The truth about "Hot Coffee"

Monday night as I lazed on the sofa trying to figure out what to watch on TV, I came across the new HBO documentary "Hot Coffee." The title comes from the now infamous McDonald's hot coffee lawsuit, in which a patron who was burned by hot coffee was awarded millions of dollars. This story has been retold, twisted and bastardized so many times by now that it barely resembles the truth, and so this documentary focused on the evils of tort reform and big business tactics in litigation used the story as the introduction to set the stage. As I watched the whole thing, numerous friends mentioned to me on Twitter that I should be watching it, presumably because I do litigate cases of the sort being described in the doc, and on behalf of evil big business to boot.

The McDonald's hot coffee case is a bit of a personal crusade for me precisely because so few people know the real details. The salient points commonly bandied about are correct: the woman spilled hot coffee on herself, was burned, and won millions at trial thanks to a punitive damages award that was calculated on the basis of McDonalds' daily revenues for sales of coffee. What many people don't know is that the woman was burned severely on much of her body, suffered extensively as a result, and was able to develop evidence at trial of numerous other similar injuries that had provided notice to McDonalds that its coffee was being delivered to customers in a dangerously hot condition (and well above the temperature other drive thru restaurants were serving their coffee at.) The punitive damages award occurred because the jury found McDonalds knew this was a problem that was injuring consumers but declined to fix it. It is far from the travesty of justice that proponents of tort reform would have us believe.

The rest of the documentary focused on four other serious problems with the state of personal injury litigation today: 1) tort reform, 2) damages caps, 3) elected judges, and 4) mandatory arbitration clauses. I happen to not be in favor of any of these things (with the exception of certain tort reform that I think does make sense, more on this later.) The dirty little secret that most defense attorneys don't like to say in public is that we don't particularly like tort reform any more than the plaintiffs do. Our livelihoods depend on having lawsuits to defend, and making it harder to sue people doesn't do us any favors. But apart from that basic defense of my job security, I find all four of these methods of controlling "runaway lawsuits" to be ineffective and unfair.

Tort reform often consists of a package of legislative enactments intended to make it harder to sue companies and harder to win a lot of money doing so. In Georgia, for example, it included several provisions that make a lot of sense--requiring defendants to be sued in the county in which they are located, requiring medical malpractice lawsuits to be supported by an affidavit signed by a physician in the same specialty saying that the care provided was deficient, and a mechanism for offers of judgment that are already available in federal court. It also included things that I didn't like, particularly caps on punitive and non-economic damages. More on those later. But the point is, there are parts of tort reform that I think can make sense and be fair. It is when the tort reform becomes focused on capping what a plaintiff can win even in the most extreme of cases, or when it seeks to shorten the time for filing a lawsuit to points that make almost no sense (such as states that now have just a one year statute of limitations for tort lawsuits) that I start to get uncomfortable.

The second part of the documentary focused on the damages caps enacted in most states, and the situations in which they often leave injured persons and their families holding the bag. Generally damages caps apply to so-called "non-economic damages," i.e. everything but lost wages and out of pocket medical costs. Pain and suffering, mental anguish, loss of consortium, and such "squishy" things are included in the cap, which may be as low as $250,000. The documentary accurately pointed out that some injuries, such as loss of ability to bear children, blindness, or loss of a limb might be considered excruciating to most people but would not be associated with high medical costs or loss of earning capacity, meaning the only way it could be compensated is with non-economic damages. If I lost my uterus in a car accident and learned that I was only getting $250K for the imposed inability to have children, I'd probably think that was a worth a lot more money to me than $250K. If I lost my eyesight, I'd definitely think it was worth more. The documentary also focused on states where the cap is absolute, on all damages. In those instances, where the money from a verdict or settlement runs out, the costs of future care invariably fall to the state and federal governments. The side effect that the documentary did not really explore (probably because it was made by trial lawyers) is that when such provisions are enacted, lawyers stop taking those cases because they cannot make enough money on them, which makes it even harder for people who have been injured by medical malpractice or someone's negligence to even recover the capped amount in a lawsuit.

The third section of the documentary was one that I feel particularly passionate about: electing judges. I have never been comfortable with the concept of allowing people who know nothing about the legal system to decide who should preside over it. I am even less comfortable with allowing judges to take campaign contributions from people and corporations who have cases before them. Massachusetts, where I began my legal career, had appointed judges with a mandatory retirement age at 65. I was shocked and uncomfortable upon coming to Georgia to learn that lawyers running for judicial slots and sitting judges hoping to hold their seats would be coming to our office and asking us for money. I was even more uncomfortable at the notion that my clients with cases winding their way through the courts system could make donations to judges who might hear those cases, and all of this was 100% legal.

However, it is after trying a case in Texas that I have now seen the true worst judicial election situation in the country: judges run as Democrats or Republicans, and voters usually end up electing a "slate" depending on what party is doing well in their county, with absolutely zero knowledge of whether any of the judges are qualified or doing a good job as judges. I hesitate to talk out of school about our judge for my last case, but let's just say that he was younger than I was, the son of a prominent plaintiffs' attorney, and elected in the 2008 Democratic "wave" election in Houston. And he had the worst ratings of any civil judge in Harris County in the survey of attorneys put out by the local legal newspaper. However, we heard horror stories about other judges elected in that same wave who would actually cajole attorneys appearing before them about not yet having received their "check"--for campaign contributions they expected to receive from all local attorneys. The obvious grift on display in Texas is astounding, and demoralizing as a lawyer. We were able to persuade our judge to rule in our favor when it really mattered, and we put on a good case, but in plenty of situations the judge's rulings will make or break a party's chances, or at minimum cause a defendant to spend millions defending a frivolous lawsuit by refusing to dismiss the case at the outset. And it makes me no more comfortable to know that my clients can give massive contributions to those same judges in an effort to influence their decisions--I want no part of that sort of winning.

The documentary's claims about the inability of plaintiffs' attorneys to compete with the Chamber of Commerce in funding judicial elections was probably the part that felt the most "off" to me. The Plaintiffs' bar is a hugely powerful organization and they can certainly compete in terms of dollars and influence. Also, traditionally plaintiffs' attorneys have been fond of electing judges precisely because in many instances they can get their pro-plaintiff buddies into office. The easiest way to get rid of Chamber money in judicial selection is to take judges off the ballot, but I sincerely doubt we will see the AAJ (formerly ATLA) pushing for that radical notion anytime soon.

The final portion of the documentary about mandatory arbitration clauses was by far the most powerful, due primarily to the story of one Jamie Leigh Jones. Most of us do not realize how many times we have unwittingly agreed to arbitrate any dispute we may have with our creditors, employers, or anyone else we've ever signed a preprinted contract with. But what happened to Jones was far more disturbing: she had signed an employment agreement containing a mandatory arbitration clause, and then shortly thereafter was shipped by Halliburton subsidiary KBR to Iraq, where her coworkers drugged and gang-raped her, then locked her in a shipping container. (The story is actually far worse than what was shown in the documentary--the rape was so brutal that it tore her pectoral muscles and ruptured a breast implant, requiring reconstructive surgery, and left her bruised and bloodied. She was examined by a physician who completed a rape kit, and the contents of that kit, including photographs and DNA samples, mysteriously disappeared soon thereafter when the kit was turned over to KBR security.)

When Jones went to sue her employer KBR and the one man who had admitted to her that he had participated, they sought to enforce the arbitration clause and have the lawsuit thrown out of court. Years later, the 5th Circuit court of appeals disagreed and ruled that Jones' suit could go to trial in the court system instead of a secret arbitration. In fact, Jones' trial began two weeks ago in Houston, and is currently ongoing. I have been watching the news and the federal court docket in her case with great interest in the outcome. In what should come as a shock to noone, KBR is now calling Jones a liar and claiming her sex was consensual and that there is no evidence to say otherwise (especially with no rape kit contents to worry about.)

Our own Hank Johnson in Georgia's 4th congressional district has been pushing for years to pass legislation prohibiting mandatory arbitration clauses from being included in these sorts of contracts. The legislation has not made it far to date, but hopefully as more people become aware of the abuse of mandatory arbitration clauses, this is an issue that will receive more attention. While it may make sense for some disputes to be arbitrated, certainly the provisions are over-used now and should not cover all types of potential disputes. In the meantime, Al Franken's amendment prohibiting companies doing work for the federal government from having arbitration clauses in their employment contracts that would include claims like Jones' claims did pass, so that at least is good news.

Overall, Hot Coffee was an interesting and thought-provoking piece, but with an obvious slant. I've seen the other side and I know there are no documentary film-makers itching to make movies about stupid, bogus lawsuits but if there were I would have BOATLOADS of material. It is a problem, in that my clients often end up paying northwards of $2 million from inception of the case through trial in order to prove their products didn't injure anyone. That may seem like highway robbery, but it's a necessary cost to retain the right experts, take the right depositions, get and review ALL the medical records, produce the necessary company documents, draft and file the right motions, and get ready for and complete a successful trial. That's just for one case, but big companies that make products like drugs, medical devices, cars, or tractors might get sued hundreds of times a year. And it's not like they can just offer to pay every plaintiff a quarter of what they'd spend to defend the case, because as soon as they did that they'd get 3 times as many cases as news spread of their willingness to open the checkbook in order to avoid litigation costs. So, not that I am suggesting you should feel bad for big business, but consider the alternatives that a big company has--pay millions to defend each case and clear their name every time, or pay millions in settlements and verdicts, or stop making products that could ever potentially be involved in any injury. These are not good options. Defending the cases vigorously and sending the message that our products are good products that never hurt anyone, and that we're going to fight back if we ever get sued, is the best of the flawed options. And it's precisely what makes everything in this country cost more than it needs to.

The other concept that I think got lost somewhere along the way is that people can get hurt without it being anyone's fault. I had an argument awhile back about vaccine litigation, and someone told the story of how they had a cousin who was severely disabled following a bad reaction to a vaccine. She assumed that was the vaccine manufacturer's fault and that they should pay for the lifetime care of that child. But people can have a "bad reaction" to almost anything--I could drink a glass of milk tomorrow and go into anaphylactic shock, through no fault of the cow or dairy. It could even kill me. Vaccines are no different than any other chemical compound ingested into the human body, be it medication, food, vitamin supplements, or beauty products. All of it can really hurt us for no particular reason. So often in my cases I see a situation where a person is severely injured and it was around the same time as they were taking this drug, or using this device, and so they assume it must be the result of that drug or device and that the manufacturer must be responsible. But they seem to have forgotten the notion that SHIT HAPPENS--people get sick, people have allergic reactions, people develop medical conditions and people have bad outcomes in surgeries or hospitalizations. None of these things necessarily mean that anyone did anything wrong.

The challenge for us defense attorneys is to remind judges and jurors that shit happens. It's not always the role that we want to be in, and it can be a tough argument. The plaintiff's attorney is essentially trying to argue that the shit wasn't there before the drug or the device, and suddenly it was there, and we have no other obvious cause, so clearly the shit is the fault of the drug or device. There is a simplicity to their argument, which is their greatest weapon. Plenty of jurors can be convinced that temporal relationship is sufficient to meet the preponderance of the evidence standard. So before everyone goes worrying that we've made it impossible to win a lawsuit in this country because Hot Coffee told you so, I'd advise you to start reading the legal newspapers in your city for a month. Think critically about what the producers of the documentary (trial attorneys, by the way) have to gain from it. Recognize there are two sides to every story. Yes, there are many tales of abuse of the legal system on both sides, and many tales of people who have been negatively impacted by tort reform, big business tactics, and defense attorneys like me. But as with almost any story, the facts depend on who's telling it. Hot Coffee got a lot right, but it got a lot wrong and left a lot out. Dig deeper.