Given the prevalence of gated communities in Florida, combined with Florida’s general light regulatory system, disputes involving homeowners associations (HOA’S) and gated communities are fertile ground for litigation. A recent blood feud in a gated community provides guidance on obtaining punitive damages involving the theft of DNA. Federal Insurance v. Perlmutter, 4D2022-1558 (4th DCA 2023).
How to Claim Punitive Damages in Florida
Before punitive damages can be claimed in Florida, a motion for leave to file an amended claim adding punitive damages must be made. Florida Rule of Civil Procedure 1.190(f) provides as follows:
(f) Claims for Punitive Damages. A motion for leave to amend a pleading to assert a claim for punitive damages shall make a reasonable showing, by evidence in the record or evidence to be proffered by the claimant, that provides a reasonable basis for recovery of such damages. The motion to amend can be filed separately and before the supporting evidence or proffer, but each shall be served on all parties at least 20 days before the hearing.
That rule of Florida civil procedure is based upon the underlying Florida statute on punitive damages, found at Section 768.72:
(1) In any civil action, no claim for punitive damages shall be permitted unless there is a reasonable showing by evidence in the record or proffered by the claimant which would provide a reasonable basis for recovery of such damages. The claimant may move to amend her or his complaint to assert a claim for punitive damages as allowed by the rules of civil procedure. The rules of civil procedure shall be liberally construed so as to allow the claimant discovery of evidence which appears reasonably calculated to lead to admissible evidence on the issue of punitive damages. No discovery of financial worth shall proceed until after the pleading concerning punitive damages is permitted.
The granting or denial of a motion for leave to amend to assert a claim for punitive damages is immediately appealable as a non-final order, under Florida Rules of Appellate Procedure 9.130(a)(3)(G). This amendment to the rules of appellate procedure was added on January 6, 2022, taking effect on April 1, 2022 via an Order from the Florida Supreme Court. As an aside, the amendment was approved 6-1, with an interesting and thoughtful dissent from Justice LaBarga.
The unfortunate consequence of this drastic change in appellate procedure will be unnecessary and unwarranted delays in civil actions with claims for punitive damages. Undoubtedly, once the interlocutory vehicle of appellate review is available, it is not unreasonable to expect that the losing party will choose to pursue an immediate appeal of the trial court’s order in most, if not all, cases, adding to the caseload of appellate courts. Once the trial court’s ruling is appealed, the case will necessarily stall at the trial level until the district court renders a ruling on whether the claim for punitive damages was properly permitted.
Given this additional delay, it is also not unreasonable to anticipate that some claimants in civil cases may reluctantly forgo meritorious claims for punitive damages in order to avoid delay in bringing their cases to a final resolution. Of particular concern are tort cases involving personal injury, where claims for much needed medical and economic relief will stall until the question of punitive damages is resolved. Access to our judicial system with claims authorized by law should not be impeded by unnecessary delay and resulting additional expense.
Tellingly, during oral argument on August 31, 2021, counsel for the Appellate Court Rules Committee of The Florida Bar (Committee) noted that in a 2018 fifty-state survey, no state had a rule like the one adopted today by the majority.
Defamation Lawsuit From Hell (Also Known as a Florida Gated Community)
A dispute arose in a gated community over the retention of a tennis instructor. The tennis instructor filed a defamation suit, to which Peerenboom was added as a defendant. As explained by the Court:
During the tennis instructor’s suit, Peerenboom’s family, friends, neighbors, and colleagues received a series of “hate mail” letters falsely accusing Peerenboom of child molestation and murder. Peerenboom suspected the Perlmutters were involved in the hate mail because, a year earlier, Isaac Perlmutter had circulated negative news articles about Peerenboom. Believing he was the victim of a crime, Peerenboom reported the hate mail to law enforcement and postal investigators, and hired private investigators to develop information about who had sent the hate mail.
As part of that investigation, Peerenboom and Douberley surreptitiously obtained the Perlmutters’ DNA to compare against DNA obtained from the hate mail. Peerenboom then reported to the police and media that the DNA results had linked the Perlmutters to the hate mail campaign.
Peerenboom later filed a complaint against the Perlmutters raising various causes of action related to the sending of the hate mail.
Upon learning that Peerenboom had surreptitiously tested their DNA, the Perlmutters asserted a counterclaim against the Appellants. In their counterclaim, the Perlmutters alleged conversion and civil theft of their genetic information; abuse of process for issuing subpoenas upon them for improper purposes; defamation for false reports of their involvement in sending the letters; invasion of privacy for the surreptitious collection, testing, and reporting of their DNA; and civil conspiracy to defame them and falsely implicate them in criminal conduct.
The Perlmutters later moved to amend their counterclaims to seek punitive damages from the Appellants. The Appellants responded in opposition. After a hearing on the Perlmutters’ motions to amend, the trial court entered the separate orders, now on appeal, granting the motions to amend as to each of the Appellants.
Seems pretty outrageous, right? Stealing someone’s DNA should be strongly discouraged through the posible awarding of punitive damages, correct? The trial court agreed and allowed the punitive damages component of the lawsuit to go forward, and this appeal ensued.
No Punitive Damages if Conduct Directly Related to Proving a Matter In Court
The appellate court reversed, holding that the conduct at issue did not rise to the level of punitive damages, as explained:
However, even conceding that the Perlmutters’ proffer demonstrated evidence that could lead a jury to conclude that Peerenboom and Douberley specifically intended to engage in acts constituting misdemeanors by testing DNA and disclosing the results, we conclude there was no proffered evidentiary showing that Peerenboom and Douberley were trying to develop DNA information about either of the Perlmutters to invade their privacy beyond trying to investigate the hate mail campaign.
As the United States Supreme Court, the Florida Supreme Court, and this Court have said, “[punitive damages] are not compensation for injury. Instead, they are private fines levied by civil juries to punish reprehensible conduct and to deter its future occurrence.”
We conclude, as a matter of law based on the facts of this case, that Peerenboom’s conduct in testing and reporting DNA results, under the circumstances of the hate mail campaign leading to a law enforcement investigation, did not meet the threshold of reprehensible or outrageous conduct. Thus, the Perlmutters’ counterclaims could not be amended to assert punitive damages against Peerenboom or Douberley.
Our decision should not be construed to preclude an award of compensatory damages, by a preponderance of the evidence burden of proof, for any intentional tort which the jury determines Peerenboom or Douberley may have committed.
So the Court instructed that the behavior allowed for a jury to determine whether the behavior was sufficiently bad so as to allow the awarding of compensatory damages. But, because the behavior was tied up with litigating contested facts, not bad enough to allow punitive damages.