Damages intended to compensate the injured party for the harm suffered.Contrast with punitive damages to punish the wrongdoer,and nominal damages awarded to recognize that a right was violated or a duty breached,but no harm done.
In such cases, due process does not limit the court to a ratio of punitive to compensatory damages, but allows it to ask whether the relationship between punitive damages and the actual harm to the plaintiff is reasonable.
Barring intervention by states on a statutory level, it is likely professionals will continue to see punitive damage awards that are grossly dissproportionate to the compensatory damages awarded a plaintiff.
If Congress enacted the proposal to disallow deductions for the cost of compensatory damages under certain environmental laws, it would create an artificial distinction in the tax law for certain types of costs associated with the manufacture and distribution of products.
In the first case, the Utah Supreme Court found that State Farm "repeatedly and deliberately deceived and cheated its customers" and upheld a punitive-damages award that was 145 times the amount of compensatory damages.