The financial awards given to a plaintiff following a civil trial are referred to as “damages.” Many are unaware that there are very specific rules about the types of damages and amounts that are awarded in each individual case. Far from a “free for all,” if a judge or jury finds a defendant liable in any case, they will conduct detailed analyses to determine the proper damage award. Attorneys will often provide separate arguments explaining the types of awards that should be given and provide specific information explaining why they are requesting certain dollar amounts.
Most damages are “compensatory.” That means that they are tied to very specific harms suffered by the plaintiff. Economic damages are those traced to financial losses of the plaintiff (i.e. lost wages, medical expenses). Non-economic damage refer to those losses that are not tied to a specific dollar amount (i.e. pain and suffering). Non-economic damages are still compensatory, however, because they are traced to a very real harm suffered by the plaintiff.
Alternatively, “punitive” damages are those which are not tied to the losses of a plaintiff. Instead, they are given solely to punish the defendant. Punitive damage awards are those that usually make newspaper headlines, because they can be sizeable. However, they are not just ad hoc judgments made on a whim. Instead, they are awarded for very specific reasons, when defendant conduct is outrageous and financial penalties are seen as the only method of ensuring changes so that the defendant never engages in that conduct again–and other similarly situated defendants learn of the decision and also make changes to ensure they do not act in the same manner.
Nursing Home Punitive Damages
Recently, as discussed in the Sacramento Bee, a jury awarded significant punitive damages in a nursing home neglect case. The case revolved around the death of an 82-year old nursing home resident. The woman was taken to the hospital after suffering serious harm as a result of several bed sores. Evidence at trial suggested that caregivers at the facility knew of the sores and told others to keep them secret, because of the adverse financial consequences for the facility. The jury in the case, after hearing the evidence, found that the facility’s poor care was responsible for the senior’s death.
In a separate damage phase of the trial (after liability was already established), the jurors admitted that they were shocked by the defendant (a large nursing home conglomerates) seeming refusal to devote sufficient resources to proper care. This was made all the worse when the jurors learned of the company’s financial situation. The defendant have revenues last year alone of over $1.5 billion, with raw profits of $116 million. Despite all of this, they paid no income taxes the last three years. The picture was painted of the large assisted-living company’s focus on more mergers and acquisitions in an effort for increase revenues. The care of the residents depending on reasonable care seemed secondary.
That is why the jurors eventually reached a punitive damage verdict in the amount of $23 million. These damages were intended to punish the facility for its egregious system-wide conduct. After all, if the company had no financial incentive to shape up, why would it?
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