The South Carolina Court of Appeals recently upheld a Spartanburg county jury’s award of actual and punitive damages against Wal-Mart in an interesting case involving negligence at the checkout counter. Solanki v. Wal-Mart Store #2806, No. 2012-213247 (S.C. Ct. App. Aug. 20, 2014). In his dissent, Justice H. Bruce Williams references the trial court judge’s remark as to the “weirdness of the transaction” underlying the claim, and the transaction was weird, indeed.
The Plaintiff, Mr. Solanki, trekked to the Wal-Mart in Boiling Springs for a shopping trip. When he attempted to checkout, the clerk tried three times unsuccessfully to charge the amount owed to Mr. Solanki’s credit card. The clerk then manually stenciled the credit card and entered the credit card number into the computer. Unfortunately, the number was entered into the computer incorrectly, and the number actually entered belonged to Ms. Martin. She noticed the apparently fraudulent transaction and reported it to the police department. Wal-Mart provided the police department with the manually sketched credit card bearing Mr. Solanki’s signature, the surveillance tape, and various other information pertaining to the transaction. Mr. Solanki was subsequently arrested in Georgia and spent almost a week in jail in Georgia before being extradited to South Carolina. Everything was eventually sorted out, and the indictment was dropped. However, Mr. Solanki filed suit against Wal-Mart as well as the police department shortly thereafter. Following a jury trial, the Spartanburg jury awarded $50,000 in actual damages and $225,000 in punitive damages.
Judgment was entered on the verdict, and post-trial motions were denied.
On appeal, Wal-mart argued that the evidence presented did not support an award of punitive damages, which in South Carolina requires the plaintiff to prove “by clear and convincing evidence the defendant’s misconduct was willful, wanton, or in reckless disregard of the plaintiff’s rights.” The Court of Appeals held that Mr. Solanki “presented sufficient evidence of Wal-Mart’s willful, wanton, or reckless misconduct to send punitive damages to the jury in two factual circumstances— the taking of the credit card information for the sale and the turning over of the credit card information to law enforcement.” Regarding the taking of the credit card information for the sale, the Court took into consideration that “[a]t the end of the transaction, the receipt presented had Mr. Solanki’s signature but showed Martin’s credit card information.” Regarding the credit card fraud investigation, the Court noted the trial court’s conclusion that “Wal-Mart was responsible for the creation and production of the evidence used to arrest Mr. Solanki and it was in the best possible position to point out the discrepancies to the police officers.”
This opinion is based on a unique set of facts, so its application to other contexts may be limited. However, it would appear at first glance that this holding imposes a heightened duty on retailers in the context of a criminal investigation, and eases the burden of proof for plaintiffs in punitive damages cases, either of which could create problems for defendants in the future.