Blog Archives

  • Attorneys’ Fees Counted as Damages For Purposes of Punitive Damages Cap

    The Missouri Supreme Court again analyzed portions of the State of Missouri’s 2005 Tort Reform Bill in a recent employment discrimination decision.  In that decision, the Missouri Supreme Court found that attorneys’ fees should be included in the determination of the “net amount of judgment” that is used to calculate the maximum amount of punitive damages pursuant to Section 510.265, RSMo. 

    Section 510.265 limits the amount of punitive damages in most civil cases to the greater of $500,000 or 5 times the net amount of the judgment awarded to the plaintiff against the defendant.  The Missouri Supreme Court ruled that in determining the net amount of the judgment against the defendant, attorneys’ fees should be included.  In other words, actual damages plus any awarded attorneys fees are added together and any appropriate reductions then applied.  This amount is then multiplied by 5 in order to determine the total amount of punitive damages awardable. 

    While punitive damages may not play a significant role in the majority of cases, including attorneys’ fees in the net amount of judgment certainly has the potential to significantly raise the floor on the amount of punitive damages awardable in such cases. 

     Hervey v. Missouri Department of Corrections

  • Facebook Post Results in Removal of Juror

    Mr. and Mrs. Khoury filed a products liability suit against ConAgra for personal injuries Mrs. Khoury suffered. The day prior to voir dire, the trial court and counsel agreed that the attorneys for the parties would investigate the jury panel members’ litigation history on case.net (Missouri’s online court information system) and determine the following morning whether any of the 80 panel members may have failed to answer questions accurately. This was done and the individual jury panel members were questioned about information found on case.net. The parties subsequently exercised their peremptory strikes and strikes for cause and a jury of 12 plus 4 alternates was empaneled.

    Prior to opening statements, counsel for ConAgra informed the court that he had found that one of the selected jurors was “a prolific poster for anti-corporation, organic foods” on Facebook. ConAgra moved for a mistrial or, in the alternative, to strike the juror because of the alleged misconduct and claimed that the juror intentionally failed to disclose information that affected his ability to be a fair and impartial juror. The trial court and counsel for the parties then questioned the juror after which, counsel for ConAgra renewed its motion based upon the juror’s intentional nondisclosure. The trial court denied the motion for mistrial, but sustained the motion to strike. The juror was excused and an alternate replaced him. The jury eventually found in favor of Defendant Con-Agra and Plaintiffs appealed for a number of reasons, including a claim of error in striking the juror after the jury had been empaneled.

     The Western District Court of Appeals found that the striking of the juror for possible bias was within the discretion of the trial court and not a reversible error on appeal. The Western District Court took this opportunity to again remind counsel that any research into a juror’s bias should be brought to the trial court’s attention at the earliest possible moment and should not wait until the case has been submitted to the jury. This case serves as another warning from the courts that attorneys representing parties should make every effort to use all available resources to investigate jurors’ background prior to submitting the case to the jury in order to avoid waiving any claim of bias or prejudice on the part of jurors.

     

    Elaine Khoury and Alex Khoury v. ConAgra Foods, Inc.

  • Damage To Your Work And The Duty To Defend – A Case Study

    A recent Missouri lawsuit tested a “damage to your work” exclusion in an insurance policy. This complex case illustrates the danger in an insurer refusing to defend a case where the claim includes damages that may be covered as well as damages that may not.

    Continental Equipment Company hired Cook’s Fabrication and Welding, Inc. to install two mast radial stackers (essentially conveyors to move rocks and gravel from one location to another) at quarries owned by LaFarge North America, Inc.  Greystone, Inc. manufactured the stackers.  After Cook’s completed the installation of the stackers, both collapsed at various times causing damage including impairing the quarries’ ability to continue doing business while the stackers were repaired.  LaFarge and Continental eventually filed a products liability suit against Greystone alleging damages including “lost business, lost business opportunities, lost profits, and expenses.” Greystone filed a counterclaim that included counts against Cook’s for indemnification and contribution alleging that Cook’s negligently installed the stackers. 

    At the time of the stackers’ collapse, Cook’s was insured under a commercial general liability (CGL) policy issued by Mid-Continent Casualty Company.  Mid-Continent initially agreed to defend Cook’s but shortly thereafter withdrew its defense contending that coverage for the incident was excluded by the CGL’s “damage to your work” exclusion.  This clause excluded coverage for any damages in Cook’s work (i.e. the stackers).  Additional litigation ensued and eventually the determination of coverage under the Mid-Continent policy came before the court.  The trial court initially found that the damage to your work exclusion applied and absolved Mid-Continent of any duty to defend or indemnify Cook’s. 

    On appeal, however, the Eastern District Court of Appeals found that the damage to your work exclusion did not apply to all damages claimed.  Because some of the damages claimed were lost profits and the loss of production capacity of the quarries at issue, the Court of Appeals found that the policy coverage did not exclude all damages claimed and, therefore, Mid-Continent had a duty to defend Cook’s in the underlying litigation.  The Eastern District Court of Appeals noted that the duty to defend arises when the facts evidence a claim that is potentially covered and, to be relieved of this duty, an insurer must demonstrate “that there is no possibility of coverage.”

  • Illinois Supreme Court Continues to Reject Post-Sale Duty to Warn

    Today, the Illinois Supreme Court in Jablonski v. Ford Motor Co. (Docket No. 110096) held in part that a manufacturer has no duty to warn its customers of risks first known after a product has left its control. A continuing duty to warn may be imposed if at the time the product was manufactured the manufacturer knew or should have known of the hazard. Nevertheless, the Court did say that a post-sale duty to warn could be recognized in the future in Illinois.

    In this case, the Illinois Supreme Court reversed a $43 million general verdict awarding compensatory and punitive damages to the plaintiffs in an automotive product liability case. The court concluded that the plaintiffs’ negligence claims either lacked evidentiary support, or, in the instance of a claimed post-sale duty to warn, were not legally viable.

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