80
Syllabus
said that the statute covers pain and suffering damages, medical expenses, and lost wages in an ordinary tort case because they are "designed to compensate . . . victims," id., at 332, n. 5, but does not apply to elements of damages that are "punitive in nature," id., at 332. The Government's reading also is more faithful to the statutory provision's history and basic tax-related purpose of excluding compensatory damages that restore a victim's lost, nontaxable "capital." Petitioners suggest no very good reason why Congress might have wanted the exclusion to have covered these punitive damages, which are not a substitute for any normally untaxed personal (or financial) quality, good, or "asset" and do not compensate for any kind of loss. Pp. 82-87. (b) Petitioners' three arguments to the contrary—that certain words or phrases in the original, or current, version of the statute work in their favor; that the exclusion of punitive damages from gross income may be justified by Congress' desire to be generous to tort victims and to avoid such administrative problems as separating punitive from compensatory portions of a global settlement or determining the extent to which a punitive damages award is itself intended to compensate; and that their position is supported by a 1989 statutory amendment that specifically says that the gross income exclusion does not apply to any punitive damages in connection with a case not involving physical injury or sickness—are not sufficiently persuasive to overcome the Government's interpretation. Pp. 87-90. 2. Petitioners' two case-specific procedural arguments—that the Government's lawsuit was untimely and that its original notice of appeal was filed a few days late—are rejected. Pp. 90-92.
66 F. 3d 1550, affirmed.
Breyer, J., delivered the opinion of the Court, in which Rehnquist, C. J., and Stevens, Kennedy, Souter, and Ginsburg, JJ., joined. Scalia, J., filed a dissenting opinion, in which O'Connor and Thomas, JJ., joined, post, p. 94.
Stephen R. McAllister argued the cause for petitioners in No. 95-966. With him on the briefs were Robert M. Hughes, Jack D. Flesher, Gregory L. Franken, and David B. Sutton. Linda D. King argued the cause and filed briefs for petitioner in No. 95-977.
Kent L. Jones argued the cause for the United States. With him on the briefs were Solicitor General Days, Acting Solicitor General Dellinger, Assistant Attorney General
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