Texas Supreme Court Provides Guidance on Non-Economic Damage Awards
In its most recent term, the Texas Supreme Court provided much-needed guidance on the legal parameters for non-economic damage awards in Texas. Shipley Snell attorney Jonathan Smith has prepared a helpful summary of critical aspects of the Gregory v. Chohan opinion below.
As always, feel free to reach out to any of our attorneys for further assistance or discussion.
-SSM LLP
In a June 16, 2023 plurality opinion issued in Gregory v. Chohan, ___ S.W.3d. ____, 2023 WL 4035886 (Tex. 2023) (attached), the Texas Supreme Court reversed and remanded a jury verdict in favor of wrongful death plaintiffs due, in part, to insufficient evidence in support of a $15 million award for non-economic damages. In doing so, the Court articulated a new legal standard for reviewing the legal sufficiency of the amount of non-economic damages. Although involving such damages in a wrongful death case, the Court’s reasoning appears to apply to any tort claims for mental anguish and other forms of non-economic damages. Specifically, the Court held that a plaintiff bears the burden of proving “a rational connection, grounded in the evidence, between the injuries suffered and the dollar amount awarded.” Although this standard lacks precision, the Court provided some helpful guidance on the types of evidence and argument that will not suffice to sustain large non-economic damage awards.
Facts of case and jury award:
In November 2013, an eighteen-wheeler driven by the individual defendant (Gregory) and owned by the corporate defendant (New Prime, Inc.) jackknifed across lanes of traffic on an icy, dark highway near Amarillo. This incident ultimately resulted in a deadly, multi-vehicle pile-up. One of the decedents, Bhupinder Deol, was a truck driver who had narrowly avoided colliding with the jackknifed truck. While attempting to assist other victims who had been involved in an initial collision, Mr. Deol was crushed by a passenger van that rolled onto him as a result of subsequent collisions. Mr. Deol was survived by both parents, his wife, and three children (the “Deol family”). Ultimately, the claims of the Deol family, along with the families of two other decedents, went to trial before a County Court at Law jury in Dallas County in November 2017.
The jury found that the defendants’ negligence had proximately caused the deaths, and the total jury award to all of the plaintiffs was $38.8 million. The Deol plaintiffs were awarded a total of $16.45 million, consisting of the following: (1) a total of $1.38 million for economic losses and for Deol’s conscious pain and suffering and (2) a total of $15.07 million for the Deol family’s mental anguish and loss of companionship. Thus, the non-economic damages of the Deol family accounted for almost 90% of their total damage award. (The breakdown by family member and category of non-economic damage is set forth in footnote 3 of the opinion). After trial, the families of the two other decedents settled, and only the Deol family claims proceeded through appeal. The primary issue on appeal was the size of the non-economic damages on the wrongful death claim and, in a 10-4 decision, the en banc Dallas Court of Appeals affirmed the award, concluding that it was not “flagrantly outrageous, extravagant, and so excessive that it shocks the judicial conscience.”
Supreme Court’s opinion:
The Court first noted that it was not until the mid-1980s that Texas began departing from the established law that largely disregarded the mental anguish and suffering of wrongful death plaintiffs, and instead, typically confined the recovery of such plaintiffs to “pecuniary loss.” Noting that the Court first held in a 1986 decision that “family members could recover for both mental anguish and loss of companionship without a showing of physical manifestation,” the Court explained that it had not elaborated on the appellate standard of review for such an award since that decision. The Court further explained, however, that it has addressed the outer limits for mental anguish awards in defamation and non-death personal injury cases. Acknowledging that these limits have not been articulated with much precision, the Court reiterated that awards of mental anguish damages require evidence of the “nature, duration, and severity” of the harm and that “[t]here must be evidence that the amount found is fair and reasonable compensation, just as there must be evidence to support any other jury finding.”
The Court then attempted to further clarify this evidentiary standard, doing so more by identifying the specific types of evidence that would not be legally sufficient to support the amount awarded. In particular, the Court specifically rejected the common strategy of plaintiffs to “anchor” an amount of non-economic damages to values associated with the defendant’s commercial operations or even generic high-dollar assets. The Court, for example, expressly disapproved of jury arguments by the plaintiff that alluded to the costs of a fighter jet and a famous painting, as well as an argument that the jury should give their ‘”two cents worth” to the New Prime defendant by awarding two cents for each of the three decedents multiplied by the 650 million miles annually driven by New Prime’s trucks. This “two cents” calculation yields the sum of $39 million, which amount the Court noted was almost identical to the total jury award of $38.8 million for all of the families. As explained by the Court, non-economic damages are not intended to punish or deter nor are they intended to generally place a monetary value on a human life; instead, they are intended to compensate and “[u]substantiated anchors like those employed here have nothing to do with the emotional injuries suffered by the plaintiff and cannot rationally connect the extent of the injuries to the amount awarded.”
However, with respect to the types of evidence that would suffice to establish a rational connection between the non-economic injuries and the amount awarded, the Court provided less guidance. The Court noted that a particular case may have direct evidence of an appropriate non-economic damage amount, such as “evidence of the likely financial consequences of severe emotional disruption in the plaintiff’s life” or “evidence that some amount of money would enable the plaintiff to better deal with grief or restore his emotional health.” In the absence of such evidence of a “quantifiable amount,” however, the Court simply stated that “parties and reviewing courts must explore whether there is any other rational explanation of how the evidence supports the [amount] finding.” Reviewing the evidence presented by the Deol family, the Court concluded that there was sufficient evidence of the “nature, duration, and severity” of the family’s mental anguish and loss of companionship. Nevertheless, without extensive analysis, the Court also concluded that there was no rational explanation in the record for why $15 million would provide reasonable and fair compensation for this harm. Although the Court’s finding of insufficient evidence to support the amount of the non-economic damage award typically would result in a remand to the court of appeals for remittitur consideration, the Court’s separate holding that the trial court also erred in striking a responsible third-party designation necessitated remand to the trial court for a new trial on both liability and damages.
Finally, it should be noted that the decision was rendered by only six justices, as Justice Lehrmann, Justice Huddle and Justice Young did not participate. Further, Justice Bland filed an opinion concurring only in part and two of the six justices concurred only in the judgment. In that concurring opinion written by Justice Devine and joined by Justice Boyd, the plurality opinion was criticized as adopting “a new evidentiary standard that is not only foreign to our jurisprudence but also incapable of being satisfied.” Noting the impossibility of objectively quantifying a plaintiff’s pain and mental anguish, Justice Devine advocated continued substantial deference to a jury’s attempts to fairly monetize such damages with the established, albeit subjective, judicial check on awards that “’shock[s] the conscience’” or “’clearly demonstrate[s] bias.’” Nevertheless, agreeing with the plurality that (i) the jury’s award here was improperly influenced by the plaintiffs’ improper “anchoring” arguments based on evidence wholly unrelated to the plaintiff’s actual harm and (ii) the defendants’ designation of a responsible third party was wrongfully struck, the concurring justices agreed with remand for a new trial.
Some key takeaways:
In a wrongful death case, as in other tort cases, a jury may not simply “pick a number” for non-economic damages and plaintiffs may not seek to “anchor” an amount of non-economic damages to evidence unrelated to the plaintiffs’ emotional injuries, such as evidence of a defendant’s sales or revenues, the market value or operational costs of its facilities, or its number of employees. The Court expressly confirmed that a trial court has a clear obligation to prevent such improper jury argument, which often impliedly seeks to punish or deter a defendant rather than to compensate the plaintiff.
What evidence will establish a sufficient “rational connection” between the plaintiff’s actual non-economic harm and the amount of damages awarded is an open question that will have to be developed by appellate courts over time. In this case, it was clear that the jury’s finding on the amount of non-economic damages was heavily influenced by the plaintiff’s improper “anchoring” arguments. It remains to be seen whether, in cases where the connection between the improper arguments and the damage award is not as apparent, appellate courts will be more lenient with respect to what evidence will suffice to establish the necessary “rational connection” between the plaintiff’s actual non-economic harm and the amount awarded.
The Court did suggest that there might be cases with direct evidence of a “quantifiable amount” to compensate a family member’s emotional or mental harm. Although the Court did not provide any examples, presumably such cases would include those involving evidence of the medical costs for treatment of a family member’s pain or mental anguish or evidence that such harm interferes with the family member’s ability to work. Also, while the Court expressly rejected any requirement that courts consider the ratio of non-economic damages to economic damages, the Court noted that such a correlation might be useful under the particular facts of a case, such as when a decedent who endures a long hospital stay prior to passing might cause the family members to “suffer more mental anguish due to the strain of dealing with medical bills and insurance hassles while coping with the death of a loved one.”