Spilling the Beans on the McDonalds' Coffee Case
Many people STILL use the "McDonalds' Coffee Case" from 1992 as an example of "Run away Juries" or a "Lawsuit Crisis". Even assuming the verdict was in error, one case in millions over 20 years is very poor evidence of a "crisis"!
I for one DO NOT think the case was incorrectly decided. Here are some facts about the case the insurance companies wont share. . .
Stella Liebeck of Albuquerque, New Mexico, was in the passenger seat of her grandson's car when she was severely burned by McDonald's coffee in February 1992. Liebeck ordered coffee that was served in a Styrofoam cup at the drive-through window of a local McDonald's.
Critics of civil justice often charge that Liebeck was driving the car or that the vehicle was in motion when she spilled the coffee; neither is true. After receiving the order, the grandson pulled his car forward and stopped momentarily so that Liebeck could add cream and sugar to her coffee. Liebeck placed the cup between her knees and attempted to remove the plastic lid from the cup. As Liebeck removed the lid, the entire contents of the cup spilled into her lap.
The sweatpants Liebeck was wearing absorbed the coffee and held it next to her skin.
Stella Liebeck's Injury and Hospitalization: A vascular surgeon determined that Liebeck suffered full thickness burns (or third-degree burns) over 6 percent of her body.
Liebeck suffered burns on her inner thighs, perineum, buttocks, and genital and groin areas.
She was hospitalized for eight days, during which time she underwent skin grafting and debridement treatments (the surgical removal of tissue).
Stella Liebeck's Initial Claim: Liebeck sought to settle her claim for $20,000, but McDonald's refused.
McDonald's Attitude During discovery: McDonald's produced documents showing more than 700 claims by people burned by its coffee between 1982 and 1992. Some claims involved third-degree burns substantially similar to Liebeck's. This history documented McDonald's knowledge about the extent and nature of this hazard.
McDonald's also said during discovery that, based on a consultant's advice, it held its coffee at between 180 and 190 degrees Fahrenheit to maintain optimum taste.
Other establishments sell coffee at substantially lower temperatures than at McDonald's. Coffee served at home is generally 135 to 140 degrees.
Damaging Testimony: McDonald's own quality assurance manager testified that a burn hazard exists with any food substance served at 140 degrees or above and that McDonald's coffee was not fit for consumption because it would burn the mouth and throat.
The quality assurance manager further testified that the company actively enforces a requirement that coffee be held in the pot at 185 degrees, plus or minus five degrees. He also testified that while burns would occur, McDonald's had no intention of reducing the "holding temperature" of its coffee.
Plaintiff's expert, a scholar in thermodynamics as applied to human skin burns, testified that liquids at 180 degrees will cause a full thickness burn to human skin in two to seven seconds.
Other testimony showed that as the temperature decreases toward 155 degrees, the extent of the burn relative to that temperature decreases exponentially. Thus, if Liebeck's spill had involved coffee at 155 degrees, the liquid would have cooled and given her time to avoid a serious burn. McDonald's asserted that customers buy coffee on their way to work or home, intending to consume it there. However, the company's own research showed that customers intend to consume the coffee immediately while driving.
McDonald's also argued that consumers know coffee is hot and that its customers want it that way. The company admitted its customers were unaware that they could suffer third-degree burns from the coffee and that a statement on the side of the cup was not a "warning" but a "reminder" since the location of the writing would not warn customers of the hazard.
According to The Wall Street Journal:
A Jury of One's Peers: The Wall Street Journal wrote (September 1, 1994), "The testimony of Mr. [Christopher] Appleton, the McDonald's executive, didn't help the company, jurors said later. He testified that McDonald's knew its coffee sometimes caused serious burns, but hadn't consulted burn experts about it. He also testified that McDonald's had decided not to warn customers about the possibility of severe burns, even though most people wouldn't think it possible. Finally, he testified that McDonald's didn't intend to change any of its coffee policies or procedures, saying, 'There are more serious dangers in restaurants.' "
The Journal quoted one juror, Jack Elliott, remarking after the trial that the case had been about such "callous disregard for the safety of the people."
The Journal story continued, "Next for the defense came P. Robert Knaff, a human-factors engineer who earned $15,000 in fees from the case and who, several jurors said later, didn't help McDonald's either. Dr. Knaff told the jury that hot-coffee burns were statistically insignificant when compared to the billion cups of coffee McDonald's sells annually. To jurors, Dr. Knaff seemed to be saying that the graphic photos they had seen of Mrs. Liebeck's burns didn't matter because they were rare. 'There was a person behind every number and I don't think the corporation was attaching enough importance to that,' says juror Betty Farnham."
At the beginning of the trial, jury foreman Jerry Goens told the Journal, he "wasn't convinced as to why I needed to be there to settle a coffee spill." By the end of the trial, Betty Farnham told the Journal, "The facts were so overwhelmingly against the company. They were not taking care of their customers."
The Verdict: The jury awarded Liebeck $200,000 in compensatory damages. This amount was reduced to $160,000 because the jury found Liebeck 20 percent at fault in the spill. The jury also awarded Liebeck $2.7 million in punitive damages, which equals about two days of McDonald's coffee sales.
Post-verdict investigation found that the temperature of coffee at the local Albuquerque McDonald's had dropped to 158 degrees Fahrenheit.
The trial court subsequently reduced the punitive award to $480,000—or three times compensatory damages—even though the judge called McDonald's conduct reckless, callous and willful. Subsequent to remittitur, the parties entered a post-verdict settlement.