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How the Supreme Court's Recent Punitive Damages Decisions Affect Class Actions



New paper on SSRN by Sheila B. Scheuerman of the Charleston School of Law (via):

This article examines the intersection between two controversial areas of the law - punitive damages and class actions - and argues that the Supreme Court's recent jurisprudence clarifying the due process limits on punitive damages has broad implications on the procedural laws governing the types of cases that can properly be certified as a class action. Specifically, the article discusses the Supreme Court's evolving approach to punitive damages from one that considered the harm a defendant's conduct caused to society as a whole to one that now focuses almost exclusively on the harm to the specific individual bringing the lawsuit. This shift, which recently culminated in the Court's 2007 decision in Philip Morris USA v. Williams, constitutionally requires that the amount of a punitive damages award relate to the amount of harm suffered by the party bringing the suit. That requirement is at odds with class action practices that treat punitive damages as a common, class-wide issue and that have allowed juries to assess a punitive damages award before evaluating the harm to the individual class members. The article argues, therefore, that where injuries are not uniform among class members, punitive damages cannot be pursued as a class-wide remedy.

This is similar to the point made by Beck and Herrmann and Marc Moller, but ostensibly different: Scheuerman claims she is arguing for a narrower view than Beck and Herrmann do, but never delivers on her footnoted promise to address the argument in Part III of her paper.

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Isaac Gorodetski
Project Manager,
Center for Legal Policy at the
Manhattan Institute
igorodetski@manhattan-institute.org

Katherine Lazarski
Press Officer,
Manhattan Institute
klazarski@manhattan-institute.org

 

Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.