the republic logo

Montana Supreme Court to hear arguments on limits on jury awards

bug
Share/Save/Bookmark

HELENA, Montana — The Montana Supreme Court will hear arguments in an appeal of a $52 million verdict awarded to an office supply company, one of two cases that could determine whether the state's $10 million cap on jury awards for punitive damages will stand.

Two district judges have now ruled the limits unconstitutional, and if the high court upholds those rulings, the effect could be an increase jury awards in lawsuits across the state.

Punitive damages are awarded by a judge or jury to set an example and punish a defendant.

In the case being heard Friday in Big Sky, Comerica Bank is appealing a verdict that it was in breach of contract in a dispute with Masters Group International, a company that had planned to build an office-supply distribution center in Butte.

The appeal in that case contains other elements besides the constitutionality of the punitive damages cap, such as whether Michigan law should apply because of a provision in the loan agreement to Masters Group.

So the court may not have to rule on the awards cap in this case, if the court rules for Comerica in those other parts of the appeal, said Comerica attorney James Goetz of Bozeman.

"The court may well not get into that issue, depending on how it deals with the other questions," Goetz said Thursday.

Waiting in the wings is a Polson case in which a Montana judge ruled the cap unconstitutional in awarding $73 million in punitive damages against Hyundai for a 2011 crash that killed two Missoula teenagers. Goetz also is an attorney in that lawsuit.

The cap is "likely to come up in that case if not this one," Goetz said.

Comerica gave Masters Group a $9.5 million line of credit in 2006 and later lent it another $1 million before the bank reneged on an agreement and liquidated Masters Group's assets, the company said.

Lee Newspapers of Montana reports Comerica responded that Masters Group defaulted and extended payments several times.

The facility planned for Butte was ultimately built in Reno, Nevada. That prompted the Butte Local Development Corp. to sue Masters Group in 2011.

After that, Masters accused Comerica of breach of contract and several other charges.

The three-way case went to trial in Butte, and the jury awarded the development corporation $275,251 from Masters Group, plus $52 million awarded to Masters Group from Comerica.

Of that $52 million, $41.5 million was for compensatory damages and $10.5 million was for punitive damages.

Think your friends should see this? Share it with them!

Story copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Feedback, Corrections and Other Requests: AP welcomes feedback and comments from readers. Send an email to info@ap.org and it will be forwarded to the appropriate editor or reporter.


We also have more stories about:
(click the phrases to see a list)

Category:

Follow The Republic:

All content copyright ©2014 The Republic, a division of Home News Enterprises unless otherwise noted.
All rights reserved. Privacy policy.