The Effects of Punitive Damages Litigation on Marketing and Public Policy

Abstract

During the past 25 years, marketers have been exposed to punitive damages claims in those cases where marketing behavior was deemed egregious. In this article, the primary purposes of punitive damages are identified, as are the various parties engaged in this arena. While each punitive damages claim is distinct, an aggregate view of the cumulative effects and the processes that produce them is possible. Over time, these effects and processes are expected to produce a change in the marketing environment, changes which vary in terms of both their economic and social consequences. While the evolution of the legal and marketing systems will occur in tandem, the isolation and measurement of these effects is difficult because of the various levels of aggregation, the number of parties, and the spatial and temporal separation of causes and effects.

Macromarketing as Agorology: Macromarketing Theory and the Study of the Agora

“…The unintended effects of marketing systems can be negative, as well, such as the effects of infant formula promotion on women's health (Gilly and Graham 1988), postconsumption waste (Uusitalo 1982), deforestation (Harvey 1995), and the marginalization of vulnerable consumers (Hill and Stephens 1997). In a similar vein, the effects of social and legal systems can curb the effectiveness of the market, including the effect of litigation on product offerings (Morgan and Stoltman 1992), social pressure to curb advertising (Solow 2001), or the concern over personal identity on the flow of marketing information (Zwick and Dholakia 2004).…”

Macromarketing: Past, Present, and Possible Future

“…Interest, however, soon moved away from the formulation of an integrated theory and the study of systems per se and toward a problem-oriented exploration of the wider impact of marketing processes on both developed and developing societies. This led to studies of environmental issues, such as sustainable consumption (Kilbourne et al 1997) and materials recycling through reverse channels (Fuller et al 1996), to a consideration of policy-related questions, such as the impact of taxes on interstate mail-order sales (Mittelstaedt and Stassen 1991) and the effect of punitive damages on marketing and public policy (Morgan and Stoltman 1992), to studies of marketing in developing or transitional economies, such as the work of Cordell (1993) in the study of craft cooperatives as trade intermediaries in a transitional economy and of and his colleagues in the redevelopment of warravaged economies.…”

The Dark Side of Development in Vietnam

“…In addition, violations of such standards should be swiftly and properly dealt with. Punitive damages (Morgan and Stoltman 1992) should be strictly enforced to send a strong message that illegal business practices are not tolerated in Vietnam and the consequences are much more costly in the long term than the short-term profit they bring. Competitive advantage through low-cost labor (Porter 1990) and lower operating standards is not sustainable and the Vietnamese government should take actions before the adverse impacts of economic development such as the killing of the Thi Vai river become irreversible.…”