On the eve of St Louis being named by the American Tort Reform Association as the number one 'Judicial Hellhole' in the country, juries in Jackson County – home to Kansas City – staked their own claim to that dubious distinction by returning two staggering punitive awards on consecutive days:
- On December 8 2016, a jury awarded a former Orkin worker $120,892 in compensatory damages and $10 million in punitive damages (a punitive to compensatory ratio of more than 82:1) for allegedly discriminatorily terminating him because of his age and disability.
- On December 9 2016, a jury awarded a former manager at American Family Insurance $450,000 in compensatory damages and $20 million in punitive damages (a punitive to compensatory ratio of more than 44:1) for alleged retaliatory discharge and age and sex discrimination.
The punitive awards in these cases may be reduced to the 5:1 maximum set by Section 510.265 of the Missouri Revised Statutes. Although the Missouri Supreme Court has held that this cap provision is unconstitutional as applied to causes of action that pre-date the enactment of the Missouri Constitution in 1820, it seems self-evident that the statutory employment and discrimination claims in these cases do not pre-date the 1820 Constitution. Nonetheless, given the predilection of the Missouri courts to thwart legislative tort reform, it is uncertain whether they will apply the cap in these cases.
Either way, both defendants appear to have strong arguments that even a 5:1 ratio of punitive to compensatory damages would be unconstitutionally excessive. The Supreme Court held in State Farm that "[w]hen compensatory damages are substantial", a 1:1 ratio "can reach the outermost limit of the due process guarantee".
Six-figure compensatory awards are undoubtedly 'substantial', and the facts in these cases do not stand out as being so reprehensible as to warrant deviation from the 1:1 presumption established in State Farm.
For further information on this topic please contact Evan M Tager at Mayer Brown LLP by telephone (+1 202 263 3000) or email ([email protected]). The Mayer Brown International LLP website can be accessed at www.mayerbrown.com.