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$38.5 Million Punitive Damage Award Barred By Statute of Limitations (PA)

July 21, 2017

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<p style="text-align: justify;">The Pennsylvania Superior Court recently addressed the $38.5 million punitive damages jury verdict in <em>Wilson v. U.S. Security Associates </em>(2015) - the highest award in Philadelphia in 2015.  In 2010, two factory workers were fatally shot and a third seriously injured at the Kraft-Nabisco factory in North Philly. The defendant security firm was found negligent by a jury when two security guards abandoned their post in fear when they saw an armed woman - a suspended Kraft worker who returned to the company looking for revenge.</p>
<p style="text-align: justify;">The issue on appeal was the trial court’s decision to allow the plaintiffs—mid-trial—to reinstate a claim for punitive damages which was withdrawn by stipulation in exchange for a withdrawal of preliminary objections two years earlier. And by the time plaintiffs sought to introduce the punitive damages claim, the statute of limitations had expired.</p>
<p style="text-align: justify;">The plaintiffs argued that the claim was merely an <em>amendment</em> to the ad damnum clause—the section of the complaint outlining damages—not a new claim; and as such there was no statute of limitations issue. Unpersuaded, the court held that to prove punitive damages, the plaintiffs must prove “reckless, outrageous, intentional and/or wanton” conduct, which is an extra element and not merely an amendment to an existing claim.</p>
<p style="text-align: justify;">After finding punitive damages to be a claim instead of an amendment, the court moved to its statute of limitations analysis. Plaintiffs’ stipulation in exchange for the defense withdrawing their preliminary objections removed the claim from the complaint. Accordingly, the complaint must be read without the punitive damages claim. If the claim is not in the original complaint, the statute of limitations was never tolled by filing the complaint and the statute ran from 2010. Therefore, when the plaintiffs sought to reintroduce the claim at trial in 2015, the statute of limitations had already expired. To support this conclusion, the court looked to the settled law of voluntary nonsuits—voluntarily withdrawing an entire lawsuit. In voluntary nonsuits, the original complaint is treated as if it never existed; the statute of limitations is not tolled. The court reasoned there is “no legal basis on which the strategic withdrawal of one significant cause of action, punitive damages, should be treated differently than our settled controlling authority treats the withdrawal of an entire lawsuit.”</p>
<p style="text-align: justify;">And thus <em>Wilson v. U.S. Security Associates</em> was stripped of its accolade of Philadelphia Court of Common Pleas’ largest 2015 award.</p>
Thanks to Ellis Palividas for his contribution to this post and please write to <a href="mailto:">Mike Bono</a> if you would like more information.


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