By Rachel Webb
Two civil cases resulted in verdicts of more than $400 million each in 2015, dwarfing the top plaintiffs’ wins in several recent years.
The cases also seemed to reverse a 2014 trend that showed diminishing plaintiffs’ wins.
A $491 million judgment in a lawsuit against PNC Bank and a $434 million judgment in a case brought by the Health Care Foundation of Greater Kansas City were the two highest plaintiffs’ verdicts, according to data analyzed by Missouri Lawyers Weekly.
The top cases of 2015 both involved major corporations with deep pockets. Jo Ann Howard and Associates P.C., special deputy receiver, et al. v. PNC Bank and Forever Enterprises Inc., resulted in a jury verdict of $491 million. Plaintiffs sued PNC Bank over the role of its predecessor, Allegiant Bank, as a trustee for assets meant to cover consumers’ future funeral expenses. Allegiant Bank had been a trustee for National Prearranged Services, Inc., a company that sold funeral services to consumers that collapsed in a Ponzi scheme. The case was tried primarily by out-of-state attorneys.
In the second-biggest case, the Health Care Foundation of Greater Kansas City sued the Hospital Corporation of America after the company failed to make improvements to the urban hospitals it had purchased. Meanwhile, the company built hospitals in the suburbs of Kansas City. When HCA bought the hospitals in 2003, it was the largest sale of not-for-profit hospitals in the history of the United States, said lead plaintiffs’ attorney, Paul Seyferth of Seyferth, Blumenthal and Harris in Kansas City.
“Our case was a very unique situation,” Seyferth said. “You could argue that our case was a one-off type of case. It involved a single transaction that was actually negotiated 13 years ago. There were so many dollars at stake and so many back-end loaded obligations. Ours is the nature of the beast that there’s a lot of money at stake.”
The company had agreed to spend $450 million to improve the hospitals it bought and $500 million over five years on charity care. HCA’s commitment to upgrade existing hospitals and other obligations necessitated the large judgment, but doesn’t necessarily signal a change in plaintiffs’ wins, Seyferth said.
In 2014, the single largest plaintiffs’ win was a settlement of $263 million, and in 2013, the top plaintiff’s win was a settlement for $220 million, according to Missouri Lawyers Weekly data.
The third-ranking plaintiffs’ case in 2015 involved a jury lodging $82 million in punitive damages against a debt-recovery company. In Portfolio Recovery Associates v. Guadalupe Mejia, the original plaintiff had gone after Mejia for a little more than $1,000 owed to HSBC Bank. Mejia had not accrued the debt, but Portfolio pursued her anyway using inaccurate information about the identity of the debtor, her attorney, Gina Chiala said. Mejia countersued for violations of the Fair Debt Collections Practices Act and malicious prosecution, according to court records.
Jurors awarded Mejia $250,000 in actual damages for malicious prosecution and violations of the FDCPA, and $1,000 for statutory damages. The millions in punitive damages appeared to be the jury’s way of sending a message to the debt-recovery business.
Personal injury cases made up the bulk of 2015’s top plaintiffs’ verdicts and judgments, and those also topped the previous year’s results in similar cases. The sixth case rounding out the top plaintiffs’ verdicts and judgments, Sherry Spence vs. The BNSF Railway Co., resulted in a $20 million wrongful death verdict.
By comparison, in 2014, the top plaintiffs’ jury verdict was a personal injury case totaling $15 million. In 2013, the median plaintiffs’ win in cases above $1 million was $2.75 million, which dipped to $2 million in 2014. In 2015, the median for all plaintiffs’ verdicts, judgments and settlements above $1 million was $4 million. The median for verdicts and judgments excluding settlements climbed to $4.4 million.
These calculations are based on cases covered by Missouri Lawyers Weekly reporters and those submitted to our Verdicts & Settlements database. These sources are not a complete record of cases litigated in Missouri.
Michael Ponder, the attorney who represented Spence, said the case’s result was due to the clear liability on the part of the railroad and a client with a compelling story to tell the jury. In the Spence case, a widow sued the railroad after her husband was struck by a train while driving his truck in Pemiscot County. The plaintiff contended that the railroad crossing had overgrown vegetation, obscuring the driver’s view and lacked lights or a gate.
“It’s been my experience that whether this verdict is classified as low, high or in-between, juries always have a way of finding right value for a case,” said Ponder, of Cape Girardeau’s Cook Barkett Ponder and Wolz. “Truthfully, at end of the day, those people will know more about the case than they wanted to and they have the tools to properly do the job. I think you can look at this verdict and call it high, but you really should look at this verdict and say the system worked.”
Despite plaintiffs receiving higher verdicts and judgments in 2015, the tendency did not carry over into plaintiffs receiving settlements.
The top settlement of 2015 totaled $18 million in the case of Laura Unverferth vs. American Traffic Solutions Inc. regarding red-light cameras in Missouri cities. The top five settlements of 2014 ranged from $263 million to $15.5 million.
The settlement covered several lawsuits pending in Missouri over so-called red-light cameras, which capture photos of drivers running red lights, resulting in traffic tickets for the vehicle’s registered owner. The settlement put to rest suits that had been pending since 2009, said plaintiffs’ attorney Ryan Keane, who was then of the Simon Law Firm. The class-action suit argued the cameras did not comply with the state’s laws regarding moving violations, the tickets violated statutory and constitutional requirements of proper notice and due process; and that 27 municipalities and ATS were unjustly enriched from the fines collected from the tickets.
During the litigation, several appellate courts invalidated red-light camera ordinances but held that the plaintiffs could not recover fines paid on their tickets. The 2015 settlement allows class members to collect reimbursement of 20 percent of the fines they paid.
“The appellate decisions were the biggest, most prominent feature of our case and were the impetus behind getting this case settled,” said Keane, now of the Keane Law Firm.
In 2015, the defense side also had wins significantly greater than the preceding year.
The top case of the year, Black & Veatch Corp. v. Strongwell Corp., was nearly triple other contenders in damages sought by plaintiffs. Black & Veatch had sought $140 million in damages from Strongwell Corp., but a jury found that the majority of fault lay with the plaintiff. Black & Veatch sued Strongwell in January 2012 claiming that Strongwell had supplied defective products to the plaintiff’s power plants.
The defense presented evidence that Black & Veatch had sought bids for the equipment using inaccurate specifications. The power-plant company based in Overland Park, Kansas, had significantly underestimated the load specifications the equipment would need to withstand, said Randy Scheer, of Sanders Warren & Russell, who led the defense team. Black & Veatch has since rebuilt its plants with equipment that has a load specification 30 times higher than what it ordered from Strongwell, Scheer said.
The case involved such big numbers because of the nature of the equipment involved and the damages alleged by the plaintiff, Scheer said.
“When you’re dealing with construction cases, numbers for construction cases usually talk about hard numbers versus personal injury cases, where they talk about pain and suffering,” Scheer said.
The second-highest defense verdict, In the matter of The Robert Kaplan Trust, Michael Kaplan et al. v. Christine Murray-Kaplan et al., involved a dispute between members of a wealthy Ladue family over the patriarch’s estate. In that case the plaintiff had sought stock and investments totaling $50 million.
Medical malpractice cases rounded out the rest of 2015’s top five defense wins, ranging from $20 million to $5.4 million.