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Upper Limit on Punitive Damages for Civil Extortion

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In California, is there a practical limit to the potential recovery for civil extortion if the extortionate amount paid was small (around $1,000) but the ability of the defendant to pay is large?

 

Can attorney fees be recovered by plaintiff if victorious or defendant if not?

 

Can small claims court award punitive damages for civil extortion up to the $10,000 limit of that venue or would the plaintiff be limited to compensatory damages (i.e., the $1,000 above)?

 

Thanks

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Is this another "theoretical" question or do your questions actually apply to something you're involved in?

 

2 hours ago, ThatTenant said:

In California, is there a practical limit to the potential recovery for civil extortion if the extortionate amount paid was small (around $1,000) but the ability of the defendant to pay is large?

 

See CA Civil Code section 3294:

 

http://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=CIV&sectionNum=3294.

 

2 hours ago, ThatTenant said:

Can attorney fees be recovered by plaintiff if victorious or defendant if not?

 

Probably not. But you can google that just as easily as I can.

 

2 hours ago, ThatTenant said:

Can small claims court award punitive damages for civil extortion up to the $10,000 limit of that venue or would the plaintiff be limited to compensatory damages (i.e., the $1,000 above)?

 

A CA small claims judge can award punitive damages for ANY case for which punitive damages are appropriate.

 

 

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To Adjusterjack:

 

It's not a theoretical question.

 

The law you cite says exemplary damages can be awarded for "breach of an obligation not arising from contract," which I assume you are saying extortion is, but it does not tell me if there is a practical limit in California to those exemplary damages, which was my lead and primary question. In online searching I have read that punitive damages are based on the defendant's ability to pay but that there are limits established in common law that the damages could not be more than about five times the compensatory damages. (No authorities were cited.) If that is an established standard no matter the amount extorted, then it would not pay to even discuss this with a lawyer to pursue extortion where the amount paid to the extortionist was only about $1,000 because the maximum award would then be the $1,000 compensatory damages plus the $5,000 exemplary damages, i.e., $6,000. I have to assume any contested civil action would run a tab of $50,000+. It seems to me that a multiplier such as described above would be too simplistic in that, where the amount extorted was relatively small,  it would not accomplish the objective of exemplary damages to dissuade a defendant (or others) from committing the extortionate behavior against others in the future. Nevertheless, it would not surprise me if a precedent exists for a multiplier of five, which would not be worth fighting, and in which case it would become a small claims case (at the most).

 

Thanks

 

 

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1 hour ago, ThatTenant said:

It's not a theoretical question.

 

Until you provide specifics all I can give you is abstract answers.

 

1 hour ago, ThatTenant said:

The law you cite says exemplary damages can be awarded for "breach of an obligation not arising from contract," which I assume you are saying extortion is

 

Yes.

 

1 hour ago, ThatTenant said:

it does not tell me if there is a practical limit in California to those exemplary damages

 

In the abstract there is no practical limit (though there are limits as will become clear later) because, as with any lawsuit, each case is adjudicated based on its own merits. There are cases where there are statutory limits on punitive damages. One example is when a landlord wrongfully withholds a security deposit. Damages can be an additional limited multiple of the amount of the deposit. Another example is a bounced check. Damages can also be an additional limited multiple of the amount of the check. I use the phrase "limited multiple" because it's either two or three and I don't feel the need to look it up.

 

1 hour ago, ThatTenant said:

In online searching I have read that punitive damages are based on the defendant's ability to pay but that there are limits established in common law that the damages could not be more than about five times the compensatory damages. (No authorities were cited.)

 

That's the trouble with online searching. You end up with unsupported opinions by people who copied the unsupported opinions of others. I have to laugh at some of the stuff I read online by lawyers and government officials who should know better. Your "five times" is a myth similar to the "three times" rule in personal injury claims. I was taught the "three times" rule almost half a century ago in claims class but that formula went out the window not long thereafter when the insurance industry became much more sophisticated in quantifying injuries.

 

1 hour ago, ThatTenant said:

If that is an established standard no matter the amount extorted, then it would not pay to even discuss this with a lawyer to pursue extortion where the amount paid to the extortionist was only about $1,000 because the maximum award would then be the $1,000 compensatory damages plus the $5,000 exemplary damages, i.e., $6,000.

 

You're right. If you could get that in small claims court, or anything up to the small claims limit, a lawyer would be superfluous.

 

1 hour ago, ThatTenant said:

I have to assume any contested civil action would run a tab of $50,000+

 

Lawyers are expensive and there is no guarantee of winning any punitive damages at all. Saying you are entitled to punitive damages is a long, long way from proving it.

 

1 hour ago, ThatTenant said:

It seems to me that a multiplier such as described above would be too simplistic in that, where the amount extorted was relatively small,  it would not accomplish the objective of exemplary damages to dissuade a defendant (or others) from committing the extortionate behavior against others in the future.

 

That's right. Which is exactly what throws the "five times" myth out the window. A jury would have to determine the extortionist's punishment based on the facts of the case. There are too many variables involved, including variables about the victim.

 

1 hour ago, ThatTenant said:

Nevertheless, it would not surprise me if a precedent exists for a multiplier of five

 

It would surprise me. Unless there is a statutory limit on a particular type of action, an appellate court would not be specific about the multiple. Appellate decisions don't work that way.

 

Here's an example of how they do work:

 

https://scholar.google.com/scholar_case?case=18105445087867644608&q=punitive+damages+caps&hl=en&as_sdt=4,5

 

Study the decision carefully and you'll get an education about punitive damages. It's very interesting.

 

 

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To Adjuster Jack:

 

Everything you say makes sense to me and I will carefully study that decision as you suggested and thank you very much for providing it.

 

The walls have ears, which is why I don't want to provide too many specifics but I hope to follow up eventually and let you all know how this situation plays out.

 

Thanks!

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You may be interested to know there is no such thing as "civil extortion."  Pleas see, Bass v. Morgan, 516 So. 2d 1011 (Fla. 3d D.C.A. 1987) .  Extortion is a criminal act but it does not give rise to a civil action for damages, compensatory or punitive.

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6 minutes ago, RetiredinVA said:

You may be interested to know there is no such thing as "civil extortion."  Pleas see, Bass v. Morgan, 516 So. 2d 1011 (Fla. 3d D.C.A. 1987) .  Extortion is a criminal act but it does not give rise to a civil action for damages, compensatory or punitive.

 

That is a Florida state court ruling. The OP is in California.

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California does recognize extortion as a civil matter.

 

According to the CA Court of Appeals, Third District:
 

Quote

 


However denominated (e.g., extortion, menace, duress), our Supreme Court has recognized a cause of action for the recovery of money obtained by the wrongful threat of criminal or civil prosecution. (See Leeper v. Beltrami (1959) 53 Cal. 2d 195, 203-204 [1 Cal. Rptr. 12, 347 P.2d 12, 77 A.L.R.2d 803]; Woodham v. Allen (1900) 130 Cal. 194, 198-200 [62 P. 398].) It is essentially a cause of action for moneys obtained by duress, a form of fraud. (Leeper v. Beltrami, supra, 53 Cal.2d at pp. 205, 207.)

 

 

See Paragraph 18 of Fuhrman v. California Satellite Systems:

 

https://law.justia.com/cases/california/court-of-appeal/3d/179/408.html

 

Note that I have only addressed punitive damages in general and that extortion can be the subject of a civil action in California.

 

I have not opined on the merits of the OP's case because OP has not provided any details of the case.

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To RetiredinVA:

 

I am not an attorney but I find multiple references online to civil extortion in California including at least two attorneys offering related services. Not sure I should post links to those here.

 

 

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3 minutes ago, ThatTenant said:

To RetiredinVA:

 

I am not an attorney but I find multiple references online to civil extortion in California including at least two attorneys offering related services. Not sure I should post links to those here.

 

 

 

 

No need. It's already confirmed.

 

2 minutes ago, ThatTenant said:

To AdjusterJack:

 

Regarding the criminal venue, I wish I could but I cannot comment at this time.

 

OK.

 

 

 

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To AdjusterJack:

 

Read through the case you cited. I am encouraged that it appears the California Supreme Court acknowledges and accepts that there are exceptions to what I, personally, would term an arbitrary maximum ratio of 10:1 they imposed in that case, noting their cite to Kemp and one or two others, and that the degree of reprehensibility is a key factor. Without going into the details, in my case the behavior was repeated in that there was one attempted extortion and one actualized and an admission linking someone else in the extortion plot. I also note that the persons involved in this effort against me were professionals in the related area of business and, therefore, may be considered to have known very well what they were doing and the harm it could have caused me. Finally, by tying up some property I owned, I suffered some loss when it burned when I might have sold it first. I have a decision to make as to whether to take the next step in having the matter reviewed by a litigator. It's not as much the money as not letting someone roll me and get away with it. But as an old person, I also have to consider the time this might cost me.

 

(I shouldn't editorialize but I would not be all that sympathetic to plaintiff Simon in claiming damages of $400k because, to me, he was seeking a windfall and failed: he thought he had a deal to buy a $1.5m property for $1.1m. In the end, he may have been very disappointed, and without really studying the details of what the various players did to him that I could agree was unfair, Simon, himself, could be looked at as less than "Snow White" by hoping to obtain the property of someone else at far below its real value. He didn't really lose anything he already had beyond his expenses and some time and trouble, which certainly justify additional compensation and which I think were reasonably set at $50,000 in this case disregarding that it was derived/expressed as a ratio., which I, as an admitted layman, still think is too arbitrary.)

 

Thanks for your insights and I hope to follow up at a later time.

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5 hours ago, ThatTenant said:

I have a decision to make as to whether to take the next step in having the matter reviewed by a litigator.

 

I think you'd better.

 

5 hours ago, ThatTenant said:

It's not as much the money as not letting someone roll me and get away with it.

 

If it's not the money then lick your wounds and get on with your life. Money is the only way to punish somebody for doing you wrong.

 

5 hours ago, ThatTenant said:

But as an old person, I also have to consider the time this might cost me.

 

How old?

 

I'm 72. If somebody did me wrong I'd sue them in a heartbeat. Unless, of course, the lawsuit would cost me more than I could get by winning. I'm not a real fan of Pyrrhic Victories (google it).

 

 

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On 4/21/2019 at 12:34 PM, ThatTenant said:

In California, is there a practical limit to the potential recovery for civil extortion if the extortionate amount paid was small (around $1,000) but the ability of the defendant to pay is large?

 

As a practical matter, punitive damages are limited to no more than 10x compensatory damages (the relevant U.S. Supreme Court case is called BMW v. Gore).

 

 

On 4/21/2019 at 12:34 PM, ThatTenant said:

Can attorney fees be recovered by plaintiff if victorious or defendant if not?

 

In most civil litigation, each side pays its own attorneys' fees.  In a case arising out of a contract that provides for the recovery of fees from the other side, such recovery may be possible.  There are also a few civil causes of action in which fees are recoverable by virtue of some law, but those are quite uncommon.

 

 

On 4/21/2019 at 12:34 PM, ThatTenant said:

Can small claims court award punitive damages

 

No.

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That was a link to CA Code of Civil Procedure 116.220 which says, in part:

 

Quote

 


(a) The small claims court has jurisdiction in the following actions:

(1) Except as provided in subdivisions (c), (e), and (f), for recovery of money, if the amount of the demand does not exceed five thousand dollars ($5,000).

 

 

There is nothing expressly prohibiting punitive damages so if the OP were to ask for $1000 compensatory plus $4000 punitive for a total of $5000 what's to stop a judge from awarding it?

 

After all, small claims is somewhat informal.

 

Is there some appellate decision somewhere that addresses that?

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1 hour ago, pg1067 said:

the relevant U.S. Supreme Court case is called BMW v. Gore

 

I think more relevant Supreme Court case would be:

 

State Farm Mutual Automobile Insurance Co. v. Campbell, 538 U.S. 408 (2003).

 

or maybe, for California-based matters:

 

Simon v. San Paolo U.S. Holding Co., Inc. 35 Cal. 4th 1159 (2005)

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