UPDATE: Punitive damages cap fails in Senate

CHARLESTON – A state Senate bill that would have capped punitive damages in civil lawsuits has been voted down.

On Wednesday, two Republican state senators voted with the Democrats on the 18-16 vote.

Senate Bill 421 would have capped the punitive damages in civil lawsuits at $500,000 or three times the compensatory damages, whichever amount was greater.

Sens. Chris Walters (R-Putnam) and Daniel Hall (R-Wyoming) sided with the 16 Democrats, one of the few legal reforms that haven't been pushed through successfully by the controlling party this session.

The West Virginia Association for Justice applauded the defeat of the proposal, saying it would have limited punitive damages against corporations for reckless or intentional wrongdoing that harmed state residents and small businesses.

“Punitive damages are the only way corporations can be held accountable when their reckless or intentional wrongdoing hurts an individual or harms a West Virginia small business," WVAJ President Anthony Majestro said. "They are reserved for only the most egregious conduct — fraud, abuse of vulnerable citizens like children and the elderly, intentionally endangering workers or theft of intellectual property or trade secrets.

"Corporations can’t go to jail.  Punitive damages ensure that they can be held accountable for their misconduct."

“When corporations know that they will be held accountable in our courts and pay significant punitive damages for their misconduct, they are more likely to act responsibly.  This disappears if the damages are so low that they’re like a slap on the wrist.  Big corporations like General Motors, Allstate and Pfizer are worth billions.  Some, like GM, even factor in possible punitive damages into its ‘cost of doing business.’

"Punitive damages should at minimum remove any profit the company received from its misconduct as well as an additional amount high enough to make sure it doesn’t happen again.  The punishment has to fit the crime—if it doesn’t, it’s like receiving a $5 ticket for driving 30 miles over the speed limit.  When the penalty doesn’t make you think twice, you don’t care. ”

Majestro also commended Hall and Walters for deciding "to put their constituents first and crossed party lines to vote with Senate Democrats.  Their courage today ensures that we are all safer and that we can hold corporations accountable in our courts.”

He also thanked Sen. Jeff Kessler for remarks he made about the bill.

“Bills like 421 impose arbitrary caps that restrict the role of juries and limit their ability to impose meaningful damage awards that discourage future bad behavior," Majestro said. "None of us would stand by if our 1st or 2nd Amendment rights were restricted or ‘capped.’  We need to follow Senator Kessler’s lead and be as vigilant about the 7th.”