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Every corporate litigator knows the risk of rejecting a settlement offer. Sometimes the risk far outweighs the reward. Consider the March 8 verdict in Hoskins v. Federal-Mogul Corp., No. 00CV-206172, an individual asbestos exposure case in which the plaintiff’s original $1 million demand was met with a $100,000 counter-offer from the defendant. The case went to trial before a Jackson County, Mo., jury and resulted in a $10 million verdict. “I’m just amazed they didn’t settle,” says Laura Lea Squires, a Blue Springs, Mo., elementary school teacher who was one of the jurors who voted 9-3 for the plaintiff, Forest Hoskins, a seriously ill operating engineer who claimed to have contracted mesothelioma from working in a 38-year-old Kansas City office building, “I feel it should never have reached a courtroom.” Squires and other jurors say they were even more surprised when they learned after the trial from news reports that Federal-Mogul Corp.’s co-defendant, Business Men’s Assurance Co. of America (BMA), the owner of the office building, had settled out of court for $5 million. For Federal-Mogul, the $10 million verdict is doubly painful because, based on juror interviews, the punitive damages of $7 million were the result of a mathematical error. And experts say it’s a verdict they may be forced to swallow. Federal-Mogul’s trial attorneys, Margaret M. Chaplinsky and Charles J. Kalinoski, two veteran civil defense attorneys in practice together in Des Moines, Iowa, did not return calls seeking comment on the case. Kimberly A. Welch, a spokeswoman for Federal-Mogul, an international auto parts manufacturer, says company officials were reviewing the Hoskins verdict for a possible appeal. Welch said she could not comment on the company’s policy on defending against asbestos claims. Jurors who spoke about the verdict say it was based on factors ranging from expert evidence to attorney demeanor. The jurors, who heard two weeks of evidence, say they believed that Hoskins’ health problems — even if not the virulent asbestos-caused cancer mesothelioma — were serious and plainly caused by inhaling dust from sprayed asbestos insulation in the BMA Tower, the Kansas City office that Hoskins helped maintain. Jury forewoman Tasha Martin of Grandview, Mo., says the jury accepted the plaintiff’s estimates of Hoskins’ medical expenses, lost wages and lost future earnings in arriving at the $2 million figure for compensatory or actual damages, plus $1 million in damages for his wife, Julia, for loss of consortium. The determination of punitive damages, however, is another illustration of the inventive ways in which jurors parse out evidence and sometimes take an illogical route to reach an agreed-upon result. Both Martin and Squires say the jurors were most impressed by a piece of evidence they heard during the damages phase of the trial: Federal-Mogul Corp.’s 1999 corporate report, in which investors were told the company set aside $1.1 billion to cover 95,000 asbestos claims that it inherited when it bought the asbestos company Turner & Newhall. The jurors say they divided $1.1 billion by 95,000 claims and came up with an individual-claim figure of $10 million. The jurors then subtracted the $3 million in actual damages and awarded the remainder — $7 million — to Hoskins as punitive damages. Their logic was good, but their arithmetic poor; $1.1 billion divided by 95,000 claims actually equals $11,579 per claim. Despite the error in calculating punitive damages, Hoskins’ attorney, Louis C. Accurso, says he does not believe that Jackson County Circuit Judge William F. Mauer will reduce the verdict: “I just don’t see a judge reducing damages because the punitive damages are three times the actual lost wages and other damages.” Peter Joy, a professor of law at Washington University in St. Louis and a specialist in trial practice and procedure, says that judges and appeals courts “have a fairly wide discretion with remittitur to decrease punitive damages to an amount they think may be more appropriate.” But Joy notes that judges usually exercise that discretion when jury verdict questionnaires contain inconsistencies that can be corrected. Judges traditionally have been reluctant to reverse or amend verdicts based on post-verdict statements made by jurors, even in cases where jurors agreed to file sworn affidavits. Concerning the punitive award in Hoskins, Joy says the Missouri courts have “declined to draw a bright line ratio between actual and punitive damages.” It is quite possible, he says, that the trial judge could look at the amount of punitive damages and discount juror statements, deciding that “there are other factors in evidence that make the punitive award still a reasonable award.” Joy says the crucial decision for Federal-Mogul Corp. will be made by Judge Mauer. Under Missouri precedent, he explains, “a wider deference goes to the trial court if and when the court decides to grant remittitur or deny it.” The Missouri appeals courts, he says, rarely upset remittitur decisions. THE UNDERLYING FACTS Hoskins, 55, was diagnosed with usually fatal mesothelioma in 1999 after 21 years as an engineer at the BMA Tower in Kansas City. A nonsmoker, Hoskins claimed his illness was caused by inhaling asbestos-laden dust that collected on suspended ceiling tiles in the BMA Tower. The suit linked the asbestos to “Sprayed Limpet Asbestos,” a fireproofing material that was sprayed on the steel skeleton of the tower when it was built in 1963. The asbestos, which eventually became brittle, flaked off the steel work and collected on the ceiling tiles, was produced by a Pennsylvania asbestos company that was acquired by Turner & Newall and, ultimately, by Federal-Mogul. Hoskins testified at trial that his supervisors at the BMA Tower told him the asbestos-laden dust that accumulated atop the ceiling tiles — as much as 40 pounds of it on some tiles — was harmless. Two medical experts called as witnesses by the defense testified that they did not believe that Hoskins suffered from mesothelioma or any other life-threatening asbestos-related disease. Company officials also said they were unaware of the dangers of asbestos when the BMA Tower was built in 1963 and that officials of BMA should have warned Hoskins of the danger after he began working there in 1978. By that time, the defense argued, BMA should have been aware of the hazards of asbestos inhalation. The jury deliberated for one day before returning a verdict finding that Federal-Mogul was liable for Hoskins’ injuries. The jurors who voted for Hoskins say they were impressed most with the line-up of seven expert witnesses called by Accurso to outline his illness, its cause and impact on Hoskins’ life and livelihood. Leading the plaintiffs’ experts was Barry J. Castleman, an environmental engineer from Baltimore and an acknowledged expert on asbestos exposure and disease, followed by Hoskins’ personal physicians and surgeons who removed tumors and asbestos-contaminated tissue from his lungs. Hoskins’ experts testified that his life expectancy was about 10 years, in varying degrees of illness, compared with 20 to 33 years without the asbestos-related illnesses. Federal-Mogul called its own medical experts — Lawrence Repsher, a pulmonary pathologist from Colorado and Andrew Churg, a Canadian surgical pathologist — to testify that Hoskins did not have mesothelioma. Martin, the jury forewoman, was highly critical of the two key defense experts and says she and the other jurors found them nervous and equivocal and less credible because they had not examined Hoskins or reviewed all of his medical records and exhibits. Martin noted that there was testimony about 20 microscopic slides of tissue samples from Hoskins’ lungs; neither defense expert had seen all 20 and one testified about seeing only six. “It made me think that somebody was trying to hide things from him, that there were things (the defense) didn’t want him to see,” Martin added. The defense experts were not helped, the jurors say, by technical problems experienced by Federal-Mogul’s lawyers, including a lengthy videotaped deposition that finally had to be discarded and the transcript read into the record. On the other hand, the jurors say they were impressed with Accurso’s use of a staff videographer who presented documents and exhibits on large-screen courtroom monitors. While acknowledging the importance of trial presentation, Accurso says he believed that the verdict was mostly the result of Hoskins’ testimony and his presence, along with his wife and sons, in the courtroom. “They are really nice people and they come across that way,” Accurso says. “You can’t underestimate the effect that has on a jury.” Finally, the Hoskins verdict is another illustration of the vagaries of going to trial. Juror Squires says the experience would make her think twice before rejecting a settlement and going to trial. “You know, looking at a jury, what you get is really a roll of the dice,” Squires says. “It’s kind of scary, when I look at the three people who didn’t agree with us and knew that they saw the same evidence that I did.”

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