by Eric Turkewitz
We once again see a whopping punitive damages verdict and need to discuss: Just how much is too much? For the reasons that follow, I think that a ratio of punitive:compensatory damages of 100:1 or greater are sustainable based on current opinions from the Supreme Court.
At issue for the moment is a $9 Billion punitive damage award against Japan’sTakeda Pharmaceutical and Eli Lilly this week. The case concerned the diabetes drug Actos, and the manufacturer’s failure to warn that it increases the chances of bladder cancer. There was also a $1.5M compensatory damage award.
The punitive award spanking was no doubt influenced by the defendants’ destruction of documents. Juries tend to hate it when people destroy important documents.
It isn’t my objective to analyze the details of the trial, which I did not follow, only to go back and try to forecast what the judge might do with the punitive damage award, and more importantly, what the appellate judges will do if the matter doesn’t settle.
But there really isn’t a straight answer. In the most significant Supreme Court ruling on the subject, State Farm v. Campbell, the majority opinion by Justice Kennedy gave three conflicting statements on the subject. He cited first, for instance, to the older case of BMW v. Gore, that:
[W]e concluded that an award of more than four times the amount of compensatory damages might be close to the line of constitutional impropriety**********
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