Tort “Reform” Marches On at the Expense of Public Safety
By Chuck Geerhart
I recently presented at a local law school about a great program run by the Diversity Committee of the San Francisco Trial Lawyers’ Association (SFTLA) aimed at bringing diverse young lawyers into the plaintiff bar. I was speaking to students who were mostly in the 22-26 age range. One of them asked me about the effect of “tort reform” on my practice. Torts are civil wrongs not arising out of breach of contract, anything from a rear end auto collision to a failure to provide a safe stairway, which results in injury. Tort reform refers to efforts by political, business and insurance interests to limit the rights of injured people to recover fair damages for things like medical expenses, wage loss, pain and suffering and emotional distress. Tort reform is a dirty phrase to the plaintiff’s bar, and should also be considered bad news by the general public, since it threatens your ability to get fair compensation when someone else negligently (or intentionally) harms you.
So I asked my assembled group of law students if they remembered George W. Bush giving the State of the Union address in the 2000s. Not one hand was raised! I guess this made sense, as even a 25 year old in 2016 would have only been 15 in 2006, and may not have been watching what is usually a boring speech. I told the students that every year without fail, the President of the United States had urged Congress to limit the rights of citizens to recover damages in “frivolous” lawsuits. This was at the behest of the business lobby, which was his donation base.
Then I asked if anyone had heard of the McDonald’s “hot coffee” case. Everyone raised his or her hand! This was fascinating, since that case occurred in 1994. The staying power of the Macdonald’s case is amazing. It proves that a story resonates with the public far more than any number of speeches, web postings, or commercials.
Tort reform often does well at the ballot box. In 1986, California voters approved Proposition 51, which basically cut in half the damages injured people can claim if they are injured by two or more negligent actors, but one of them is uninsured or inadequately insured. People (i.e., consumers) voted for Prop. 51 (now codified as Civil Code 1431.2) by a whopping margin of 62% versus 38% opposed. This for a bill that cost the consumer big time. But they believed what they were told– that lawsuits costs them money in the form of higher insurance premiums and higher prices charged by business. The notion that the threat of civil liability forces business to act more safely was ignored.
Getting back to the McDonald’s case. Full disclosure: the following is partly cribbed from the website of Consumer Attorneys of California or CAOC (https://www.caoc.org/?pg=facts). The facts most people have heard are: In 1992, 79-year-old Stella Liebeck bought a cup of takeout coffee at a McDonald’s drive-thru in Albuquerque and spilled it on her lap. She sued McDonald’s and a jury awarded her nearly $3 million in punitive damages for the burns she suffered. Most people thought she was driving.
In fact, Stella was not driving when her coffee spilled, nor was the car she was in moving. She was the passenger in a car that was stopped in the parking lot of the McDonald’s where she bought the coffee. She had the cup between her knees while removing the lid to add cream and sugar when the cup tipped over and spilled the entire contents on her lap.
The coffee was, per McDonald’s policy served it at a temperature (180-190 degrees) that could cause serious burns in seconds. Stella’s injuries were far from frivolous. She was wearing sweatpants that absorbed the coffee and kept it against her skin. She suffered third-degree burns and required skin grafts on her inner thighs and elsewhere.
McDonald’s had received more than 700 previous reports of injury from its coffee, including reports of third-degree burns, and had paid settlements in some cases.
Stella initially offered to settle the case for $20,000 to cover her medical expenses and lost income. But McDonald’s never offered more than $800, so the case went to trial. The jury found Mrs. Liebeck to be partially at fault for her injuries, reducing the compensation for her injuries accordingly. But the jury’s punitive damages award made headlines — upset by McDonald’s unwillingness to correct a policy despite hundreds of people suffering injuries, they awarded Liebeck the equivalent of two days’ worth of revenue from coffee sales for the restaurant chain. The punitive damage award was ultimately reduced by more than 80 percent by the judge. Ultimately, Mrs. Liebeck and McDonald’s reached a confidential settlement, believed to be less than $200,000. No one knows this last part. They remember the $3 million.
There is a great list of all the facts the jury heard on CAOC website showing that McDonald’s knew its coffee was dangerously hot, but kept on selling it. Sort of like the Ford Pinto exploding gas tank in the 1970s, except no one died. They just got horribly burned.
There is also a great documentary film called “Hot Coffee” which address the McDonald’s case and three travesties of justice caused by tort reform.
So what to make of all this? If you are a consumer, do not assume that big business is looking out for you. Business wants a frictionless environment, which means no civil liability– zero, zilch, nada. They will keep putting tort reform measures on the ballot until they get there. One of their favorites is to limit damages injured people can recover (like Prop. 51, or the horrible medical malpractice legislation, which caps pain and suffering damages at $250,000 even if you’re rendered a quadriplegic due to medical error.)
The other big impact of tort reform is that when I pick a jury, I always hear about the McDonald’s case and other so-called frivolous lawsuits from my jury panel. I hear this even in what should be liberal areas like San Francisco and Oakland. The greatest challenge in most of my trials is getting a jury free of knee jerk tort reformers whose minds have been poisoned by the U.S. Chamber of Commerce or a front group like Citizen Against Lawsuit Abuse, known for their cheesy billboards.
What can you do? Read every ballot initiative carefully when you vote. See who is supporting it, and opposing it. If you see CAOC opposing it, it’s certainly designed to take away your rights as a consumer and as a person in our society. And when you are called to jury duty, show up and, if empaneled on a civil jury, make sure people follow the law and don’t bring outside influences from the tort reform lobby into the sanctity of the jury room.