Vested Interest - Tort Briefs - September 1999 Issue

Three More States Strike Down Civil Justice Restrictions

State supreme courts in Ohio, Indiana, and Oregon have struck down legislatively imposed restrictions on the legal rights of injury victims, echoing the 1997 Illinois high court ruling in Best v Taylor Machine. On July 8, the Indiana Supreme Court invalidated a statute of limitations on medical malpractice actions that failed to allow patients time to discover their injuries. On July 15, the Oregon Supreme Court ruled in Lakin v Senco Products, striking a $500,000 cap on noneconomic damages that was imposed in 1985. The Oregon court cited a state constitutional provision assuring that the right to trial shall remain inviolate. And on August 16, the Ohio Supreme Court struck a 1997 state law that limited noneconomic damages to $500,000 and punitives to the greater of $250,000 or three times compensatories. The Ohio court ruling relied upon state constitutional guarantees of the separation of powers. (Liability Week, July 19, 1999; AP, August 17, 1999)

California Jury Issues $295 Million Verdict Against Ford

Juan Romo was driving his parents and brothers in a Ford Bronco when he swerved to avoid a slow-moving vehicle. The other vehicle also swerved, however, and when Romo turned back, traveling at just under 50 miles per hour, the Bronco flipped over. The car’s fiberglass roof collapsed during the rollover, and Romo’s parents and one brother were killed. A jury found Ford 78% responsible for the deaths, citing faulty design of the fiberglass roof, and ordered the automaker to pay $5 million in compensatories and $290 million in punitives. Ford vowed an appeal. (Bloomberg, July 13, 1999)

Jury, Citing Internal Memo, Issues $4.9 Billion Verdict Against General Motors

Patricia Anderson was driving her family and a friend home from a Christmas Eve church service in 1993 when her 1979 Chevy Malibu was struck from behind. The gas tank, located close to the rear axle, ruptured and exploded, engulfing the car in flame. Without the fire, only one of the passengers would have been injured. But the flames caused severe burn injuries to all passengers; Patricia’s 11-year-old daughter has had over 60 surgeries to correct her disfigurements. A memo written in 1973 and uncovered by plaintiffs showed that General Motors was aware of the problem with the placement of the gas tank, but determined that paying wrongful death claims would cost about $2.40 per car, while fixing the problem would cost as much as $12 per car. The jury returned a verdict of $107 in compensatories and $4.8 billion in punitives. The victims have pledged to set up a trust fund with half of their verdict to benefit burn victims across the country. Superior Court Judge Ernest Williams later reduced the punitive portion of the verdict to $1.09 billion. (Reuters, July 9, 1999; AP, July 13, 1999)

Tort Restrictions Fail to Lower Insurance Rates: Study

A report by Citizens for Corporate Accountability and Individual Rights and co-authored by J. Robert Hunter of the Consumer Federation of America examined 14 years of insurance data from all 50 states and determined that so-called tort reform failed to reduce insurance costs. Responding to the report, “Premium Deceit: The Failure of Tort Reform to Cut Insurance Prices,” proponents of tort reform conceded that insurance relief is not the object of limiting the legal rights of injury victims. “States with little or no tort law restrictions have experienced the same level of insurance rates as those states that enacted severe restrictions on victim’s rights,” the report notes. (Copies of the report may be purchased from CCAIR at (212) 267-2801)

Federal Judges Attack Congressional Underfunding of Judiciary

Federal judges criticized Congress on two fronts for failing to provide adequate resources for the national judiciary. U.S. District Judge John Garrett Penn ruled in a lawsuit filed by 20 U.S. District Court judges that the Congress has unlawfully denied judges cost of living adjustments in three of the last four years, as required by law. He ordered retroactive pay increases based on the 1990 Ethics Reform Act. A month later, Supreme Court Chief Justice William Rehnquist chided Congressional leaders in both chambers, noting that both the House and Senate spending plans fail to provide adequate support for the judiciary. “As you know,” he wrote in his August 9 letter, “the courts do not control their workload but rather must respond to filings created in large part by Congress’ expansion of the federal courts’ jurisdiction.” (AP, July 17, 1999; AP, August 10, 1999)

Another Insurer Offers Legal Advice to Claimants

Allstate Insurance was recently penalized for sending brochures to victims of car crashes urging them not to file a lawsuit. Now MetLife is treading on similar ice, issuing two pamphlets that they claim will be sent only to policyholders. One, “Taking Legal Action”, urges potential plaintiffs to consider pro se actions where the dollar amount in dispute is low. Another, “Being Sued” repeats the advice for defendants. Both pamphlets incorporate Charles Schulz’ Peanuts characters, and are available from the “MetLife Consumer Education Center” at http://www.lifeadvice.com. (PRNewswire, August 5, 1999)

Norplant Suit Settled for $54 Million

More than 36,000 women have complained about complications from using the implanted birth control drug Norplant. These include nausea, depression, and irregular menstrual bleeding. American Home Products, parent of Norplant manufacturer Wyeth-Ayerst Laboratories, has agreed to settle those claims by paying each victim $1,500. AHP admits that the implants caused a variety of complications, but insists that those risks were discussed on the product’s packaging. (AP, August 26, 1999)

Florida Court Affirms $50 Million Wrongful Death Verdict

Paul Palank of Florida was traveling by train due to a fear of flying. The Amtrak Silver Star he was riding derailed, however, after striking a parked CSX freight train near Camden, South Carolina. Palank and others were killed. Evidence at trial showed that CSX deliberately cut back on track inspections, halving its in-house inspector staff, in order to boost its bottom line, and that CSX lied about how often it inspected the tracks. A trial court returned a verdict for $50 million to the family of Palank, a police officer, and the 4th District Court of Appeals has approved that verdict. (AP, August 25,1999)

Texas Jury Issues $6 Million Verdict in Asbestos Case

Patricio Sanchez worked as a school janitor for 31 years before he died of mesothelioma at age 60. His work for the El Paso Independent School District involved joint finishing compound manufactured by U.S. Gypsum Co. and National Gypsum Co., both of which were made from asbestos. A county jury issued a compensatory verdict for $6,050,000. Parties agreed to a $6 million settlement before the jury considered punitive damages. (AP, August 10, 1999)

Southern Grocer Agrees to $33 Million Discrimination Settlement

Supermarket chain Winn-Dixie has agreed to pay $33 million to settle claims that it discriminated against women and racial minorities in its hiring practices. The settlement includes payments totaling $120,000 split among the 13 named plaintiffs in a class action suit. Another 13 million would be divided among as many as 50,000 women and blacks who worked for Winn-Dixie since 1993. The settlement also provides for $11 million in incentive bonuses for current employees, and $1 million in diversity awards for supervisors who help to correct past discrimination. Winn-Dixie will spend $4 million to implement the settlement, and plaintiffs’ attorneys will be paid $3.9 million. (AP, July 17, 1999)

Wisconsin High Court Affirms $8.5 Million Verdict

Seventeen-year-old Steven Sharp of Oregon was cleaning his family’s hay baler when it suddenly and without warning started up. Both hands were trapped in the machine, which slowly amputated his arms. A trial court in Racine, Wisconsin, found that Case Corp., maker of the baler, deliberately ignored mounting evidence of a self-start problem, and issued a verdict for $6.5 million in compensatories and $2 million in punitives. Case, based in Wisconsin, sought to have the verdict set aside, citing Oregon’s tort deform statute. The Wisconsin Supreme Court declined, and affirmed the trial court’s finding. (PRNewswire, June 24, 1999)

Jury Issued $5.7 Million to Bystander Killed During Hostage Melee

Aurea Bonnie Vargas was walking on the upper west side of Manhattan when Mujahid Muhammed, fleeing from an attempted bank robbery, grabbed her as a human shield from police. Six police officers quickly surrounded the pair, but rather than wait for a hostage negotiator as required by police department policy, they opened fire. Forty-four rounds later, both Muhammed and Vargas lay dead. A grand jury declined to bring criminal charges against the officers, but a civil court found that they violated department policy and were responsible for Vargas’ death, issuing a verdict for $5.7 million. (AP, July 21, 1999)

Native Americans Join States, Unions, and Individuals in Suing Tobacco Companies

Representatives for the Navajo Nation have filed suit in Navajo court alleging that tobacco companies target misleading marketing campaigns at its members, resulting in above average rates of smoking and cancer-related deaths. The suit seeks reimbursement for health care costs in treating members of the Navajo Nation suffering with tobacco-related illnesses. The suit also noted that Navajo minors are targets of tobacco advertisements, and that Navajo high school students are more likely to smoke than are their non-Navajo peers. (AP, August 11, 1999)

Chief Justice Rehnquist Criticized for “Dixie” Appearance

U.S. Supreme Court Chief Justice William Rehnquist is drawing fire from those who think his decision to lead a delegation in singing “Dixie” was insensitive. Justice Rehnquist attended the 4th Circuit Judicial Conference with other judges and lawyers from states mostly south of the Mason-Dixon line. As in years past, the conference ended with the singing of several songs, including the Confederate marching song. Some in the audience took offense at the inclusion of “Dixie”, calling it “nostalgic for slavery”, and criticized the Chief Justice for leading the attendees in that song. (AP, July 22, 1999)