Vested Interest - Tort Briefs - March 2004 Issue

Jury Awards Carnahans

A jury found airplane parts manufacturer Parker Hannifin Corporation negligent in the 2000 plane crash that killed Missouri Governor Mel Carnahan and his son. (Chicago Sun-Times – January 17, 2004)

School District Sues Oil Companies Over Tainted Water

A lawsuit over the presence of a gasoline additive in an elementary school’s water system has become wrapped up with national energy policy. U.S. District Judge Allen Sharp put the North Newton School Board’s lawsuit on hold until a judicial panel decides whether it should be consolidated with similar lawsuits and transferred out of his federal court in Lafayette. The school district is suing 41 oil companies over contaminated water at one of it’s schools. The lawsuit was filed in Newton County Court in November and was transferred to federal court. For more than two years, more than 450 students at the school drank and used water contaminated with MTBE, a gasoline additive that was used to replace lead. (ATLA Law News Digest – January 15, 2004)

Jury Tacks on Punitive Damages in Cancer Death

For the first time in New York State, a jury in Brooklyn said a tobacco company should pay punitive damages for the lung cancer death of an individual smoker. The damage award was imposed on Brown & Williamson for conspiracy and fraudulently concealing the health risks of smoking. The jury also assessed additional damages against two tobacco industry trade organizations that have been dissolved, the Tobacco Institute and the Council for Tobacco Research. The verdict could be a turning point and begin to demonstrate there are cracks in what was for decades a legal armor that seemed to make tobacco companies invulnerable to such lawsuits nationwide. (ATLA Law News Digest – January 15, 2004)

Ford Not Liable

A New Jersey jury found Ford Motor Company not liable for a rollover accident that killed a school administrator riding in an Explorer. The 54-year-old woman died after her husband lost control of their SUV on an interstate. The woman’s family alleged the vehicle’s design made it unstable and prone to flipping. Ford has never lost a jury verdict on the design issue. (Chicago Tribune – January 16, 2004)

Illinois Jury Returns Verdict Against Illinois Power

A jury in Mercer County, Illinois, returned a verdict against Illinois Power Company. The case involved wrongful death caused by electrocution when a ladder came in contact with bare, high-voltage wires (7200 volts) owned and maintained by Illinois Power. (Press Release – February 9, 2004)

Jury Awards Columbia Hospital $18.2 Million

A D.C. Superior Court jury awarded the defunct Columbia Hospital for Women Medical Center $18.2 million in damages, agreeing with the hospital that a malpractice insurance company had overcharged for premiums and encouraged doctors to practice elsewhere. Officials for the insurer, NCRIC Group Inc., said that the verdict, if upheld, could threaten its viability. A failure by NCRIC could force many of the doctors it covers to leave the District, a company official said. The jury rejected claims by NCRIC in a 2000 lawsuit that Columbia had failed to pay $3 million in premiums and interest. The hospital denied the allegation, counter-claiming that it wasowed damages by NCRIC. NCRIC denied those allegations. The 136-year-old hospital closed in May 2002, citing severe financial problems. (ATLA Law News Digest – February 19, 2004)

Commissioner Files Suit on Behalf of Policyholders

Tennessee Insurance Commissioner Paula Flowers, acting as liquidator for three failed malpractice insurance firms, has filed suit in U.S. District Court seeking to recover damages on behalf of the companies’ more than 50,000 former policyholders. The 62-page lawsuit, filed in the Western District of Tennessee, asserts that executives of Richmond-based Reciprocal of America and its network of commonly managed companies, together with two reinsurance companies, engaged in a massive conspiracy to defraud the policyholders of The Reciprocal Alliance, American National Lawyers Insurance Reciprocal, and Doctors Insurance Reciprocal. The three Tennessee-domiciled risk-retention groups collapsed in January 2003, leaving thousands of doctors, hospitals and lawyers without malpractice coverage and unpaid claims totaling at least $200 million. The lawsuit reportedly details a complex web of corporate shells, secret side agreements, loans and money transfers, all controlled by a small group of corporate officers and investors of Reciprocal of America. (ATLA Law News Digest – February 19, 2004)