naming as defendants the Police Department, the Criminal
Court, the Department of Welfare, the sheriff and the late Frank Hogan, former Manhattan district attorney.
Many of these cases are still pending because Frances, who generally acts as her own attorney, has yet to
file papers on them or to pay court fees. Some, such as the one she brought against a judge asking return of the tape recorder
he confiscated in court, have been dismissed. In others, she has won settlements and small jury awards totaling about $4,000.
"I sue where my reputation is at stake, where I've been denied employment or my right to get a job,"
she said. "It's injustice that gives me the drive." She said that because she acts as her own attorney she doesn't
get the awards or settlements she could get if she had a good lawyer. "If they get $5,000, I should get $5,000."
"I used to be timid; I was quiet," Frances said. But there comes a day "when you just have
to fight back."
That day has arrived for an increasing number of people, the insurance
industry says. Few people may sue as many times as Frances has, but many have her attitude -- that if they are injured in
some way, they should be compensated; that if someone else can be awarded $1 million for the loss of a leg or an eye, they
should be able to get $1 million if they suffer the same or similar loss. The attitude has been called "Sue Syndrome."
And it has produced a new breed of millionaire that has the targets of suits -- from insurance companies to self-insured cities
like New York -- going ga-ga.
Last year a Maryland man was awarded $13.35 million in damages for the
rape, stabbing and fatal strangling of his 30-year-old wife, the mother of two. In his suit, Benjamin Blum accused a furniture
leasing company of negligence in its hiring and supervision practices because it failed to investigate the criminal background
of one of its employees -- who pleaded guilty to the rape and first degree murder of Blum's wife. The employee was
a member of a crew removing furniture from the apartment next door to the Blums. If his jury award is upheld, Blum will be
the richest in this new species of millionaire, which numbers at least 95 and includes widows, widowers, the brain-injured
and the paraplegic.
Everett Parks, a claims expert with Marsh & McLennan, the largest
insurance brokerage firm in the world, says "Verdicts in excess of $1 million are now frequent and it is no longer rare
to exceed $3 million."
"So what does a toe go for these days?" I asked Charles Clarke,
executive vice president of the Insurance Information Institute. He assumed an indignant expression and said, "I don't
know. But I do know what a rape goes for. It goes for two and a half million dollars."
was referring to Connie Francis who was awarded $2.5 million from Howard Johnson's after being raped in a motor lodge.
Her jury award is on appeal.
awards "dictate the environment" in which claims are made and settled -- and the cost of legal defense is sometimes
almost as much as the loss. Many insurance executives fear that people will read about the Connie Francis award and ask for
those kinds of damages in other suits.
"That's their right," says Francis Swinick.
That's juries and judges playing Robin Hood, says Business Week.
you, the policy holder, pay for this "situation," says a recent Travelers Insurance Co. advertisement. You paid
for it last year, it says. You're paying for it now, it says. And you may be paying more, says Forbes Magazine: "If
people continue to regard insurance companies as fair game, and if inflation gets out of hand again, there will be no alternative
for the companies but to raise rates even higher." The consumer also pays in terms of higher prices, and in some cases
a decrease in services because of the cost of insuring some services.
You, the taxpayer,
also pay. In some large cities which are self-insured, such as New York, you pay for jury awards made against the city directly
in taxes. Outside large cities you pay in taxes when the liability premiums for your municipality or school district increase
or when your municipality "goes bare" because it can't get insurance at all.
is suing doing? Part of the answer lies beyond the large jury awards and settlements. Part of it lies in the process that
preceds that -- the lawsuit and, most often, the personal injury lawsuit.
I name you juror
for a while in a randomly chosen case.
It was bad enough, thought Herbert Meisels, that he had to go through what he went through -- the day in October
1971 when he was walking east on a 46th St. sidewalk and, as he passed a Kinney garage, was hit by a car that was leaving
that garage and ended up on the street on the other side of a taxi. There were fractures of his right hip and thigh bones
and the dislocation of his left ankle. There were stays totaling more than 200 days in five hospitals, three operations, therapy
and scars. Now he had to endure it again. He had to look at those X-rays again. Everybody in the courtroom was staring at
Herbert Meisels' X-rays, illuminated in a box on the judge's bench. X-rays of his pelvic bone and his fractured right
thigh bone held together with a long metal plate attached to the bone with screws. Just seeing those screws, those foreign
objects in someone's body, thought one juror, was enough to make you miserable for the man.
attorney, Aaron Broder, asks the doctor on the stand how many screws are in this particular X-ray. "Fourteen screws,"
says the doctor. "Fourteen screws inthe X-ray," says Broder. "Right?" "Right," says the doctor.
Broder, flipping through more than 120 ages of Meisels' medical record, goes on all day asking the doctor
about the extent and effect of the other injuries he wants to establish his client suffered as a result of this accident --
insomnia, jaundice resulting from serum hepatitis, dermatological infection over the right thigh and scrotum, arthritis, depression,
"excruciating pain, suffering, and agony."
This is the fourth day of testimony for the plaintiff, Meisels, in his
suit against the drive of the car that hit him, Cecilio Ramos, and against National Kinney, which owned the garage:
There is not one bit of misery that Meisels experienced or that he is expected to experience as a result of
this accident that Broder would not bring before the jury. Meanwhile, Meisels is half-sitting, half -lying on the first bench
in the courtroom. He is pale, the muscles in his face strained. His metal crutch rests on his left shoulder. His wife Inez
sits beside him. She is pale, the muscles in her face strained. Her arms are wrapped around his right arm as if to keep him,
sometimes, from sliding to the floor. She looks her age, 53. Meisels, 51, looks as if he could be 60.
Meisels has alrready testified that he was not able to continue as an accountant for an anti-poverty agency
since the accident. His claims for special damages, which may be used in court as an indication of the seriousness of his
injury, include about $41,000 in medical expenses, about $62,000 in loss of earings up to the time of the trial (last September)
and an estimated future loss of income for life of about $500,000. His claims for general damages include "pain and suffering."
Since pain and suffering are about as tangible as wind, it's up to the attorneys for both sides to gauge
and illustrate them from their points of view. "You're selling pain and suffering, as gruesome as it sounds,"
Broder says. "And it's necessary sometimes to bore the jury, sometimes to bore them to tears. At great length you
want to fully present the extent of the client's suffering."
yu are never quite surehow a juror is going to react. On the forth day of testimony, Aaron Broder illustrated his client's
limp by limping in court. A few minutes later, a juror sent a note to the judge, Sidney Asch, which said Broder's constant
references to pain and suffering were making her ill and making her antagonistic towards him. "I wasn't doing something
naught," Broder said, "She had no idea of what my duties and responsibilities were. She had some vague notiong perhaps
that lawyers want to prey upon the sympathy of the jury. I personally feel that she didn't appreciate the whole nature
of a personal injury case and pain and suffering is at the root of it."
Too often pain
and suffering get stretched out like a rubber band, says T. Lawrence Jones, president of the American Insurance Association.
"No amount of dollars is gong to minimize or remedy pain and suffering, and a feeling I have is over time juries have
become aware of what lawyers get paid so I think they throw in some pain and suffering to pay the lawyer."
By the rules of the New York State Appellate Division, trial lawyers can charge their clients either one third
of the amount they recover or on a sliding scale, which beings at 50% of recoveries up to $1,000 and declines as the size
of the recovery increases. But, Broder noted, the trial lawyer is the "poor man's key to the courhouse," for
if he loses his case, the lawyer receives nothing.
On the seventh day of the Meisels case, the defense called its first
witness. He was about five feet tall, stocky, and said about 25 words before Broder stopped him.
man was Robert Kuhn, a photographer for a private investigation firm retained by Travelers, which insures Kinney, and he had
a film of Herbert Meisels going to Bloomingdales's and climbing the steps of the post office. Broder, Judge Asch and the
defense attorneys recessed to the robing room, where they viewed the film and argued over its admissibilitye as evidence.
AT 5 p.m. Broder emerged, sweating. Patterson emerged with Frank McLaughlin, senior house attorney for Travelers. They too
"We're not contesting that the man was injured," said
McLaughlin. "We're saying that he is exaggerating completely the seriousness of these injuries."
In his complaint, Meisels sought $1 million. His wife sought $500,000 for lost of his services. On the morning
of the eighth day of their trial, the Meisels accepted a settlement of $l90,000.
As judge Asch explained to the jury that the case was over, Mrs. Meisels
began to cry, hard. "I'm spent," she said. Meisels said it was a "five-year nightmare." McLaughlin
said the amount of the settlement had "everything to do with the film." He said it showed Meisels walking up and
down the stairs of the Post Office's Ansonia Station on Broadway wihtout a crutch or a cane. He said Meisels was walking
"just a little slower than other people" on the street -- an interesting point to make since such films are sometimes
speeded up and heavily edited.
That such films are sometimes admitted into evidence does not mean the
plaintiff's case has been ruined however. "The last they lowered the lights on me in court," said Max Toberoff,
a plaintiff's attorney, "it was counterproductive for the defense. You see the jury resents spying and secret cameras,
and a clever plaintiffs' attorney must be able to play on emotions. I get the guy (photographer) on the stand and say,
'How long were you spying on my client?' and he follows with 'weeks and weeks blah blah' and
I say, 'In secret? You were doing it from a van in secret?'"
would not comment on the film. He said his clients had accepted the "paltry settlement" because they didn't
want to go through the appeals process, which could have lasted two years.
This leads us
to a lever used in negotiations of such settlements -- the reputation of the trial attorney himself, for some are known for
settling and others are known for going to trial. The trial itself and its various stages also become levers in negotiations.
"The closer you get to trial, you either put up or shut up," Toberoff said. The same goes for the proximity of jury
Perhaps the most important lever in negotiations is the liability factor.
What you ask for, how far you push, whether or not you go to trial, how far you go in a trial are matters influenced by the
liability factor. "You play craps?" asked Toberoff. "You figure your odds like in craps."
One of the reasons why more than one defendant is sometimes named in a suit is that there is often a real
question of who is liable and, if so, how liable. Another is that at least one defendant should have money. With regard to
this, the defendants in the Meisels case represented extreme opposites. You had Ramos, with his $l0,000 in insurance coverage
-- called in courthouse hallways "judgement proof" -- and you had Kinney, which has money -- called in courthouse
hallways a "target defendant."
you want in negotiations is not usually what you put forth in the complaint. "If the chance of winning the case is 50%
you would want 50% of what the reasonable fair sum is and that sum comes out of the heads of lawyers," Broder said. A
chief consideration in determining that sum is the precedent set by the Appellate Division, said Broder, who noted that the
division usually reduces large jury verdicts.
Meisels was well aware of the liability factor when he settled for $l0,000
from Ramos' insurance company and $180,000 from Travelsers. He was also well aware of the film. "It was the only
time in five years I went to Bloomingdale's," he said of a section of the film. "I figured I could have gotten
a jury verdict of $600,000 or $750,000, which might have been reduced to $350,000 in the Appellate Division. So we were looking
for $350,000. But then there was the film and we didn't want to go through appeals."
said this over tomato juice in a bagel joint near his West Side apartment late one afternoon two months after the case was
concluded. I had met him a few minutes earlier -- by accident -- in front of the Ansonia Station. He went up the steps at
about the same pace I did. Although he limped, he had no crutch, no cane. He volunteered the information that six months before
it took him 20 minutes to get up those dozen or so steps, but that on some days, like that day, he felt pretty well and it
took less than a minute. He looked much less pale and more his age in a blue suit than he did in the brown one he wore
"It was a gamble," Meisels said.
the way he lost his wife, he mentioned matter-of-factly. He said they were separated, that they were "splitting up,"
and that they had planned this two years ago. "It's all part of it," he said. "Suing."
I asked Meisels to comment on the fact that the insurance industry has been complaining about the cost of
claims and suits. "It's their own fault," he said. "Look at my case. In the first year after the accident
I would have settled for $30,000. I figured $10,000 from Ramos and $20,000 from the garage "because the garage had the
money." But Travelers wouldn't settle five years ago. Since the accident was before no-fault, the Meisels paid some
expenses and Blue Cross paid about $40,000, he said. Meisels said the decision to go for $350,000 was made after he retained
Broder. He had sought only $30,000 before that because, he said, he was "despondent."
now Herbert Meisels may start a mail order business with what's left of the settlement (which along with jury awards for
compensatory damages is tax free). He said he can't go back to accounting because he lost five years' experience.
He said he gave Inez part of the money. He had to pay some expenses, like the fee for the expert testimony of the doctors
-- $1,000 for a day on the stand is not unusual. And he had to pay Aaron Broder a third of the settlement, about $63,000.
Aaron Broder said he had to share some of his fee with a "forwarder," another attorney who "shared
in the work" and who referred Meisels to Broder. And, Broder said, part of his fee went to his staff, which he says is
his greatest luxury next to his home on Long Island Sound and its accoutrements, including a sailboat named Whiplash.
It's lawyers like Aaron Broder the insurance industry resents, to put it mildly. "They (plaintiffs'
attorneys) even have a club for lawyers who''ve won $1 million verdicts," snarled one insurance representative.
"Oh yeah," said Richard Grand of Tucson, Ariz., founder of the Inner Circle of Advocates, an organization of at
least 72 attorneys who've won at least $1 million in any one jury verdict. "They (insurance companies) hate us."
As one insurance executive put it, "It's those spellbinder lawyers," along with other factors,
who caused the industry to suffer losses in l974 and l975 -- losses that had some of their executives pounding their fists
on their desks.
Bur for sure, it's not just the lawyers. It's not really clear
what exactly is causing the whole insurance industry loss problem. Even a U.S. Department of Commerce staff wrote that it
was not sure what are the "causes," "effects" and "severity" of the problem. The Commerce Department
report stated that the list of material that was not available from manufacturers or the insurance industry included: the
number of insurance companies writing product liability protection, the number and severity of product liability claims and
"accurate trends on increases in premium payments."
Several State Appellate
Division reports show that suing in general over the 10 years from 1965 to 1975 has not increased. But there are far more
claims than suits, one liability expert explained.
"Something's going on," said John Regan, chairman of Marsh
and McLennan. "The fundamental theory is that this is a reflection of consumerism. When my father bought a car and it
didn't work some cold morning, he may not have suied. He may have fixed it himself. People expect these days to buy a
car that willl work perfectly!"
This year the insurance industry's headaches seem to be subsiding,
but their "pain remedies" have widespread side effects. In the last year, auto insurance rates in New York State
rose an average 55% and the increase directly affects policy holders. There are other results that we will feel soon.
Remember the medical malpractice crisis? According to the Administrative Board of the Judicial Conference
of the State of New York, 210 medical malpractice suits were filed in New York State Supreme Court in the judicial year 1964-65.
In the same period, 10 years later, the number increased to 531. In 1975 alone, 932 were filed.
AIA President Jones says the coming "products liability crisis" is going to make medical malpractice look like a
modest pinch. "During a recent five-year period the average claim settlement in product liability cases has increased
300%," said The Travelers' advertisement. "The resultant astronomical liablity protection costs (the increase
in premiums) have put some manufacturing companies out of business and threaten still others."
One metropolitan area manufacturer of aircraft machine parts was paying $4,000 in liability insurance last
year. This year he's paying $70,000 and getting it from Lloyds of London. "There's no way that a manufacturer
can absorb that," said his insurance agent. "He's going to have topass the increase along to his customers,
" which means that planes are probably going to cost more money, which means that tickets may cost more money.
And why has this manufacturer's liability insurance increased? Have you not heard of defects in aircraft
engines causing, directly or indirectly, plane crashes? The jury verdicts and settlments that resulted from just one such
crash in the Florida Everglades in 1972 came to at least $10 million. One plaintiff who lost both legs in another plane accident
was awarded $1 million in compensatory damages, $10.5 million in punitive damages and $1.2 million in damages for the death
of his wife in the same crash by a California jury.
The insurance companies are refusing to insure certain "lines"
altogether. Jones says the ares where insurance companies "can't estimate" what rates would be sufficient to
provide coverage -- areas which they therefore may refuse to insure -- include manufacturers of machine and woodworking tools,
pest control operators, the glass industry and sporting goods. In such areas, particularly machine tools, he said, the
courts have found manufacturers liable for injuries caused by products they put out as many as 20 years ago.
Another area where premiums have not only increased but sometimes become "unavailable" could affect
taxpayers even more directly: municipal liability.
New York is self-insured. It has bout 60 attorneys to handle its lawsuits.
And when a milliion-dollar verdict is brought against the city, it comes out of our pockets. The number of claims made against
the city for injuries caused by everything from defective sidewalks to false arrests has remained fairly constant but the
cost increased from $7.5 million in 1965 to $21.3 million in 1975, exclusive of legal defense expenses.
The Westchester municipalies of Tuckahoe and Bedford are not self-insured but they too have problems. Last
June the Hartford Insurance Group sent Tuckahoe a notice that it was not going to renew its policy. Through negotiations the
village, with a population of 6,500, was able to get insurance on a month-to-month basis until October, when Hartford renewed
for one year, rather than for three years as in the past. The premium: $42,000 a year vs. $6,000 the year before.
Early this year Royal Globe Insurance also sent a notice of nonrenewal to the Tow of Bedford, population 15,000
for its 1977 policy. F. Stanton Carey, resident vice president for Greater New York for Royal Globe, said his company had
sent such a notice because the town had changed brokers and Royal Globe does not do business with the White Plains office
of the new broker, Marsh & McLennan. Bedford subsequently switched back.
premiums increased from about $28,000 for its 1974-75 insurance year to $60,000 for the 1975-76 insurance year and to $160,000
for 1976-77. The town's biggest losses have been for property damages to town cars.
no real justification for the increase," said Bedford Town Supervisor Albert Marchigiani. Thomas Dietz, the town's
reinstated broker, said the town's liability risk had increased because its police payrool had increased 50% and because
the town had installed a ski tow. Carey of Royal Globe said there are many possible reasons for the increase but that he didn't
have time to look them up.
"For no reason" the rates go up, such village and tow officials
But there is another side f what suing is doing.
said trial lawyer Harry Lipsig, "has made doctors, with all their bleating on the subject, more careful than malpractice
suits and nothing has made manufacturers more concerned about not having a consumer electrocuted by a carelessly manufactured
electronic product than a judgement rendered against them on proof of their carelessness.
true that products liability lawsuits have increased the overhead of many businesses, which as a result of this type of litigation
now spend money in greater efforts to produce safer products.
"Let them be careful;
their rates will drop."
Plaintiffs' attorney Aaron J. Broder is very careful. Aaron J. Broder
has been sued, for malpractice.
He said he couldn't remember the details of any case brought against
him except that in one case payment was made in settlement without conceding responsiblity on his part.
"I have been," Broder said, "from fear of being sued meticulously careful. We expend a tremendous
amount of energy in my office to protect against that sort of thing, but we do that anyway, expend a tremendous amount of
Broder also says he has seen several beneficial
results of suits. As the result of one suit he filed on his behalf against the County of Nassau and the Township of North
Hempstead, there is now a sidewalk on Bayview Ave. in Great Neck.
There wasn't a sidewalk
on Bayview Ave. when Joel Brtoder, aged 15, was walking there one evening in 1970, when he was sturck by a hit-and-run driver.
Broder said hs son died two years later in the hospital as a result of that accident. Broder then dropped his suit for the
same reason he has never been able to close out his son's bank account or been able to touch the clothing in his room,
which has been locked since the night of the accident.