alfonso v Robinson 257 Va. 540,545

Is the Bad Conduct Continuing?

If the defendant is still denying fault or causation? If so, that should be pointed out as a factor.

Punitives Deter

Punitives punish and also deter. To know what amount to award in order to deter the jury must know the extent of bad conduct and what effect it could have. The risk may be small but the breach of the standard of care persists. This latter fact may be proof of deliberate indifference.

The Award Has To Make Sense

Not only must the award make sense in regard to the other damages but it should make sense in regard to the defendant itself. The jury has a right to know how much was spent to market the product during the time in question. Did the party being sued know the dangers of the product while they were pushing the product? During this same time how much did they spend on quality control? That financial motive may make the claim.

Know The Wealth

The wealth of the party you are suing may not just be net worth. It may also be gross receipts, cash flow, accounts receivable or value of the parent company. All of those should be looked at.

In terms of proving the net worth or assets of the defendant, there may be several things to keep in mind:

    • It’s a bit unclear in the case law as to whether or not the plaintiff has to prove net worth.  I think the better policy is to prove net worth, in particular if you have a defendant with substantial assets.  If the defendant has meager assets, there may be some logic in not presenting evidence of what those assets are.
    • There is an argument to be made that there is a constitutional issue relating to assets. That is, if the plaintiff fails to present any evidence of assets, then the jury has no basis upon which it can “punish” the defendant because it doesn’t know what amount would constitute a punishment. In that case a lack of proof of assets may give rise to a due process argument i.e., you’ve created a potential circumstance where the jury could award punitive damages that have no relationship to the defendant’s assets.

Insurance

  • Based on the case of Allstate v. Wade, 265 Va. 383, a UM carrier for the victim cannot inject insurance into the case and thereby argue that an award of punitive damages would not serve to deter since they are paid by the carrier and not the wrongdoer.
  • Any issue of admissibility of UM/UIM coverage needs to be looked at from the fact that the defendant may still be exposed to subrogation and therefore has liability indirectly.

Taxes

You need to be aware that punitive damages are taxable.  As such to the extent that the award can be lumped into the general damages there may be some logic in trying to do that. The general award of course has to be for what is called “personal physical injury”. Otherwise that too may be taxable.

Discoverability

The defendant has the right to present evidence as to net worth. If there is a lack of evidence of the defendant’s net worth, that does not defeat the punitive claim. Flippo v. CSC Associates, III, 262 Va. 48, 58 (2001) An award of punitives must not be so great as to produce bankruptcy. Johnson v. Hugo’s Skateway, 974 F.2d 1408, 1418 (4th Cir. 1992) As to exactly who has the burden of proof as to net worth, the 4th Circuit in Kunstler v. Britt, 914 F.2d 505 (4th Cir. 1990) addressed that issue. It analogized the burden to what exists in a Rule 11 Sections case. Inability to pay is a type of affirmative defense. In that instance, the burden of coming forward with evidence of financial status rests with the party to be sanctioned.
If the defendant fails to present evidence of financial worth, it cannot then complain that the award is excessive. Condo Services, Inc. v. First Owners Assoc., 281 Va. 561, 581 (2011); Kory v. McCluney, 59 Va. Cir., 74 (2002) The only way of course to determine what the defendant’s net worth is, is through discovery. Discoverability is not dependent upon a prima facie showing of merit. Turnage v. Clarity Services, Inc., 215 Lexis 106553 (E.D.VA 2015); Kovari v. Bevard Expeditions, LLC, Lexis 230032 (W.D.VA 2019); Hirsch v. CSP Nova, LLC, 98 Va. Cir. 286, 300-301 (Loudoun 2018)

In terms of questions to ask to discover assets, a good starting point is the Schedule of Assets used in bankruptcy court.  That can be found by Googling “Official Form 206A/B”.

Personal Injury Punitive Damages in Federal Court

In federal courts the ratio that is typically followed is a single digit ratio.  State court however is not bound by that federal case law.  One issue however in awarding punitive damages is what is referred to as due process i.e., under the Constitution has there been an improper taking of property without due process that may pose a constitutional problem.  The improper taking of property would be the excessive punitive damage award.
Punitive damages may be awarded where only nominal damages are granted at the compensatory level.  In the May 8, 2011 decision in Feld v. Feld, the U.S. District Court in the District of Columbia adopted the view from the Restatement Second of Torts Section 163, that an award of nominal damages is enough to support further award of punitive damages when the tort is committed for an outrageous purpose even though no significant harm resulted.

For information on the basis for punitive damages as reflected in Virginia case law see the highlighted article.   Call, or contact us for a free consult.

For more information on punitive damage awards and personal injury see the other pages on this site and see the pages on Wikipedia.

Contact Us For A Free Consultation

    Contact Us For A Free Consultation

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