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Added after edit: Is there any clause in the Constitution of California that prevents a law from attaching fines that are worth more than the actual damage that was caused by violation of the law?Has there been any such cases?
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The jurisdiction is : USA -> California

The law used as example is: CCPA

The CCPA states that if someone fails to respect a user's privacy rights, the website owner may be charged $7,500 per visitor or violation. Now, let's say a company has 10 million users from California. The website either fails to delete IP logs of the visitors or suffers a data breach. The company only makes $100,000 per month through ads, with operations costs of $10,000 per month.

Can the company be given a $7,500 * 10 million = $75 billion dollar fine? Are there any laws that prevent this?

In general, can any law just demand any amount from anyone?

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  • The profit that the company makes is not related to the damage it causes. Would a company that does not make a profit be free to ignore the laws because it is inmune to lawsuits?
    – SJuan76
    Nov 16 '20 at 8:25
  • My question was whether the fine can be greater than the magnitude of damages?
    – questioner
    Nov 16 '20 at 9:12
  • Then what is the point of mentioning profits?
    – SJuan76
    Nov 16 '20 at 9:26
  • To show it is impossible for them to pay the fine( The high CCPA are impossible to pay for almost any corporation in the world(This is just matter of fact , I do not aim to speak against or criticize any jurisdiction or their sovreignity to make laws).)
    – questioner
    Nov 16 '20 at 9:27
4

Damages are (generally) not constrained by the defendant’s ability to pay

The purpose of a fine is to punish the wrongdoer and dissuade others from offending. The purpose of damages is to restore the wronged party to their original position.

In recent times, there is a tendency to link fines to corporate profits or revenues but that is generally as a means of increasing the fines rather than limiting them.

If a fine or lawsuit bankrupts the defendant then it bankrupts the defendant.

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  • No one seems to understand the question. I am asking if damages say amount to $100000 can the defendant be charged $ 75 billion just because the state desires?
    – questioner
    Nov 16 '20 at 10:07
  • 2
    @questioner oh, an easy one! Yes. Damages are a civil remedy to restore the plaintiff, fines are a punishment by the government - they are unrelated.
    – Dale M
    Nov 16 '20 at 10:08
  • You mean yes.Then any amount can be extracted from anyone!
    – questioner
    Nov 16 '20 at 10:11
  • 1
    @questioner no - that’s why bankruptcy exists; once everything has been extracted, then you stop.
    – Dale M
    Nov 16 '20 at 10:45
  • 5
    @questioner As a general rule, if you've found an ingeneous loophole in corporate law, the answer is "no because it's fraud".
    – Studoku
    Nov 16 '20 at 21:41
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Q: Can the company be given a $7500*10 million=$75 billion dollar fine?

Legally, mathematically and hypothetically yes. However a proper reading of the Act at 1798.155(b) shows that $7,500 is not a fixed mandatory amount but rather is the maximum that can be imposed for each intentional violation that is no remedied within the statutory timeframe. Courts have discretion and defendants have mitigation.

(b) A business shall be in violation of this title if it fails to cure any alleged violation within 30 days after being notified of alleged noncompliance. Any business, service provider, or other person that violates this title shall be subject to an injunction and liable for a civil penalty of not more than two thousand five hundred dollars ($2,500) for each violation or seven thousand five hundred dollars ($7,500) for each intentional violation...

Q: Is there any laws that prevents this?

No. There are no laws that prevent another law being applied correctly, although one may be able to appeal a court's ruling in certain situations.

Q: This question is of general law, can any law just demand any amount from anyone?

No. The maximum amount is set by the relevant statute.

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  • The OP may be interested in 1798.155(a)... Any business or third party may seek the opinion of the Attorney General for guidance on how to comply with the provisions of this title.
    – Rock Ape
    Nov 16 '20 at 12:12
  • What!! I think the attorney genral only gives advice to public officials.
    – questioner
    Nov 16 '20 at 13:54
  • I'm only quoting from the legislation you cited in the OP :)
    – Rock Ape
    Nov 16 '20 at 14:24
  • However I think the attorney general just changed the rule.
    – questioner
    Nov 16 '20 at 14:40
  • @questioner Can you cite the rule change in case it's relevant?
    – Rock Ape
    Aug 11 at 12:47

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