TIME: Almanac 1990/1990 Time Magazine Compact Almanac, The (1991)(Time).iso/time/080789/08078900.011

Text File | 1990-09-17 | 6KB | 96 lines

LAW, Page 42

Showdown in "Sue City"

Lawyers race to file suits following the United DC-10 crash


    Philip Corboy doesn't need to chase ambulances. They seem to
chase him. Just one day after the July 19 crash of United Airlines
Flight 232 in Sioux City, Iowa, the white-thatched,
patrician-looking Chicago attorney was asked for legal help by the
family of one of the survivors. Within 24 hours, Corboy had filed
the first lawsuit to come out of the disaster. Since then, he has
received calls from twelve other people involved in the crash. His
fee, if he wins: as much as one-third of the damages.

    Corboy's lawsuit was the first volley in what promises to be
a high-stakes legal battle over the Iowa crash. Some attorneys have
even taken to calling the tragedy "Sue City" because of the huge
number of lawsuits that are expected to follow. While the 185
survivors and the next of kin of the 111 who were killed are the
ultimate beneficiaries, the struggle will take place between a
small cadre of plaintiffs' lawyers and their counterparts, who
represent airlines, aviation manufacturers and their insurance
companies. That kind of tug-of-war has grown increasingly fierce
over the past few decades.

    Iowa bar officials arrived at the scene of the Sioux City crash
nearly as fast as the doctors did. They were determined to head off
a well-known postcrash problem: unscrupulous lawyers soliciting
clients on the scene in violation of ethics codes. Representatives
of the state bar set up an office at the health center where many
of the survivors had been taken for treatment. Bar officials also
placed an ad in the Sioux City Journal asking people to call if
they knew of any unethical contacts by attorneys. None were
reported.

    Other crash scenes have been more ghoulish. After 137 people
died in the Aug. 2, 1985, crash of a Delta L-1011 at the
Dallas-Fort Worth airport, legions of lawyers sought business amid
the chaos, scurrying among emergency-relief workers and hospital
aides. They even tramped through the halls of Parkland Memorial
Hospital handing out name cards to the families of the deceased.
Top lawyers in the field, who get their cases mainly through
referrals, consider such tactics lowbrow. "I have utter contempt
for those who choose to get cases this way. They deserve the bad
reputation they have," says Lee Kreindler, a New York City lawyer
who won a record $7.9 million judgment in the Delta case.

    Insurers show up just as quickly as the lawyers, seeking
through a disputed process known as claim control to keep costs
from spiraling. Associated Aviation Underwriters, one of the major
airline-liability insurance companies, has already begun the
process of talking with survivors and the families of victims of
the Sioux City crash, trying to settle their claims quickly and
dissuade them from going to court. Says Peter Magee, executive vice
president of the company: "If you buy a ticket to get from Point
A to Point B, and you don't make it there, then the legal burden
is on me to explain why. Statistics show you're going to recover
something. It isn't a question of Is compensation fair? It's a
question of how much."

    The answer, say plaintiffs' lawyers, is usually "not enough"
for those who sign up with the insurance companies. Friendly
letters urging families and survivors to take the settlements
initially offered to them -- and suggesting that they shouldn't
consult a lawyer -- are anathema to the aviation bar. According to
Gerald Sterns, a San Francisco lawyer who specializes in air-crash
litigation, "These letters can be very dangerous for the victims
if they decide later to file a lawsuit. The insurance company's
concern is damage control. What they're doing is developing a
rapport with the victims and duping them."

    Lawyers for plaintiffs also accuse the insurers of more
dastardly deeds. Says Daniel Cathcart, a Los Angeles-based lawyer
who specializes in air disasters: "Either directly after the
accident or a little later, as soon as the insurance companies know
who the survivors are, they will dispatch a team of investigators
to find out your financial situation, whom you're sleeping with and
the status of your married life. Then they'll use this evidence to
try to intimidate and embarrass you in court." Following the 1985
crash in Dallas, Delta was criticized for prying into the lives of
passengers during litigation. After investigators found that one
victim was homosexual, insurance lawyers raised the issue of
whether his life expectancy would have been cut short because of
AIDS.

    Plaintiffs' lawyers have a strong financial incentive to keep
people from settling without representation, since it is virtually
certain in crash cases that damages will be paid. But a study last
year by the Rand Corp. found that litigation often does not yield
the jackpots that the public imagines. Rand found that airlines and
other defendants paid victims' families less than half their
average "economic loss," the value of what the deceased would have
earned in a normal lifetime. Jury verdicts averaged $599,000 per
victim. Still, the odds are good enough and the stakes high enough
to ensure that lawyers will continue to litigate these cases
avidly. As insurer Magee puts it, "This whole business has come to
take on a lottery mentality. If someone gets hurt this week, then
they rush to court to see what numbers come up."