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Punitive-damage awards are now commonplace in product-liability lawsuits, and the consequences are grave: the awards, which often reach six figures or more, may not be covered by liability insurance. How to avoid them? From the cases to date, several factors have emerged that make it more likely a jury will award punitive damages.

"The most serious problem is concealment," says Sheila L. Birnbaum of Skadden, Arps, Slate, Meagher & Flom, in New York City. When safety complaints emerge about a product, companies should take prompt action -- redesign the product, for example, or bring the complaints to the attention of an appropriate government agency. "What gets you into real trouble is hoping the problem goes away," says Birnbaum.

Other factors that have led juries to award punitive damages include evidence that the company has:

* knowingly violated a government or industry safety standard;

* ignored a safer (and reasonably inexpensive) alternative;

* used misleading advertising about the safety of the product;

* disregarded technical reports suggesting an unreasonable hazard;

* demoted or fired a whistle-blower who voices safety concerns;

* done a poor job of handling consumer safety complaints; or

* failed to do sufficient safety research.