What distinguishes nominal damages from punitive damages?

Nominal damages are a legal concept used to acknowledge that a legal wrong has occurred, even if there is no substantial financial loss resulting from that wrong. They are typically awarded in situations where the plaintiff's rights have been violated, but they cannot prove actual damages or financial loss. This type of damage serves more to affirm the principle that the law recognizes the alleged wrong rather than to provide financial compensation.

This understanding highlights the key distinction between nominal damages and punitive damages. While punitive damages are intended to punish the defendant for particularly egregious conduct and deter similar behavior in the future, they do not represent compensation for direct losses. Punitive damages are awarded in cases of serious misconduct, while nominal damages simply acknowledge that a wrong occurred without necessitating a showing of financial damage.