Damage awards seem totally outrageous mostly because the media coverage of the subject is typically very one-sided, and VERY shallow. Just saying the same thing over and over doesn't make it true - but it does make lots of people THINK it is.
Chris summarized the case very well in his post. How much of that detail do you think the average person knows? For that matter, how many really stop to consider that a jury made that award - 12 citizens who tend to reflect the same hostility to these cases and judgments that are held by the public at large? How many know the difference between compensatory and punitive damages - and the reasons for each. How many realize, as Chris pointed out, that blame is often apportioned, and compensatory damages decreased as a result?
Why do the media fail to report both sides of this case, and continue to refer to the "million dollar damages", when the judge decreased the award to a fraction of that, as Chris mentioned? Maybe because referring to millions gets better ratings?
How many people realize that, for a corporation like McDonalds, even punitive damages in the millions of dollars aren't much punishment? (I've heard that the jury in this case determined punitive damages by deciding that McDonalds should pay 2 days coffee receipts as punishment - seems pretty reasonable when stated that way, right?)
The purpose of punitive damages is to punish the guilty party, not enrich the person who receives it. Tough to get any big company's attention unless it's "real money". Punitive damages are also the only incentive for lawyers to pursue such cases at all - if they don't win, they get zip. Most of us don't have deep enough pockets for lawyers if we had to pay them ourselves for this stuff.
Like a lot of things in life, you really don't get the information to make an informed decision on these issues unless you do some digging on your own. The web helps a lot (though you have to be careful, there's lots of misinformation there, too). If you rely only on the TV news and other mass media, you're handicapping yourself.
There's plenty of people taking advantage on both sides of these cases. Juries are supposed to be how we sort them out. But there are plenty of justifiable awards, too, and using a product liability case that's justifiable as the poster child for abuse is flat wrong.
Just calling yourself "fair and balanced" doesn't make you a journalist (let alone fair and balanced). Perpetuating the conventional wisdom doesn't help much, either.