Punitive Damages Why the Monster Thrives
Citation: 105 Geo L.J. (2017)
Twenty years ago, in BMW of North America, Inc. v. Gore, the Supreme Court ruled for the first time that a punitive damages judgment awarded by a state court jury was unconstitutional under the Due Process Clause of the Fourteenth Amendment. Previously, the Court had expressed concern about the proliferation of punitive damages awards “run wild” and declared that the Due Process Clause of the Fourteenth Amendment imposes “substantive limits” on the magnitude of civil penalties that it had described as “quasi-criminal” punishment. In BMW, the Court held that on a claim of fraudulent misrepresentation in connection with the sale of a car, a punitive judgment of $2 million—500 times the plaintiff’s actual harm of $4,000—was grossly excessive.5 To curtail disproportionate punitive awards, the Court enunciated three guideposts to govern judicial review when damages awards are alleged to be unconstitutionally excessive.