CONCERNING RISE IN NUCLEAR VERDICTS
New York is experiencing a surge of “nuclear verdicts” in cases ranging from premise liability to medical malpractice. These are awards that usually include an amount for pain and suffering that dwarfs prior verdicts and, at levels in the tens of millions of dollars, hardly serve a compensatory purpose. Rather, they result from improper tactics that inflame jurors and mislead them to believe that amounts at these levels are ordinary and acceptable in litigation.
In July 2020, the New York Law Journal published a three-part series titled, “Ahead to the Past: The Evolution of New Rules of Engagement in the Age of Social Inflation and Nuclear Verdicts.” In this piece, the authors discuss how plaintiffs’ attorneys employ a “how dare they defend” approach to litigation. This method allows for disproportionate compensation by fueling emotional outrage. They use specific language, such as “big corporations” and “hired guns” when speaking to the jury and encourage them to “send a message” to the defendants.
Tort law is meant to compensate, not to punish. As the authors observe, “Rather than provide just compensation, [nuclear verdicts] are thinly veiled efforts to punish the defendant that are nearly always awarded at the specific request of plaintiff’s counsel.”
“The average New Yorker feels the pain too. Nuclear verdicts (and routinely excessive ver- dicts) drive insurers from the market and increase premiums. The twin pressures of decreasing competition and increased insurance costs are ultimately passed through to the consumer. This is the same consumer and taxpayer who was leaving New York at a higher rate than any of the 50 states even before COVID-19.” – New York Law Journal
THE “ANCHORING” TACTIC
Another tactic used by the plaintiffs’ bar to secure nuclear verdicts is improper “anchoring.” During summation, lawyers will suggest an unreasonably large award to the jury and that number becomes the starting point in a juror’s mind.
Several cases are currently on appeal in New York in which anchoring led to record-setting pain and suffering awards.
For example, after a woman was hit with a shopping cart thrown off a mall’s parking garage by two teen- agers, her lawyers sued the retailers, security firm, and property owners. The plaintiff’s lawyer asked the jury to award $58 million for her pain and suffering. The jury apparently felt this level – which would take the average New Yorker several lifetimes to earn – was too high, but still returned an extraordinary $45 million award, including $35 million in noneconomic damages. The trial court in that case, Hedges v. Planned Security Services, then cut the noneconomic damage award in half to $17.5 million–still a record amount.
In another case, plaintiffs’ lawyers asked a jury to award $85 million in noneconomic damages to a worker who fell while assembling a booth for an event at Jones Beach. The jury obliged with a $85.75 million pain and suffering award on top of $13.5 million for medical care and lost wages. The trial court lowered the pain and suffering award in that case, Perez v. Live Nation, to $40.6 million – an amount wildly beyond that which New York courts have permitted. The New York Law Journal points to how the rise in nuclear verdicts is “turning the New York court system on its head” and is “contributing to the demise of New York state.”
“At a high level, every improper anchor in our data set produced a runaway verdict of $15 million or more for pain and suffering with awards ranging as high as $90 million. The value of these pain and suffering awards totaled a staggering $1.5 billion, and this figure does not tell the full story.”
Unlike some other states, New York law does not set a hard cap on awards for a person’s pain and suffering, which cannot be objectively measured. Instead, in New York, a verdict is “excessive or inadequate if it deviates materially from what would be reasonable compensation.” Courts look to prior awards for comparable injuries, sustained on appeal, for guidance. Prior to the dramatic rise in nuclear verdicts, only two New York appellate cases surpassed $10 million in noneconomic damages. The article highlights specific data that demonstrates the impact anchoring has had on recent verdicts. According to the report, in 90 percent of all cases where a plain- tiff’s lawyer requests $20 million or more, the verdict is at least double the state’s “de facto cap” for pain and suffering damages of $10 million. In almost two-thirds of all cases, the plaintiff receives at least $30 million, and finally, in almost 33 percent of all cases, improper anchoring results in a verdict of more than $50 million.
These nuclear verdicts directly impact all New Yorkers, as it leads to higher insurance rates, higher consumer goods costs, and fewer jobs. Since public entities, such as public schools and the transit authority, are subject to these types of awards, nuclear verdicts also place taxpayers on the hook and place city services at risk.