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Find evidence to establish the right to criminal damages



In 1989, Exxon's supertanker founded a reef off Alaska that released millions of gallons of crude oil. The accident occurred after the captain of the tanker – who had previously had alcohol abuse and whose blood still had a high alcohol content 11 hours after the spill – inexplicably left the bridge and left a tricky course correction to unlicensed subordinates.

Exxon spent approximately $ 2.1 billion in sanitation, pleaded guilty to criminal offenses that resulted in fines, settled a civil lawsuit from the United States and Alaska for at least $ 900 million, and paid an additional $ 303 million in voluntary payments to private parties. Other civil cases were consolidated against Exxon, the captain and others to recover financial losses such as those that sued Exxon. The jury awarded $ 287 million in damages to some of the plaintiffs; others had settled their compensation claims for $ 22.6 million; was awarded $ 5,000 in penalty damage against the captain and $ 5 billion against Exxon. The Ninth Circuit finally dropped the penalty against Exxon to $ 2.5 billion.

I Exxon Shipping Co. v. Baker 128 S.Ct. 2605, 171 L.Ed.2d 570 (US 06/25/2008) the Supreme Court of the United States concluded that the penalty against Exxon was excessive in the case of shipping and that the award should be limited to an amount equal to compensatory damages. By applying this standard to the Exxon case, the Supreme Court ruled in favor of the District Court in calculating the total relevant compensatory damages of $ 507.5 million. A penalty-to-compensation ratio of 1: 1 thus gave maximum penalty damages in that amount.

The test for determining whether criminal damages are correct requires the court to consider the degree of reprehensibility of the defendant's conduct, the difference between the actual or potential damage suffered by the plaintiff and the penalty for damages; and the difference between the criminal damages granted by the jury and the civil penalties that are permitted or imposed in comparable cases.

The U.S. Supreme Court has instructed the courts to reach a conclusion as to whether a penalty for damages is "grossly excessive," They should consider three "guides."

  1. The extent to which the defendant's conduct is reprehensible. [19659008] The difference between criminal and compensatory damages provisions, usually in the form of a relationship.
  2. Compare the criminal damage. but also the potential damage that may have been caused by the defendant's actions. [19659004] The Supreme Court of Oregon Hamlin found that although compensatory damages were small and the ratio of punishment to c sustained damages – 22: 1 – was in the low double-digit penalty would remain, even if it found that the ratio was higher than what would be cow nstitutionally allowed if the compensation damage was greater, the punitive damages that the jury judged were not so high that it made the award "grossly exaggerated". The amount of the penalty damages – $ 175,000 – was also not so high that it exceeded, rather than served, the state's interests in discouraging and punishing violations of state criminal law.

    Any lawyer representing a plaintiff who sues an insurance company for torture in bad faith or the lawyer who defends an insurance company against allegations that he has committed the crime must understand why a penalty can be imposed to punish an insurer. Through an analysis of criminal damages applied in the United States to bad faith insurance policies, this book will analyze why the various states allow judges and juries to award criminal damages to insurers in civil litigation.

    In Mississippi, punitive damages are controlled. by law, Miss Code Ann. 11-1-65 (1) (a) which instructs:

    In all cases involving penalties for damages, the plaintiff must, in determining the amount of punitive damages, in so far as relevant, take into account the following: the defendant's financial position and net worth; the nature and blame values ​​of the defendant's errors, for example, the influence of the defendant's conduct on the plaintiff or the defendant's relationship with the plaintiff; the defendant's awareness of the extent of the damage caused and the defendant's motivation to cause such damage; the duration of the defendant's misconduct and whether the defendant sought to conceal such misconduct; and all other circumstances which the evidence shows to establish a proper penalty.

    If neither of the parties during the trial proved a defendant's net worth, neither party can appeal the appeal of either inadequacy or exaggeration of a criminal. amount of damages. [ Woodkrest Custom Homes Inc. v. Cooper 108 So.3d 460, 470 (Miss. Ct. App. 2013) (citing C & C Trucking Co. v. Smith 612 So .2d 1092, 1102 (Miss. 1992)); agreement Moore v. McDonald 210 So.3d 563, 568 (¶15) (Miss Ct. App. 2017)

    First and foremost, lawyers and plaintiffs must understand that unlike contracts or damages, damages are punishable. to punish the perpetrator sufficiently to act as a deterrent to others who may consider acting in the same way. Until the 1950s, a person who sued an insurance company could only recover contractual damages. The most insured could recover, if an insurer violated the insurance contract, are the benefits that the police promise. When the courts created torture in bad faith, they changed the contract law enormously by having unhappy insured persons sue insurers for both contractual and tort damages, including punitive damages.

    Basic damages are designed and are expected to provide compensation. Claims for damages attempts try to use money to place the plaintiff in the same situation he or she was in before he or she was injured by a pest.

    The award of punitive damages gives the plaintiff a larger amount than the damages actually incurred as a result of the damages in an amount sufficient to punish the defendant and discourage the defendant – and others – from repeating the wrongful conduct. Criminal damages do not help the insured to return to the situation he or she was in before the insurance contract was broken. If they bear the punitive damages that the insured is placed in a better position than he or she was in before the breach of contract. As punitive damages are not compensatory, the plaintiff will also find that the government will demand that the plaintiffs pay income tax on the punitive damages issued. [ Commissar for Int. Reef. v. Obear-Nester Glass Co ., 217 F.2d 56 (7th Cir., 1954)]

    In order to obtain a judgment granting damages, the plaintiff must state that:

    1. The insurer lacked an arguable or legitimate grounds for refusing the claim, and
    2. the insurer committed an intentional or malicious error, or acted grossly and ruthlessly disrespectfully to the insured's rights. [ State Farm Mut. Car. Ins. Co. v. Grimes 722 So. 2d 637, 641 (Miss 1998)

    Penal damages may not be granted unless both of these teeth are met. [ Mitchell v. State Farm Fire & Cas. Co., 954 F.3d 700 (5th Cir. 2020)] There is no light line test, but in accordance with due process, punitive damages must be both reasonable and proportionate to the damage to the plaintiffs and to the general damages recovered.


    Adapted from the book: Zalma on Insurance Claims Part 106 Third Edition Available on Amazon.com

    © 2021 – Barry Zalma

    Barry Zalma, Esq., CFE, now limits his practice to to serve as an insurance consultant who specializes in insurance coverage, insurance claims handling, bad faith insurance and insurance fraud almost as much for insurers and policyholders.

    He also acts as an arbitrator or mediator for insurance-related disputes. He practiced law in California for more than 44 years as an insurance and claims management attorney and more than 54 years in the insurance industry.

    Subscribe to Excellence in Claims Handling at https://barryzalma.substack.com/welcome.

    He is available at http://www.zalma.com and zalma@zalma.com. Mr. Zalma is the first recipient of the first annual Claims Magazine / ACE Legend Award. For the past 53 years, Barry Zalma has devoted his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to enable insurers and their indemnity staff to become liable for insurance.

    Go to training available at https://claimschool.com; articles at https://zalma.substack.com, the podcast Zalma On Insurance at https://anchor.fm/barry-zalma; Follow Mr. Zalma on Twitter at https://twitter.com/bzalma ; Go to Barry Zalma videos at https://www.rumble.com/zalma; Go to Barry Zalma on YouTube- https://www.youtube.com/channel/UCysiZklEtxZsSF9DfC0Expg; Go to Insurance Claims Library-https: //zalma.com/blog/insurance-claims-library/ T the last two issues of ZIFL are available at https://zalma.com/zalmas-insurance-fraud- letter -2 / podcast now available at https://podcasts.apple.com/us/podcast/zalma-on-insurance/id1509583809?uo=4


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