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Tennessee AG May Ask Supreme Court to Reinstate Cap on Punitive Damages


Last December, a federal appeals court delivered an important ruling for personal injury victims and their families when it declared unconstitutional a Tennessee law limiting jury awards of punitive damages. According to the Knoxville News-Sentinel, Tennessee Attorney General Herbert L. Slatery III is in the process of deciding whether to ask the U.S. Supreme Court to review that decision–a move that could lead to the reinstatement of the law and the cap on punitive damages.

Sixth Circuit: Limiting Punitive Damages Violates Historic Right to “Trial by Jury”

The case that led to this situation, Lindenberg v. Jackson National Life Insurance Co., began with a lawsuit against an insurance company that refused to pay out $350,000 in life insurance benefits to two children whose father had died, according to an earlier report from the News-Sentinel. A jury subsequently ordered the insurance company to pay $3 million in punitive damages for its “bad behavior.”

The federal judge overseeing the case reduced that award to just $750,000 because of a 2011 law passed by the Tennessee legislature capping punitive damage awards at that amount. The children’s mother appealed that decision to the U.S. Sixth Circuit Court of Appeals, which has federal appellate jurisdiction over Tennessee. She asked the Sixth Circuit to declare the caps unconstitutional.

In a December 21, 2018, opinion, the Sixth Circuit did just that. A three-judge panel held that limiting damage awards in this manner “violates the individual right to a trial by jury set forth in the Tennessee Constitution.” Like the U.S. Constitution, the state constitution guarantees the right to a jury trial in many (though not all) civil cases. The right itself derived from the common “common law under the laws and constitution of North Carolina at the time of the adoption of the Tennessee Constitution of 1796.”

And based on historical evidence, the Sixth Circuit panel said “punitive damages awards were part of the right to trial by jury at the time the Tennessee Constitution was adopted.” Indeed, the court said the determination of punitive damages was a “finding of fact,” which is solely the responsibility of the jury. And while punitive damages “are not compensatory in nature” under Tennessee law, the jury still has the right to award “non-compensatory” damages in order to “deter persons from the commission of such offences” in the future.

Following the panel’s decision, the Attorney General asked the full Sixth Circuit to rehear the case. The Sixth Circuit denied that petition over the dissent of several justices, who felt the question of constitutionality should be referred to the Tennessee Supreme Court rather than decided in federal court. Nevertheless, the panel’s decision currently stands. If Slatery decides to ask the Supreme Court to take up the case, it will likely be on the question of whether the state supreme court should properly decide this case.

Speak with a Tennessee Personal Injury Lawyer Today

Limits on punitive damage awards are great for negligent businesses and their insurance companies. But they also represent a slap in the face to innocent accident victims who have done nothing wrong. That is why it is critical to fight for such damages when justified by the facts of a given case. If you have been injured in an accident and need advice from an experienced Knoxville personal injury lawyer, contact Fox, Farley, Willis & Burnette, today.





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