Plaintiff attorneys hear a lot about “frivolous litigation,” and whenever the subject comes up, discussion inevitably leads to the infamous McDonalds “hot coffee” case. Eighteen years since the verdict and the case seems to have become emblematic of all that is wrong with our civil justice system.
I certainly won’t argue that all lawsuits are justified, or that less-than-honest plaintiffs don’t on occasion file actions in bad faith. What I do take issue with, however, is the notion that truly “frivolous” litigation is widespread and that jury awards are routinely excessive. This misconception is due in large part to the spread of inaccurate information and, at least in my view, the propaganda of big business whose interest it is to deter consumer litigation.
The McDonald’s hot coffee case illustrates my point exceptionally well. Everyone has heard about it, but most people have only a vague understanding of the facts–mainly, that a woman spilled coffee on her lap and then successfully sued for millions of dollars. While these facts are essentially true, a more thorough understanding of the case reveals that the plaintiff, a 79-year-old woman by the name of Stella Liebeck, was a lot more reasonable than people think, and perhaps even acquiescent to a fault. Here’s a bullet point run down of the actual facts:
- By its own corporate standards, McDonald’s sold coffee at 180 to 190 degrees Fahrenheit at the time of Ms. Liebeck’s injury–a temperature far in excess of the industry standard and one capable of producing third degree burns in less than three seconds.
- McDonald’s admitted during trial that it had known about the risk of serious burns from its coffee for more than 10 years. From 1982 to 1992, McDonald’s received more than 700 reports of burns from scalding coffee; some of the injured were children and infants. Many customers received severe burns to the genital area, perineum, inner thighs and buttocks. In addition, many of these claims were settled, amounting to more than $500,000.
- This wasn’t a simple “coffee spill.” Ms. Liebeck spent eight days in a hospital as a result of her injuries. In that time she underwent expensive and painful treatments for third-degree burns including debridement (removal of dead tissue) and skin grafting. The burns left her scarred and disabled for more than two years.
- Before a suit was ever filed, Liebeck informed McDonald’s about her injuries and requested reimbursement for her medical bills, which totaled approximately $11,000. McDonald’s made a counter-offer for $800.
- McDonald’s had several other chances to settle Ms. Liebeck’s case before trial. At one point, Ms. Liebeck’s attorney offered to settle for $300,000. In addition, days before the trial, the judge ordered both sides into a mediated settlement conference where the mediator, a retired judge, recommended that McDonald’s settle for $225,000. McDonald’s refused all of Ms. Liebeck’s efforts to settle the case.
- The jury found that Ms. Liebeck suffered $200,000 in compensatory damages for her medical costs and disability. The award was reduced to $160,000 since the jury determined that 20 percent of the fault for the injury belonged with Ms. Liebeck for spilling the coffee.
- Based on its finding that McDonald’s had engaged in willful, reckless, malicious or wanton conduct, the jury then awarded $2.7 million in punitive damages. Essential to the size of the award was the fact that McDonald’s made $1.35 million in coffee sales daily at the time of the accident. The award amounted to two days worth of coffee sales.
- The judge reduced punitive damages to $480,000, three times the compensatory amount, for a total award of $640,000. McDonald and Liebeck appealed the decision in December 1994, but the parties settled out of court for an undisclosed amount less than $600,000.
Clearly, Ms. Liebeck was not the greedy plaintiff that the media portrayed her to be–originally, she sought only reimbursement for her medical bills. Her ‘large’ verdict, which ultimately amounted to less than $600,000, was a result of surprisingly serious injuries and the arrogant insistence of McDonalds to deny her even a penny.
The media’s portrayal of Ms. Liebeck’s lawsuit was deceptive and really quite unfortunate. They created a “legal horror story” when in fact Ms. Liebeck’s claim was the ideal example of a legal system that protected a “little guy” from the reckless indifference of big business.
Ethical plaintiff attorneys provide a service that is essential to keeping big business in check. To the extent we contribute to maintaining this balance, we take a very special pride in our work.