Despite recent efforts by special interests to cap punitive damages, the fact remains that they are perhaps the best and only shield the general public has against egregious and unsafe actors.
According to an Associated Press article reprinted on CNN.com, a New Mexico Appellate Court recently upheld a jury verdict of almost $15 Million dollars in compensatory and punitive damages against a Natural Gas Company. The trial court jury originally found that Energen Resources Corporation had acted recklessly in leaving a natural gas well head exposed and unprotected in an area known to be frequented by young people and off road enthusiasts. While out “off-roading,” the plaintiff inadvertently backed his car into the well head causing a fire that took his life. The jury found Energen’s conduct to be reckless in that they knew of the danger posed by the wellhead but did little to prevent an accident like this from happening.
Energen’s appeal focused on its argument that the jury award, which included $13 million dollars in punitive damages was unreasonable and thus unconstitutional. The appellate court disagreed and upheld the jury’s finding. The court saw little problem with a punitive damages award that achieved “dual goals of punishment and deterrence.”
Punitive damages are often cast in a negative light, and maybe that reputation is sometimes deserved. However, this case shows that punitive damages when used properly can serve as a powerful deterrent against irresponsible conduct.