You are right, Sid, that we hear lots of horror stories about so-called “frivolous litigation” and “runaway juries” from those who want to take away the right of ordinary citizens to hold big companies accountable for the damage caused by negligence and defective products. The stories are very effective in giving the public the impression that the system is badly broken and in dire need of fixing. The problem is that most of them are myths.
Take the notorious McDonald’s case that you mention. The anti-lawsuit pundits have characterized this case as a situation in which a careless woman drove up to a McDonald’s, ordered coffee, drove off, stuck the coffee between her legs and spilled the coffee in her lap when she tried to remove the lid while she was hurrying off to her next destination. Rather than take personal responsibility for her carelessness, she was persuaded by a greedy trial lawyer to sue McDonald’s for her damages.
The story, as told and retold by dozens of critics and comedians, bears only the faintest resemblance to the truth. Here are the real facts.
Stella Liebeck, a conservative Republican, was a passenger in a car driven by her grandson when she purchased the cup of coffee. Her son then parked the car in the parking lot while she attempted to put cream and sugar in the cup. Unable to remove the lid with only one hand, she placed the cup between her legs. During this operation, the coffee spilled into her lap, and she was badly burned over 6 percent of her body. She was in the hospital for more than a week undergoing skin grafts, and she was ultimately permanently disfigured.
It might be hard to imagine that a single cup of coffee could do so much damage, but the coffee that she opened had been heated to between 195 and 200 degrees in accordance with company policy. This is hot enough to peel the skin from bone after about seven seconds of exposure. McDonald’s had in fact received hundreds of complaints arising out of similar incidents, and it had made payments to many of the complainants. Soon after the lawsuit, the McDonald’s from which Liebeck purchased her coffee cooled its coffee down to a more reasonable 158 degrees.
Ms. Liebeck asked McDonald’s for the $20,000 of medical expenses that she incurred. McDonald’s offered her $800. After she resorted to a lawsuit for the first time in her life, McDonald’s refused a settlement offer of $300,000. The jury awarded Leibeck $200,000 in actual damages, but reduced it by 20 percent to adjust for Liebeck’s own negligence. It also assessed punitive damages of $2.7 million, but the judge reduced that to $480,000. The headlines erroneously reported that she received $3 million for her efforts. The Chamber of Commerce advertisements deceptively asked: “Is it fair to get a couple of million dollars from a restaurant just because you spilled your hot coffee on yourself?” and answered “Of course not. It’s ridiculous. But it happened.”
While there are certainly instances of abuse out there, they are few and far between for the very simple reason that lawyers working for plaintiffs usually work on a contingent fee arrangement. This means that the lawyer incurs all of the litigation expenses (including his own fee), and the client pays nothing until the case is won or settled. The lawyer, in other words, takes on all of the risk that the litigation will fail. Most lawyers are unwilling to waste their valuable time and resources on “frivolous” litigation.
So the next time that you hear a horror story about the civil justice system, take it with a grain of salt
If you would like to find out more about the McDonald’s myth and many more, I highly recommend Stephanie Mencimer’s new book “Blocking the Courthouse Door.”