It’s a pretty good sign that a trial has just not gone well for the defendant when the defendant takes solace in the fact that the punitive damage award is “only” $850 million.
The same Florida state court jury that awarded Ronald Perelman $604.3 million in actual damages against Morgan Stanley earlier in the week awarded the Revlon, Inc. chairman $850 million against Morgan in punitive damages for defrauding the financier in connection with the 1998 sale of a large interest in Coleman, Inc. to Morgan’s client, Sunbeam Corp. Mr. Perelman had been seeking $1.8 in punies.
Thus, Morgan Stanley is facing a $1.454 billion jury verdict. If the trial court upholds the jury verdict, then Morgan is facing a difficult appeal, which will almost certainly revolve around the trial court judge’s pre-trial sanction order against Morgan Stanley that effectively prevented Morgan from defending itself during trial on the merits of Mr. Perelman’s fraud claims. Although that sanction order was harsh, most jurisdictions review such orders on an abuse of discretion standard. That is not an easy standard to overcome on appeal, even when the result is a $1.454 billion jury verdict.