Last year, the American Transportation Research Institute (ATRI) published a comprehensive analysis on the notable increase in verdicts over $1 million in the trucking industry. ATRI’s 2020 study, Understanding the Impact of Nuclear Verdicts on the Trucking Industry, received significant attention, ultimately prompting ATRI to investigate verdicts and settlements in the trucking industry under $1 million. As such, last month, the ATRI published The Impact of Small Verdicts and Settlements on the Trucking Industry. Unlike the sensational multi-million dollar nuclear verdicts, these “smaller” payouts seemingly have little effect on motor carriers and insurance agencies. However, there is a general consensus in the trucking industry that small settlements and verdicts are increasing in both frequency and severity.
ATRI’s research focused on: (1) identifying the legal conditions that cultivate the small litigation cases in the trucking industry; (2) assessing the relationship between small payouts and increasing insurance rates; (3) quantifying the impact of crash characteristics and litigation factors on payment size; and (4) quantifying the impact of crash characteristics and litigation factors on settlement timing. In advancing these four objectives, ATRI analyzed litigation data from 641 cases, over the course of 14 years. Notably, the study only considered data from cases involving some form of litigation; the data did not include pre-suit settlements.
The Impact of Small Verdicts and Settlements on the Trucking Industry provides key insight into the current climate of the trucking industry while also anticipating future trends in trucking litigation. The report contains several noteworthy conclusions. For instance, the study showed that settlements in trucking cases were approximately 37.7% larger than verdicts. The type of injury also affected whether a case settled or resulted in a verdict. Cases involving a fatality were 393% more likely to settle and cases with a severe injury were 217% more likely to settle than reach a jury.
Furthermore, ATRI’s investigation into how alleged driver infractions affected smaller payouts reinforces the importance of carrier safety practice. Alleged driver infractions that resulted in the largest payouts did not uniformly relate to the accident giving rise to a plaintiff’s claim. ATRI noted that “[p]oor driver history and other alleged carrier infractions can prove especially costly because they spark additional jury sympathy on the basis of corporate ethics and culture.” The data also connected poor driver history with poor hiring practices, inadequate training, and vicarious liability. This correlation reinforces the importance of motor carrier oversight through programs like driver onboarding and training programs to reduce payouts.
ATRI also discussed how the venue of a particular case affected the payout value of smaller claims. Data from states including California, New Jersey, and Michigan (all deemed “judicial hellholes”) revealed average payments significantly above the national average. For example, California had an estimated average payment amount of $588,231, or 56.1% above the national average. Interestingly, ATRI identified one state, Tennessee, with predicted lower than average payments. In making this distinction, ATRI noted that
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