517 U.S. 559 (1996), United States Supreme Court Facts The plaintiff, Dr. Ira Gore, bought a new BMW, and later discovered that the vehicle had been repainted before he bought it. Defendant BMW revealed that their policy was to sell damaged cars as new if the damage could be fixed for less than 3 % of the cost of the car. Dr. Gore sued, and an Alabama jury awarded $4,000 in compensatory damages (lost value of the car) and $4 million in punitive damages, which was later reduced to $2 million by the Alabama Supreme Court. Issue Whether excessively high punitive damages violate the Due Process clause of the Constitution? Opinion of the Court The Court, in an opinion by Justice Stevens, found that the excessively high punitive damages in this case violate the Due Process clause. For punitive damages to stand, the damages must be reasonably necessary to vindicate the State’s legitimate interest in punishment and deterrence. Punitive damages may not be "grossly excessive" - if they are they violate substantive due process. The Supreme Court applied three factors in making this determination: The degree of reprehensibility of the defendant’s conduct; the ratio to the compensatory damages awarded (actual or potential harm inflicted on the plaintiff); and Comparison of the punitive damages award and civil or criminal penalties that could be imposed for comparable misconduct. Using these factors, the Court found that BMW’s conduct was not particularly reprehensible (no reckless disregard for health or safety, nor even evidence of bad faith). The ratio of actual or potential damages to punitive damages was suspiciously high. Finally, the criminal sanctions available for similar conduct were limited to $2,000, making the $2 million assessment the equivalent of a severe criminal penalty. The Court noted, however, that these three factors can be over-ridden if it is "necessary to deter future conduct." Dissenting opinions were written by Justice Scalia and Justice Ginsburg both contending that the Constitution was not implicated here, raising principles of federalism.