The Foggy Road for Evaluating Punitive Damages: Lifting the Haze from the BMW/State Farm Guideposts

In this Article, Professors Chanenson and Gotanda propose that courts treat comparable maximum criminal or civil legislative fines as a presumptive due process limit on punitive damage awards. The Article reviews the manner in which courts have implemented the three-guidepost framework for constitutional review of punitive awards laid out by the Supreme Court in BMW of North America, Inc. v. Gore and in State Farm Mutual Automobile Insurance Co. v. Campbell. Finding that courts have struggled to articulate a coherent rationale and methodology for review of such awards, the authors propose a greater reliance on the third guidepost of State Farm, comparison with legislative fines for comparable misconduct. In particular, the authors propose that the highest comparable fine should be the presumptive constitutional limit on a punitive damage award. Such an approach would give lower courts clear and workable guidance for review of punitive damage awards, while also providing civil defendants with fair notice of potential awards and reinforcing the proposition that important lawmaking authority belongs in the hands of state legislatures.