Monday, December 10, 2012

Tea lawsuit against Southwest Airlines echoes renowned hot coffee case

Just after Christmas last year, Angelica Keller was on a Southwest flight bound for Houston when she ordered a cup of tea from the attendant.

Since she was seated in the front row, Keller, 43, did not have a drop-down table available. Before she could place the tea bag into the lidless paper cup, she spilled the hot water onto her lap.

Keller, a construction worker from Smyrna, suffered skin blisters and second-degree burns, according to her attorney Rob Anderson, who filed an $800,000 negligence lawsuit against Southwest on her behalf.

If the circumstances have a familiar ring, there's a reason. Although the beverage has changed, the case echoes one involving a New Mexico woman who won a settlement after spilling a piping hot cup of McDonald's coffee on herself in 1992.

That case took on a life of its own after defense lawyers and business interests, including the U.S. Chamber of Commerce, began citing it as an outlandish example of greed and abuse in the legal system. But the facts and outcome of the case were distorted — blurred, many legal experts say, by the forces of time and misleading propaganda.

Since then, states across the country, including Tennessee in 2011, have passed tort reform measures intended to weed out trivial lawsuits and stem the tide of runaway jury awards, which businesses say cost states millions of dollars a year.

Tennessee's version of the legislation passed swiftly. Now, however, it faces a legal challenge.

Hundreds of plaintiffs file lawsuits claiming a civil wrong of some kind every year. While the facts in each case vary widely, and some are discarded by judges and juries as frivolous, advocates of lawsuit reform frequently cite the McDonald's suit to demonstrate the need for change.

Few come as close as Keller's, however, to the case that became legendary in corporate America.

"It's natural for people who think they know the facts of one case to hear another and draw a correlation," said local attorney John Day. "But the hot coffee case is often invoked to make people have doubts about the civil justice system."

A 'manufactured' crisis

Attorneys representing Southwest recently filed a response to Keller's lawsuit, claiming that she selected her own seat, knew there was no drop-down table and ordered the hot tea herself. Keller, therefore, was "negligent" when she spilled the hot beverage on herself, according to the response.

The lawsuit does not specify the temperature of the tea, only characterizes it as "extremely hot," and "too hot for use in an aircraft."

Neither side would comment on the case.

About $300,000 of the $800,000 Keller is seeking includes pain and suffering damages, a type of injury that is subjective and hard to quantify.

Whether there should be limits on pain and suffering damages, and if so, how much, has long been politically charged.

Since at least the early 1990s, Republican strategists have used lawsuit reform as a rallying cry. Or as then-President George H.W. Bush, guided largely by political consultant Karl Rove, put it in 1992: "We must sue each other less and care for each other more."

On the opposite side of the argument, former Tennessee Sen. Fred Thompson has voiced loud opposition to tort reform, breaking from GOP ranks on the issue.

Thompson, a lawyer and former presidential candidate, contends that it runs counter to long-standing conservative values about state and individual rights.

Conservatism is "about government closest to the people and equal justice with no special rules for anybody," he wrote last year in The Tennessean. "Our system ain't broke."

Yet Thompson has been unable to sway his fellow Republicans.

Reform about political posturing

Tort reform advocates often point to eye-popping verdicts to make their case, and not all of them involve spilled coffee. They cite plenty of other examples — including a $22 million award to a Chattanooga couple after a woman became paralyzed following a medical error after surgery — as evidence that Tennessee juries have run wild.

They say frivolous lawsuits drive up medical costs, make liability insurance both necessary and prohibitively expensive, and that lawyers file claims in jurisdictions that tend to sock it to businesses.

It is also depicted as an economic development issue. As states compete like never before to lure new business and jobs, they say, legal costs figure prominently.

"One important factor in whether businesses expand and invest is whether states have a stable and predictable legal environment," said attorney Lee Barfield, who lobbies for business interests. "Caps make awards more predictable."

Physician recruitment is also affected, as doctors who work in critical care favor states with liability caps, said Douglas Buttrey, the former executive director of Tennesseans for Economic Growth.

A 2001 study published in the American Law and Economics Review by Albert Yoon looked at whether damage awards dropped in Alabama while the state had caps.

Compared with other Southern states that did not have damage caps, Alabama plaintiffs' awards, on average, decreased by $20,000. The average awards, Yoon found, nearly doubled after the state's high court found the caps to be unconstitutional.

Yet reform discussions are more about political posturing than saving companies money, according to Phillip Miller, personal injury lawyer and former president of the Tennessee Association for Justice, a group opposed to the caps.

"The bare-knuckle facts show that runaway juries were never a problem in Tennessee," Miller said. "If you're a Republican in Tennessee and you want to get elected, you can't say you're against tort reform."

In Tennessee, plaintiffs cannot recover more than $750,000 in pain and suffering damages unless the case is considered "catastrophic," in which case the award cannot exceed $1 million. The caps went into effect last July after Gov. Bill Haslam pushed a tort reform bill through the legislature, widely cheered by the state's business community.

The law does not restrict the amount patients can recover in medical bills and lost wages. That provision, Miller says, ensures that hospitals and insurance companies still get paid but it "doesn't mean a nickel goes to the person who's injured."

About half of the states cap pain and suffering awards. Legal standoffs have flared up across the country in recent years attempting to undo the limits, and the Tennessee law is far from immune to challenge.

Trial lawyer David Randolph Smith filed a lawsuit five months ago questioning the legality of Haslam's tort reform. Central to his argument is that juries, not the legislature, should decide how much an injury is worth.

A decision on the Tennessee cap is expected sometime next year, likely from the state Supreme Court.

Coffee case still resonates

The 2011 documentary film "Hot Coffee" attempted to debunk the myths surrounding the famous McDonald's lawsuit .

For instance, many believe Stella Liebeck, the plaintiff, was behind the wheel of a car when she spilled the coffee. In fact, her grandson had been driving and the car was parked at the time.

The spilled coffee had been served at around 180 degrees, 40 degrees hotter than most home-brewed coffee. The spill led to skin grafts across her body.

Liebeck originally asked for just $20,000, enough to cover her medical expenses. McDonald's offered $800.

In spite of the headline-grabbing $2.7 million award that was granted, a judge later reduced it to $640,000 — and that amount was reduced even further in an undisclosed settlement

Daniel Clayton, a local medical malpractice attorney, said the propaganda about the case has helped marshal public opinion in favor of lawsuit reform. Many, he said, do not fully grasp its implications for people claiming injury.

Those implications easily could come into play with Keller's case. It's not hard to imagine jurors being reminded of the McDonald's case, even as they confront a different set of facts.

Whether they ultimately conclude that the fault lies with her or Southwest Airlines, trial lawyers say the wave of lawsuit reform buttressed by the McDonald's spill damages the civil justice system.

Said Clayton: "It ends up hurting those who are hurt the most."

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