Breaking Down The Infamous McDonald’s “Hot Coffee” Case

mcdonals imageWhen most people think of infamous personal injury cases, the McDonald’s hot coffee case usually comes up at the top of the list. But why is this case referred to by so many personal injury experts? Some speculate that the case brought millions of dollars to a plaintiff with minor injuries at the expense of our justice system. Still others claim that the case represents a just punishment for a corporate America that cares too little about its consumers. In reality, the case does not clearly really fall into either category. Here is a breakdown of the facts and the outcome.

The Injuries

This case began in 1992 when 79-year old Stella Liebeck bought a 49-cent cup of coffee from a McDonald’s drive-through in Albuquerque, New Mexico. Her grandson was driving and she was sitting in the passenger seat. As many beverage drinkers did before the days of multiple cup holders, Ms. Liebeck placed the cup between her legs and opened the lid to add cream and sugar. As she popped the top off her beverage, the hot coffee spilled onto her lap. This then directly caused third-degree burns to her inner thighs, buttocks, and groin.

As a result of her burns, Ms. Liebeck spent eight days in a hospital for treatment. Her injuries required extensive treatments for third-degree burns including removal of dead tissue and multiple skin grafts. The burns left her scarred and disabled for several years after the incident.

The Monetary Damages

Most people who hear about the case assume Ms. Liebeck walked away with millions. Consequently, the case became a popular example of why we should have limits when consumers attempt to hold corporations accountable for personal injuries. However, there is more to this case than meets the eye.

Before a lawsuit was filed, Ms. Liebeck informed McDonald’s of her injuries and asked for compensation for her medical bills. At the time, the total cost for her medical expenses was around $11,000. McDonald’s ignored her request and offered $800.

Liebeck’s attorney came back asking for $300,000. An offer of $225,000 was brought to the table next. But McDonald’s refused all attempts to settle the case out of court.
In the end, a New Mexico jury awarded Ms. Liebeck $160,000 in compensatory damages and $2.7 million in punitive damages.

Advocates for limits on jury awards is such cases called the result an unreasonable award and a “perversion of our justice system”. But those who know the true facts of the case know that this is merely a “legal myth”.

Was Ms. Liebeck’s Award Reasonable?

Many personal injury advocates argue that in light of McDonalds’ actions, Ms. Liebeck’s award was justified. Here is why:
According to corporate standards, most McDonald’s restaurants served their coffee at 180 to 190 degrees Fahrenheit. Interestingly enough, coffee hotter than 130 degrees Fahrenheit can cause third-degree burns. Additionally, it only takes about three seconds to produce a third degree burn when coffee at 190 degrees comes into contact with skin.

During the hot coffee trial, McDonald’s corporation admitted that it had been aware of the risk of serious burns from its coffee products for over 10 years. In fact, during the decade between 1982 and 1992, there were more than 700 reports of coffee burns caused by McDonald’s coffee. These claims were mostly settled out of court and amounted to over $500,000. And finally, McDonald’s admitted it failed to warn its customers of the dangers of the excessively hot coffee it served.

What The Court Decided

Initially, the jury found that Ms. Liebeck’s injuries were worth $200,000 in compensatory damages. Later, the award was reduced to $160,000. The reason for the decrease in damages was because it was determined that 20 percent of the fault for spilling the coffee belonged to Liebeck.

Next, the jury determined that McDonald’s was guilty of willful, reckless, malicious or wanton conduct. For this reason, $2.7 million was awarded in punitive damages. McDonald’s immediately filed papers for a retrial. However, the trial court found that McDonald’s behavior was “callous” and refused to allow a retrial. The punitive damages award was later reduced to $480,000.

Before any appeals could be heard an out-of-court agreement for an undisclosed amount of money was reached. As part of this settlement, the details of the case were sealed and no one can officially say how much money was granted.

Although some misinformed parties may consider this case a cautionary tale of the excesses allowed by our justice system, this is hardly the case. Ms. Liebeck was severely injured and did not in fact walk away with millions. And given her age and health, it is likely that the amount of damaged agreed to in the lawsuit went to pay for her medical care at an assisted living facility.

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