National Law Journal: Downward Trend in Tort Awards and Punitive Damages

February 21, 2005

The National Law Journal reported Monday that, even as legislative tort reforms advance, an analysis of the 100 largest jury verdicts of 2004 indicates that the size of damage awards, particularly punitive damages against large corporations, appears to be headed downward.

Based on analysis of data compiled by VerdictSearch, the NLJ reveals that both the total amount awarded by juries for all top 100 verdicts and the amount of the largest award of last year declined significantly over the previous three years.

In addition, the ratio of punitive to compensatory damages also declined significantly. But, experts disagree on whether the desire of juries to punish corporations and “send a message” has peaked. These trends are reported in a special section in today’s issue of The National Law Journal and selected results are also online at

“Based on data trends over the past four years, it appears that the anger towards large corporations expressed by jury verdicts may be subsiding in these very large cases, but jurors continue to react strongly to circumstances in individual trials,” said Rex Bossert, editor in chief of the NLJ. “The awards trend may also reflect the Supreme Court’s 2003 State Farm Insurance decision that sought to bring punitive awards back into balance, as well as efforts by attorneys to avoid fueling awards of large punitive damages which are later reduced on appeal.”

For all 100 verdicts, jurors awarded a relatively modest $11.1 billion last year, compared with a $12.1 billion total in 2001, $40 billion in 2002 (most of it attributable to one verdict), and $20.1 billion in 2003 (all inflation-adjusted). The top award– a $1.6 billion verdict against Southwestern Life Insurance Co. for fraud– was considerably lower than the $11.9 billion top award in 2003, $28 billion in 2002 and $3 billion in 2001.

It also appears that huge punitive damage awards may be headed back to earth. In 2004, the median verdict ratio of punitive to compensatory damages dropped to 0.7-to-1, compared with a 1.6-to-1 median ratio in 2003, a 4.4-to-1 median ratio in 2002 and a 3-to-1 median ratio in 2001.

According to one expert, the VerdictSearch data are consistent with a Bureau of Justice Statistics sample from state courts in 1992, 1996 and 2001.

Neither data set shows signs of rising awards, despite politically charged debates on the subject.

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