I will jump right in. Follow along if you can.
The Prevalence of Corporate Corruption
There are so many bigger companies in America today whose entire business model is predicated upon something nefarious if not outright illegal. Let’s consider just a handful of examples: Surreptitiously tracking consumers online and selling their data. Recurring billing that is impossible to cancel. Racial discrimination in lending. Non-compete abuse. Wage theft. No-poaching agreements. Toxic products that are killing people and causing cancer. Taking advantage of PPP loans that were intended for small businesses. The list goes on and on. Any effort to portray the modern American business world as embodying this folksy, old-timey, small business feel good story is utter bullshit. It’s myth-making and nostalgia. It is not reality. Sure, there are some great small businesses out there. But just look around you. How many businesses of any size can you name that do things the right way? And of those, how many of them are big companies? On the flip side, how many big companies are routinely engaged in some sort of nefarious behavior? Corporate malfeasance and corruption is just getting worse. All of this is obvious to the average person. But to most powerful people and big corporate types, the system works great. Because they make tons of money from it.
Corporate Fear (and Avoidance) of Juries
Companies are terrified of juries and jury verdicts. The bigger and more corrupt the company, the more terrified the company is of ever facing a jury. And that makes sense. So, companies (especially big ones) do whatever they can to avoid juries. Why risk a trial by jury when you can have a trial by judge. And that judge might (a) be friendly with some powerful corporate types within your organization or connected to it or (b) might even own stock in the company that he doesn’t disclose. These scenarios are more common than our society is willing to admit (and certainly more common than our legal system would ever acknowledge).
So, naturally, there is an entire system built up to protect big companies from jury trials and large jury verdicts. Big companies routinely use jury trial waivers and arbitration agreements. Federal case law has made it virtually impossible to avoid arbitration. There are damage caps on Title VII (discrimination) claims that haven’t been adjusted since they were implemented in 1991. The Supreme Court determined that the Due Process Clause of the United States Constitution protects against excessive punitive damage awards and set a 10:1 ratio (punitive:compensatory) as a constitutional maximum (how’s that for strict textualism). There’s a ton of case law (judge created law) that lets companies off the hook.
Even when somebody can pursue their case in court, has a strong case on the law, and has the right to a jury trial, corporate defendants are notorious for their delay tactics. Have you ever seen a company lie, cheat, steal, stall, and obfuscate for 3 or 4 years? I have. No regular person can afford to litigate a case like that. Even if it’s the type of case that can theoretically be handled on a contingency fee, just think about the investment that a plaintiff-side law firm has to make to pursue 3 or 4 years of litigation. Sorry to blow up these stupid plebeian notions about law and justice and just needing a “bulldog” lawyer who believes in a case — Nonsense. This shit costs real money. Overhead. Salaries. Office space. Insurance. Computers. Software. Technology. Travel. Experts. Deposition transcripts. Court reporters. Document collection. Data hosting. This says nothing of the sheer man hours and intellectual work that goes into a 3 or 4 year long contingency fee case. The all-in risk and investment is utterly massive. The point: Getting to a jury trial is a long-shot. And corporate America has worked long and hard to make it that way.
The Economics of Jury Trials
A regular person with a bullshit claim or case probably doesn’t make it to a jury. The law is heavily stacked against regular people (as is the system, litigation, the war of attrition, etc). And from a business standpoint, it makes zero sense for a plaintiff-side law firm to take a bullshit or even mediocre case all the way to a jury. Corporate lawyers routinely take bogus cases as far as they can get them— because they are usually paid by the hour. There are no economic consequences for that sort of behavior. But on the plaintiff-side, it’s a totally different world. You are not going to put $500,000 worth of attorney time, overhead, resources, and hard costs into a mediocre case. And by that same logic, you are probably going to advise your client to settle before trial if there is a reasonable offer— unless the case is incredibly strong and the upside is truly astronomical.
Post-Covid Nuclear Verdicts
Even before COVID-19 hit, the size of jury verdicts was on an upward trend. The pandemic basically hit the pause button on jury trials throughout the country. But as courts have opened back up and started trying jury trials, we’ve seen some truly astronomical jury verdicts. A Florida jury awarded $1 billion – billion with a B – in a wrongful death trucking case. Beyond that, we have seen significant (albeit not nearly as large) jury verdicts in jurisdictions and counties that were previously considered “conservative” with respect to jury awards. All of this has prompted insurance companies (and their adjusters and lawyers) to tread more cautiously. Within the insurance industry, there is the widespread sense that juries are angry, no longer trust corporate America, and are just looking for somebody (i.e. a big company) to punish. There is also the reality of demographic shifts. Millennials now make up the largest generational cohort in America. Millennials are far less trusting of their corporate overlords than prior generations. And Generation Z trusts big business even less.
What we are witnessing right now is not just a post-COVID uptick in big jury verdicts. Instead, it is a true societal shift. It is driven in large part by demographics (i.e. Millennials and Generation Z). But it is also driven by widespread access to information and countless revelations about corporate greed, misconduct, and corruption. Even since 2015, polling on trust / mistrust of corporate America has revealed a massive increase in the percentage of folks who outright do not trust big business. The upshot of all this: Corporate America will do whatever it can to further insulate itself from the risk of ever facing a jury (especially in, e.g., the employment context). But when cases involving clear corporate misconduct make it to a jury, expect more nuclear verdicts. This isn’t a blip on the radar or a temporary phase. It’s the new reality for at least the next several years.
About the Author
Jonathan Pollard is an attorney and founder of the Fort Lauderdale law firm Pollard PLLC. Over the past decade, Pollard has litigated hundreds of cases in the realm of non-compete agreements, trade secrets, employment law, wrongful termination, and sexual harassment. In addition to litigation, arbitration, and appellate work, Pollard is widely sought after for advice on complex, high-stakes non-compete and trade secret matters. Pollard has 70,000+ followers on LinkedIn and has appeared in or on The New York Times, The Wall Street Journal, Bloomberg, NPR, PBS News Hour, The Guardian, The New York Post, and many more.
