The New York Times reports that Italy’s Supreme Court has refused to enforce a U.S. punitive damage award, finding that “a peculiarity of American law — punitive damages — was so offensive to Italian notions of justice that it would not enforce the Alabama judgment.” The article then goes on to discuss how the rest of the world generally does not use punitive damages the way the U.S. does. As the article notes, in other countries, punishment is meted out by the criminal justice system, not a civil jury.
To me, the interesting aspect of the article is the discussion of how U.S. legislatures and courts, particularly the Supreme Court, are limiting the use of punitive damages, bringing the U.S. more inline with the rest of the world. The article correctly reports that many states have eliminated or reduce punitive damages, mostly in response to “tort reform” lobbying. What the article does not discuss, however, is the fact that as punitive damages are eliminated, nothing else is put in place to punish or deter the wrongful conduct punitive damages punished. Unlike much of the world, which uses public enforcement, both civil and criminal, to regulate the marketplace, the U.S. has long relied on private lawsuits and the civil justice system to punish wrongful conduct. The movement to eliminate punitive damages continues, but not even a whisper is heard regarding the enactment of alternative methods of regulation.