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DUKE UNIVERSITY NEWS
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FOR IMMEDIATE RELEASE: Thursday, Oct. 26, 2006

CONTACT: Frances Presma
(919) 613-7248
presma@law.duke.edu

NEWS TIP: Empirical evidence proves juries behave “rationally” when making punitive damage awards, Duke Law professor says

Note to editors: Neil Vidmar can be reached for additional comment at (919) 613-7090 or vidmar@law.duke.edu.

Juries behave rationally and deliberately when they make large punitive damage awards, says Duke University law professor Neil Vidmar.

Vidmar, who conducts empirical studies on the legal system, including the subject of punitive damages, is the principal author of an amicus brief filed in the case of Philip Morris USA v. Mayola Williams, which is scheduled for argument in the U.S. Supreme Court on Oct. 31. His brief has been endorsed by 23 other academics who also study jury awards.

In the pending case, Philip Morris is challenging an Oregon jury’s award to a smoker’s widow of more than $79 million in punitive damages on top of a compensatory damage award of $500,000, arguing that it is grossly excessive and a violation of due process. The cigarette maker is asking the Court to raise the standard for assessing punitive damages but, according to Vidmar, no such additional federal standards should be imposed on state punitive damages laws.

Vidmar said that underlying Philip Morris’s challenge is a false assumption that juries are “out of control” in awarding punitive damages and that judges are not properly scrutinizing the awards. Empirical evidence “on what juries actually do” tells a different story, said Vidmar, the Russell M. Robinson II Professor of Law and professor of psychology at Duke. 

“What we concluded from the data is that contrary to the myths that juries are out of control and the awards are increasing, that it’s just not true. Punitive awards have not increased in frequency, and especially when you adjust for inflation, they have not increased in magnitude over the years.” One study cited in his brief estimated that only about one in 1,000 cases involve punitive damages and that when juries award compensatory damages, they give punitive damages only about 5 percent of the time. Vidmar observed that the occasional “blockbuster” cases in recent years have often involved businesses suing other businesses.

Punitive damages are intended to address societal damage for purposes of deterrence and retribution for bad behavior, Vidmar points out, citing the Supreme Court’s recent decisions in BMW v. Gore and State Farm v. Campbell. “The Supreme Court has said the primary criterion for punitive damages is ‘reprehensibility.’ When you look at the facts of this case, what the tobacco companies knew [about the addictive and cancer-causing properties of nicotine] and what they continued to do, you can’t help but come away with the conclusion that this was reprehensible behavior.

“What the jury in Oregon was told to do was to look at all the facts and apply them only to Oregon -— to decide what impact it had on that state. That’s how the jurors came up with the award.”

Oregon, like other states, instructs judges to scrutinize jury awards for rationality and proportionality, Vidmar said, noting that the Oregon Supreme Court has affirmed the $79 million punitive damage award -— twice. In fact, he said, studies show that trial judges and juries consider cases in similar ways, basing their decisions on their perceived reprehensibility of defendants’ behavior and making similar awards. 

Vidmar’s own study of Florida jury awards involving punitive damages, conducted with Mary Rose, an assistant professor of sociology and law at the University of Texas at Austin, indicated juries were “discriminating” in basing punitive damage awards on the reprehensibility of a defendants’ conduct. “When they make a big award, they intend to,” Vidmar said. “Juries are far more sophisticated than critics from the business community claim they are; they are very careful about what they do.” 

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