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Punitive Damages

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  1. What are punitive damages for?
  2. How should punitive damages be computed?
  3. Are punitive damages 'out of control'?
  4. On what principles do courts rely in awarding punitive damages?
  5. What other principles could help the courts determine the amount of punitive damages?
  6. What factors are relevant when computing punitive damages?
  7. Conclusion: What about de-coupling?
  8. Bibliography

Although there is a debate over the purpose of punitive damages, it is generally admitted that their main goals are to deter and to punish wrongdoers : ?punitive damages are designed to punish a defendant for grossly inappropriate actions and, in doing so, to deter future such actions by signaling that their consequences can be severe?

[...] It is often said that punitive damages awards are increasing both in amount and in frequency[11], that they are unpredictable and hence that they ?provide an uncertain and unstable foundation for law?[12]. An adverse consequence of this unpredictability is the externalization of risk by companies : critics of the current system point out the fact that due to the fear of punitive damages, firms tend to hire independent contractors to undertake risky tasks. This evolution causes both more accidents and less economic efficiency[13]. [...]


[...] According to Sebok, A., punitive damages should be seen as a ?private retribution?, not as a deterrent[21]. This conception implies that the courts could determine the amount of punitives by simply looking at the reprehensibility of the defendant's conduct in order to fix the amount of damages. This approach has the benefit to be consistent with what actually happens in courts nowadays, while theorizing it. Chanenson, S. And Gotanda, J. also insist on the fact that the third guidepost enacted by the Supreme Court in BMW of North America, Inc. [...]

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