Large Verdicts & Settlements – 2011

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A $327 million verdict against a pharmaceutical company for violating the state’s Unfair Trade Practices Act tops the list of South Carolina Lawyers Weekly’s annual roundup of the year’s top verdicts and settlements. The 2011 list comprises the 14 awards of at least $1 million that were reported to Lawyers Weekly during the year.

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Unfair trade verdict results in $327M award

The record-setting $327 million verdict levied against the Ortho-McNeil-Janssen pharmaceutical company for violations of the state’s Unfair Trade Practices Act could have been a lot bigger.

The award could have soared to more than $2.6 billion, had Spartanburg Circuit Court Judge Roger Couch decided to hit Janssen, a subsidiary of Johnson & Johnson, with maximum penalties under the UTPA for violations involving the anti-psychotic drug Risperdal. The state claimed that Janssen misrepresented and concealed side effects of the drug.

The verdict amount was based on UTPA violations involving drug labels or inserts and “dear doctor” letters, messages the company sent to physicians in an alleged attempt to conceal growing concerns about Risperdal. Couch ruled that the company distributed 509,499 package inserts with sample boxes and that it also mailed 7,184 “dear doctor” letters and provided another 36,372 letters during sales calls.

Under the UTPA, each violation carries a maximum penalty of up to $5,000. Add up the number of violations – 535,055 – and multiply the sum by $5,000, and result is a knee-buckling $2,675,275,000.

Couch, however, didn’t hit Janssen with the maximum allowed penalties. He levied a $300 fine for each of the 509,499 violations involving package inserts, totaling $152,849,700. He set a $4,000 fine for the 43,556 violations involving “dear doctor” letters for a total award of $174,224,000.

The state Attorney General’s Office contracted with Harrison, White, Smith & Coggins to handle the case on behalf of the state. The firm retained the Simmons Law Firm of Columbia and the Texas-based firm of Bailey Perrin Bailey to assist.

Type of action: Violations of the state’s Unfair Trade Practices Act

Case name: State v. Ortho-McNeil-Janssen et al.

Case number: 2007-CP-42-1438

Court: Spartanburg Circuit Court

Judge: Roger Couch

Verdict or settlement: Verdict

Date: June 3, 2011

Amount: $327,000,000

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Abuse victim gets second shot at justice

When Kelly Waldron Bowles, 27, finally decided in 2002 to report years of sexual abuse at the hands of her former stepfather, a Dorchester County grand jury indicted Donald A. Baxter with second degree criminal sexual conduct with a minor and committing a lewd act upon a child.

Baxter eventually pleaded guilty to a lesser offense and did no jail time. But in the civil suit that followed eight years later, it took Berkeley County Court of Common Pleas Judge Stephanie McDonald just one day to find for the victim.

On November 15, McDonald awarded Bowles $14 million in damages on her claims of sexual assault, sexual battery, intentional infliction of emotional distress and gross negligence.

McDonald’s award consisted of $7 million in past and future pain, suffering and mental anguish and $162,145 in future medical expenses, along with $7 million in punitive damages.  It is believed to be one of the largest verdicts for a child molestation case in South Carolina history.

Type of action: Sexual assault, sexual battery, breach of fiduciary duty, intentional infliction of emotional distress/outrage, gross negligence

Injuries Alleged: Physical and mental injuries arising from sexual molestation of a minor

Name of Case: Kelly Waldron Bowles v. Donald Baxter

Court: Berkeley County Court of Common Pleas

Case #: 2008-CP-08-3509

Tried Before: Judge

Name of Judge: Stephanie McDonald

Verdict or Settlement: Verdict

Amount: $14,162,145

Date of Verdict: November 15, 2011

Attorneys for the plaintiff: Joseph P. Griffith Jr., Charleston; Jerry N. Theos, Charleston

Attorney for the defendant: James B. Jackson, Santee

– 3 –

Condo owners get full repair bill

The owners of the Twelve Oaks at Fenwick Plantation condo development sued more than a dozen construction contractors and subcontractors over botched construction work on the exterior of the complex’s 12 residential buildings. The lawsuit named nearly 16 defendants, and all but one settled with the class of condo owners over two mediation sessions. With $8 million in settlement already in hand, attorney Jesse Kirchner went after the lone remaining defendant for the balance of the $15.7 million needed to fix the complex: Plastering & Stucco Inc., a now-defunct Orlando, Fla., company

“We told the jury from the beginning that it would cost $15.7 million to fix the buildings,” said Kirchner, a plaintiffs’ attorney with Thurmond Kirchner Timbes & Yelverton. “We had already received $8 million and we’re going to ask for the difference.”

For his transparency, Kirchner’s clients – a class of 215 condo owners and their owner’s association – got exactly what they wanted: a $7.72 million verdict.

Type of action: Construction defect litigation

Injuries alleged: Negligent construction, breach of implied warranty of workmanlike service

Case name: Twelve Oaks at Fenwick Property Owners Association Inc. v. Professional Plastering & Stucco Inc.

Case number: 2008-CP-10-0049

Court: Ninth Circuit Court of Common Pleas, Charleston County

Judge: Kristi Lea Harrington

Verdict or settlement: Jury verdict

Date: May 13, 2011

Amount: $7,723,225

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Live power line costs company $4.4 million

An Upstate teen who emerged unhurt from a single-vehicle wreck only to suffer electrocution when he touched a downed power line won a $4.4 million verdict against Duke Power Co. in a negligence suit.

Xavier Massey’s lawyers said an SUV in which Massey was a passenger struck a roadside utility pole in Greenville County during a rainstorm in 2006. Two of three power lines on the pole shut down, but the third didn’t.

As Massey, then 13, walked away from the SUV, voltage surged through him, burning 4 percent of his body, burning off parts of both feet and leaving wounds in a hand and an elbow, his lawyers said. Massey had to have several toes amputated and is expected to undergo as many as five additional surgeries. His medical costs totaled about $600,000, Walker said, and he faced an estimated $3 million in life-care costs.

In his complaint, Massey claimed that Duke’s safety systems should have shut down the power line on impact. In its answer, the company denied negligence but asserted that, if there were any negligence, Massey was barred from recovery because he was more than 50 percent responsible for proximately causing his injuries.

The jury found Massey 0 percent negligent.

Type of action: Personal injury

Injuries alleged: Second-, third- and fourth-degree burns over 4.4 percent of plaintiff’s body; permanent scarring and disfigurement

Case name: Xavier Massey, a minor, by Celeste Massey, his parent and natural guardian v. Duke Power Company, LLC d/b/a Duke Energy Carolinas, LLC

Case number: 2009-CP-23-7220

Court: Greenville County Court of Common Pleas

Judge: Hon. Robin Stilwell

Verdict or settlement: Verdict

Date: March 11, 2011

Amount: $4.4 million

Special damages: $608,000 (past medicals); $3 million (life-care plan)

Demand: $1.5 million

Offer: $200,000

Insurer: Duke Energy, self-insured

Plaintiff’s attorneys: Billy Walker of Walker & Morgan (Lexington), and Robin Foster, of Foster & Foster (Greenville)

Defendants’ attorneys: James W. Logan, James D. Jolly, Jr., Richard L. Sizemore, Michael T. Smith, of Logan Jolly & Smith (Anderson)

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Taking children from home costs state $4 million

A South Carolina couple whose children were taken from them by government social workers was awarded $4 million by a jury who agreed that the agency’s conduct was reckless.

The case arose out of the response by the Fairfield County Department of Social Services to a May 15, 2008 hospital staff report of “potential parental poisoning” of two children of Otis and Diane Bass. After a short investigation, DSS notified the Basses that those children, along with a third child, would have to be placed with a relative or placed in foster care.

But after learning that the source of the children’s illness was due to a wrongly-filled prescription, the children were returned to the Basses. The parents subsequently brought suit against the pharmacy, Long’s Drugs in Columbia, and DSS. Long’s settled for an undisclosed amount. The case against DSS proceeded to trial.

The Basses alleged that DSS was grossly negligent, and also brought a claim based on the tort of outrage.

At trial, the Basses argued that DSS failed to conduct a thorough investigation before deciding to remove the children from their parents’ physical custody. There was no evidence that any DSS employee ever spoke to a doctor, nurse or any medical staff at the hospital where the children were treated, nor did they consult with the Bass children’s primary care physicians. DSS was also advised early on by family and friends of the Basses that the children’s medicine may have played a role in their illness.

DSS admitted that the investigation was not thorough. But it argued that by responding in a timely fashion to the report of abuse and neglect, it had exercised slight care. Therefore it was not grossly negligent.

A Winnsboro jury, however, found in the Basses’ favor and awarded the couple $4 million in damages

Type of action: Gross negligence, tort of outrage

Injuries alleged: Temporary loss of custody of children

Case name: Bass v. Dept. of Social Services

Case number: 2009-CP-20-0395

Court: Fairfield County Court of Common Pleas

Judge: Judge R. Ferrell Cothran Jr.

Verdict or settlement: Jury verdict

Date: May 27, 2011

Amount: $4 million

Special damages: n/a

Demand: Unknown

Offer: Unknown

Insurer: Unknown

Plaintiff’s attorneys: John Koon, Jamie Walters and Lee Cope

Defendant’s attorneys: Patrick John Frawley

– 6 –

Dram shop claim nets $3 million settlement

A man who claimed a Sumter restaurant served wine to an intoxicated customer settled a wrongful death suit for $3 million, thanks in part to an earlier S.C. Supreme Court ruling.

Lawyers for plaintiff Paul Schmidt said the court’s 2010 decision helped Schmidt get the settlement despite a multi-million-dollar setoff resulting from an earlier, confidential settlement with the customer’s employer.

Schmidt sued the restaurant and a bartender after a 2008 collision in which a woman driving the wrong way down a highway near Sumter crashed into his car. Schmidt’s son, 12-year-old Christian, died, and Schmidt suffered severe leg injuries.

The parties settled in mediation about a month before trial was set to begin. The plaintiff’s lawyers argued that the defendants violated dram shop laws, under which the restaurant had a duty to not serve alcohol to intoxicated patrons.

But it helped to also poke holes in the restaurant’s defenses. That’s where the Supreme Court’s ruling in July 2010 decision in Hartfield v. The Getaway Lounge gave them added leverage.

Under state law, lack of visible intoxication is a defense in dram shop cases. Under Hartfield, however, plaintiffs can get around that defense by using experts to estimate a driver’s alleged intoxication before an auto collision.

Evidence indicated the woman’s blood-alcohol level was almost three times the legal limit four hours after the collision, said lawyers for the plaintiff. They argued that the restaurant had served her eight glasses of wine and that management took no action after a hostess reported the woman was intoxicated when she left.

Principal injuries: Death of Christian Schmidt; Paul Schmidt suffered injuries to his leg and shoulder.

Special damages: Approximately $100,000 in past medical bills for Paul Schmidt and $1 million in future medical treatment.

Verdict or settlement: Settled at second mediation 30 days prior to trial date.

County and court: Sumter County

Case name: Paul Schmidt, individually, and as Personal Representative of the Estate of Christian Schmidt v. Anonymous Restaurant Group

Date concluded: March 21, 2011

Amount: $3 million

Insurance carrier: Fireman’s Fund

Attorneys for plaintiff: David B. Yarborough Jr. and William E. Applegate IV, both of the Yarborough Applegate Law Firm (Mount Pleasant); and Garryl L. Deas of The Deas Law Firm (Sumter)

Attorney for defendant: James Cox III of the Grier, Cox and Cranshaw Law Firm (West Columbia)

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Test results that showed heart condition overlooked

The family of a 36-year-old man whose death in the woods during a hunting trip came just weeks after a doctor failed to notice his serious heart condition collected a $3 million settlement after filing a medical malpractice action.

The man’s family sued the doctor for allegedly bungling the results of a cardiac stress echo test, which is commonly conducted while a patient runs on a treadmill. The August 2008 test results revealed that the patient in this case had heart disease, but his doctor misread the results as being normal.

The man was found dead in the woods about six weeks after the cardiac stress test. An autopsy showed that he had suffered a heart attack. About 90 percent of the main artery feeding his heart had been blocked, and he died when a clot completely closed the same artery.

One of the defense’s experts acknowledged that there were obvious signs of heart disease. Another defense expert initially testified that the test results were normal, but later admitted that they showed clear signs of heart disease.

With discovery finished and a Dec. 5 trial date approaching, the plaintiff’s lawyers offered to settle the case for $3 million – the limit of the defendants’ insurance coverage. The defense accepted the offer on Nov. 7, and the court approved the settlement agreement on the day that the trial was slated to begin.

Type of action: Medical malpractice

Injuries alleged: Death

Name of case: Confidential

Court: Confidential

Special Damages: Economic loss of about $4.5 million

Verdict or Settlement: Settlement

Amount: $3 million

Date of verdict or settlement: December 5, 2011

Insurance Carrier: S.C. Medical Malpractice Liability Insurance Joint Underwriting Association and S.C. Patients Compensation Fund

Attorneys for plaintiff: Chad A. McGowan and Randy Hood (Rock Hill)

Attorney for defendants: H. Spencer King and William “Billy” U. Gunn (Spartanburg)

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Lawyers roll dice on a high-low deal

A pair of Camden attorneys won $3 million in a personal injury case after rejecting a low ball settlement offer and overcoming a lack of medical evidence to prove the cause of their client’s life-altering disability.

William S. Tetterton of the Tetterton Law Firm and co-counsel Vincent A. Sheheen, a partner at Savage, Royall & Sheheen, represented a father of two who began having debilitating muscle spasms after inhaling a toxic chemical that was sprayed into the small cab of a crane he was operating.

The crane operator, Terry Geddings, and his wife, Candace, sued contractor D&L Inc., alleging that two of its employees had acted recklessly when they sprayed six to a dozen bottles of a product called Blast-A-Coil into the crane’s air conditioning unit while Geddings was still inside.

The Achilles’ heel of their case was the fact that no medical or scientific study had ever established a connection between inhalation of trichloroethylene, or TCE – the chemical used in Blast-A-Coil – and permanent nerve or muscle damage in humans.

The defendant zeroed in on the lack of medical evidence, stating in a pretrial memo that the Geddings were “alleging a first in medicine and toxicological science,” and offering to settle the case for $10,000.

While the jury was out, the plaintiff’s lawyers reached a high-low agreement with the defense. Under the agreement, the Geddingses would receive at least $500,000 if the jury sided with the defendant. But if the jury sided with the Geddingses, they could receive no more than $3 million. Minutes after both sides shook hands on the deal, the jury came back with a $4 million verdict.

Type of action: Personal injury

Injuries alleged: Chemical poisoning

Case name: Geddings v. D&L, Inc.

Case number: 2009-CP-08-292

Court: Berkeley County Court of Common Pleas

Judge: Judge Kristi L. Harrington

Verdict or settlement: Settlement

Date: June 17, 2011

Amount: $3 million

Insurer: Unknown

Plaintiffs’ attorneys: William S. Tetterton (Camden); Vincent A. Sheheen (Camden)

Defendant’s attorneys: John H. Tiller (Charleston); Joseph D. Thompson III (Charleston)

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‘Tyger River’ key element in $2.2M settlement

A man whose leg had to be amputated from the knee down after an ATV rollover settled an out-of-court negligence claim against the driver for $2.2 million.

The plaintiff, Kenneth M. Boissoneault, concluded the settlement after making a Tyger River demand on the defendant’s insurer. No suit was filed.

The doctrine, defined by the 4th U.S. Circuit Court of Appeals in Smith v. Maryland Casualty Insurance Co., 742 F. 2d 167 (1984), says an insurer has a duty to an insured to settle a personal injury claim covered under a policy when reasonable. The insurer is liable to the insured if its failure to settle results from fraud, bad faith or negligence.

The insurer, Fireman’s Fund Insurance Co., paid up after Boissoneault’s attorney set a deadline for payment under the defendant’s policy. The limit on the policy was $2.5 million, and the attorney believed the insurer would prefer to make a payment within that limit rather than risk a trial and damages that might exceed the limit.

Principal injuries: Right tibia-fibula open fractures resulting in a below-the-knee amputation

Special damages: $338,462 (medical bills); $428,071 (lost wages and loss of earning capacity); and: $866,464 (future medical care costs)

Verdict or settlement: Settled pre-suit

County and court: Charleston County

Date: March 14, 2011

Amount: $2.2 million

Insurance carrier: Fireman’s Fund

Attorney for plaintiff: David B. Yarborough Jr. of the Yarborough Applegate Law Firm (Mount Pleasant)

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Client wins big judgment against his lawyer

When Jack Tuttle bought a tree-mulching machine for his land-clearing business in 2005, and had nothing but problems with it, he sought to return the machine and get his $300,000 back.  He tried negotiating with the company, South Carolina-based Gyro-Trac, but to no avail, so he hired Charleston attorney Robert Lowe to help him.

Three years later and on the eve of trial, Tuttle was still out his $300,000, plus an additional $665,000 he’d paid his attorney to get his case to that point. Tapped out after borrowing from family, mortgaging his house and maxing out his credit cards, Tuttle took the only step he thought he had left: He settled the case.

Of the $700,000 settlement, Tuttle got $198,000 and Lowe got $261,000.  The remaining $241,000 is likely uncollectible, since Gyro-Trac filed bankruptcy.

Tuttle left South Carolina and headed home to Florida, feeling like his pockets had been picked and his trust in the legal system shaken.  But then he came back, that time to file a lawsuit against Lowe for malpractice and negligent misrepresentation, alleging that Lowe had grossly mismanaged the case and  failed to disclose conflicts he had in representing another company who likewise had a case against Gyro-Trac and to whom Lowe had given a far-better deal for fees and costs.

The jury awarded Tuttle $782,714 in actual damages and $1 million in punitive damages.

Type of Action: Legal Malpractice and Negligent Misrepresentation

Injuries Alleged: Economic damage due to loss of “day in court”

Name of Case: Tuttle Dozer Works, Inc. vs. Robert J. Lowe, Jr., et al

Court: US District Court for the District of South Carolina Charleston Division

Case #: 2:10-065-MBS

Tried Before: Jury

Name of Judge: Judge Margaret Seymour

Special Damages: none

Verdict or Settlement: Verdict

Amount: $1,782,714.33

Date of Verdict: Oct. 20, 2011

Demand: $500,000

Highest offer: $60,000

Insurance Carrier: Attorneys Liability Protection Society

Attorneys for the Plaintiff: Paul E. Tinkler and Matthew E. Yelverton; Charleston

Attorneys for the Defendant: David Overstreet and Amanda Dudgeon; Charleston

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$1.65M pretrial settlement reached in wreck

A Lowcountry man who suffered severe injuries to his left arm in a 2009 auto collision settled for $1.65 million in mediation over alleged reckless driving.

In pre-litigation negotiations, lawyers for plaintiff James Fallon worked out the details of the settlement almost two years after Fallon was in a wreck on Wadmalaw Island in Charleston County.

The collision occurred in April 2009 when Fallon, driving on a two-lane highway, collided with an oncoming vehicle towing a small bulldozer on a trailer. The trailer edged several feet into Fallon’s lane and hit his truck, and Fallon suffered multiple fractures in his left arm.

To Fallon’s lawyers, the trailer’s shift was too anomalous not to suggest reckless driving by the other driver.

Type of claim: Personal injury

Principal injuries: Multiple fractures and nerve damage to left arm

Special damages: $218,908 (medical bills) and $27,917 (lost wages)

Verdict or settlement: Settlement

Date concluded: Jan. 28, 2011

Amount: $1.65 million

Attorneys for plaintiff: David Hoffman Jr. of the Hoffman Law Firm (Charleston) and D. Nathan Hughey of the Hughey Law Firm (Mount Pleasant)

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Dispute over purchase of bottler nets businessman $1.2M

Charlotte businessman Clifford Hansen didn’t get the water bottling company he dreamed of owning and struggled to buy, but instead he got nearly $1.2 million in damages in a suit against business advisers whom he said ditched him and used his work to help purchase the company for themselves.

Hansen said he hired the defendants to represent him in securing part of the financing and capital for the purchase of the Hickory Springs Water Co. in Elloree. The company bottles and distributes spring water, and its sales topped $6.7 million in 2009.

The plaintiff claimed that, as he put the transaction together, his advisers started with a proposed $100,000 fee but later sought partial ownership as investors in the bottling company. Hansen himself planned to take a 25 percent stake in the company, serve as president, sit on the board and have his own management team, but the advisers sought to whittle down his role, said Hansen’s attorney William Hopkins Jr.

After Hansen protested, the defendants said they were no longer representing him but reserved the right to buy the company on their own.

Type of action: Business tort

Injuries alleged: Lost salary, lost profits from business and lost ownership interest in business

Name of case: Clifford C. Hansen v. Fields Company, LLC, Beechwood Advisory Group, Inc., Beechwood Development Group, Inc., and Beechwood Development Group of South Carolina, LLC

Court: Charleston County Court of Common Pleas

Case number: 09-CP-10-3333

Tried before judge, jury, mediator or arbitrator? Fields Company, LLC, and Beechwood Development Group, Inc., both went into default. Settlement was mediated with Beechwood Advisory Group, Inc. Case against Beechwood Development Group of South Carolina, LLC, was tried to a jury verdict.

Name of judge, arbitrator or mediator: Earl Ellis mediated settlement with Beechwood Advisory Group, Inc. Trial judge was Hon. Kristi L. Harrington.

Special damages: $2 million, of which about $1 million was lost salary, about $400,000 was lost profits and about $600,000 was value of lost ownership interest in business.

Verdict or settlement? Settlement with Beechwood Advisory Group, Inc., was confidential. Verdict was against Beechwood Development Group of South Carolina, LLC.

Amount: $1,189,408

Date: March 17, 2011

Highest offer: $30,000

Attorney for plaintiff: William E. Hopkins Jr. of Beasley Allen Crow Methvin Portis & Miles (Montgomery, Ala.)

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Doctor misses cancer report; patient dies

In their lawsuit, the plaintiffs claimed the defendant doctor never told Franklin Scott Jr. that he had a cancerous lesion on his right lung even though in August 2008, the doctor had received a radiology report identifying the lesion. By the time Scott received his second chest scan in 2009, the cancer had spread to Scott’s liver.

When the doctor looked at Scott’s second scan, he walked out on his patient without warning or explanation, the lawsuit claimed. In October 2009, the family first heard the cancer diagnosis from an emergency room physician. Scott died the next month.

During preparation for the trial, Scott’s family received a settlement offer of $1 million, which they accepted. The amount was lower than the potential $2.8 million the plaintiffs’ lawyers thought they might recover at trial under their interpretation of the S.C. Medical Malpractice Reform Act of 2005. But it was close to the $1.05 million that, under the defense’s likely interpretation of the act, would have been the plaintiff’s highest recovery absent a finding of gross negligence.

Claim: Medical malpractice

Special damages: Funeral and burial expenses in the amount of $8,170.20

Tried or settled: Settled

County and court: Confidential

Case name: Mary Inez Scott as Personal Representative for the Estate of Franklin Scott, Jr. and Lesie Ann Scott, Individually v. Confidential Physician and His Practice

Date concluded: May 12, 2011

Amount: $1 million

Insurance carrier: Confidential

Attorneys for plaintiff: David B. Yarborough Jr. and William E. Applegate IV of Yarborough Applegate Law Firm; and Steven E. Goldberg of the Steinberg Law Firm.

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$1M verdict for death after ER sent patient home

A York County jury awarded a $1 million medical-malpractice verdict to a man who claimed his wife died two days after a doctor failed to notice a dangerous increase in her heart rate during an emergency room visit.

The plaintiff’s lawyer said 51-year-old Deborah Kirksey was suffering from an inflamed and enlarged bowel when she went to the ER at Piedmont Medical Center in Rock Hill on June 1, 2008.

During a seven-hour visit that included tests, Kirksey’s heart rate accelerated from 88 beats per minute to about 113. That should have been a clue that something was wrong, but a doctor sent her home after failing to notice the rapid heart rate on a chart.

The next day Kirksey, severely ill, was back. That time doctors admitted her, but she died the following day of gall bladder disease.

Type of action: Medical malpractice

Injuries alleged: Death

Case name: Sidney Kirksey, individually and as personal representative of Deborah Kirksey v. John Lee, MD., and S.C. Emergency Physicians, LLC

Case number: 09-CP-49-02113

Court: York County Court of Common Pleas

Judge: John Hayes

Verdict or settlement: Verdict

Date: March 11, 2011

Amount: $1 million total – $500,000 for survival action and $500,000 for loss of consortium

Insurer: JUA/PCF  

Plaintiff’s attorneys: Chad McGowan (Rock Hill) and Jones Andrews (Columbia), both of McGowan Hood Felder & Johnson; and Brent Stewart of Stewart Law Offices (Rock Hill)