Opinion ID: 2067270
Heading Depth: 1
Heading Rank: 4

Heading: Punitive Damages Awards in Products Liability Actions

Text: Appellees rely on the views expressed by Judge FRIENDLY in Roginsky v. Richardson-Merrell, Inc., 378 F.2d 832 (2d Cir. 1967). Among the questions presented in that diversity action was whether under New York law an award of punitive damages against Richardson-Merrell was proper for its failure to warn consumers that MER/29 was cataractogenic. The court stated at the onset that the issue was one of extreme significance not only in monetary terms to this defendant in view of the hundreds of pending MER/29 actions and to the plaintiff as well, but from a longer range, to the entire pharmaceutical industry and to all present and potential users of the drugs. Id. at 838. After calculating that [i]f all [plaintiffs] recovered punitive damages in the amount here awarded these would run into tens of millions . . . ., the court confessed to having the gravest difficulty in perceiving how claims for punitive damages in such a multiplicity of actions throughout the nation can be so administered as to avoid overkill, and emphasized that it [does not] seem either fair or practicable to limit punitive recoveries to an indeterminate number of first-comers . . . . [9] Id. at 839. The court further observed that if insurance against punitive damages were available, the deterrent effect of such damages would be greatly blunted, for the cost of the insurance could simply be passed on to the consuming public, and if they cannot, as is held by other courts and recommended by most commentators, a sufficiently egregious error as to one product can end the business life of a concern that has wrought much good in the past and might otherwise have continued to do so in the future, with many innocent stockholders suffering extinction of their investments for a single management sin. Id. at 841. [10] Despite its conclusion that permitting the recovery of punitive damages might do more harm than good, the court acknowledged that New York cases afford no basis for . . . predicting that the Court of Appeals would adopt a rule disallowing punitive damages. . . ., and went on to conclude that the evidence was insufficient to support an award of punitive damages. Id. at 840-41. We acknowledge our indebtedness to the court's thoughtful opinion in Roginsky. We have concluded, however, that the better course is to permit punitive damages in products liability actions, and in what follows we shall explain our disagreement with Roginsky. [11]