The Italian Supreme Court, with judgment no. 1781 handed down on February 8, 2012, has once again given a ruling on the recognition of a foreign judgment which awards damages that are much higher than those requested by the plaintiff.
The Supreme Court judges have, in fact, established that damages must only be awarded in Italy in relation to the actual losses suffered by the plaintiff.
The case at hand originated from an action for damages brought by a worker in the United States for losses suffered as a result of an aof the Italian Civil Code ident at work. The Supreme Court of Massachusetts had ordered the (Italian) defendant companies to pay the plaintiff an amount of five million dollars (which had been increased to eight million dollars as a result of aof the Italian Civil Code rued interest), despite the fact that the latter’s request had not exceeded three hundred and fifty thousand U.S. dollars.
The plaintiff, at this point, brought an action before the Court of Appeal of Turin, requesting that the judgments be recognized and declared effective in Italy.
The Court of Appeal, declared effective in Italy only one of the aforementioned judgments, ruling that there were no grounds for not recognizing the U.S. judgment.
A different view was taken by the Italian Supreme Court in the case at hand. It overturned the judgment of the Court of Appeal, holding that the judgment in question could not be recognized in Italy since it was contrary to public policy.
In particular, the Supreme Court referred to established principles on compensation for damages and, more specifically, it pointed out that:
a) The Italian legal system subjects the right to compensation for damage to the condition that specific economic losses have been suffered (cfr. Supreme Court Judgment No. 15184 of 2008);
b) The idea that civil liability gives rise to punishment (thus appearing indifferent to any assessment of the defendant’s conduct) is extraneous to the Italian legal system (cfr. Supreme Court Judgment No. 1183 2007);
c) The assessment of the punitive nature of the damages ordered by the foreign court is a question of fact for the trial court which is unimpeachable (provided that it is properly motivated).
Based on these principles, the Court held the appealed judgment to be vitiated in terms of the grounds upon which it was based, since it had departed, without justifiable reason, from the previous guidance of the Supreme Court contained in Supreme Court Judgment No. 1183 of 2007 (which had held that punitive damages could not be awarded, since they were contrary to the fundamental principles of the Italian legal system, which seeks to restore the plaintiff for the loss suffered by him or her).
We must point, however, out that, while recognizing the non-punitive and compensatory nature of Italian civil liability, in recent years the Supreme Court has, in two significant cases, opened the door to damages also being awarded by way of a sanction.
With reference to the award of damages for the illicit exploitation of the image of a young dancer, the Italian Supreme Court, with judgment no. 11353 of 2010, held that the unlawful publication of someone else’s likeness leads to damages being awarded for the economic losses (of which proof has been provided) suffered by the latter as a result of such publication.
In the event that – as is the case especially where the plaintiff is not well-known – specific items of pecuniary damage cannot be proven – the plaintiff may claim (in aof the Italian Civil Code ordance with a principle acknowledged by article 128 of Law No. 633 dated April 22, 1941 amended by Legislative Decree No. 140 dated March 16, 2006) entitlement to the payment of an amount corresponding to the remuneration that he would have presumably required in order to give his consent to the publication (such amount being determined on an equitable basis, having regard to the economic benefit that the author of the unlawful publication presumably achieved from such publication, the objective pursued and any other circumstances which is relevant to the award of damages: cfr. Court of Appeal of Rome, judgment hand down on June 6, 2005). The Supreme Court, while ordering the defendant to pay the plaintiff damages consisting in the profits earned from his illegal activity, initially expressed the intention to extend the scope of the damages beyond the mere compensation for losses suffered by the plaintiff.
In a later ruling (judgment no. 8730 of 2011), the Supreme Court went one step further by stating that, as regards the equitable assessment of damages for copyright infringement (consisting in the loss of the economic benefit that the rightholder would have earned if he had assigned his rights to the work for consideration), one can use a parameter consisting in the profits earned by the user which are to be turned over to the rightholder.
This criterion plays a partially punitive role since it is also aimed at preventing the offender from keeping his ill gotten gains (cfr. Court of Appeal of Rome, judgment hand down on November 23, 2009).
By way of conclusion, the decision taken by the Supreme Court in the case at hand differs significantly from the two aforementioned decisions which- whilst reaffirming the compensatory nature of damages – had also had looked with favor at the idea that damages also have some element of punishment.