Punitive Damages - Worker's Compensation - Parent-Subsidiary Relations - Good Samaritan Liability

Mr. McReynolds handled this case where The Louisiana Supreme Court reversed a jury award of $38 million in compensatory damages and $120 million in punitive damages against a French parent corporation for injuries sustained in an air separation plant owned and operated by its American subsidiary that had employed three injured workers. The Court affirmed the basic principle of shareholder immunity that a “parent corporation may, by virtue of its ownership interest, ha[ve] the right, power, and ability to control its subsidiary, [but] a parent corporation generally has no duty to control the actions of its subsidiary and thus no liability for a failure to control the actions of its subsidiary.” The court also held that the plaintiffs had failed to prove that the French parent had undertaken any such duty within the meaning of §324A of the Restatement (Second) of Torts, also known as the Good Samaritan Doctrine: “Neither a parent’s concern with safety conditions and its general communications with the subsidiary regarding safety matters, nor its superior knowledge and expertise regarding safety issues, will create in the parent corporation a duty to guarantee a safe working environment for its subsidiaries’ employees under §324A.” The case was re-argued and submitted on January 18, 2005. The Supreme Court re-instated its original decision, reversing the jury verdict, in a per curiam opinion issued on January 19, 2006.

Bujol v. Entergy Services, Inc., 03-0492 (La. 1/19/06), 922 So. 2d 1113, 2004 WL 1157413.