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Overview. Punitive damages are awarded in addition to actual damages in certain circumstances. Punitive damages are considered punishment and are typically awarded at the court's discretion when the defendant's behavior is found to be especially harmful.
Generally the courts have held that the acts of a defendant for which the plaintiff is awarded punitive or exemplary damages must be characterized by being wanton, wilful, reckless, or malicious.
418, the California Supreme Court articulated 'three guideposts' for courts reviewing punitive damages: ?(1) the degree of reprehensibility of the defendant's misconduct; (2) the disparity between the actual or potential harm suffered by the plaintiff and the punitive damages award; and (3) the difference between the ...
For instance, say a company sells a product they know to be defective or that can cause injury so they can still profit off it, they could be ordered to pay punitive damages if it is proven they were negligent in their decisions to sell these products.
A common example of punitive damages is drunk driving cases. In most cases, the plaintiff will receive the punitive damage awards, especially if they were directly injured by the defendant. Not every case will call for punitive damages. Punitive damages are primarily awarded in extreme cases.