TRANSCRIPT:
Paul Edelstein:
All right, now let’s pick up again. We’re going to pick up again now because I got my Brooklyn shirt.
Daniel Thomas:
Okay.
Paul Edelstein:
And it’s ironic that I would have that on. I didn’t even plan that as you know. As I said earlier, it’s because I took off an uglier shirt here in my office here. And it’s important when you were talking about compensatory damages, when they get reviewed by your trial judge, which was what we had here, or an appellate court, which is where we’re going. We now have compensatory damages awards for Harold and Pam, and they were both, the jury both gave… Do you remember, what was the total compensatory for Harold? I don’t even remember the exact number. I don’t know, approximately the jury gave-
Daniel Thomas:
11.8 to Sinclair, and I believe it was almost 30 to Harold.
Paul Edelstein:
Okay, right. Let’s just call it $30 million in compensatory damages to Harold, much bigger number because he could argue future pain and suffering. Sinclair doesn’t have that ability. He can argue future medical needs. Sinclair didn’t have that ability. He has those, she doesn’t have those, and hence the difference in numbers. But now we knew, okay, those numbers are not going to hold up when this judge reviews it because you and I both know that this judge is going to look to appellate division law and say, “All right, what does that say?” Now here’s another whole area of law and I asked you, “What do you think about some of these areas of law before? Were you angry and frustrated?” And you gave such a great lawyerly political answer, which I wouldn’t have given because I just think it sucks. I think it’s just ludicrous. It makes no sense to me, these areas of law, one being that you’re worth more alive than dead, ridiculous.
And this other one. This other one is that appellate courts will look at compensatory awards like ours and say, “Well, those [inaudible 00:02:01] here’s the law.” People say, “What’s the law? What is this?” Does it deviate materially from what would be reasonable under the circumstances? I don’t know what the hell that means, okay, but I know how it’s applied in the law and here’s why it’s even stupider in my opinion, and it goes to my Brooklyn shirt, because you know we have four appellate divisions in New York State. New York’s a big state. We have four different departments. We have the first department, which is Manhattan-
Daniel Thomas:
And the Bronx.
Paul Edelstein:
And the Bronx, okay, because it’s so big. We have the second department, which is Brooklyn, Queens, Staten Island, and Long Island.
Daniel Thomas:
And Westchester.
Paul Edelstein:
And Westchester, there you go. That doesn’t make sense either, because I don’t know, we’re skipping around. I don’t know who drew this map. It sounds like we should have some fighting over districting and redlining here. Nevertheless, that’s the second department. Then we have the third department, which is upstate Albany, I think. Right? Or that area.
Daniel Thomas:
Putnam County up all the way to the top.
Paul Edelstein:
There you go. And then we have the-
Daniel Thomas:
About Syracuse, and then you have Syracuse West.
Paul Edelstein:
West is the fourth Department. Okay. We’ve cut up New York into four areas, but let’s just talk, and we know that our area for this case that we’re talking about, the Harley Davidson case is the fourth department. But for the purposes of explaining why this is a strange concept that people don’t understand and I don’t like, and you’ll give a political answer, but I know you don’t like it either. I’m in Brooklyn. Let’s do this. You don’t have your Manhattan shirt on, but I know you’re a Manhattan. My broken leg, if I had it and some jury was valuing it, will be worth more in Brooklyn when it’s reviewed by an appellate division than my broken leg will be in Manhattan where you’re sitting. Isn’t that true?
Daniel Thomas:
Yes.
Paul Edelstein:
That’s stupid, okay, because the law says, well, it has to deviate materially from what a reasonable juror would think is okay under the circumstances. If a jury gave me $25 million from my broken leg in Brooklyn, an appellate division is going to look at that and go, “Yeah, that deviates materially from what’s reasonable. Okay, I could agree with that.” $25 million, my leg is healed, that’s too much. Fine. Reduce it. But in Brooklyn, second department, they would reduce it, we know, to a certain range. And in Manhattan it would be, actually you and I understand, that would be a slightly higher range. How? I want you to explain this to me in layperson, explain it to me like I’m seven years old. Why is my broken leg worth more in Manhattan than it is in Brooklyn? If the law says, “Well, it’s just deviates materially from what a reasonable juror would say is appropriate under the circumstances,” how could that be different over the bridge?
Daniel Thomas:
Economics. Simple as that. The first department that’s made up of the Bronx and Manhattan have per capita, higher wage earners, higher net worth value individuals. Therefore, they play the game at a higher level in terms of the courts. The boroughs tend to have lesser high net worth individuals. Therefore, the values are less. And it all comes down to economics, which is why the third department is less than the first and the second, and the fourth department is less than the first and the second. It all comes down to the economics and geography and demographics. And that’s the justification that’s used. Not that I accept and agree with it, but I’m just giving you an answer to your question. Manhattan is the spoiler, which is why the first department tends to be higher in its awards than the second department.
Paul Edelstein:
That’s funny, because that also was a really nice, very political, very intellectual answer. But my answer would be different. It’s bull. Okay? It doesn’t make sense at all. There is no legal justification for this principle that exists, but there is the legal reality that we both know that jury verdicts, whatever a jury gives, tend to be higher in the first department than the second or the third or the fourth. Now, that could be socioeconomic. Could be. Maybe that’s an explanation for why jurors tend to give higher rewards in certain areas. Maybe there’s a socioeconomic relation to that. A lot of lawyers would say that’s the reason why, but again, we’re just dealing with six individual people each time. There’s some randomness to this.
Nevertheless, when it goes to an appellate court, now I’m not dealing with just six random people. Now I shouldn’t be dealing with a socioeconomic component to this. Now I should be dealing with sterile application of law. And that law is the same in all four departments, right? It’s the same law, right? There’s no different law is there?
Daniel Thomas:
Same law.
Paul Edelstein:
Okay. They apply the same law in four different departments, four different results on the same broken leg. Isn’t that what happens?
Daniel Thomas:
Yes.
Paul Edelstein:
You’re okay with that?
Daniel Thomas:
No.
Paul Edelstein:
Okay, good. Lisa-
Daniel Thomas:
I like cross-examining you. You’re a good witness. But there’s a difference between liking something and acknowledging and accepting that is what it is. And let me just draw a parallel, if I may. Foreclosures. Foreclosures happen all over the state. All over the state. The department that pumps out the most amount of foreclosure law is the second department for two reasons. There’s way more homes in the boroughs than there are in Manhattan, and there’s way more people in the homes in the boroughs than there are in the rest of the state, relatively speaking.
That’s why the second department, they’re the most prolific writers of foreclosure-related law, encounter the most interesting and diverse and unique scenarios. And that basically controls the whole state because that’s where the majority of the people are who are bringing these lawsuits relative to residences and things of that nature. And that’s just a reality. And if you distributed the people and made the homes much more plentiful in the third and the fourth, then you would see a shift in terms of where the majority of the law comes from.
I use that as an example here to say that most broken legs that come from auto accidents are fairly the same. You have mild, you have medium, you have severe. Some people never recover. Some people recover in a couple of weeks, some people recover in a couple of months. You take those three as a criteria and just say, “If you fall into one of these three, mild, medium, and hot, like wings, those three categories, one of those three, you get what’s reasonable under those particular categories.” That’s compensatory.
And that’s what the courts do is they basically say, “What’s the majority of the decisions that predate this one?” And if we average them or aggregate them and say, “What’s the norm?” That’s what this has to fit into. They take a specific result and they say, “How does this compare? How do we match the color scheme of this one case to the entire universe of history on these types of injuries?” And they come up with a number and they say, “This either is reasonable and we leave it alone. It materially deviates from what’s reasonable, so we have to change it and modify it down. Or it’s inadequate or insufficient compared to what the traffic allows, so we’ve got to adjust it up.”
Now, that’s the one saving grace about the law is that in, and I’ll use the Harley case as an example. Jury came back with $287 million. Your client’s first reaction was, “What’s wrong? Everything was fine. Why can’t we just keep that? That’s what the jury did. Isn’t that the system? Jury speaks and we listen.” Well, not so fast because it materially deviates from the norm. Now, this case doesn’t fall into a norm. This is an-
Paul Edelstein:
Well, that’s true, but let’s not argue. We’re going to just talk a general concept here.
Daniel Thomas:
Okay, fair enough.
Paul Edelstein:
This general concept of compensatory. We know that 287, we know $220 million of it was punitive, which we’re going to talk about in a few minutes, but the rest of it was compensatory.
Daniel Thomas:
Compensatory. Let’s just go back-
Paul Edelstein:
And you and I knew that was going to change, that compensatory number was going to change.
Daniel Thomas:
That’s right. We did. But the point I’m making is, let’s assume the jury came back and they gave $5,000. Who would be the one fighting to say, “Hey, this wasn’t right”?
Paul Edelstein:
Spoken like the son of a judge. It’s fantastic. All right. I’m the son of a street lawyer who’s going to tell you I don’t like it. I don’t like the way it’s applied. But both of us are right. Both of us are right, and we both have to operate, and we both do, under the realities of a system. We’ve had to have this experience of explaining to our clients, and I hope we’re explaining it here on this podcast, the reality of compensatory damages and how this works and how both there is an analysis of what’s reasonable for a particular injury, but also a secondary analysis of what’s reasonable where you are, which is, I think for most people they think that’s crazy but we know that’s the reality.
And so in our case, let’s bring it back to our case compensatory wise, and we’ll wrap up on the compensatory discussion here. We had a $220 million punitive damages award, that last, was it $67 million was awarded in compensatory to both of our clients. But we both knew, okay, that $67 million is not going to hold up based on our understanding of what’s material and reasonable under the circumstances and the limitations of law, particularly law involving somebody that dies, horrible that law is limited, and that we were in the fourth department, not in Brooklyn.
Daniel Thomas:
Right.
Paul Edelstein:
Crazy stuff, right?
Daniel Thomas:
Yep.
Paul Edelstein:
Knowing all of that, when the judge then reduced, let’s just talk about the compensatory number from $67 million to, I think he reduced the compensatory number from… See, this is how prepared I am. From $67 million to an aggregate of what? What was his total compensatory with the two cases combined in the reduction? Probably 20 something. [inaudible 00:11:59].
Daniel Thomas:
Yeah.
Paul Edelstein:
Right? Okay, whatever. He reduced it almost by two thirds, let’s just say. Were you shocked and outraged?
Daniel Thomas:
No.
Paul Edelstein:
Neither was I. Okay. But yet we received a lot of, “What the F?” calls.
Daniel Thomas:
And the reason really is because what the judge did, which was the right thing to do, is said, “I’ve got to look at a body of recovery that’s been deemed acceptable by the higher courts for these similar types of injuries.” Now, no case is identical. No death is the same. No broken leg is the same, but there’s enough similarity where you can say, “This is what is reasonable.” Now, I just want to mention just a quick, something called workers’ compensation. There’s a whole body of law.
Paul Edelstein:
Don’t do that. What are you crazy?
Daniel Thomas:
No, this is the point I’m trying to make. There’s a body of law called workers’ compensation. There is a set value for an eye, for an ear, for a toe, for a hand, for a foot. In that world, they’re set. And so you think to yourself, “Well, why don’t we have that in just general common law?” And the answer is because you need to have wide open field to allow for individuality. Although the court system and the case law has created an aggregate norm, if you will, that’s used as a litmus test. And that’s what the struggle is. Now, there is no one precise number for every case, but there are ranges, and the ranges-
Paul Edelstein:
Well, we know why. We know why, because if somebody punched me in the mouth and broke my mouth, it would be worth more than punching someone else in the mouth. If somebody hurt Dan Thomas’ brain, that could be worth a lot. More than mine.
Daniel Thomas:
Well, again, that’s what I said before about if you’re a concert pianist and you have a hand injury, that’ll hurt you more than if you’re a public speaker and you have a hand injury. It all has to relate in that respect. But you have to compare the concert pianist with the hand injury to a concert pianist with a hand injury if you can do it fairly.
Paul Edelstein:
Nevertheless, let’s just wrap up on the compensatory part. I think both you and I can agree that this judge’s decision to reduce the compensatory damages’ aspect of this case by nearly two thirds was not met with shock and anger by us. We certainly understood, hey, it’s going to come somewhere in this range. And this judge came in within that range, did he not?
Daniel Thomas:
Yes, he did.
Paul Edelstein:
There you go. Now people should understand. Let’s wrap that part up.