Indiana Punitive Damages Allocation Statute Survives Review

Indiana, like a number of other states that enacted similar “tort reform" legislation, limits the amount of benefit that a plaintiff can receive from a punitive damages award by allocating a percentage to a state fund (here 75%). In Cheatham v. Pohle, 789 N.E.2d 467 (Ind. May 30, 2003), plaintiff argued that it was unconstitutional for the state to “take” $75,000 of her $100,000 punitive damages award. However, in a 3-2 decision, the Indiana Supreme Court reversed the intermediate appellate court and upheld the statute because a plaintiff has no right to punitive damages and, therefore, no property interest for the state to “take.” This decision brings Indiana into line with all other state courts considering similar laws, except for Colorado.