In the case of State Farm Mutual Automobile Insurance Company v. Campbell, the U.S. Supreme Court ruled on punitive damages awarded in a lawsuit against an insurance company for bad faith and fraud. The Campbells had been involved in a car accident that resulted in one death and injuries to others; they were insured by State Farm who refused to settle within policy limits, assuring them it would cover any judgment if they lost at trial. However, when a verdict far exceeding their coverage was returned, State Farm refused to pay the full amount leaving the Campbells liable for most of it. They sued State Farm alleging bad faith and fraud winning $145 million in punitive damages from a Utah court which was reduced on appeal but still substantial at $25 million. The Supreme Court found this award excessive under constitutional due process principles as there must be reasonable relationship between actual or potential harm suffered by plaintiff and punitive damages awarded - suggesting single digit ratio between compensatory & punitive damage is more likely acceptable under due process clause.

In the dissenting opinion for State Farm Mutual Automobile Insurance Company v. Campbell, Justice Ginsburg argued that the majority's decision to limit punitive damages was not in line with previous court rulings and did not take into account the reprehensible conduct of State Farm. She emphasized that while there should be limits on punitive damages, these limits should be flexible enough to allow courts to punish and deter particularly egregious behavior by defendants. In this case, she believed that State Farm's actions were sufficiently reprehensible to justify a higher award of punitive damages than what the majority allowed. Furthermore, she disagreed with the majority's view that due process requires a strict ratio between compensatory and punitive damages; instead arguing for an approach which considers various factors such as harm caused or potential harm caused by defendant’s misconduct.