Texas SC: Defendant's income should be kept from jurors

Steve Korris Oct. 7, 2008, 4:00am

Justice Scott Brister

AUSTIN – Texas trial judges must never let jurors know how much money a defendant makes, the nine justices of the Texas Supreme Court have ruled.

On Sept. 26, the justices discarded a $3 million verdict awarded by Waller County jurors against Reliance Steel and Aluminum, after learning Reliance made $1.9 billion a year.

Jurors awarded almost 500 years of earning capacity, Justice Scott Brister wrote.

"Courts must provide equal justice to all, regardless of their circumstances, and efforts to suggest that jurors should do otherwise cannot be lightly disregarded," he wrote.

The justices granted Reliance a new trial.

Reliance, a California company, owned a tractor trailer that slammed into the back of a vehicle carrying Cathy Loth and Michael Sevcik on a highway west of Houston.

The crash permanently damaged Loth's brain.

Swevcik and Loth sued Reliance and driver Sam Alvarado.

At a deposition, counsel for Sevcik and Loth asked a Reliance representative how big the company was. The representative said a year's sales approximated $1.9 billion and employed around 3,000 workers.

Reliance did not contest liability. Sevcik and Loth did not seek punitive damages.

That left nothing for jurors to decide except actual damages.

At trial before District Judge Dan Beck, counsel for Sevcik and Loth quoted the sales figure from the deposition.

Outside the presence of the jury, Reliance objected and Beck overruled.

After a four day trial, jurors awarded Loth $1.75 million for impairment and anguish, $750,000 for loss of future earnings, $250,000 for future medical expenses, $40,000 for past medical expenses, and $15,000 for pretrial loss of earnings.

Those figures from Brister's opinion add up to $2,805,000, though he writes elsewhere that jurors awarded more than $3 million.

On appeal, the 13th District in Corpus Christi upheld 99.8 percent of the verdict but trimmed Loth's past medical expenses to their actual amount, $33,985.23.

Reliance appealed again, successfully.

"Even when a party's wealth has no logical relevance to a case, the prejudicial effect of such evidence often creates strong temptations to use it," Brister wrote.

"Even when wealth can be used on the issue of punitive damages, we take the unusual step of bifurcating a trial so that it cannot be used for any other purpose," he wrote.

He wrote that "big companies cannot afford to be less efficient than small companies, at least not for long."

There was no evidence that future medical expenses would exceed $127,000, he wrote.

"The jury's finding of $750,000 for future earning capacity was also surprisingly large given the evidence," he wrote.

"Loth's tax returns leading up to the accident showed a total income of $7,562 for all five years combined," he wrote.
At that rate, he wrote, the award represented almost 500 years.

"We need not decide whether this particular award was erroneous; we conclude only that in combination with the other awards it shows that the jury's findings probably were the result of something other than the admissible evidence in the case," he wrote.

Thomas Wright, Chad Forbes and Russell McMains represented Reliance.

David Holman, Macklin Johnson and Ruth Downes represented Sevcik and Loth.

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