March 28, 2002
Vol. 21 No. 12

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    Inconsistencies evident between the monetary, moral judgments of juries

    By Peter Schuler
    News Office

    Cass Sunstein

    Cass Sunstein, the Karl N. Llewellyn Distinguished Service Professor in the Law School and the College, is the author of many books at the intersection of law and social science, and his latest is no exception. Punitive Damages: How Juries Decide, (University of Chicago), written with four other legal scholars, analyzes how juries arrive at punitive damage verdicts and discusses alternative methods in figuring the amount of awards.

    Sunstein and his fellow authors cite results from controlled experiments with more than 600 mock juries, involving the responses of more than 8,000 jury-eligible citizens. Using the tools of psychology, economics and the law, they found that although juries tended to agree in their moral judgments about a defendant’s conduct, they rendered erratic and unpredictable dollar awards. “Instead of moderating the jurors’ verdicts, the process of jury deliberation moves the jurors to ever-higher and less predictable awards,” Sunstein said.

    “Jurors also tended to ignore instructions from the judges,” Sunstein added. “And we found that they used ‘hindsight bias,’ believing that what happened should have been foreseen, and they also penalized corporations that based their decisions on careful cost-benefit analysis. This point raises a number of interesting issues about how people think and what they find immoral.”

    Sunstein said he and his colleagues wanted to learn why it was so difficult to predict the likely amount of punitive damages that would be awarded by a jury in a given case.

    Though the $144.8 billion class action award against cigarette manufacturers in 1999 is perhaps the most extraordinary example, the authors noted that in the past decades, large and apparently unpredictable punitive damages awards have become a national issue.

    “In an Alabama case that same year, a jury awarded $580 million when the economic damages were alleged to amount to no more than $600,” Sunstein said. “That equals over one and three-quarters times the total annual amount the state of Alabama spends on police protection and correction, including the funding for its prisons.”

    Sunstein and his colleagues believe these jury awards, which are sometimes staggeringly large, sometimes unaccountably low and wildly varying even in similar cases and are based on vague and confusing judges’ instructions, undermine society’s commitment to employ the force of government with reason and consistency.

    “We found that our mock juries had a very hard time arriving at consistent, predictable judgments when using the scale of dollars, even when their moral judgments are both consistent and predictable. We concluded from our research that a major source of this unpre-dictability comes from the fact that people do not know how to translate their moral judgment into dollar amounts,” Sunstein said.

    The authors believe that jurors face a daunting task to come up with dollar figures for punishment when they have not been given guidance about the meaning or consequences of different choices on a literally infinite scale of amounts. “This problem is not created because jurors are irrational, inattentive or stupid. It’s because the tasks involved are extremely complex,” Sunstein said.

    Sunstein and his co-authors offer two principal ways to help cure the problem. They suggest judges take a firmer role in overseeing jury awards, including measuring the jury’s award against other awards in similar cases. Ideally, judges would increase implausibly low awards and decrease implausibly high ones. Though both the federal government and some states are considering formulas to cap punitive damage awards, the authors also consider a more dramatic change: the replacement of the jury’s verdict with a system of civil fines established through a damage schedule set by specialists.

    “This has been used successfully in many areas of the law, including workers’ compensation and environmental violations,” Sunstein said.

    “Our current approach to punitive damages is very far from ideal. It involves too much unpredictability and too little sense. In imposing civil punishments for misconduct, a well-functioning legal system should be able to do a lot better.”