Friday, September 16, 2011

Guest Blogger: Henry Lowenstein - Punitive Damage Award: Time = Money

Henry Lowenstein from Coastal Carolina University sent in the following:

I thought you might be interested in this just published case from the Court of Appeals in South Carolina on punitive damages. Cody P. v. Bank of America, August 23, 2011.

The 11 page opinion is  written in very plain language is a good walk through for students of the Court's logic in determining punitive damages that pass constitutional muster and those that violate due process (re:  U.S. Supreme Court in BMW v. Gore, and, State Farm Ins. v. Campbell.)

The case is interesting from a business standpoint as it involved the failure of the Bank of America to properly handle a conservatorship account (trust account) that is set up by the Probate Court in this state to protect the insurance proceeds for a disabled child. At the end of the day, experts testified that it would have taken the bank one hour to properly set up the account with their established safeguards.  So the punitive award was calculated to equal the earnings of the Bank of America for one hour......$1,583,000.

editor's note:  I added the image below:

source of image: South Carolina Lawyers Weekly

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