The number of so-called "nuclear verdicts," in which plaintiffs are awarded many millions of dollars from trucking companies for accident relief is a rapidly growing issue for carriers - and something that will in the end impact the freight rates that shippers pay.
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In a just published survey of top issues for truckers, insurance availability and cost ranked as the fifth most important, and tort reform was number seven. |
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As SCDigest reported in June, a report from the American Transportation Research Institute (ATRI) found that large legal verdicts, sometimes called "nuclear verdicts" have been a part of the legal landscape of the trucking industry since 2006. These awards to injured plaintiffs of sometimes more than $10 million naturally stem from serious crashes involving massive injury and death.
The report said the dollar awards to plaintiffs have grown enormously over time, for a variety of reasons.
For example, ATRI says that states with what is called joint liability (any liable defendant can be required to pay the entire damages award) may find that plaintiffs place the entire burden of the damages onto a carrier, despite the carrier being less negligent than other defendants.
Naturally, this is leading to a spike in insurance rates for carriers, and is a key factor in small and medium sized trucking firm exiting the industry.
Now, Transport Topics magazine, a publication of the American Trucking Associations, is out with the story of how a seemingly minor accident led to a nuclear verdict.
In 2013, a man driving a pick-up truck was sideswiped by a tractor-trailer operated by carrier FTS International Services.
The drivers both pulled over, had a friendly exchange, and reported no injuries. Over a handshake, the truck driver offered an apology and accepted blame for the accident. After local police visited the scene, the drivers went on their way.
"Later that evening, Patterson's neck felt sore. The next day, his father advised him to visit a doctor. And retain an attorney," Transport Topics says.
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Almost five years later, the seemingly uneventful drive-away accident resulted in a Texas jury awarding $101 million jury award against FTS and in favor of the pick-up driver.
 The award was reduced to a still gigantic $32 million by the trial judge. FTS appealed the verdict to a Texas appeals court.
How can this have happened?
First, it was correct the FTS driver was at fault for the accident – and it turns out he was known as a risky driver FTS knowingly employed.
Second, it was a case of a "runaway jury" in the end wanting to send a message to a carrier and the trucking industry over perceived lack of safety concerns
During the original trial, the plaintiff's attorney told the jury ""Ladies and gentlemen, I submit to you that this is a single-most important case. It's been in this courtroom [for] years. You have an opportunity at the end of this case to change an industry. You have an opportunity to right a wrong that this company committed and to make the roads safer not just for Upshur County but for the rest of this nation."
It is also not at all clear to what extent the plaintiff was really injured. After retaining counsel, the pick-up driver underwent traditional chiropractic treatment for approximately three months, which led to some improvement in his condition, Transport Topics reports.
However, he ultimately received a disc replacement in October 2016, three years after the accident. During that time, the plaintiff continued to work at his job as a crane operator. There were other questions about the true state of affairs.
After looking at case, "The record here clearly indicates that the award was based on passion, prejudice, or improper motive, or is so excessive as to shock the conscience," Texas appellate court Justice Greg Neeley wrote on behalf of the appellate panel.
In the end the appellate court threw the case back to the original court, where clearly the award will be reduced – but could still leave millions in damages to be paid by FTS
In a just published survey of top issues for truckers, insurance availability and cost ranked as the fifth most important, and tort reform was number seven.
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