TORT REFORM FACT VS. FICTION PART 1

Fiction:  People are filing frivolous lawsuits that clog our justice system and take advantage of the courts.   

Fact:      The Rand Institute for Civil Justice has found that only 10 percent of injured people seek compensation and only 2 percent of them file lawsuits.  Also, since 1991, tort cases reflected only six percent of all cases filed.   Big business, corporations and insurance companies have framed several legitimate lawsuits as frivolous by selectively discussing facts or falsely reporting them entirely. (Please see our blog concerning the McDonald’s Hot Coffee Case).  Additional interesting facts are:

                1.  Personal injury lawsuits have decreased by 21 percent. 

                2.  There has been a 52 percent decrease in personal injury jury trials from 1992 to 2005.  

Fiction:  Our tort system threatens business owners and job creators with frivolous lawsuits that will drive them out of our state. 

Fact:      Corporations and small business have repeatedly admitted that fear of litigation is not a high motivator for them.  The Economic Policy Institute has found that “there is no historical correlation between the inflated estimates of the costs of the tort system and corporate profits, product quality, productivity, or research and development spending.”  In 2008, a small business lobbying group, surveyed its members asking them to rate their problems and priorities.   Out of 75 issues surveyed, “Cost and Frequency of Lawsuits/Threatened Lawsuits ranked 65^th.  To give this some perspective, the 64^th issue that concerned businesses and corporations was solid and hazardous waste disposal. 

Fiction:  Medical malpractice lawsuits are driving up healthcare costs for everyone.

 

Fact:      Medical negligence compensation accounts for only 0.3 percent of national healthcare costs.  According to the National Association of Insurance Commissioners, the total amount spent defending medical malpractice claims and compensating victims is $7.1 billion annually – just 0.3 percent of America’s $2.2 trillion in overall healthcare spending. 

Please stay tuned for part 2. 

If you are injured, don’t be bullied into thinking that you shouldn’t file a lawsuit.  Allow Attorney Douglas V. Stoehr or Attorney Aaron Ling to evaluate the facts and circumstances surrounding your case to determine if a valid claim exists.  Call us at (814) 946-4100.  

20 Years Later: Get the Facts Straight about the McDonald’s Hot Coffee Case!

             

            This case may be one of the most sensational and high profile tort cases in recent memory, and the media incorrectly reported nearly all of the facts.  This case was one that proponents of tort reform used as a rallying cry to attempt to limit jury verdicts in what they thought were frivolous cases.  Tort reformers will typically attach themselves to a case that garners national attention, and spin the facts to make the jury verdicts seem ridiculous and nonsensical.  It was reported that she was awarded 2.9 million dollars, but the actual amount was reduced to a much smaller amount.

 

The facts of this case prove that nothing was frivolous about her claim.  Stella Liebeck, was 79-years-old when she spilled a cup of coffee in her lap while sitting in a parked car at a McDonald’s parking lot in Albuquerque, New Mexico.  The coffee that was spilled in her lap that day was served to her at a temperature of 180 to 190 degrees, which is about 30 degrees hotter than most home brewing machines.  The coffee caused her to suffer burns over 16% of her body, and 6% of those burns were third degree burns.  She was in the hospital for one week and amassed medical bills in excess of $10,000.00.  She attempted to settle with McDonald’s, but was only offered $800.00 to settle her claim. 

A seven day trial ensued, which included testimony from burn experts that liquids served at between 180 to 190 degrees could cause third degree burns within 15 seconds of contact.  To drive home the severity of the burns, the plaintiff’s attorney produced pictures of the burn area, which are quite graphic.  McDonald’s was well aware that their hot beverages were being served at dangerous temperatures.  Between 1983 and 1992 nearly 700 people had been burned by hot coffee at McDonald’s.  McDonald’s believed that because these burns occurred in only 1 out of 24 million cups sold, it was statistically insignificant.  The jurors felt differently when they awarded compensatory damages in the amount of $200,000.00.  The jury was asked whether McDonald’s should be punished: evidence showed that McDonald’s ignored hundreds of other burn claims, and chose to keep brewing the hot coffee.  Internal memos indicated that McDonald’s chose profits over safety.  Jurors awarded punitive damages against McDonald’s in the amount of 2.7 million dollars, which was based on the revenue of two days of coffee sales.  Unfortunately she was only awarded 1/6 of what the jury felt she was entitled to.  The judge in the case drastically reduced the total award from 2.9 million dollars to $650,000.00.   

McDonald’s now serves coffee at between 170 and 180 degrees, which is 10-20 degrees cooler than they previously served it.  Stella Liebeck, passed away in 2004 at the age of 91, but she is still a part of our popular culture and this case is still one of the most misunderstood cases ever reported.  To hear Stella’s story in her own words click the link below[1].  If there is one thing to take away from this case, it is that we shouldn’t be so quick to jump to the conclusion that an injury claim is frivolous.  An individual suffered very serious injuries in this case, and was made the subject of jokes and is still being ridiculed today nearly 10 years after she passed away.  She did nothing to deserve the media attention that she received as a result of this lawsuit.  She simply opened a cup of coffee that was served to her at a dangerous temperature, and she suffered damages as a result. 

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[1] http://www.nytimes.com/2013/10/21/booming/not-just-a-hot-cup-anymore.html?emc=eta1&_r=0