Orrin Hatch: “during debate on the products liability bill last week, some of our colleagues who defend the status quo made comments…”

“during debate on the products liability bill last week, some of our colleagues who defend the status quo made comments on the punitive damages issue to which I would like to say a few words. I heard one comment to the effect that, ``if a multibillion-dollar corporation makes a mistake in building a bus and the bus explodes, to punish a multibillon-dollar corporation $250,000 or three times economic damages is not going to cut it.'' First, let us understand that punitive damages were not conceived for application in cases of mere mistake, mere negligence. They are intended for application in cases of much, much more serious conduct. The underlying bill, which speaks to conduct carried out with a conscious, flagrant indifference to the safety of others is the kind of standard usually employed before punitive damages are found appropriate. Second, given today's regime of compensatory damages, the cost of litigation, and adverse publicity, punitive damages infrequently are needed to punish and deter such misconduct. In the case of the exploding bus, if it had resulted from the kind of conduct triggering a right to punitive damages under the law today, all of these factors would combine as a powerful incentive for the company to reform its practices. But, the underlying bill hardly does away with punitive damages, it simply places rational limits on their award. Third, the current, largely uncontrolled nature of punitive damages is anticonsumer.”