Paul Newman sits in the courtroom and waits. He looks sick. He is shifting his eyes and rubbing his mouth. The jury shuffles in. The judge asks, “Have you reached a verdict?” The jury foreman responds, “We have…. Your Honor, we agree to hold for the plaintiff…. But, Your Honor, are we limited on the size of the award? What I mean sir, are we permitted to award an amount greater than the amount the plaintiff asked for?” The judge replies coldly but honestly, “You are. You’re not bound by anything other than your good judgment based on the evidence.”
So ends Sydney Lumet’s 1982 classic, “The Verdict,” starring Newman as the down-on-his-luck Boston plaintiff lawyer Frank Galvin. With a harsh winter setting of early 1980s Boston, the movie captures the lifecycle of a case: the high highs, the low lows, and that moment of pure anxiety just before the jury pronounces its verdict. Nuclear Verdicts were rarer then, making the result even more shocking. And we never hear a number, with everyone left to wonder how they rewarded Galvin and the plaintiff, the victim of a tragic medical malpractice event.
Everything goes wrong for Galvin during the case. He is rushed into the trial, pressured to accept lowball settlements, his expert tanks, and he is continually outfoxed by a ruthless defense attorney played to perfection by the intractable James Mason. When he does catch a break and tracks down the witness who vindicates his case on the stand, the evidence is stricken from the record by a merciless judge in the pocket of defense counsel. His last measure of hope comes from his closing argument and the jury’s good sense. We’re rooting for Galvin. And we feel good when “justice” is done.
But those of us who have worked on the defense side of the bench still likely feel a twinge of agony because we dread what James Mason’s character feels when he knows he has lost. The prospect of a limitless award is the stuff of defense attorney nightmares.
Nuclear Verdicts are unpredictable. This uncertainty underscores the need for a proactive and adaptable approach to high-value cases with significant exposure, which can be aided by the U.S. Chamber of Commerce Institute for Legal Reform’s (ILR) recent in-depth study on the topic.
ILR’s findings reveal a troubling upward trend in the frequency of reported nuclear verdicts over the 10-year study period between 2012- 2022, a trend our community has been anecdotally observing for years. The median Nuclear Verdict during this period was $21 million, with higher numbers in product liability and intentional tort cases. The mean Nuclear Verdict overall was $89 million. California, Florida, New York, and Texas hosted half of the nation’s nuclear verdicts. Nuclear Verdicts in personal injury and wrongful death cases were most frequent in product liability (23.3%), auto accident (23.2%), and medical liability (20.3%) cases. The hard data indicates a significant increase from earlier studies, particularly for product liability, auto accidents, and other negligence trials.
Additionally, cases involving commercial trucks, primarily tractor-trailers, “were particularly susceptible to Nuclear Verdicts.” More specifically, approximately one in four auto accident trials that resulted in a $10 million (or more) verdict involved a commercial trucking company. Not surprisingly, pain and suffering awards were the most significant component of most Nuclear Verdicts because plaintiffs’ attorneys have succeeded in mastering noneconomic damages.
What is driving these surges? Among other reasons cited:
- The inundation of advertising promoting Nuclear Verdicts.
- An increase in multi-plaintiff litigation.
- The rise in third-party litigation funding.
Great (and Unrealistic) Expectations
One of the alleged causes for the surge in Nuclear Verdicts is anchoring (i.e., when a concept is put forth to the jury so they can attach themselves to it. Most often, it is the suggestion by plaintiff’s lawyer of a specific verdict or damages amount). For example, “My clients suffered due to the defendant’s negligence, and only $15 million will make them whole again.” The $15 million serves as the anchor.
According to ILR’s study, defense counsel is reluctant to suggest an amount lest they admit that some amount, even if minor compared to the plaintiff’s demands, should be awarded. This is a psychological tactic that can influence jury decisions. As the Nuclear Verdict amounts are climbing, and jurors are riding those plaintiff-induced suggestions to seven-, eight-, and nine-figure paydays, it may be time to revise whether or not defendants should be creating their own anchors. At the very least, in catastrophic cases poised for trial, defendants should be aggressively pursuing high-low agreements with plaintiffs.
Additionally, the higher the number, the less connected the result is to reality. We have long been living in the reality television/HGTV era. Everyone wants 10 weeks of paid vacation, the water view, and the French Chef’s kitchen. We are deluged with consumer excess at all times, and it is easy to understand why juries are responding by obliterating prior award norms.
Scalar variability, as applied in this context, suggests that an individual’s comprehension of numbers decreases as the number increases. This aligns with what the ILR study suggests—it is becoming easier for jurors to increase these awards because as the number values dramatically surge, jurors are not grasping what they mean. They are untethered to our everyday reality. The difference between $10 million and $20 million as an award has no practical connection to the daily lives of 99.99% of all prospective jurors. However, it dramatically affects the insurer or company ordered to pay it. Closing that conceptual gap is crucial to drive down these awards. When we recognize and counter these cognitive hiccups, attorneys and insurers can devise better strategies to improve juror comprehension.
Focus on What We Can Control
Multiple issues addressed in ILR’s study are out of most defendants’ and insurers’ control, e.g., a court’s insistence on allowing attorneys to provide a jury with an anchoring figure over objections, the local legislature’s refusal to draft actual tort reform legislation, or counsel’s unscrupulous tactics to increase medical costs and expenses. Lamenting these factors, therefore, is a waste of time, and we should move forward.
How? By focusing on what we know and what we can control. Most courtroom theatrics are a myth. In real life, Colonel Jessup (in “A Few Good Men”) never admits he ordered the Code Red. He more likely asks you to repeat the question 237 times during his nine-hour deposition, and you fight over the admissibility of the airport logs with opposing counsel. The “gotcha” moment rarely has the effect in real life that it does in the movies. The most significant victories occur long before a plaintiff files their lawsuit.
Consider this: Your client, be it an insurance company or its insured, takes a hard stance on what they see as a robust and defendable case. Right or wrong, this invariably leads to costly litigation. But was the cost worth it, even if it ends in a defense verdict?
Companies and insurers would be better suited to attacking Nuclear Verdicts on the front end, not during litigation. Do not think pre-suit, think pre-incident. Lasering in on what can be done to prevent accidents in the first place and/or having your client’s accident and litigation response planned out in advance is a far better use of our time and brainpower. More to the point, building these essential case foundations before an incident ever occurs is the single best way to defend against the reptile (cue Godzilla-like roar).
Establishing the Good Company Story ASAP
We have been hearing about the reptile theory as if it is an all-powerful spell concocted by Voldemort himself. The reality, however, is much simpler: Most plaintiffs’ attorneys want to tell juries a bad-company story. They want to talk about how ruthless companies are, how they don’t care about the public, how they put profits before safety. Do not let it happen.
Lawyers and insurers must start building a good-company story before a catastrophic incident occurs. You need to be able to counter the aggressive plaintiffs’ attorneys by telling juries how your clients are safe, law-abiding, upstanding companies with good cultures and excellent safety records. You need to tell juries how your clients’ employees are good-standing members of their communities—they are your neighbors, they sit next to you in church; they serve with you on the school board. But to do that, you have to do the legwork to make sure it is true.
Establishing a good company story requires work. First, you have to visit companies in person and start building the defense one piece at a time. This kind of essential “get to know your client” effort used to be a given. But, at least anecdotally, it is now a rare occurrence. Second, lawyers and insurers need to take the time to meet with their clients on (at the very least) an annual basis to review their operational practices, training and safety programs, drug and alcohol testing policies, and accident/ incident investigation protocols.
Third, you have to master your client’s fundamentals by ensuring that:
- The company utilizes employee qualification and hiring protocols/ practices to obtain the most qualified individuals.
- The company is cultivating a safety culture by utilizing documented safety policies and procedures.
- The company has appropriate inspection and maintenance protocols and operational procedures, especially those involving vehicles and equipment.
- The company has adequate checklists prepared in the event of an accident to preserve all necessary evidence and avoid a spoliation claim, including, but not limited to, video footage, “black box” data, photographs, inspection and maintenance reports, and daily logs.
Most importantly, you need to identify the company employees who may make good corporate designees and start the conversations on corporate depositions now; not when you get a list of topics from counsel and only have a few weeks to prepare.
The more you can evaluate these issues beforehand, the more engaged your clients will be in preventing accidents and injuries, significantly reducing the likelihood of a Nuclear Verdict. To wit, understanding clients, their corporate culture, and their strengths and weaknesses is vital. It is critical to establish in-depth relationships with your clients so that you are familiar with the people, culture, and philosophies well before the threat of litigation. This allows counsel to jump in headfirst in the event of a crisis.
How This Works in Practice
Theory and ideas are fine, but they are only meaningful if you employ these tactics in practice. How would all this work? Suppose you have a significant transportation incident, one that results in multiple and/or severe or catastrophic injuries. If you have spent the time beforehand working on behalf of the company, learning every facet of its day[1]to-day operations, you will know who to speak to internally and what documents they will have ready. You will know what to ask for, what rules and regulations apply, what the video (if any) shows, and you will oversee any employee witness statements given.
If you have done your preparation work correctly, your client will trust your judgment in navigating the company’s initial response. You can then jump in headfirst without hesitation and confidently put the company in the best situation possible.
This message is for insurers as much as it is for attorneys. Think about your go-to counsel and slot them in when the situations arise. Think about building that defensive wall brick-by-brick.
Now is not the time to be hamstrung by guidelines and overly restrictive billing protocols. Instead, we all have an opportunity to reframe the kind of work we are doing in the face of what could be industry-altering jury awards. The efforts we have outlined herein will not fix all of the problems. However, they may assist in managing, capping, and even preventing these risks long before costly litigation commences. Waiting too long will only ensure a Nuclear Verdict lurks on the horizon.