In the landmark case Liebeck v. McDonald’s Corporation (1994…
In the landmark case Liebeck v. McDonald’s Corporation (1994), Stella Liebeck, a 79-year-old woman, suffered severe third-degree burns to her legs, groin, and buttocks when she spilled a cup of McDonald’s coffee while sitting in a parked car. Evidence revealed that McDonald’s knowingly served coffee at 180-190°F (significantly hotter than typical restaurant coffee at 140-160°F), had received 700+ prior complaints about burns, and had conducted a cost-benefit analysis concluding it was cheaper to pay injury settlements than to reduce coffee temperature. The jury awarded Liebeck $200,000 in compensatory damages and $2.7 million in punitive damages. Which of the following BEST explains what punitive damages are and their purpose in this case?