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Focus on safety and avoid out-of-control damages

February 3, 2022 By    

I want to take a moment to look at a profound change to the litigation landscape.

It comes in the form of what has been labeled “nuclear verdicts.” It can be hard to label a verdict as so out of proportion to the actual damages, but some examples seem to fall easily into that category.

In late 2021, a jury awarded a single injured plaintiff (and his family for loss of consortium and economic losses) $352 million for an accident at Houston’s George Bush Intercontinental Airport that left him partially paralyzed. There is no doubt this man was severely injured after being hit by a vehicle while working on the tarmac, but these types of damages seem to be far beyond compensatory damages.

A study by the American Transportation Research Institute found that the average verdict in the trucking industry was $2.3 million in 2010 but rose to an average of $22.3 million in 2018. And the average has continued to grow substantially. There is no available analysis of verdicts in the propane industry, but it is a widely expressed concern in the litigation defense bar that verdicts are getting out of control and do not reflect fairly the compensatory value of damages in cases.

Trying to assess the “why” can be difficult, but there are commonly acknowledged influences.

Corporate America has been seen as a scapegoat for financial ills since the economic crash of 2008. Jurors are inclined to hold companies at fault and in effect punish them when they are negligent. Teaching the jury to understand the people behind the company and the safety practices that are paramount is a way to combat this bias.

Plaintiff’s counsel strives to show the company was only interested in profit, that it did not care about safety or ignored safety to benefit its bottom line. Plaintiffs will explore any way a company may have failed to adhere to safe practices, even if these shortcomings have nothing to do with what caused an accident.

The lesson here is to be vigilant in getting the training current, the paperwork done correctly, and making sure all employees comply with company policy. When there is a failure, be sure to correct it and document that correction. These steps promote safety and allow your counsel to have a good story to tell a jury.

Litigation funding, once rare, is now commonplace. It allows plaintiffs to pursue cases they might otherwise have avoided due to the financial costs. In exchange for a significant fee, the funding entities give lift to otherwise lost cases. There is little we can do to prevent this development.

The plaintiffs’ bar is getting organized – gathering and sharing data on corporations, settlement histories of insurers and companies, and dossiers of experts used by defendants. The best way to counter this is for the defense bar to organize its team, as well. This is done in good measure, but we must always strive to be better. It requires us to vet our experts to be sure they are not compromised by prior omissions or admissions.

Finally, the growth of nuclear verdicts feeds on itself in many ways. It causes insurers, corporate defendants and defense lawyers to alter their view of case values upwards to properly account for the present litigation climate. This causes a ripple effect on insurance premiums and the overall cost of litigation.

Fires and explosions are rare in our industry. These cases require counsel that can navigate the law, industry standards, and the experience and aptitude to gently deal with death and serious injuries.

Industry driving has a much higher volume of accidents. Trucking accidents are an area of particular concern for nuclear verdicts. Following federal motor carrier laws and company policies is a top priority. Make sure your drivers have their paperwork in order and follow federal transportation rules and regulations.

In the end, the best defense is to put safety first and always.

John V. McCoy is with McCoy, Leavitt, Laskey LLC. His firm represents industry members nationally. He can be reached at 262-522-7007.

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