The Associated Press reported over the weekend that a San Bernardino jury awarded $2 million in punitive damages, on top of $4.5 million in compensatory damages, to a man who claimed that the defendants plotted to murder him. According to a press release by the plaintiff’s attorneys, the two defendants conspired with members of the Mexican Mafia to kill the plaintiff as a result of some sort of confrontation that occurred at a bar.
When a jury awards such a large amount of punitive damages against individual defendants, it usually raises questions about whether the award is disproportionate to the defendants’ ability to pay. Several California decisions have referenced a 10 percent rule of thumb, i.e., awards that exceed 10 percent of a defendant’s net worth are presumed to be excessive. In this case, the AP story reports that the defendants are members of an Indian tribe and receive in excess of $1 million per year in proceeds from a casino. If the plaintiff can use that evidence to demonstrate that the defendants each have a net worth in excess of $10 million, the plaintiff may be able to fend off the argument that the award exceeds the defendants’ ability to pay.
