Law360 highlighted ways litigants are getting creative to impose meaningful sanctions on wealthy companies. State law requires that court-imposed sanctions be proportional and bear a direct relationship to a party's objectionable conduct. As a consequence, financial penalties are typically modest, except in egregious cases where the bad actor is usually a repeat offender. That's what makes creative punishment options alluring.
"The most impactful sanctions are the ones that affect the lawsuit itself," said Gardere Partner James G. Munisteri. "Especially if there are multiple lawsuits pending that involve the same issues."
But there are limits. As with monetary sanctions, the punishment must fit the crime if an alternative penalty is to be upheld on appeal. Imposing the "death penalty" on a party's case is viewed by most courts as an option of last resort because the extreme measure can violate constitutional rights if a lesser remedy was available. It usually pays to come up several options for a court to consider, Mr. Munisteri said.
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