Assessing Punitive Damages (with Notes on Cognition and Valuation in Law)

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CONTENTS

I. INTRODUCTION: ARBITRARINESS, UNPREDICTABILITY,

AND VALUATION PROBLEMS

A. Two Goals

B. Shared Outrage and Erratic Awards

II. DETERRENCE, RETRIBUTION, AND THE CONSTITUTION

A. The Goals of Punitive Damages

1. Deterrence

a. Conventional Arguments

b. Puzzles and Problems with the Deterrence Justification

2. Retribution

B. The Constitution and Punitive Damages

1. Substantive Versus Procedural Interpretations of Unconstitutional

Punishment

2. Leading Cases

3. The Need for an Understanding of Jury Variability To Inform

Constraints on Punitive Damages

III. WHY PUNITIVE DAMAGE AWARDS ARE ERRATIC

A. Shared Outrage

B. Hypotheses

C. Results

1. Shared Outrage

2. Unpredictable Dollar Awards

3. The Effects of Context, Harm, and Firm Size

D. Discussion

1. The Underlying Problem: "Scaling Without a Modulus"

2. A Simple Way. To Improve Predictability

IV. POLICY REFORMS: COMMUNITY JUDGMENTS WITH MEANING

AND WITHOUT NOISE?

A. Preliminary Observations on Limitations and Reform

1. Experiments and the Real World

2. Anchors and Their Effects

3. The Rule of Law and How To Obtain (and How

To Obtain) Its Virtues

4. Deterrence and Retribution

B. Punitive Damages Reform

1. Predictable Populism: Community Judgments

About Dollars

a. Administrative Issues

b. Two Phases

c. Using Scenarios and Cases: A Note on

Existing Practice

2. Technocratic Populism: Using Punitive Intent

but Not Dollars

a. Phase One: The Jury's Role

b. Calibration and Phase Two: Translating Jury

Judgments into Dollars

3. Civil Sentencing and Bureaucratic Rationality:

The Partial or Complete Elimination of Juries

4. Evaluating the Alternatives: The Proposed Reforms,

Caps, and Multipliers

V. IMPLICATION, EXTENSIONS, AND SPECULATIONS

A. Difficult Damage Determinations

1. Pain and Suffering

2. Libel

3. Intentional Infliction of Emotional Distress and

Sexual Harassment

4. Compensatory Versus Punitive Damages:

General Considerations

B. Other Valuation Problems

1. Regulatory Expenditures

2. Prison Terms

3. Contingent Valuation

VI. CONCLUSION

APPENDIX A: EXPERIMENTAL DESIGN

A. Sample and Procedure

B. Design and Stimuli

APPENDIX B: EXCERPTS FROM INSTRUCTIONS

APPENDIX C: PERSONAL INJURY SCENARIOS

APPENDIX D: TABLES

I. INTRODUCTION: ARBITRARINESS, UNPREDICTABILITY, AND VALUATION PROBLEMS

A. Two Goals

This Article has two goals. The first is to investigate the sources of arbitrariness and unpredictability in punitive damage awards. On the basis of responses from 899 jury-eligible citizens, we estimate the results of deliberations consisting of all white juries, all African-American juries, all female juries, all male juries, all wealthy juries, all poor juries, and juries of widely diverse degrees of age and education.

Our principal conclusions, stated briefly,(1) are that at least in the personal injury cases studied here, people's moral judgments are remarkably widely shared, but that people have a great deal of difficulty in mapping such judgments onto an unbounded scale of dollars. Shared moral judgments but erratic, unpredictable, and arbitrary awards, possibly even meaningless awards, are a potential product of this difficulty. …