It’s not an Alabama decision. However, I think it provides valuable insight and analysis into an important subject. On November 3, 2009, the Tennessee Supreme Court issued the decision of Goff v. Elmo Greer & Sons. This case involved the appeal of a verdict that assessed only a small amount of compensatory damages with a much larger punitive assessment. 

Our appellate courts employ a review of punitive damage verdicts based upon a number of factors largely established in prior U.S. Supreme Court decisions. One of these factors — one very frequently cited by The Alabama Supreme Court in reducing assessments of punitive damages — is the ratio of the punitive damage assessment to the compensatory damage assessment.

However, I have long believed that employing a strict ratio in cases where the actual harm was small but the potential harm could have been catastrophic or the defendant’s conduct was especially egregious, is unjust. This recent Tennessee decision provides a review of just such a factual scenario.

The Nashville firm of Leader, Bulso, Nolan & Burnstein has an excellent summary of this new decision on its blog, Tennessee Business Litigation Report. I would urge the Alabama attorney who might have a similar case on appeal to our Supreme Court to review this new decision and incorporate its helpful analysis.