He’s not paying 1billion for a single defamation case. For one thing that’s the sum of multiple cases against him, and the more significant thing is that he lost because he did not fight it through the legal process and got a default judgement entered against him, and the most significant thing is that this amount is awarded due to punitive damages.
The amount is not simply meant to compensate the aggrieved party. That would have been capped to a much smaller amount. However because of a continuous series of intentional deceit and fraudulent actions during the lawsuit itself, punitive damages were awarded instead, where the point is to set an example against such behavior in court cases.
That extra punishment is for the benefit of the legal system rather than the aggrieved, it was something he could have simply avoided by just fighting the court case through the normal legal process. He would have simply lost and would only have had to pay a fraction of that amount.
The point of the ability to punish subversion of the legal process is that otherwise, no legal consequence for ignoring the court, would mean that anyone could completely ignore the legal process (which is what he was attempting to do).