Academic journal article Defense Counsel Journal

Punitive Damages Should Be Reviewed De Novo

Academic journal article Defense Counsel Journal

Punitive Damages Should Be Reviewed De Novo

Article excerpt

Current Decisions

DAMAGES

De novo is the proper standard of review of punitive damages awards, the U.S. Supreme Court held in Cooper Industries Inc. v. Leatherman Tool Group Inc., 121 S.Ct. 1678 (2001), resolving a conflict among the circuits.

A federal court jury found Cooper Industries guilty of passing off, false advertising and unfair competition, and it awarded Leatherman Tool Group $50,000 in compensatory and $4.5 million in punitive damages-a ratio of 90 to 1. Cooper argued that the punitive award was "grossly excessive" within the parameters set by the Supreme Court's decision in BMW of North America Inc. v. Gore, 517 U.S. 559 (1996). The court rejected this contention, and the Ninth Circuit, reviewing only for an abuse of discretion, affirmed in an unpublished opinion. 205 F.3d 1351 (1999).

Writing for the Supreme Court, Justice Stevens recognized that in Gore, the Court placed due process constitutional limitations on punitive damages awards. He analogized the imposition of punitive damages to criminal cases and pointed out cases in which the standard of review was de novo because the judicial determinations below were "grossly disproportionate" to the gravity of the offense. …

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