## Facts

- Doris Cheatham and Michael Pohle divorced in 1994 but continued to live and work in the same community.
- Pohle retained nude photographs of Cheatham and photographs depicting sexual acts involving the couple.
- In 1998, Pohle photocopied the photos, added identifying information (including Cheatham’s name, work location, phone number, and others’ names), and distributed at least sixty copies locally.
- Cheatham sued for invasion of privacy (public disclosure of private facts) and intentional infliction of emotional distress.
- A jury awarded Cheatham $100,000 in compensatory damages and $100,000 in punitive damages.
- Indiana Code § 34-51-3-6 required punitive damages to be paid to the clerk and then split: 25% to the plaintiff and 75% to the State’s Violent Crime Victims Compensation Fund.

## Issues

1. Whether Indiana Code § 34-51-3-6 effects an unconstitutional taking under the Fifth Amendment or the Indiana Constitution by diverting 75% of punitive damages to a state fund.
2. Whether the statute violates the Indiana Constitution by imposing an unconstitutional demand on an attorney’s services due to its effect on contingency-fee arrangements.
3. Whether the verdict and punitive-damages award were improper based on cross-appeal challenges to the availability of public-disclosure privacy liability in Indiana and to the punitive-damages instructions.

## Decision

- The Supreme Court of Indiana affirmed the judgment, including the statutory allocation of punitive damages (25% to Cheatham, 75% to the state fund).
- The court held the allocation statute did not violate the Takings Clause of the U.S. Constitution or the Indiana Constitution.
- The court held the statute did not unconstitutionally demand an attorney’s services under the Indiana Constitution.
- The court rejected the cross-appeal challenges to the liability theory and punitive-damages instructions, allowing the verdict to stand.

## Legal Principles

- Punitive damages serve punishment and deterrence rather than compensation; they are not awarded as a matter of right.
- A plaintiff has no vested property right in punitive damages beyond what state law defines; without a cognizable property interest, a takings claim fails.
- A statute that defines the plaintiff’s entitlement to punitive damages as a fixed percentage from the outset does not “take” the remainder, because the plaintiff never owned it.
- Legislative authority includes the power to limit, modify, or channel punitive damages as a state-law remedy.
- A statute allocating punitive damages to a public fund does not, by itself, compel attorneys to provide services or violate constitutional limits on compelled legal services; attorneys remain free to structure fees or decline representation.

## Conclusion

The Indiana Supreme Court upheld Indiana’s punitive-damages allocation statute against federal and state takings challenges, reasoning that punitive damages are a state-created, noncompensatory remedy in which plaintiffs have no vested property right beyond the share the legislature grants, and it also rejected claims that the statute unconstitutionally commandeers attorney services.


Cheatham v. Pohle, 789 N.E.2d 467 (Ind. 2003)