Why There is No Defense of Punitive Damages

Abstract

My analysis of punitive damages in environmental and products liability cases concludes that these awards impose substantial costs on society, and that abolishing punitive damages would improve social welfare. The two commentaries on my proposal are written by prominent proponents of punitive damages. Professor Luban has been a leading advocate of punitive damages as a form of punishment, and Professor Eisenberg has promoted the view that punitive damages are both small and predictable. Not surprisingly, each of them is critical of my proposal, but as I will indicate below, neither provides any evidence that punitive damages play a constructive role in society. Without such a beneficial function, the costs of these awards cannot be justified.