In a landmark decision that has sent ripples throughout the trucking industry, a jury has granted nearly half a billion dollars in total damages to plaintiffs following a fatal accident in 2019. The verdict targeted the manufacturer of a 2004 Wabash dry van trailer, claiming its rear impact guard was faulty, despite meeting safety regulations at the time of production. This decision did not include potential key factors such as the Volkswagen driver’s legal intoxication and both occupants’ failure to wear seat belts, as the case was centered solely around product liability.
Earlier this year, the American Transportation Research Institute noted a significant 12.5% rise in trucking insurance premiums in 2023, attributing the spike to increased equipment costs, rampant litigation, and general inflation. This upward trend in expenses poses a growing challenge for carriers, who not only must navigate these higher costs but also deflect so-called nuclear verdicts – disproportionately large legal awards against companies seen increasingly across jurisdictions.
Jay Starrett, head of accident litigation at Scopelitis, Garvin, Light, Hanson & Feary, P.C., highlighted the expanding threat of enormous jury awards, which he described as a permanent feature of the current litigation landscape. The increase in such verdicts is compounded by the presence of jurisdictions he referred to as “judicial hellholes,” where judges and juries tend to be more plaintiff-friendly.
In response, Lewie Pugh, executive vice-president of the Owner-Operator Independent Drivers Association, has called attention to a pattern in litigation that often paints trucking companies and equipment manufacturers in a biased light. His observations underscore the need for tort reform to balance compensation in accidents without fostering extortionate financial demands on carriers.
The debate over tort reform, however, faces significant hurdles, as noted by Starrett. Tort laws, diversified and governed at the state level, demand extensive resources to reform, a process complicated further by the present-day political climate. As these legal battles rage on, the financial ramifications resonate through the trucking industry, which often bears the costs of both advocating for and combating tort reform measures.
Adding to the industry’s woes, a recent verdict in Alabama saw Daimler Truck North America facing a $160 million judgment after a Western Star truck driver was paralyzed in a rollover. The jury’s decision was influenced by the optional availability of a safer seat design, which was not standard in the vehicle involved.
Gary Johnson, head of safety and compliance strategy at Motive, argues that prevention of such legal outcomes could benefit from better utilization of existing technologies. Tools like AI-integrated dash cams offer a real-time peek into incidents, potentially swaying court opinions with hard evidence rather than speculation.
Despite available technology that could bolster defense against litigations and enhance driver safety, a 2023 report from Motive highlighted a significant underinvestment in these vital resources. Only 60% of surveyed companies had adequately invested in driver safety technologies, with the remainder potentially exposing themselves to avoidable litigation risks.
Advanced driver assistance systems, including adaptive cruise control, collision mitigation, and in-cabin video setups, present a tantalizing proposition for companies keen on mitigating litigation risks and fostering safer driving practices. However, the disparity between available safety technologies and their application in the trucking industry suggests a significant gap that needs bridging.
Amidst these turbulent skies, the financial toll of litigation extends beyond the industry, affecting general consumer prices and straining job markets within the sector. The enormity of this challenge was encapsulated by Johnson, who referenced FMCSA data showing a stark rise in the average cost of accidents involving commercial vehicles.
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