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Truck Accident

Trucking Tort Awards Grow in Number and Cost

July 11, 2020
Industry says changes are needed in determining non-economic and punitive damages.

A new study has confirmed that accident liability judgments and financial awards levied against truckers have risen rapidly in recent years, but there is broad disagreement over why this is the case. Tort lawyers and some safety advocates say it is because of a marked rise in accidents involving trucks, but the trucking industry says it is because tort lawyers have been actively seeking new targets.

The American Transportation Research Institute (ATRI) took a closer look at more than 600 truck accident lawsuits between 2006 and 2019. In the first five years of the data, it found that there were 26 awards of over $1 million, but in the last five years there were nearly 300 such awards.

ATRI’s research also found that from 2010 to 2018, the monetary size of verdict awards grew 51.7% annually. During that same period, standard inflation increased 1.7% while healthcare costs rose 2.9%.

“Runaway verdicts are increasing in both size and numbers,” asserts Clay Porter, partner at the Porter Rennie Woodard and Kendall law firm. “This study documents a frequency in excessive awards that, while not surprising, tells us that the trial system has gotten completely off track. Foundational changes are needed in the way we determine non-economic and punitive damages.”

ATRI is the nonprofit research arm of American Trucking Associations, which represents for-hire trucking companies in the public policy arena. For decades ATA has pursued tort reform initiatives. During last fall’s ATA annual convention, federation president Chris Spears said this has become one of ATA’s top priorities. “We’re growing very tired of padding the pockets of trial lawyers at the expense of trucking jobs, and we’re just not going to stand for it anymore.”

Especially concerning to trucking company owners is the growth of what are deemed “nuclear” verdicts of $10 million or more. Not surprisingly, insurance rates have increased along with these litigation awards, ATRI notes. Over the last two to five years, commercial truck insurance premiums have increased annually between 35% and 40% for low- to average-risk carriers.

Digging deeper into the data, the institute’s researchers found a number of factors that influence the size of these awards:

● When children were involved in the crash, verdict sizes increased more than 1,600%, regardless of fault.

● While they fall short of statistical significance, the existence of spinal cord injuries more than doubled average jury awards, raising them to slightly less than $3.5 million.

● In terms of traumatic brain injuries, the presence of these raised jury awards by more than $800,000 per case.

● Crashes involving “spins and rolls” were by far the most expensive crash type, with average awards of nearly $15 million.

● When rear-end crashes occur (primarily the truck driver rear-ending the plaintiff), the plaintiffs win 89% of the cases. Rear-end crashes that occur in work zones generate the highest award among rear-end crashes, with an average award of $7.25 million.

As you might expect, there also is a positive relationship between the number of parties involved in the crash and the size of the verdict.

How to Protect Yourself

The situation has reached the point that litigation financing has become one of the fastest growing trends in trucking litigation, the institute says. State regulations view it as falling somewhere between marketplace investing and gambling, and as an investment model it is both highly speculative and relatively unregulated.

Worldwide, litigation financing is estimated to be a $400 billion industry, although it is just in its infancy in the U.S. That said, litigation financing in the U.S. grew by more than 745% between 2015 and 2019.

Based on regulations and litigation opportunities, the most attractive states for litigation financing are Florida, Texas, New York and California, the ATRI researchers reveal. The least attractive states are Georgia, Alabama, Colorado, Kentucky and Pennsylvania.

Pre-crash actions taken by motor carriers are critical to a successful defense, the researchers point out. ATRI found that both the tort lawyers who bring these cases and carrier defense attorneys emphasize crash avoidance is everything, and that strict adherence to safety and operational policies is essential to staying out of court or reducing award sizes.

Almost any failure to adhere to Federal Motor Carrier Safety Regulations (FMCSRs) or company safety policies will be the focus of plaintiff arguments. The most common examples included failure to run proper background checks, failure to conduct or review drug testing, and tolerance of driver violations such as hours-of-service and logbook citations.

Solely from a litigation standpoint, fleets should consider FMCSRs as minimum standards that can and should be exceeded, rather than assuming letter-of-the-law FMCSR compliance is adequate, ATRI stresses.

“The ability of defense attorneys to document carrier or driver safety activities that exceed FMCSRs carries great weight with juries,” the report explains. “The longer-term solution is the creation of national testing and compliance standards for trucking.”

Another step for fleets to take not mentioned in the ATRI report involves attempting to blunt tort lawyers’ quest to be allowed by the court to argue that truck drivers should be held to a higher standard of care than other drivers because they are trained professionals.

“Plaintiff success rates at trial would drastically increase if juries were able to consider whether a truck driver’s actions required more care and caution than ‘ordinary’ care,” according to attorneys Todd A. Gray and Joseph Fiorello of the law firm of Lewis Brisbois Bisgaard & Smith.

“The ‘professional driver’ standard of care assertion accompanies and bolsters plaintiffs’ reptilian theme at trial that motor carriers must place only the world’s safest drivers behind the wheel,” they add.

Gray and Fiorello say the key to defeating this higher standard of care argument is to identify it early and aggressively defend against it while alerting the court that no such standard exists. They urge defense lawyers to object to written discovery that labels the defendant-driver as a “professional driver” or “commercial driver,” adding that any request seeking admission of the notion the driver was a “professional driver” should be denied.

The ATRI report also discusses in greater detail various defense strategies carriers should consider adopting, including how to approach mediation and settlement negotiations.

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