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Miami�A trial judge has thrown out a $33.8 million punitives-only damage award handed down by a jury in a fraud case against ChevronTexaco Corp. In the case, brought by the Fort Lauderdale, Fla.-based Apex Development Corp., Miami-Dade County Circuit Judge Fredricka Smith ruled that the punitive damages award could not stand because the jury found that Apex had suffered no economic loss. During deliberations after a two-week trial in June, the jurors sent two notes to Smith asking whether they could award punitive damages without any compensatory damages, Smith noted in her order. Before she could discuss the question with the lawyers and reply to the jurors, the jury announced it had a verdict. Both sides agreed to take the verdict without answering its question. The jury found that Texaco, which merged with Chevron in 2000, made false promises to Apex in a deal to open Texaco Xpress Lube franchises in South Florida. It awarded Apex no compensatory damages, only the punitives. San Ramon, Calif.-based ChevronTexaco filed a post-trial motion to set aside the verdict. In her order granting the motion on Nov. 12, Smith said that because damages are an essential element of proving a case of fraud, compensatory damages are “a prerequisite to an award of punitive damages. “Since the jury did not find that the misrepresentation resulted in compensatory damages, there was no express finding of liability,” Smith wrote. “There being no actual damages found by the jury or implied by law, the punitive damages award must fall.” In the same order, Smith denied Apex’s motion for a new trial on compensatory damages. Apex had argued that the verdict was contrary to the evidence and that Smith had improperly instructed jurors that they could consider mitigating factors in assessing compensatory damages. “Apex had a duty to mitigate its damages,” said ChevronTexaco’s attorney, David Wood, a partner in the Orlando, Fla., office of Baker & Hostetler, said in an interview. “We respect Judge Smith and are studying the order to see our next step,” said Apex’s lawyer, Adam Moskowitz, a partner at Kozyak Tropin & Throckmorton in Miami.

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