February 2007

A leading case on punitive damages regarding systemic failure to manage drivers’ hours in the interstate commercial driver fatigue context is Came v. Micou, 2005 WL 1500978 (M.D.Pa.,2005), in which the plaintiff overcame summary judgment on a claim for punitive damages.  Among the several factors considered in determining that the defendants’ conduct  constituted “reckless indifference to the rights of others” were failure to monitor the truck driver’s conduct,  failure to conduct any investigation into the driver’s hours of service,  re-dispatching the truck driver even though he had exceeded his hour of service limitations; and failure to have effective procedures in place to verify drivers’ hours of service when the company knew that hours of service regulations were in place to protect the safety of the monitoring public. 

(Continued below)

    The Federal Motor Carrier Safety Regulations often referred to in cases where tired truckers wreck include the following:

    49 C.F.R. § 392.3, Driver Impairment.

No driver shall operate a commercial motor vehicle, and a motor carrier shall not require or permit a driver to operate a commercial motor vehicle, while the driver’s ability or alertness is so impaired, or so likely to become impaired, through fatigue, illness, or any other cause, as to make it unsafe for him/her to begin or continue to operate the commercial motor vehicle.

    § 390.11 Motor carrier to require observance of driver regulations.

 Whenever … a duty is prescribed for a driver or a prohibition is imposed upon the driver, it shall be the duty of the motor carrier to require observance of such duty or prohibition. If the motor carrier is a driver, the driver shall likewise be bound.

FMCSR, 49 C.F.R. § 390.13, provides that

"No person shall aid, abet, encourage, or require a motor carrier or  its employees to violate the rules of this chapter."  It does not say "no motor carrier." 

49 CFR 390.5 defines "person" as follows:

Person means any individual, partnership, association, corporation, business trust, or any other organized group of individuals.

    § 395.3 Maximum driving time for property-carrying vehicles.

    Subject to the exceptions and exemptions in § 395.1:

(a) No motor carrier shall permit or require any driver used by it to drive a property-carrying commercial motor vehicle, nor shall any such driver drive a property-carrying commercial motor vehicle:

    (1) More than 11 cumulative hours following 10 consecutive hours off duty; or
    (2) For any period after the end of the 14th hour after coming on duty following 10 consecutive hours off duty, except when a property-carrying driver complies with the provisions of § 395.1(o) or § 395.1(e)(2).
(b) No motor carrier shall permit or require a driver of a property-carrying commercial motor vehicle to drive, nor shall any driver drive a property-carrying commercial motor vehicle, regardless of the number of motor carriers using the driver’s services, for any period after-
     (1) Having been on duty 60 hours in any period of 7 consecutive days if the employing motor carrier does not operate commercial motor vehicles every day of the week; or
    (2) Having been on duty 70 hours in any period of 8 consecutive days if the employing motor carrier operates commercial motor vehicles every day of the week.

    § 395.8 Driver’s record of duty status.

(a) Except for a private motor carrier of passengers (nonbusiness), every motor carrier shall require every driver used by the motor carrier to record his/her duty status for each 24 hour period using the methods prescribed [herein]….
    * * * *
(e) Failure to complete the record of duty activities of this section or § 395.15, failure to preserve a record of such duty activities, or making of false reports in connection with such duty activities shall make the driver and/or the carrier liable to prosecution.

    A court may also consider the applicable administrative interpretations included in the Regulatory Guidance for the Federal Motor Carrier Safety Regulations, 62 Fed.Reg. 16370 (1997).  The agency "consolidated previously issued interpretations and regulatory guidance materials and developed concise interpretive guidance in question and answer form for each part of the FMCSRs." Id. at 16370.  "[A]n agency’s interpretation of its own regulations is entitled to a relatively high level of deference…. A court must accept the interpretation unless it is … plainly erroneous or inconsistent with the regulation."  United States v. Thorson, No. 03-C-0074- C, 2004 WL 737522, at *8 (W.D.Wis. Apr. 6, 2004); "Deference is particularly appropriate when an agency interprets its own regulation." Hickey v. Great W. Mortgage Corp., No. 94 C 3638, 1995 WL 317095, at *5 (N.D.Ill. May 23, 1995). 
 
   The Regulatory Guidance for the Federal Motor Carrier Safety Regulations, 62 FR 16370-01 (1997) includes the following official administrative interpretations of the regulations:

Question 7: What is the liability of a motor carrier for hours of service violations?
Guidance: The carrier is liable for violations of the hours of service regulations if it had or should have had the means by which to detect the violations. Liability under the FMCSRs does not depend upon actual knowledge of the violations.
Question 8: Are carriers liable for the actions of their employees even though the carrier contends that it did not require or permit the violations to occur?
Guidance: Yes. Carriers are liable for the actions of their employees. Neither intent to commit, nor actual knowledge of, a violation is a necessary element of that liability. Carriers "permit" violations of the hours of service regulations by their employees if they fail to have in place management systems that effectively prevent such violations.

    In interpretation of 49 C.F.R. § 395.8, the regulatory guidance states:

 Question 21: What is the carrier’s liability when its drivers falsify records of duty status?
 Guidance: A carrier is liable both for the actions of its drivers in submitting false documents and for its own actions in accepting false documents.  62 Fed.Reg. at 16426. In short, “Motor carriers have a duty to require drivers to observe the FMCSRs.”

    Punitive damages are designed to "penalize, punish or deter" conduct that shows "willful misconduct, malice, fraud, wantonness, oppression, or that entire want of care which would raise the presumption of conscious indifference to consequences."  Such conduct must be proven by "clear and convincing evidence."  Therefore, we pursue a punitive damages claim at trial only if the evidence obtained during discovery and investigation credibly supports that claim.

    O.C.G.A. § 51-12-5.1 provides for punitive damages as follows:

(a) As used in this Code section, the term "punitive damages" is synonymous with the terms "vindictive damages," "exemplary damages," and other descriptions of additional damages awarded because of aggravating circumstances in order to penalize, punish, or deter a defendant.
 (b) Punitive damages may be awarded only in such tort actions in which it is proven by clear and convincing evidence that the defendant’s actions showed willful misconduct, malice, fraud, wantonness, oppression, or that entire want of care which would raise the presumption of conscious indifference to consequences.

     Under Georgia law, gross negligence alone is not enough to meet the standard of O.C.G.A. § 51-12-5.1 .  See, e.g., Carter v. Spells, 229 Ga.App. 441, 494 S.E.2d 279 (1997) (mere violation of a rule of the road); Coker v. Culter, 208 Ga.App. 651, 431 S.E.2d 443 (1993)(a little speed, a little beer (0.03 gr/%), a little distraction); Bradford v. Xerox Corp., 216 Ga.App. 83, 453 S.E.2d 98 (1994)(speeding on wet road, loss of control, no evidence of alcohol or bad driving history); Cullen v. Novak, 201 Ga.App. 459, 460(2), 411 S.E.2d 331 (1991)(running red light only).

    Georgia case law includes several examples of a “pattern or practice” sufficient to support punitive damages in the trucking context.  Those examples are not, however, comprehensive or exclusive. See, e.g.,Smith v. Tommy Roberts Trucking Co., 209 Ga.App. 826, 828(2), 435 S.E.2d 54 (1993)(driver in hurry to deliver load, paid for fast driving, quick deliveries,  employer knew of two moving violations, and failed to check bad driving record  as required by the Federal Motor Carrier Safety Regulations);  J.B. Hunt Transport v. Bentley, 207 Ga. App. 250, 255(2), 427 S.E.2d 499 (1992)( “forced dispatch” system so that drivers could not refuse a load without losing job;  driver required to take truck out again without requested brake repair).

    There are also cases with less dramatically onerous facts in which there are still genuine issues of material fact for a jury to determine.  For example, in Fowler v. Smith, 237 Ga.App. 841, 516 S.E.2d 845 (1999), evidence was sufficient to overcome a motion for partial summary judgment on a punitive damages claim where there was some evidence that the trucker may have violated 49 CFR § 392.22(b) by being stopped in the interstate’s center lane for approximately 35 minutes before the collision without placing triangular warning devices on the highway, and that he did not turn on his tractor-trailer lights after it became dark and his main truck lights were not on at the time of the collision.

    There are no controlling Georgia cases regarding punitive damages truck driver fatigue, so it is useful to consider the Georgia statute in case law in the light of other interstate trucking punitive damages in jurisdictions with similar standards for punitive damages. 

Kudos to State Rep. Robert Mumford (R-Conyers) who on Tuesday introduced the Medical Malpractice Insurance Reform Act  . The bill wouldrequire the Insurance Commissioner to hold medical malpractice insurers tothe same rate-filing standards that auto and homeowner insurers have to meet.
"We need to do everything we can to make sure people are able to get affordable health care," said state Rep. Robert Mumford, R-Conyers. "In my view, tort reform has not produced the results it advertised."
An Associated Press analysis of state insurance records last year revealed six of the state’s top insurers of doctors and dentists have increased their liability rates _ in some cases by more than a third _ since new restrictions on malpractice cases became law in February 2005.
Supporters of Mumford’s measure point to California as an example of how theslight change could ultimately decrease medical malpractice rates. Three years after the state approved a similar measure, the malpractice premiums declined by 3 percent, according to Georgia Watch, a consumer advocacy group.

 

Currently, most insurers have to get a rate increase approved by the Commissioner before they raise premiums on consumers. But medical malpractice insurers aren’t held to the same standard. An insurer can "file and use" the higher rate immediately, even if the Insurance Commissioner has not yet reviewed the request. Rep. Mumford’s bill would require "prior
approval" for malpractice insurers. It would also require public hearings on any rate increase over 10 percent, so that doctors could voice their opinion about costly insurance. Finally, the bill would give Georgians more information about what’s behind high rates by requiring malpractice insurers to file information with the Insurance Commissioner about their claims
experience and what claims they have paid. This information would then be turned into an annual report and made available to the public.
 
Two years ago, when we were trying to tell legislators that doctors needed insurance reform more than a "one size fits all" cap on damages, the legislative leadership didn’t want to slow down the train long enough to consider what might really work in holding down medical malpractice insurance premiums.  We tried to tell them that the legislation that contained premiums in California wasn’t the damages cap but the later enactment of insurance reform, but of course they didn’t want to listen.

These sorts of changes are sorely needed in the medical liability insurance market, which is dominated by one organization (MAGMutual). Despite a lack of understanding about what was causing high medical malpractice insurance rates, Georgia enacted tort "reform" in 2005. But

since Georgia passe the bill, doctors haven’t seen rates go down. In fact,some companies have actually raised their rates.