defendants wilfully engaged in a course of conduct violative of elemental standards of morality in the business community in order to win a public contract at plaintiffs’ expense, held, plaintiffs not entitled to punitive damages since no public right was involved and the underlying private wrong was susceptible of adequate compensation
How later courts described this case
- defendants wilfully engaged in a course of conduct violative of elemental standards of morality in the business community in order to win a public contract at plaintiffs’ expense, held, plaintiffs not entitled to punitive damages since no public right was involved and the underlying private wrong was susceptible of adequate compensation
- “The basic rule of damage in a case of unfair competition is the amount plaintiff would have made except for defendant’s wrong.”
Written by the judges who cited it.
The opinion
Tilzer, J.
(dissenting). I dissent. Punitive damages are but a means of admonition and are singularly appropriate and recoverable in an action for unfair competition where, as here, the defendants’ acts were committed “ deliberately, wantonly and maliciously and with reckless disregard for the rights of *120 the plaintiff.” Defendants’ “ outrageous wrongdoing ” may not be indemnified merely on the basis of compensatory damages. Moreover, it is not the form of the action or the existence of public or private wrong which gives the right to punitory damages, " but the moral culpability of the defendant.” (Walker v. Sheldon, 10 N Y 2d 401, 404; James v. Powell, 19 N Y 2d 249, 260; and see I. H. P. Corp. v. 210 Cent. Park South Corp., 12 NY 2d 329, 333 ; Toomey v. Farley, 2 N Y 2d 71, 83.) “ What is true of all actions, is especially true in a suit for unfair competition: disposition of each case peculiarly depends upon the precise state of facts disclosed.” (Roman Silversmiths v. Hampshire Silver Co., 282 App. Div. 21, 27 .) “ Hence, in assessing damages or requiring an accounting therefor, the nature and effect of the unfair competition becomes important.” (Ronson Art Metal Works v. Gibson Lighter Mfg. Co., 3 A D 2d 227, 231.) “ The seeming inconsistency of assessing the exemplary damages as a punishment and awarding the benefit of them to the plaintiff and not to the state may be justified by considerations already mentioned, namely, the advantage of furnishing an incentive for this sort of private prosecution of wrongs wfiich the public prosecutor would ignore, and by the fact that exemplary damages are likely to approximate recompense for the expenses of litigation (over and above taxable costs) for which the plaintiff would otherwise not be reimbursed.” (McCormick, Law of Damages, § 77, p. 278 [1935],)
Nor is there need for any further assessment as to compensatory damages. There is evidence sufficient in the record to compute plaintiffs’ profit on the Connecticut contract with reasonable precision, to conclude that but for the defendants’ wrongful acts the plaintiffs’ profit would have been $185,112. Conclusive proof of damages is .not required. “ The defendants are wanton wrongdoers and in such case ‘ every doubt and difficulty should be resolved against them.’ (Rubber Co. v. Goodyear, 9 Wall. [76 U. S.] 788, 803.) ” (Michel Cosmetics v. Tsirkas, 282 N. Y. 195, 203 .)
Accordingly, I would modify the judgment by reducing plaintiffs’ compensatory damages from $250,000 to $185,112, and would affirm the award of $50,000 punitive damages.
Steuer, J. R, Rabin and Bastow, JJ., concur with McNally, J.; Tilzer, J., dissents in opinion.
Judgment reversed, on the law and on the facts, without costs or disbursements; the cause is remanded to the trial court, and a new trial directed limited solely to the issue of compensatory damage. [See 30 A D 2d 117.]