Punitive damages are meant to deter and punish defendants, but what happens when they are indemnified by an employer? What evidence should be permitted and what jury instructions given? The question is knotty and the answers, far from clear.
Legal Framework
Under 42 U.S.C. §1983, “Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State…, subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable.” Section 1983 ultimately serves twin purposes: “compensation of persons injured by deprivation of federal rights and prevention of abuses of power by those acting under color of state law.”1
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