Buffalo Law Review

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The United States tort reform movement has capped noneconomic damage awards in many jurisdictions, thereby preventing the most injured plaintiffs from being fully compensated for their suffering. While litigants have asserted numerous state constitutional challenges to these tort recovery limits, with varying degrees of success, aggrieved plaintiffs have underutilized the Fifth Amendment’s Takings Clause. This Article advocates that judicial reduction of a jury’s noneconomic damage calculation after the court has informed the successful plaintiff of the full verdict is a regulatory taking in violation of the federal Takings Clause, as incorporated against the states through the Fourteenth Amendment.

A Takings Clause violation requires a government taking of private property for public use without just compensation. A noneconomic damage award of which an injured plaintiff has been informed is a vested property interest; a trial judge reduces that award based on a statute; this is a regulatory, rather than a physical, taking under the Penn Central ad-hoc, three-factor standard; the taking is uncompensated because the plaintiff does not receive an equivalent of the full noneconomic damage verdict; and the taking is for public use because it is intended to reduce liability insurance premiums for the general public and encourage business investment. Finding enforcement of noneconomic damage caps to be an impermissible regulatory taking is supported by the Fifth Amendment’s historical roots and the Supreme Court’s Takings cases since the Founding. Moreover, ensuring that the most injured members of society, who are damaged because of a tortfeasor’s actions, are adequately compensated and are not required by states to carry the burden of lower insurance costs and business investment for a whole jurisdiction is sound public policy.