Punitive damages, awarded in civil cases, serve not to compensate the plaintiff for losses, but rather to punish the defendant for egregious misconduct and deter similar behavior in the future. These damages are awarded over and above compensatory damages, which are intended to make the plaintiff whole. For instance, if a company knowingly markets a defective product that causes harm, a court might impose punitive damages to discourage such reckless disregard for consumer safety. The calculation of these awards differs significantly from compensatory damage assessment.
The rationale for awarding punitive damages lies in protecting the public from malicious, oppressive, or fraudulent actions. Their imposition acts as a deterrent, signaling that society will not tolerate certain types of reprehensible conduct. Historically, punitive damages have played a crucial role in shaping corporate behavior and promoting accountability, particularly in areas like product liability and environmental protection. By holding wrongdoers financially responsible, these damages encourage ethical practices and responsible decision-making.
