Rarely have I ever observed a more successful statistical hoax perpetuated on most electronic: and print media than that being accomplished almost daily by Jury Verdict Research (JVR) of Solon, Ohio a firm that purports to collect samples of average jury verdicts in the malpractice and product defect areas.
During the rising media attention to the presently profiteering insurance industry greed crisis, which is causing thousands of businesses, non-profit organizations and government units to be gouged, JVR continues to be cited among others, in LISA Today, the Wall Street Journal, NBC, CBS and ABC. Consumer groups hoe pointed out errors but the media fix on these figures have become transfixed because they illustrate, falsely, the chosen theme — that jury awards are out of control.
What if a friend of yours gave you that the average weight of mammals on Earth by weighing whales, elephants and rhinos and overwhelmingly ignoring cats, dogs, rabbits, hamsters and many other smaller creatures. You would turn quite a skeptical eye on such weight figures.
Here is an illustration of what Jury Verdict Research does. USA Today printed on March 11, 1986 a story on lawsuits and insurance coverage for businesses. A chart, attributed to JVR, showed an increase the overage product liability verdicts rising from $430,946 in 1977 to $1,657,187 in 1978 and dropping $761,009 in 1979. (Product liability awards by juries are for injuries received due to dangerously engineered cars, hazardous drugs or other product defects.)
Wondering about the gyration, I called the research director of JVR and asked what accounted for the sudden jump in 1978. She replied that it reflected the $125 million punitive damage award following a horrible Pinto fuel tank fire. The jury socked it to Ford after reviewing an internal Ford memo actually costing out the major savings from this type of fuel tank location and what damages the company would to pay to burned victims or their next of kin. When I observed that the verdict was reduced on appeal to $3.5 million punitive damages, she said that does not take into account such reductions. Nor does JVR, take into account reversals, dismissals, losses or the many cases which receive nothing in jury awards. Nor, deplorably enough, does JVR even adjust for inflation over the years.
If one Pinto case can cause that kind of rise in JVR’s average product liability verdicts in the nation, the sample cannot be sufficiently, adequate or representative. JVR plays the same tricks with so-called average malpractice jury verdicts which it puts at an absurdly high and inaccurate level near $1 million. When I asked the research director whether JVR was upset at how the media used its data or whether JVR sent the media qualifying letters explaining the misuse, her reply was vague, to put it mildly.
Unfortunately, collection of complete jury award statistics in such categories of cases is not done by any governmental institution in our country. But common experience and knowledge of personal injury cases and extrapolation of figures are more than sufficient to conclude that JVR is way off the chart. Nonetheless the casualty insurance companies and their trade associations, such as the Insurance Information Institute, are gleefully flooding the media with such wrong information even though their own files know otherwise.
And you, the insurance ratepayer are paying for these deceiving numbers that then are being used to stampede legislative action to restrict the rights of injured or sick people to sue wrongdoers or perpetrators of their harms.
Fortunately, A. Russell Localio, director of research at the Risk Management Foundation in Cambridge., Massachusetts (F40 Memorial Drive, Cambridge, Massachusetts 02139) criticized JVR’s statistical practices in the June 1985 issue of Law, Medicine & Health Care. He wrote: “These misstatements arise from four errors in analysis: (1) the failure to define accurately the data being cited, (2) the assumption that an incomplete sample of data represents a random and unbiased sample of all verdicts., (3) the failure to adjust figures to constant dollars and to present graphs cal displays with this adjustment, and (4) the assumption that the ‘average’ (mean) verdict represents an appropriate summary statistic for a wide-ranging distribution of verdicts;.”
Both the Institute for Civil Justice in California and studies by Professor Marc: Galanter and the American Ear Foundation show no overall litigation explosion, either in the number of cases brought by injured people or verdicts and settlements, after taking into account inflation and population growth.
Lawmakers in the many states now considering cruel restrictions on victims rights should turn instead to insurance industry reform as well as to policies preventing injuries and diseases. Let the victims have their day in court — a prospect made more secure if the media exposes Jury Verdict Research instead of repeating such phoniness.