$23.6 Billion in Punitive Damages

A Florida jury recently awarded $23.6 billion in punitive damages against R.J. Reynolds Tobacco Company for causing the smoking-related death of a longtime smoker. The jury also awarded $16.8 million in compensatory damages. Because the punitive damage award is so disproportionate to the award of compensatory damages, it’s almost a certainty that the trial court will significantly reduce the punitive damage award.

Punitive DamagesIn Florida, punitive damages are only available when the actions of the defendant are “fraudulent, malicious, deliberately violent or oppressive, or committed with such gross negligence as to indicate a wanton disregard for the rights of others”. Punitive damages are not available as a matter of absolute right. In fact, before a party makes a claim for punitive damages, the party has to come forward with evidence that supports an award of punitive damages. The trial judge is required to determine if there is evidence in the record to support an award of punitive damages before allowing the claim to go forward. If the trial judge allows a plaintiff to plead punitive damages, the plaintiff must prove entitlement to punitive damages at trial by clear and convincing evidence (a higher standard than the preponderance of evidence standard in most civil cases).

The types of cases that may warrant punitive damages include claims for tortious interference, breach of fiduciary duty, fraud, defamation, an accident caused by a drunk driver and intentional torts committed for monetary gain. While punitive damages may be available in some types of cases, most insurance policies will not cover a claim for punitive damages. In addition, a punitive damage award cannot bankrupt a defendant and Florida law generally imposes a limit of punitive damages at 3-4 times the compensatory damages.

Most cases do not warrant punitive damages. However, in those cases where the defendant’s conduct is especially egregious, a claim for punitive damages might be a consideration. If the court allows this claim, it can be a powerful argument and allow a jury to punish a defendant for their conduct.