Due Process Limitations on Punitive Damages: Why State Farm Won't Be the Last Word

Part I of this article will trace the development of the evolving principles and requirements the Court is imposing on state awards of punitive damages, identifying notable undercurrents within the Court regarding this new and expanding application of the Due Process Clause. Part II will present a detailed analysis of State Farm Mutual Automobile Insurance Co. v. Campbell, which represents the Court’s most ambitious attempt yet to provide guidance to states on how to approach the imposition of punitive damages and how to assess the appropriate size thereof. Finally, Part III of this article will examine recent lower court cases involving contested punitive damage awards as a means to identify and discuss several important issues left unresolved by State Farm. These issues include the relative significance of the “reprehensibility” factors, determining the appropriate ratio of punitive to compensatory damages, the relevance of a defendant’s wealth in calculating punitive damages, and the aggregate punishment problem.