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Gov. Schwartzenegger Says State Should Get Most of Punitive Damage Awards

California Governor Arnold Schwartzenegger recently proposed that the state take most of the money that courts award to the plaintiffs in lawsuits against large companies....
May 25, 2004

California Governor Arnold Schwartzenegger recently proposed that the state take most of the money that courts award to the plaintiffs in lawsuits against large companies. In his revised budget, the governor noted that punitive damages, awarded to punish the defendants, should go to the state, which can use the money for public good.

Under the governor's proposal, the state would receive 75 percent of punitive damages, while the remainder and compensatory damages would go to plaintiffs and their lawyers, whose fees are to be approved by a judge.  California trial lawyers contend that the proposal would undermine the principle of punishing corporate wrongdoing.  Joseph Sturdevant, president of the Consumer Attorneys of California, says that the proposal would prevent plaintiffs' attorneys from investing the resources needed to take on such large corporate targets as tobacco and auto companies. The Wall Street Journal reports that at least eight states currently take a percentage of punitive damage awards.

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