Professor Neil Vidmar
Russell M. Robinson II Professor of Law
Senate Committee on Health, Education, Labor and Pensions, June 22, 2006
Vidmar commented on proposals in the Fair and Reliable Medical Justice Act to establish special “health courts” to hear patients’ claims, and impose damage caps on recovery:
I want to address the commonly held myths that have been raised about the tort system and in particular the jury system. Empirical research evidence strongly goes against these beliefs.
… In recent research I and my colleagues have been studying closed medical malpractice claims in the state of Florida. … In this research we centered on cases closed between 1990 and 2003. A total of 21,809 claims were closed with a payment to the claimant during those fourteen years. We found that 20.2 percent of paid claims were settled without the claimant even resorting to a lawsuit, 6.3 percent of claims were settled in arbitration and 70.8 percent settled before a trial, leaving just 2.7 percent of paid claims that resulted from a jury verdict. To pursue this insight further we singled out cases involving a million dollars or more. We found that 10.5 percent were settled without a lawsuit and … trial and only 7.6 percent resulted from a jury verdict. Thus, more than 92 percent of claims with million dollar payments were settled without a jury. Going further, we found that 37 of the 831 million dollar cases resulted in payments over $5 million. Only two of these cases were settled following a jury trial. Five of the 831 cases exceeded $10 million dollars but only one was the result of a jury trial; of the remaining four cases one was settled in pre-litigation negotiations, and three settled before a trial had commenced.
Whether we are talking all cases or just million dollar cases the process by which claims are paid in Florida (and, it appears, also in North Carolina) involves the negotiation table, not the jury room.
Perhaps Florida is different than other states. It is hazardous to generalize because each state has its own unique set of laws and legal culture. Nevertheless, it is interesting to observe that data from North Carolina seems roughly consistent with the Florida findings. I compared data on verdicts and settlements reported in the North
Carolina Lawyer’s Weekly… These data show some interesting patterns. As early as the first part of the 1990s decade there were verdicts and settlements exceeding $1 million. Over the period from 1990 through 2002, the number of million-dollar-plus settlements exceeded the number of million- dollar-plus jury verdicts by a factor of over three to one. The average amounts of $1 million plus settlements, when settlements were reported, were comparable to the jury awards. A statistical test on the data indicated that the distributions and the magnitudes of payments for jury verdicts and non-jury settlements were not statistically different from one another. In short,
the North Carolina findings also indicate that most of the payments exceeding a million dollars involved settlements rather than jury trial.
These findings have a major implication. Whether we are talking all cases or just million dollar cases the process by which claims are paid in Florida (and, it appears, also in North Carolina) involves the negotiation table, not the jury room. In Florida settlements exceed jury trials by a factor of more than nine to one for million dollar cases.