Lawsuit abuse, outrageous settlements cannot become trucking’s Achilles' heel
The concept of "nuclear" verdicts is nothing new, but the fear of these court judgments has become more palpable across trucking these days.
For at least two decades, verdicts of $10 million or more have been an “Achilles’ heel” for the medical industry. And even though these verdicts against medical professionals have declined over the years, plaintiffs are receiving even higher, record-breaking jury awards, according to the Medical Professional Liability Association.
Stephanie Chesney, partner and transportation defense attorney at MG+M Law Firm, pointed out during the recent Women In Trucking Accelerate Conference & Expo in Dallas, that large verdicts in the medical profession declined over the years because the industry was able to close some loopholes that made it more vulnerable to runaway juries.
“What we are seeing post-COVID is an intolerance of corporations in our juries,” Chesney explained. “A nuclear verdict is this idea of a runaway jury or creating a culture of fear. It’s when the plaintiff’s attorney successfully convinces the jury that there is danger, and they as the jury have a duty to send the message to the corporation to say, ‘We’re not going to stand for this.’”
This sentiment has been further compounded by plaintiffs’ attorneys who are relying more and more on traditional and social media to bolster litigation by misleading the public, according to an op-ed by the American Tort Reform Association (ATRA).
“They sometimes partner with so-called experts to provide misleading scientific evidence to support their claims both inside and outside the courtroom,” ATRA wrote. “This concerning trend repeats fallacies and influences public perception of cases and the parties on each side.”
The trend is not only concerning, but it has become a new standard, prompting larger fleets like Werner Enterprises, for example, to settle even when there has been no negligence on the part of the trucking company or their driver.
Trucking settlements regardless of fault
A couple of years ago, a Werner truck driving down a public highway in Texas during inclement weather was going 10 mph below the posted speed limit, Daniel Murray, SVP of the American Transportation Research Institute (ATRI), told Women In Trucking Accelerate Conference attendees.
“Truck drivers are taught to drive in inclement weather; that’s what they do,” Murray added. “He was a newer driver and had a supervisor right next to him. On the other side of the traffic, someone who probably should not have been out, hit some black ice, skidded across the median, and hit the Werner truck head on. There was a child fatality and child catastrophic injury, and the jury came back with a $91 million award against Werner that is now under appeal.”
“When children are involved, no matter what the negligence is, jury awards skyrocket,” he added.
Murray also pointed to another recent Werner crash in which police determined there was no negligence on the part of the trucking company or its driver. Werner, however, knowing these juries are out of hand, felt forced to settle for $150 million.
See also: Truck crashes happen. Then what?
According to 2020 data from ATRI, from 2010 to 2018, the average verdict for truck crashes jumped from $2.3 million to $22.3 million, a nearly 1,000% increase. The 2020 report also saw a dramatic uptick in cases, particularly those over $1 million.
“We are seeing jurors act very strongly right now, and that’s very scary,” transportation defense attorney Chesney emphasized. “We kind of find ourselves in a position where we’re ready to fight back, but after doing a business analysis, is it worth it if it goes awry? That’s a deeply personal business decision to make, and it needs to be made collaboratively with your counselor, insurance agents, and the drivers who are involved.”
Cases like Werner’s reflect some of those outrageous numbers that drive a lot of media attention. Keep in mind, though, there’s a subset of predatory tactics being leveraged to get companies to settle for a quick $1 million or less.
“There is also a business plan being rolled out that if you sideswipe someone, you can scare them a little bit and get less than $1 million,” Chesney noted. “That has a profound impact on a trucking company, especially if they’re smaller in nature.”
ATRI also studied the impact that these “smaller” verdicts and settlements have on trucking. These cases often don’t involve serious injury or death but have led to requested payment amounts that are five times greater than true medical costs. Again, fault typically doesn’t matter here.
“There is a whole other business model out there,” ATRI’s Murray stressed. “It’s the billboard lawyers and litigation financing. They are nickeling and diming us to death. They are just tapping the policy at $750,000 or $1 million and moving on. It stays below the radar screen of the media because it is not sensational or exciting.”
“This is as bad for us as an industry as the nuclear in total,” he added. “It’s very interesting that we are now so scared of jury awards because of how out of control they are. We are now starting to settle over 30% higher than the jury would have offered because we are so scared as an industry.”
See also: FMCSA deems two Texas motor carriers public safety hazards
Time to act
The time has come for the industry to stand united against these predatory tactics that target trucking companies and drivers regardless of fault. When motor carriers and drivers are in the wrong, they should be held accountable and those injured fairly compensated. The key word here is fairly.
Lawsuit abuse reform has been one of American Trucking Associations’ top priorities since 2019. Some state trucking associations, like Texas and Louisiana, have been working with ATA and their state lawmakers to address many of the flaws in the current system. Others should do the same.
Ultimately, the best way trucking companies can protect themselves, their drivers, and other motorists is to remain intently focused on building and adhering to a strong safety culture.
As Jill Snyder, director of safety and compliance at Zonar Systems, pointed out during WIT’s conference, “nuclear verdicts have helped a lot in companies recognizing that they can’t just think about it, they have to act on it. I see a lot more interaction and companies really looking at where their weaknesses are and finding ways they can educate their drivers.”
FleetOwner recently published one of the most comprehensively reported series on how nuclear verdicts are impacting the industry. Check out the following articles, and let us know what your company or state is doing to combat some of these predatory tactics against trucking:
