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Member, Beacon International Group, Ltd.
Main points in the U.S. Supreme Court ruling in Philip Morris USA vs. Mayola Williams:
At issue
1. Whether in reviewing a jury's award of punitive damages, an appellate court's conclusion that a defendant's conduct was highly reprehensible and analogous to a crime can "override" the constitutional requirement that punitive damages be reasonably related to the plaintiffs harm.
2. Whether due process permits a jury to punish a defendant for the effects of its conduct on nonparties to a lawsuit.
The decision
The Supreme Court held that a jury can take into account actual harm to nonparties when determining the reprehensibility of a defendant's conduct, but it cannot go further and use punitive damages to punish the defendant for harm caused to nonparties. The court did not decide whether punitive damages levied against Philip Morris were excessive, and sent the case back to the Oregon Supreme Court for further consideration.
Source: U.S. Supreme Court