It is no secret that nuclear verdicts are on the rise in accident litigation across the United States. These “runaway” or “nuclear” verdicts are jury awards that exceed $10 million, and they are a major obstacle facing the trucking industry today.
On June 23, 2020, the American Transportation Research Institute (“ATRI”) released a report confirming that verdict awards for plaintiffs over $1 million have drastically increased in number and size over the years. The report, “Understanding the Impact of Nuclear Verdicts on the Trucking Industry,” examined the history of large verdicts in addition to underscoring the impact they have on the industry. The study analyzed 600 trucking cases between 2006 and 2019 in which the jury award was over $1 million. The data is quite compelling. In 2006, there were only four cases with awards over $1 million. The numbers slightly increased from 2006 to 2010 with ATRI reporting there were as many as 26 cases. However, from 2010 to 2018 the numbers shot through the roof as ATRI reports there were 299 cases in which the jury awarded over $1 million to a plaintiff. ATRI reports an increase of 235 percent from 2012 to 2019!
Not only did the number of jury verdicts increase, the size of the verdict increased as well. For example, in 2011 a $40 million verdict was awarded where a driver failed to yield at a stop sign, resulting in the death of two passengers. In 2012, a $281.6 million verdict (reduced to $105.2 million) was handed down where a drive shaft broke and pierced the windshield of a vehicle killing the vehicle’s driver. The largest verdict was awarded in 2016 where a company was ordered to pay $280 million when a driver fell asleep and struck a vehicle killing five passengers, including two children.
ATRI reports that certain factors substantially impact verdict size. For example, accidents involving children are the single largest factor in verdict size, finding a $27 million increase on average where a child was either injured or killed because of the accident.
Nuclear verdicts are not going anywhere, so, how do companies protect themselves? Certainly, it is near impossible to totally prevent an accident from occurring; however, there are steps that companies can take to mitigate risks.
First, it is important to develop a culture for safety and to adhere to the company’s commitment to same. This means communicating company expectations to drivers and enforcing rule violations—including violations by your most seasoned drivers. Trucking companies should also focus on allocating resources towards safety and compliance measures. Enhanced safety measures include going over and above The Federal Motor Carrier Safety Administration (“FMCSA”)’s regulations, employing strict hiring/recruitment standards—including implementing background checks, and checking driver incident history reports, ensuring adequate driver training, and retaining documentation of driver trainings on file. Companies should oversee drivers by implementing drug testing and monitoring the driver’s hours of service. Companies should also strive to improve the safety of trucks and consider updating and installing truck safety technology such as camera systems and have preservation policies in place in the event this data is needed for trial.
Nuclear verdicts can have detrimental effects on the trucking industry, from closing company doors, to forcing bankruptcy, and higher insurance premiums. Although it is impossible to avoid every accident, early assessment and risk management will add an extra layer of protection in the event you find your company at the forefront of a lawsuit. Let your company’s commitment to safety assist in the defense of your company!
A full report on this subject can be found at: https://truckingresearch.org/wp-content/uploads/2020/06/ATRI-Understanding-the-Impact-of-Nuclear-Verdicts-on-the-Trucking-Industry-06-2020-2.pdf.