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August 16, 2005
Making policy based on urban legends
Great story in Sunday's Los Angeles Times on how policy often gets made "Legal Urban Legends Hold Sway":
Merv Grazinski set his Winnebago on cruise control, slid away from the wheel and went back to fix a cup of coffee. You can guess what happened next: The rudderless, driverless Winnebago crashed. razinski blamed the manufacturer for not warning against such a maneuver in the owner's manual. He sued and won $1.75 million. His jackpot would seem to erase any doubt that the legal system has lost its mind. Indeed, the Grazinski case has been cited often as evidence of the need to limit lawsuits and jury awards.
There's just one problem: The story is a complete fabrication.
The article goes on to talk about how these urban legends are passed off as truth in policy debates.
What I really liked was th description of how the McDonald's hot coffee suit was morphed from a serious lawsuit to "the poster child for frivolous claims."
Here is what happened:
According to popular accounts of the lawsuit, [Stella] Liebeck coaxed nearly $3 million from an Albuquerque jury in 1994 after being scalded by McDonald's coffee she spilled on herself while riding in a car. These are the story's best-known elements, but filling in the missing facts puts the case in a different light.
Trial testimony showed that at 180 to 190 degrees, McDonald's coffee was much hotter than that served by other restaurants or by people in their homes. The fast-food chain had received at least 700 complaints about hot coffee in the previous decade and had paid more than half a million dollars in settlements, according to trial testimony cited by the Wall Street Journal.
Liebeck's injuries were hardly minor. She suffered third-degree burns on her thighs and groin area, was hospitalized for a week and had to undergo painful skin grafts. Before filing a lawsuit, she wrote McDonald's requesting that it lower the temperature of its coffee and cover her uninsured medical bills and incidental costs of about $20,000. McDonald's offered $800.
Later, as the case neared trial, a mediator recommended that McDonald's pay a settlement of $225,000. The company refused.
Jurors ultimately awarded Liebeck $160,000 in compensatory damages and about $2.7 million in punitive damages. "The facts were so overwhelmingly against the company," one of the jurors told the Journal. "Their callous disregard was very upsetting," another said.
Soon after the verdict, the trial judge slashed the punitive damages by more than 80% to $480,000. Then the case settled for an undisclosed amount.
Posted by Ken Jarboe at August 16, 2005 8:52 AM
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