Damages Awards in Tort Law

 Goal is to put the plaintiff in the position he or she would have been in had
the wrong not occurred
 Some losses must be reasonably proved with certainty
 Plaintiffs have a duty to mitigate damages
Overview
 Tort damages fall into three general categories
o Compensatory damages
o Punitive damages
o Nominal damages
 Each serves a distinct function in achieving justice and deterrence
Compensatory Damages
 These are intended to make the plaintiff ‘whole’ again
o Economic (Special Damages): medical expenses (past and future), lost
income and loss of earning capacity, property damage, other
quantifiable costs (e.g., transport, household services)
o Non-economic (General): Physical pain, mental suffering/emotional
distress, loss of enjoyment of life, loss of consortium
 Zone of Danger Test for Emotional Harm
1. Whether the plaintiff was located near the scene of the
accident, as contrasted with being a distance away
2. Whether the shock resulted from a direct emotional
impact on the plaintiff through sensory and
contemporaneous observance of the accident, as
contrasted with learning of it afterwards
3. Whether the plaintiff and the victim were closely related,
as contrasted with having only a distant or no relationship
 Loss of Consortium Claim
 A loss of consortium claim is brought by the spouse (or
close family member in some states) of an injured plaintiff
 It seeks damages for the loss of companionship, services,
affection, and intimacy resulting from the tortious injury
to the primary victim
 The claim is derivative, meaning it depends on the
success of the underlying tort claim
 Elements
1. Valid marriage or recognized relationship (in some
jurisdictions)
2. Injury to one spouse caused by the defendant’s tort
3. Loss of companionship, affection, comfort, and/or
sexual relations
4. Proof that the losses stem directly from the injury
 Wrongful Death Claim
 Statutory tort claim brought by survivors of the decedent
 Focus: survivors’ losses caused by the death
 Compensatory damages may include
o Lost financial support (income, benefits), loss of
household services (childcare, guidance, chores),
loss of consortium, companionship, or guidance,
emotional distress, medical and funeral expenses
  Survival Action (separate)
 Separate statutory claim brought by the decedent’s
estate
 Focus: damages the decedent could have recovered if
they had lived
 Compensatory damages may include:
o Medical expenses incurred before death, lost
earnings between injury and death, conscious pain
and suffering before death
 Proof often includes receipts, medical records, and testimony
Punitive and Nominal Damages
 Punitive Damages
o Aimed at punishing the defendant and deterring future misconduct
o Only awarded in cases of willful, malicious, or egregiously reckless
behavior
 Nominal Damages
o A small, symbolic sum awarded when a legal wrong occurred but no
substantial harm is proven

Liebeck v. McDonald’s (1994)

 Stella Liebeck, 79, purchased coffee at a McDonald’s drive-thru in New
Mexico.
 While parked, she tried to remove the lid to add cream and sugar.
 Coffee spilled onto her lap, causing third-degree burns to thighs, buttocks,
and groin.
 She required skin grafts and two years of medical treatment.
 McDonald’s served coffee at 180–190°F, much hotter than home-brewed
coffee.
 McDonald’s had received more than 700 prior burn complaints.
o McDonald’s policy at the time was to hold coffee at 180–190°F, which
is significantly hotter than home-brewed coffee (usually 130–150°F).
o McDonald’s argued customers wanted coffee hot enough to stay warm
for commuters and to taste better over time.
o Internal documents showed the company knew the serving
temperature could cause severe burns in seconds, but they treated it
as an acceptable risk.

Punitive Damages—Constitutional Limits

 BMW v. Gore (1996):
o Facts: $4,000 compensatory, $4M punitive for undisclosed repainting.
o Holding: Punitive damages grossly excessive → violates Due Process.
o Rule: Established 3 guideposts – degree of reprehensibility, ratio,
comparison to penalties civil and criminal for similar conduct.
 State Farm v. Campbell (2003):
o Facts: $1M compensatory, $145M punitive for bad-faith insurance
practices.
o Holding: 145:1 ratio unconstitutional under Due Process.
o Rule: Punitive damages must be proportional; few ratios >9:1
permissible.
 Philip Morris v Williams (2007)
 o Issue: Can a jury punish for harm to people not before the court?
o Holding
 No. Punitive damages cannot punish for injuries to nonparties
 Violates Due Process (no defense opportunity)
o Reasoning
 Broader harm may show reprehensibility
 Punishment must be tied to plaintiff’s harm only
 Otherwise: no fair notice, no chance to contest
Punitive Damages
 Punitive damages are a special category of damages awarded not to
compensate the plaintiff, but to punish the defendant and send a message to
deter similar future conduct.
 They are only available in tort cases where the defendant’s conduct goes
beyond ordinary negligence and rises to the level of:
o Willful misconduct: knowing, deliberate violation of rights (even
without hatred)
o Malice: Express (Actual spite or intent to injure) v Implied (disregard
of others’ rights or safety, even without a desire to harm)
o Fraud
o Gross or egregious recklessness
 To receive punitive damages, the plaintiff must first prove liability and
entitlement to compensatory damages. Then, additional evidence must show
the defendant’s state of mind or pattern of egregious conduct.
 Juries consider the severity of the misconduct, the defendant’s financial
condition, and the proportionality between punitive and compensatory
damages. Courts may review punitive awards to ensure they are not
constitutionally excessive.
 Arguments in Favor:
1. Deterrence of Egregious Conduct:
o Punitive damages deter especially reckless or malicious conduct,
especially when compensatory damages are insufficient.
2. Expressive Function:
o They symbolically condemn morally reprehensible conduct, reinforcing
societal norms.
3. Under-Enforcement:
o They incentivize private parties to bring socially valuable lawsuits
(“private attorney-general”)
4. Internalizing Externalities:
o In light of imperfect enforcement, PD makes defendants internalize the
full social costs of their actions (Polinsky & Shavell).
 Arguments Against
1. Unpredictability:
o Punitive awards can be inconsistent and unpredictable.
 Scholars like Cass Sunstein and David Schkade have shown in
empirical studies that juries are inconsistent in awarding
punitive damages, even when presented with similar fact
patterns.
2. Over-Deterrence:
o They might chill beneficial activities due to fear of liability.
3. Due Process Concerns:
 o Excessive punitive awards may violate constitutional due process.
4. Windfall to Plaintiffs:
o Punitive damages may unjustly enrich plaintiffs beyond compensation.
 While punitive damages are meant to punish the wrongdoer and
deter misconduct, some jurisdictions allocate a portion of the
award to public funds to prevent excessive windfalls to plaintiffs.
5. Disproportionate Impact:
o They may disproportionately impact defendants, especially businesses.
 Example: Public Allocation of Punitive Damages in California
o California’s Share of Punitive Damages:
 Under California Code of Civil Procedure § 384, the state may
claim 75% of punitive damages in certain cases.
 Applies in actions brought by public entities or specific actions
(e.g., qui tam, unfair competition).
 Remaining 25% usually goes to the plaintiff.
o Rationale: Reflects public interest in deterrence and avoids windfalls.
o Funds support public programs like legal aid and consumer protection.
o Key Case: Walker v. Superior Court (1988) upheld the constitutionality
of this allocation.
Cy Pres Doctrine in Tort Cases
 When Cy Pres is Used:
o Applied when full distribution of damages to plaintiffs is impractical
(e.g., unclaimed funds).
o Common in class actions where not all class members can be located
or claims are minimal.
o Courts direct leftover funds to organizations that indirectly benefit the
class (e.g., public interest groups).
 Ensures the funds still serve the lawsuit's intended purpose.
 Example: Consumer fraud case may direct unclaimed funds to a consumer
protection non-profit.
Nominal Damages
 Recognition of Rights – acknowledges a legal violation even without financial
loss
 Precedent and Deterrence – records wrongdoing, deterring future violations
 Access to Attorneys’ Fees – in some statutes, prevailing with nominal
damages triggers fee recovery
 Gateway to Injunctive/Declaratory Relief – enables broader remedies beyond
money
Why Litigate for $1?
 Principle – rights matter even without measurable damages
 Future Impact – liability finding shapes future behavior of defendants
 Leverage – attorney’s fees may be awarded despite minimal damages
 Symbolic Value – demonstrates that rights are worth defending
 Example: Uzuegbunam v. Preczewski (2021) – Supreme Court held a $1 claim
can vindicate constitutional rights
Proving Damages
 To recover damages, plaintiffs must prove both the existence and the extent
of harm.
 Economic damages: Require clear documentation (bills, pay stubs, expert
testimony).
  Non-economic damages: Often supported through witness accounts, expert
reports, and evidence of life impact.
 Punitive damages require proof of defendant’s state of mind and outrageous
nature of the conduct.
Proving Pain and Suffering in Court
 Types of Non-Economic Damages:
o Pain and Suffering: Physical discomfort from the injury.
o Emotional Distress: Psychological impact such as anxiety, depression,
PTSD.
o Loss of Enjoyment of Life: Inability to participate in activities that once
brought pleasure.
 How Plaintiffs Prove These:
o Testimony: Plaintiff’s own account of pain, mental health, daily
limitations.
o Medical Evidence: Doctor notes, therapy records, diagnoses (e.g.,
depression).
o Witness Testimony: Friends/family describe changes in behavior or
lifestyle.
o Documentation: Journals, photos, videos illustrating life before and
after injury.
o Expert Testimony: Psychologists, vocational experts, or life-care
planners explain the extent and impact of loss.
 Key Point: Non-economic damages require credible, consistent evidence that
conveys the subjective experience of suffering and its impact on quality of
life.
Penalties for Overclaiming Harm in Tort Litigation
 The tort system provides some adversarial mechanisms (like discovery and
cross-examination) to police exaggeration and encourage truthful claims.
 The absence of criminal or formal sanctions, however, perhaps reflects the
difficulty of proving intentional misrepresentation and strategic
overstatement.
Adversarial System and Scholarly Perspective
 The tort system relies on adversarial checks like discovery and cross-
examination to prevent exaggeration.
 While formal penalties are rare, systemic mechanisms promote truthfulness.
 Most overstatements are handled within the litigation process rather than by
criminal or civil sanctions.
Legal Penalties for Overclaiming Harm
 Cross-Examination and Credibility: Jury or judge may reduce or deny
damages if exaggeration is detected.
 Sanctions for Frivolous Claims: Rule 11 sanctions include fines, legal fees,
and case dismissal.
 Perjury Charges: Rare but possible if a plaintiff lies under oath during
litigation.
 Loss of Insurance Coverage: Claims may be denied or investigated for fraud.
 Civil Liability: Extreme misrepresentation may lead to counterclaims for fraud
or abuse of process. But rarely metered out – difficult to make it stick.