The need for tort reform has been a central point in arguments about Obamacare and a huge talking point in debates between liberals and conservatives on all kinds of liability matters. While there are many liability and medical malpractice cases that have fueled the debate, one stands out because now, long after both sides have made their points, it remains difficult to come to a clear conclusion.
On February 27, 1992, Stella Liebeck, a 79-year-old woman, ordered a 49-cent cup of coffee from the drive-through window of a McDonald’s restaurant in Albuquerque, New Mexico. While sitting in the passenger seat of her grandson’s car, Ms. Liebeck tried to take the top of the coffee container to add some cream and sugar. The coffee spilled setting off a chain of events that have reverberated through the years and the controversy over the case and its outcome has fueled the debate over tort reform for two decades as well as serving as an example for those purchasing commercial liability insurance.
Simply stated the facts are Ms Liebeck bought the coffee, spilled the coffee, was burned, sued McDonalds and won a judgment of over $2 million. Those unadorned facts led to a widespread notion that hers was a frivolous lawsuit. Helped along by late night television and talk radio, it even helped spawn some of the synonyms we now hear for suits with little merit – “lotto litigation” and “jackpot justice”, for example.
The bare facts would seem to support the scorn of late night comics; after all, what is not to understand about “hot” coffee? Spilling it on oneself and then crying foul was the symbol of “it must be somebody’s fault.” Yet, as the actual suit unfolded, it appeared there was much more to learn.
First, McDonald’s kept its coffee heated to 190 F a temperature so high it can burn off skin and cause muscle and bone damage in just 2 seconds. Other restaurants typically kept their coffee at about 160 F, a temperature that allowed seconds more margin of time to escape damage. Next, while this initially sounded like one person making an outrageous claim, McDonald’s had 700 coffee burn claims filed against it before this suit. They had paid out over $500,000 on previous burn injuries. In testimony, McDonald’s Quality Assurance Manager acknowledged they were aware of the risk of serving dangerously hot coffee. In short, McDonald’s knew its coffee was burning people all over the country.
As to Ms. Liebeck, Her medical bills were almost $200,000 and her injuries were extensive. Her initial appeal to McDonald’s was not a “jackpot” suit, but for only $20,000 to help pay some of her bills. McDonald’s refused to help her pay any of her medical bills. With facts like these, the pendulum began to swing the other way, finally culminating in the documentary movie “Hot Coffee” which skewered the notion this was a frivolous lawsuit and undermined the whole tort reform argument.
Forbes Magazine responded not long after with an article aimed at the movie itself noting among other things that the “700 complaints” McDonald’s received were out of 10 billion cups of coffee sold and suggesting there was little proof a ten degree reduction in temperature would have caused less damage. In the end, Ms. Liebeck’s award actually was reduced from the $2.7 million that the jury awarded to a more modest $480,000. While the case itself is long over it still remains a contentious topic in discussions of tort reform.