By Jim Wren

Excerpted from Proving Damages to the Jury

§19:70 What Is the Danger?

Punitive damages aren’t necessarily governed by the extent of actual damages. Punitive damages are instead designed to confront (i.e., punish and deter) the degree of danger posed by the defendant’s conduct. The point has been illustrated by the Supreme Court:

“For instance, a man wildly fires a gun into a crowd. By sheer chance, no one is injured and the only damage is to a $10 pair of glasses. A jury reasonably could find only $10 in compensatory damages, but thousands of dollars in punitive damages to teach a duty of care.” [TXO Production v. AllianceResources, 509 U.S.443, 459 (1993).]

Without regard to how bad the damage was, how bad could it have been? In other words, how dangerous was the defendant’s conduct?

This point has to be clearly demonstrated to the jury. Often, the best way to do that is through admissions obtained from defense witnesses during depositions. For example: “You would agree that [this kind of conduct] could possibly cause [and give examples of very bad consequences]?”

§19:71 What Did the Defendant Know About the Danger?

Often the answer to this question is obvious because the danger is obvious, but in many cases it’s not. That’s where discovery of prior incidents or complaints or claims becomes crucial.

Knowledge of danger readily available within the industry can suffice, because as long as the defendant knows that there is some risk involved, a defendant shouldn’t be allowed to choose to stay willfully ignorant.

The degree of danger combined with a demonstration of the defendant’s knowledge of the danger is a big part of showing the reprehensibility of the defendant’s conduct. Remember, “Perhaps the most important indicium of the reasonableness of a punitive damages award is the degree of reprehensibility of the defendant’s conduct.” [BMW of North America, Inc. v. Gore, 517 U.S. 559, 575 (1996).]

In discovery, work to get admissions from defense witnesses regarding the knowledge of danger.

§19:72 What Standards Should Have Guided the Defendant’s Response to the Danger?

This is possibly the category of discovery least understood by many plaintiff attorneys, and yet it is the category with the greatest potential to custom frame the case to match the facts.

The most powerful questions in a case are those for which the jurors already “know” the answers based on common sense and life experience. Therefore, the most powerful “standards” are those that jurors already understand and believe to be true without resort to a technical rulebook from the government or industry. But, too often attorneys focus on just “technical” standards as if those are the only ones that count. Technical standards are often helpful, but a standard that has to be proved by reference to a technical publication is not nearly as strong or persuasive as a standard that jurors accept as obvious common sense.

Before starting discovery, articulate (for yourself) the standards that would have avoided the danger and therefore should have guided the defendant, but which were instead violated by the defendant. This then tells you the admissions about standards which you’ll be seeking to obtain in discovery.

Choosing the standards you want to focus on in discovery is something akin to writing your own rules for a game when you were a kid: you pick the ones that fit your strengths. As an example, in a trucking fatality case in which the driver failed to see a car in his blind spot before changing lanes, one of the “standards” focused on in discovery might be: “A professional driver must not needlessly endanger the public by holding and talking on a cell phone in high-speed traffic.” There would of course be several more standards directed to the company’s responsibility to train its drivers and hold them accountable. [See Rules of the Road by Rick Friedman and Patrick Malone (2006); and Reptile by David Ball and Don Keenan (2009).]

The following are key characteristics of a valid rule or standard:

  • It must prevent the identified danger.
  • It must protect people in a wide variety of situations, not just someone in your client’s position.
  • It must be in clear English.
  • It must explicitly state what a person [or company] must or must not do.
  • It must be practical and easy for someone in the defendant’s position to have followed.
  • It must be one the defendant has to agree with — or reveal himself as stupid, careless, or dishonest — because the jury will naturally agree with it.
  • It must be one that was violated in this case due to the defendant’s conscious choice to ignore it or violate it.

[David Ball & Don Keenan, Reptile, Ch. 6: “Safety Rules and the Reptile” (Balloon Press 2009).]

§19:73 Did the Defendant Consciously Violate Those Standards?

Inadvertent violations of standards won’t support punitive damages. The conduct must be intentional (meaning that the consequences were intended, not just the act) or at least reckless (meaning that the defendant acted with conscious disregard of the danger to others).

But what may at first look like merely inadvertent conduct can have a very intentional basis if you trace actions and decisions further back in time.

To use our example of the truck driver changing lanes without seeing another driver in his blind spot: Is the conduct intentional or inadvertent? The truck driver (and his employer) certainly didn’t intend to collide with or kill the other driver. But, as we step backwards through the chronology, there were conscious choices being made: the choice by the truck driver to talk on a handheld cell phone despite the danger, and the choice by the trucking company not to install a hands-free device in the cab to avoid the danger.

Pursue questions about what actions the defendant took to investigate known dangers and to prevent or warn against those dangers. Compare the extent of effort the defendant put into prevention with the extent of effort the defendant has put into denial of liability. Based on the respective levels of effort, does the defendant appear to place greater value on safety of people or on preservation of assets?

§19:74 Why Did the Defendant Consciously Violate Those Standards?

Motive is always important. Until jurors know why someone did something, they often don’t really know whether or not to believe it, and they certainly don’t know how to feel about it. Going back to the importance of reprehensibility, the question of “why” is fundamental to the assessment of punitive damages.

As a basic rule, follow the money. Nine times out of ten there is a money motive at work somewhere. But in the process of looking for it, don’t make either of two common mistakes:

  • Don’t simply allege “profits over people” without doing the discovery and being prepared to back up that claim with specifics.
  • Don’t make the mistake of treating a “profit motive” as something inherently evil. It’s not; our society is built on it, and jurors are not generally predisposed to bash businesses just because they want to generate a profit for their owners. However, there is a crucial difference between a fair profit, made within the rules that are designed to protect people, and an unfair profit that seeks to take advantage of employees, the public, and of other businesses that are operating within the rules.

When jurors see that it’s not a case of a plaintiff against the business world, but instead is a case of a rogue business against all of society, the dynamics of trial change.

Pay particular attention to a high volume of predatory transactions built on the reality that very few people will detect or be in a position to legally challenge the underlying bad conduct. A defendant may be counting on the fact that only one in ten thousand consumers will recognize and challenge predatory conduct. In the defendant’s internal accounting, if one plaintiff sues, so what? Expose that profit motive, and jurors will be far more inclined to use punitive damages to deter. [See §19:52 for discussion of the optimal deterrence model available for use in direct response to this profit motive.]

§19:75 What Has the Defendant Done Since?

In a punitive damages case, the defendant’s conduct after the injury is relevant to the issues of proper punishment and adequate deterrence. Lack of remorse or change by a defendant figures into the assessment of those factors.

Has the defendant made any effort (outside of privileged settlement negotiations which are only made to eliminate further liability) to rectify any wrong or to ease the plaintiff’s suffering? Has the defendant continued to insist that its actions were proper and/or continued to blame the plaintiff? Has the defendant refused to make any changes which might prevent another future occurrence?

Even if the defendant has admitted fault, when did that admission come — in the last weeks or days before trial, in anticipation of finally facing a jury?

In a good punitive damages case, the most aggressive defense tactics only make the plaintiff’s case better. Welcome the defendant’s aggressive allegations and defenses against the plaintiff. Those aggressive positions are often gifts to be used with the jury.

§19:76 What Will Make a Difference for the Future?

In the end, deterrence is the greatest legal justification for punitive damages. The U.S. Supreme Court has repeatedly expressed concern about excessive punishment. It has cautioned against overemphasis on the wealth of the defendant as a factor in determining punishment, and has stated that the amount of punitive damages may not be used to punish a defendant for its conduct toward people other than the plaintiffs in the case. These concerns are directed against fear of an overwrought desire of jurors to mete out punishment for past acts. However, deterrence stands on a different footing. Deterrence is forward-looking, intended to protect rather than to punish.

It is important to understand that the same evidence which may be suspect when presented to justify punishment is appropriate for consideration when offered for deterrence.

For example, consider fraudulent advertising directed to millions of consumers across the United States. The effect of the fraudulent advertising on millions of non-parties to the case should not be considered by the jury in determining the proper punishment for the wrong committed against the plaintiff. [See Phillip Morris USA v. Williams, 549 U.S.346, 127 S.Ct. 1057, 166 L.Ed.2d 940 (2007) (discussed in §19:17).]

On the other hand, if the defendant is deriving an average illicit profit of $10 per customer through deceptive advertising, is the defendant going to be deterred by one plaintiff out of several million consumers? The answer is no, unless the punitive damages assessment is large enough to take the profit out of the entire series of transactions.

Therefore, while evidence of reprehensibility is being developed based on the answers to the first six questions in this subsection, shift the focus in this seventh question from punishment for reprehensibility to deterrence for protection. For this part of discovery, look forward to what it will take to adequately deter, rather than backward to what it will take to adequately punish the defendant. [See §19:52 for discussion of the optimal deterrence model specifically designed to address the issue of deterrence.]

Jim Wren is a trial lawyer – with more than 30 years of trial experience – and a Baylor law professor. He is board certified nationally in Civil Trial Advocacy by the National Board of Trial Advocacy, and by the State of Texas in both Personal Injury Trial Law and Civil Trial Law. He was named as a Texas Super Lawyer each year from the origination of the designation in 2003 through 2007, when he was recruited to the Baylor Law Schoolfaculty as a professor teaching trial procedure and advocacy. Although he now teaches on a full-time basis, he continues to represent a limited number of clients in courts across the nation.

Jim has served as a board member of the National Board of Trial Advocacy and of the Texas Trial Lawyers Association, and as national president of the National Board of Legal Specialty Certification (2009-2011). He has also served as chapter president of the American Board of Trial Advocates (ABOTA).

Jim graduated with a J.D. cum laude from Baylor Law School in 1980, and subsequently added an M.A. in International Relations from the Universityof Kent at Canterbury. He is also a graduate of Trial LawyersCollege in Dubois, Wyoming.