COEN v. APTEAN, INC.

Timothy Coen sued his former employer over a severance dispute and won. He later filed a separate lawsuit accusing the company and its lawyers of abusive litigation, meaning they allegedly ran up his costs with baseless defenses filed in bad faith. In that abusive litigation suit, Coen asked for punitive damages, which punish a wrongdoer rather than simply compensate a victim. A DeKalb County trial court and then the Court of Appeals of Georgia said punitive damages are never available for this kind of statutory claim, following older Court of Appeals rulings. The Supreme Court of Georgia disagreed. It examined the abusive litigation statute's language allowing 'all damages allowed by law,' the history of the older common-law torts it replaced, and a footnote in a 1986 case that the lower courts had misread. The court held that punitive damages are generally recoverable in abusive litigation cases, so long as the plaintiff isn't seeking damages only for hurt feelings, and sent the case back for further proceedings.

OCGA § 51-7-83(a)'s phrase 'all damages allowed by law' includes punitive damages in abusive litigation cases, because the statute's text supports it, the common law before the statute generally allowed punitive damages in such cases, and awarding punitive damages alongside compensatory damages is not always an improper double recovery.

The ruling reopens the door to punitive damages for people and businesses who sue over abusive or bad-faith litigation tactics in Georgia, potentially raising the financial stakes for parties and lawyers who file frivolous claims or defenses, and clarifies how trial courts should handle these damages claims going forward.

Reversed in part and remanded

1. The court read the abusive litigation statute's phrase 'all damages allowed by law as proven by the evidence' (O.C.G.A. § 51-7-83(a)) broadly, noting that Georgia courts have generally interpreted words like 'all' expansively, and that punitive damages are a type of damages 'allowed by law' under O.C.G.A. § 51-12-5.1 when proven by clear and convincing evidence.
2. The court distinguished a prior case, Lyman v. Cellchem, where 'any damages sustained' language excluded punitive damages because punitive damages are imposed on a wrongdoer rather than 'sustained' by a victim; that reasoning didn't apply here because the abusive litigation statute doesn't use 'sustained' language.
3. The court examined the historical common law: before 1986, the torts of malicious use and malicious abuse of legal process, the predecessors to today's abusive litigation claim, generally allowed punitive damages, contrary to what later Court of Appeals decisions assumed.
4. The court traced this misunderstanding to a footnote in its 1986 decision in Yost v. Torok, which said in passing (as dicta, meaning a comment not essential to the court's actual ruling) that punitive damages were excluded from abusive litigation claims; the court concluded this footnote mischaracterized the law and was not binding precedent.
5. Because the legislature enacted the abusive litigation statute in 1989 against a legal backdrop where punitive damages were traditionally allowed, the court applied a presumption that lawmakers meant to preserve existing common-law rules unless they clearly said otherwise, supporting the conclusion that punitive damages remain available.
6. The court explained that awarding punitive damages alongside compensatory damages, attorney fees, and litigation costs does not create an improper double recovery, because compensatory damages make the plaintiff whole while punitive damages separately punish the wrongdoer, so long as the claim isn't based solely on injury to peace, happiness, or feelings.

• abusive litigation
• punitive damages
• attorney fees dispute
• statutory interpretation
• malicious use of process