Much as I side with the bakery on this, $31 million is ridiculous. That’s probably as much money as they’d make in 40 or 50 years.
The fact that this was led by a rogue college official was probably are major factor in the size of the award. Probably meant to be punitive and an example for others. As such, I think it's totally proper.
Punitive damages are meant to deter evil minded conduct that intentionally harms. One of the factors a jury may consider is the ability of the defendant to pay. So $31M with a $1B endowment was reasonable enough for the appelate court to endorse the judgment of 12 registered voters that served as jurors. With punitive damages, the taller they are, the harder they fall.
Punitive damages need to be significant so that the college learns its lesson. A jury is supposed to make it hurt without bankrupting them.
Punitive damages are awarded above and beyond compensatory damages. In cases like this, “punitive” is measured based on the value of the defendant’s assets.