McDONALD’S — We are here to see if we can turn a quick buck, maybe 100,000 of them or even 2.7 million. I can tell that you need filling in, so here goes: Helen Julian of Galveston County is suing the parent company of Sonic Drive-In Restaurants for damages after, she claims, the lid of a cup of scalding coffee popped off, spilling the contents onto her inner thighs, causing second and third degree burns. According to her lawsuit, the restaurant chain is negligent due to the employee’s wrong placement of the lid and “lack of due care” when serving the beverage, and because of management’s improper training of employees. The lawyer wants an award of “at least” $100,000 but will leave the total up to the jury.
Helen Julian, meet Stella Leibeck. Leibeck is the famous, or infamous, woman who was awarded $2.7 million from McDonald’s after a cup of hot coffee spilled on her lap. ABC News called her case “the poster child of excessive lawsuits.” There was even a website called the “Stella Awards” for people who filed “outrageous and frivolous lawsuits.” The settlement was trotted out as Example A as the need for tort reform.
But hold on there, ladies and gentlemen of the jury. Do you want to hear the rest of the story (thank you, the late Paul Harvey)? On Feb. 27, 1992, Stella Liebeck (the “poster child” was 79 years old) was a passenger in a car driven by her grandson. At a McDonald’s in Albuquerque she bought a cup of coffee to go. When the car stopped nearby, she attempted to hold the cup between her knees and remove the lid. The coffee spilled on her, she was burned and sued, seeking to settle her claim for $20,000. McDonald’s offered $800, so Liebeck got a lawyer, Reed Morgan of Houston. Morgan offered to settle for $90,000, then $300,000. Big Mac refused.
That was a bad decision, because in the trial Liebeck’s treating physician testified Liebeck had third degree burns over 6 percent of her body. The surgeon also testified it was one of the worst scald burns he had ever seen. (She was in the hospital for eight days and lost 20 pounds.) A professor from UT-Austin, a burn expert, testified the risk involved was unacceptable. Jurors learned that McDonald’s, according to corporate rules, sold its coffee at 180-190 degrees. Other establishments sell coffee at substantially lower temperatures, and coffee served at home is generally 135 to 140 degrees.
This was not the first suit over McDonald’s hot coffee — the company’s own records showed that from 1982 to 1992 it had received more than 700 reports of people burned by McDonald’s coffee to varying degrees of severity, and had settled claims arising from scalding injuries for more than $500,000. Still, a McDonald’s expert witness testified the number of burn victims was statistically “trivial.” McDonald’s quality control manager, Christopher Appleton, testified that this number of injuries was insufficient to cause the company to evaluate its practices. He argued that all foods hotter than 130 degrees posed a burn hazard, and that restaurants had more pressing dangers to warn about.
The jury found for Liebeck and awarded her $2.86 million. Why that specific amount of money? This point is most important: the judge didn’t award those millions, the lawyers didn’t do it. The amount was set by the jurors. They awarded Liebeck $200,000 for compensatory damages, reduced by 20 percent for her own negligence to $160,000. McDonald’s sells 1 billion cups of coffee a year. It generates $1.3 million a day for the company. So the jury fined McDonald’s two days’ coffee sales, or $2.7 million in punitive damages. It all came to about $2.86 million, minus $50,000 in expenses not counting legal fees.
Hold that outrage. The judge cut the $2.7 million punitive award to $480,000 or three times compensatory damages. When the dust had cleared, that $2.86 million wound up as $640,000. The judge said the amount was appropriate for McDonald’s “willful, wanton, reckless and what the court finds was callous” behavior. The jurors said the company’s stance and attitude were appalling. Both McDonald’s and Liebeck appealed the decision, but the parties settled out of court for an undisclosed amount less than $600,000. So take from that her medical and legal bills, cost of going to Houston time and again, pain and suffering, and that undisclosed amount may not have amounted to much.
Companies constantly have to defend themselves against phony nail-in-my-doughnut and beak-in-my-omelet charges. In 1994 an elderly couple in Tacoma, Wash., claimed that they found a syringe in a can of Pepsi. Soon everyone was finding syringes in cans of Pepsi. They found horseshoes in their popcorn, hair in their hotdogs, John Deere tractors in their butter. All of a sudden, our food was contaminated by bed springs, toxic waste and embalmed rodents. But most proved to be total falsehoods and were found out. The U.S. Food and Drug Administration said that after the so-called Pepsi scare, at least 23 people were convicted of state and federal charges related to soda cans and false tampering reports. Liebeck’s accusation was pretty straightforward, but in many similar hot-coffee cases since then, judges have thrown out the charges. So Helen Julian in Galveston County and her lawyer may have to settle for 100 percent of nothing. As for us, let’s cool our indignity over “the 2.7 million dollar cup of coffee.” Never happened. It’s a red herring, an urban legend.
I notice on the rim of this cup of coffee I just purchased at the McDonald’s drive-thru, it reads: “Caution I’m hot.” Same thing in Spanish. The indented, small letters are black on black. I’ll just take a sip and….oops!
Ashby scalds at email@example.com
Korrectshun: A few weeks ago I wrote: “Obama smashed Romney in the popular vote by one and a half million nationwide.” Actually, the margin was almost 5 million votes (4,980,387). Close enough for government work.