Update: Giving the state a share of punitives

by Walter Olson on October 24, 2006

Remember the legislation proposed in California by Gov. Arnold Schwarzenegger (Jun. 2, 2004), and passed amid much hoopla, asserting a claim by the state to 75 percent of punitive damage awards? It’s raised “not even a penny” for the state’s Public Benefit Trust Fund, reports John Howard for Capital Weekly (“Behind-the-scenes shell game marked punitive-damages plan”, Sept. 7). This is pretty much what I predicted in my WSJ op-ed at the time; it’s just too easy for lawyers to escape the law’s reach by settling cases before final judgment (if necessary, characterizing the sums that change hands as compensatory only). Decs and Excs Sept. 20 also points out peculiarities in the law’s specified time span of coverage that would have encouraged evasive action. Schwarzenegger has now vetoed a renewal of the law, but on grounds that the renewal had been saddled with amendments added without adequate discussion; he left the door open to reconsider the issue next year.

{ 2 comments }

1 Tom T. 10.24.06 at 12:56 am

Does anyone track aggregate punitive damage awards, either nationally or by state? How much tends to get awarded as punitives in a given year?

2 J.T. Wenting 10.24.06 at 11:16 am

A good idea even if poorly executed.
In lieu of stopping ambulance chasers the next best thing is to tax them into submission.
If there are no more billions to be made extorting others, maybe they’ll stop.

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