Rising tide of lawsuits hits US trucking industry

Trucking companies in the US face a rising tide of lawsuits, despite improvements in safety, according to the US Chamber of Commerce Institute for Legal Reform (IRL). The organisation said the current litigation trajectory is “unsustainable for the American economy and the trucking industry” and called for policymakers and judges “to take action to restore balance and fairness in trucking lawsuits”.

ILR’s recent study, Roadblock: The Trucking Litigation Problem and How to Fix It, says that part of the problem is the increase in nuclear verdicts (jury awards worth $10m or more). It also reveals that among verdicts worth $1m or more against trucking firms, the average verdict increased by 867% between 2010 and 2018.

This is despite the fact that trucking accidents per mile travelled decreased from 2,000 to 2,020, says the ILR. “In other words, trucking is getting safer, but verdicts are getting bigger. It’s not a coincidence that some of the worst states to operate a truck because of the litigation risk – like California, Georgia, and Pennsylvania – are the same states in previous ILR research with the highest number of nuclear verdicts per capita,” it says.

The ILR says there are a variety of reasons for the growing litigation trend: medical referral networks and inflated billing practices, so-called “reptile” courtroom tactics by plaintiffs’ lawyers, a strategy to widen the circle of defendants, and an ambiguous standard of care.

Apparently “reptile theory” is when plaintiff lawyers attempt to make the jury fear the defendant as a threat to themselves and their safety, and therefore make bigger damages awards.

The ILR study outlines several solutions that it says state legislators and courts can pursue to clamp down on rising verdicts, such as requiring transparency in claiming medical damages, preventing plaintiffs’ lawyers from improperly inflaming jurors if the defendant company has already said it would be responsible for the driver’s negligence (if any), and creating reasonable caps on non-economic damages.

A review of 154 trucking litigation verdicts and settlements from June 2020-April 2023 reveals a mean plaintiffs’ award of $27,507,334 and a median award of $759,875. For settlements, the mean award was $10,608,219, and the median award was $210,000. Additionally, an analysis of verdicts in the trucking industry from 2005 to 2019 found that the number of cases with verdicts over $1m increased by 235% when comparing the latter half of that period (2012-2019) to the first half (2005-2011), says the study.

In a study of 641 cases with verdicts or settlements of under $1m, the average payment was $427,336 and the median payment was $400,000. The ILR says that study did not capture the overwhelming majority of claims that are settled before any litigation is actually initiated.

The ILR notes that over the period from 2010-2020, a trucking company’s insurance premium costs per mile increased by 47% to $0.087 per mile. The American Transportation Research Institute attributed this rise, in part, to litigation, jury verdicts, and the pressure to settle cases.

The ILR concludes by acknowledging that trucking accidents, when they occur, can have severe consequences for those involved. But it adds: “The current trajectory is unsustainable. Many of the drivers of inflated verdicts are known. Likewise, a number of potential solutions have been identified. Policymakers, judges, law enforcement, and ethics bodies must now answer the call and restore reasonableness and fairness to the resolution of truck accident litigation claims.”