Exemplary or punitive damages are available when a claimant proves by clear and convincing evidence that the harm results from fraud, malice, or gross negligence. Before amendment, a state statute defined malice as incorporating both objective and subjective elements of the gross negligence standard: (1) viewed objectively from the standpoint of the actor, the act or omission must involve an extreme degree of risk, considering the probability and magnitude of the potential harm to others; and (2) the actor must have actual, subjective awareness of the risk involved, but nevertheless proceed in conscious indifference to the rights, safety, or welfare of others. Extreme risk does not mean a remote possibility of injury or even a high probability of minor harm, but rather, the likelihood of serious injury to the plaintiff. Actual awareness means that the defendant knew about the peril, but its acts or omissions demonstrate that it did not care.
Respondent customer went to petitioner department store to return merchandise. Prior to doing so, the customer purchased other items. He was reported as a possible shoplifter, handcuffed, and turned over to the police. The customer testified that a store employee refused to allow the customer to search for a receipt for the merchandise and instead, handcuffed him and questioned him while he was lying on the floor. After the customer was acquitted on criminal charges, he brought this false imprisonment action against the store, and he was awarded both actual and exemplar damages. On review, the appellate court affirmed judgment as to the actual damages but deleted the exemplary damages..
Was there clear and convincing evidence of department store's malice thus entitling a customer to exemplary damages?
Because a customer"s testimony provided some evidence that the customer had not been detained in a reasonable manner, as required by state statute, an award for actual damages for false imprisonment was supported. However, the court, assuming without deciding that the gross negligent component of the former statutory malice definition of former Tex. Civ. Prac. & Rem. Code Ann. § 41.001(7)(B) could provide a basis for an award of exemplary damages when the underlying actual damages were based on an intentional tort, there was no clear and convincing evidence that the conduct involved had exposed the customer to an extreme risk of substantial harm.