Punitive damages came largely out of the Ford Pinto cases because prior to that corporate leaders would just do the calculations, figure out that the limited amount of damage/fines allowed by the law is cheaper than the cost of fixing the issue. Punitive damage is in a way meant to be absurd. The idea that the sky is the limit is meant to make those calculations impossible or very risky and thus compel corporations to fix the issue once they know about it. There are some unintended consequences of course but often times when you see such cases there are usually a history of knowing neglect or willful ignorance. In the other famous punitive damage case involving McDonald's, there was a trail of complaints to McDonald's about how hot they made their coffee (they did this on purpose because people who get coffee in the morning tend to be drivers so extra hot coffee means right temperature when they get to their office). Even then, McDonald's was only found to be partially at fault. Also many of the tobacco cases demonstrated a long history of tobacco companies knowing the health effects of smoking and lied about them.

The way these cases are sometimes reported makes American courts look crazy and leave out a lot of context and history.