Court Upholds Punitive-Damage Awards

THE Supreme Court upheld the legality of multimillion-dollar punitive-damage awards that have forced some companies to raise product costs and insurance premiums in anticipation of liability suits. The court, in a 7-to-1 decision, ruled March 4 that often massive monetary jury verdicts intended to punish and deter wrongdoers in civil suits are not barred by the due-process clause of the Constitution.

The court said punitive damages can be deemed excessive in some instances and that guidelines in determining damage amounts are necessary. But the role of deciding whether awards are too great will remain largely that of appellate courts on a case-by-case basis.

Last term, the court said such jury awards were not prohibited by the Eighth Amendment provision against excessive fines. It had left open, however, the possibility that excessive fines could violate the due-process clause of the 14th Amendment.

Michael Maher, president of the Trial Lawyers of America, called the ruling a ``major victory for American justice,'' and said it means juries can ``continue to make the punishment fit the crime.''

In an opinion written by Justice Harry Blackmun, the court ruled that while courts should have guidelines in setting punitive-damage figures, there should be no national cap on the amount of the awards.

In dissenting, Justice Sandra Day O'Connor said the court should have issued specific guidelines juries could follow in determining awards.