Thread by @WALLACHLEGAL

A loss in the St. Louis Rams relocation lawsuit could cost the NFL more than $3 billion in damages (before punitives), consisting of disgorgement of LA franchise value increase (latest Forbes valuation is $4.8B) and NFL relocation fee ($550M), plus City’s lost revenues.

A key part of the City’s damages calculation is the disgorgement (return) of profits unjustly conferred upon the NFL, Rams and Kroenke due to alleged improper conduct. See claims of unjust enrichment, fraudulent misrepresentation and tortious interference from City’s complaint.

Under Missouri law, disgorgement and/or restitution of ill-gotten gains is one of the remedies for a claim of unjust enrichment.

Unjust enrichment count:

Para. 72 - "The Plaintiffs are entitled to restitution of all sums obtained by Defendants based on their improper conduct, including the relocation fee and the increase in team value resulting from the move to Los Angeles."

Punitive damages could also be a billion-dollar-plus number. Unfortunately for the NFL, the new Missouri statute making it harder to plead and prove punitive damages applies only to claims asserted after August 28, 2020. This lawsuit was brought in 2017, before the law changed.

Further, in 2014, the Missouri Supreme Court struck down as unconstitutional a Missouri statute which had imposed a cap on the amount of punitive damages awarded to the greater of $500,000 or five times the net amount of the judgment awarded a plaintiff against a defendant.

A key ruling from the Missouri court on summary judgment: damages on unjust enrichment are not tied to "direct payments" made by a plaintiff. The benefit conferred must simply be "at the expense of the plaintiff." This puts relocation fee and increase in franchise value in play.

The new Missouri law (not applicable here) makes it harder to get punitive damages. PD's will now be limited to egregious cases where a “defendant intentionally harmed the plaintiff without just cause or acted with a deliberate and flagrant disregard for the safety of others.”

For cases filed before August 28, 2020, the standard is whether the defendant intentionally acted "either by a wanton, willful or outrageous act, or reckless disregard for an act's consequences (from which evil motive is inferred).”

The new punitive damages statute (enacted in 2020) eliminates "reckless disregard" and instead requires that a defendant "intentionally harm" the plaintiff or act with with "deliberate and flagrant disregard for the safety of others." City avoids the newer, higher threshold.

So, the City of St. Louis doesn't have to show "intent to harm" or "deliberate and flagrant disregard" to recover punitive damages. Under the pre-2020 standard applicable here, a showing of a "reckless disregard for an act's consequences" is enough to recover punitive damages.

Clear and convincing proof still required:

"A submissible case 'requires clear and convincing proof that the defendant intentionally acted ‘either by a wanton, willful or outrageous act, or reckless disregard for an act's consequences (from which evil motive is inferred).'"

“To satisfy the ‘clear and convincing’ standard of proof [for punitive damages], the evidence must show that the defendant either knew or had reason to know that there was a high degree of probability that the defendant's conduct would result in injury.” Achievable here.

Instead of having to show that the NFL defendants "intentionally harmed the City without just cause or acted with a deliberate and flagrant disregard" (the new standard), the City need only show that the NFL defendants acted with "reckless disregard" for the act's consequences."

As to the amount of punitive damages, "single-digit multipliers" (i.e., punitive damages over compensatory damages) generally comport with due process under SCOTUS precedent (Campbell). This leaves the NFL easily vulnerable to a several-billion dollar punitive damages award.