Damage Suits: The Price-Tag Problem

The stars of the “negligence bar” are courtroom impresarios who seek whopping damages in exchange for a fat cut of the plaintiff’s proceeds. Those stars are shining so brightly that jury awards for serious personal injuries are rising by 14% a year and beleaguered insurance companies are crying foul—appealing out-of-court to the public.

Latest blast comes in a 43-page monograph from Milwaukee’s Defense Research Institute, which represents 225 companies and 3,800 defense lawyers. Chief target of the D.R.I, is the ad damnum (damages) clause that puts a specific price tag on the injury at issue. Strictly speaking, the dollar amount a plaintiff is claiming is not supposed to sway juries empaneled to determine actual damages based on trial evidence. But, charges the institute, negligence lawyers are using the ad damnum clause for just that purpose.

By filing “astronomical” claims, says the institute, the artful advocate earns pretrial newspaper publicity that gets prospective jurors psychologically prepared for huge verdicts. During the trial, the lawyer keeps repeating the “price,” sometimes leaves it on a blackboard as a means of subliminal advertising. To woo jurors, the lawyer may suddenly decrease the price to show “fairness.” In an equally dramatic maneuver, he may increase it to suggest that the plaintiff underestimated. Then, as Cleveland’s Jury Verdict Research Inc. puts it: “The higher the amount of suit, the higher the point at which the jury begins its deliberations.”

The defense lawyers’ monograph argues that the ad damnum clause should be banished—or at least kept from jurors’ ears. Technically, it merely determines which court has jurisdiction over the amount in controversy. (Most kinds of federal court cases, for example, must involve more than $10,000.) In Pennsylvania and Florida, the plaintiff may now plead only that he demands more or less than the jurisdictional amount of a particular court. New Jersey has eliminated the ad damnum clause. British courts long ago barred lawyers from reading the clause to juries, thus focusing full attention on the trial evidence.

In sharp rebuttal for plaintiffs, President Joseph Kelner of the American Trial Lawyers Association last week attacked the defense monograph as a “radical abandonment” of “dignified and customary” methods of legal reform. According to Kelner, only 2% of all claims ever go to verdict, defendants win more than 50% of the verdicts, and judges are well-equipped to set aside excessive awards.