Commercial transportation companies can’t just hope for favorable legal outcomes in traffic accident cases at a time when nuclear verdicts have become the norm, according to Lew Bricker, an attorney with Amundsen Davis, LLC. During Captive Resources’ March Risk Control Webinar, Bricker shared a few proactive strategies that could help companies limit the risk of nuclear verdicts — i.e., jury awards of $10 million or more. Read on for Bricker’s perspective on how to level the “legal playing field.”
Bricker quantified substantial increases in settlements and verdicts against transportation companies over the past few years. He cited a 2020 American Transportation Research Institute (ATRI) study of 600 cases from 2006 to 2019 revealing that nuclear verdicts jumped from 26 from 2006–2011 to 300 from 2014–19.
According to Bricker, several broad economic and societal trends are contributing to nuclear verdicts, including:
The U.S. Dollar is about one-third as valuable as it was 40 years ago, and average prices jumped by about 20% from March 2020 to January 2024. Also, medical costs of $1 million in 1982 would now be $6.02 million.
Large companies have become increasingly popular targets for plaintiff’s attorneys, according to Bricker. Also, while juries have a strong affinity for companies like Amazon that sell them goods and provide last-mile delivery, they are less sympathetic to third-party logistics partners.
Based on failed federal legislation in recent years, congressional sentiment appears to have shifted away from support for tort reform, regardless of party affiliation.
You can download an Executive Brief from the Insurance Information Institute for more insight into the impact of these trends on jury verdicts and commercial insurance costs.
Bricker indicated that plaintiffs’ attorneys have gained the upper hand on defense attorneys in recent years. He said they are particularly exploiting the impact of economic and societal trends on jury sympathy. An increasingly sophisticated jury sympathy strategy manifests itself in several ways, Bricker said:
Increasingly, plaintiffs’ attorneys are appealing to the instinctive fight-or-flight area of the brain that human jurists share with reptiles. They argue that a transportation company that allegedly violated a government or company safety rule presents a threat to the entire community, and assessing a large damage award is the only realistic deterrent.
Plaintiffs’ attorneys often argue that the defendant knowingly hired and continued to employ a driver with a poor driving record who was involved in an accident. They also might argue that the driver was not trained or supervised to ensure that they used safe driving techniques.
This doctrine holds that an employer and an employee acting within the scope of his employment comprise a single liable entity in regard to an accident. However, when negligent entrustment applies to a case in some states, the plaintiff’s attorney can pursue a direct cause of action against the employer with a separate allocation of fault, a case value multiplier.
Bricker cited an example of how this strategy can work against defendants: a 2014 accident in Texas. The plaintiff was awarded $89.7 million despite having lost control, crossed an interstate median, and collided with a tractor-trailer during an ice storm. The plaintiff’s attorney successfully argued that Werner Enterprises’ student truck driver followed an expeditious route through hazardous weather conditions and failed to drive with extreme caution per federal regulations — despite traveling at 50 mph.
The Texas case proves that operational compliance with regulations isn’t enough for transportation companies in the current legal environment. The public is holding them to a higher standard, according to Bricker. He provided several tips for limiting legal exposure to nuclear verdicts:
Utilize technology and data such as cameras and collision avoidance systems. Keep records and preserve any evidence that might be material to pending litigation. When you learn of a problem, focus on the specific incident, but also analyze why it happened, and apply it company-wide.
As an adage goes, claims and cases don’t improve with age. Respond to an accident immediately by identifying the people, documents, and data involved. Even if no one claims they were injured at the scene, there was minor or no property damage, or no tickets were issued, don’t assume that a case won’t be filed in court.
Negotiating settlements early in the process can reduce legal expenses, eliminate fishing expeditions, and reduce long-term legal exposure. Doing so can also preserve a good reputation among employees, business partners, and the community.
This presentation was part of Captive Resources’ Risk Control Webinar Series — regular installments of webinars to educate the group captive members we work with on topics like workplace safety, organizational leadership, and company performance. The thoughts and opinions expressed in these webinars are those of the presenters and do not necessarily reflect Captive Resources’ positions on any of the above topics.
