McDonalds Hot Coffee Case – What you don’t know!
25 years ago today (July 24), a jury in New Mexico announced its verdict in one of the most infamous and misunderstood cases in recent memory: Liebeck v. McDonald's, also known as the "hot coffee lawsuit."
This case is held up as one of most egregious examples of frivolous lawsuits. The story goes that a woman bought coffee from McDonald's, drove with it between her legs, spilled it on herself, sued McDonald's because it was hot, and took a cool $1 to $5 million (depending on who's telling the story) off of them. "Wait, she sued because coffee was hot? And she was driving with it between her legs? What did she expect? Anyone can sue for anything these days."
Guess what? That story is almost completely false. I mean, Stella Liebeck did have hot coffee spill on her. That part is true. But here's what's not. Liebeck wasn't driving. The 79 year old was in the passenger seat of her grandson's car. He pulled into a parking spot, where she was trying to add cream and sugar to her coffee. The car didn't have cupholders, so she put it between her legs, and when she pulled the lid off, it spilled all over her.
The spilled coffee wasn't just unpleasant; it was served at nearly 190 degrees, which caused 3rd degree burns over 6% of her body, required multiple skin grafts, necessitated further care after she left the hospital, and left her permanently disfigured. She originally tried to settle with McDonald's and asked for $20,000; they responded with an offer of $800.
At that point, she hired an attorney who discovered that 1) McDonald's required franchisees to serve coffee between 180-190 degrees 2) no other coffee in the city was served at more than 160 degrees 3) 190 degree liquid causes third degree burns in less than 3 seconds and would burn the mouth if consumed at that temperature 4) 160 degree liquid takes over 20 seconds to cause third degree burns and 5) McDonald's had been sued over SEVEN HUNDRED times in the prior decade for coffee being too hot and had settled up to $500,000 in cases and been told to lower the temperature.
Ultimately, McDonald's refused an arbitrator's suggestion of a $225,000 settlement and the case went to trial, where a jury ultimately awarded Liebeck $200,000 in compensatory damages, and $2.7 million in punitive damages. "A ha!," you sa, "so she still got millions! That's still frivolous!" Well...no.
First, the jury found Liebeck was 20% at fault, so the compensatory damages were reduced by that amount, to $160,000. Then the judge reduced the punitive damages to three times the compensatory, or $480,000, for a total of $640,000. We don't know how much Liebeck got because they eventually settled for less than $600,000, but between medical expenses and legal fees, it's a FAR cry from the millions she got for a slightly warmed leg in the well-known story.
So how did this become so legendary? Simple. McDonald's knew the case was going poorly, so it looked to the one thing it had that Liebeck didn't: a bully pulpit. They started a massive PR effort that was basically a smear campaign, painting Liebeck as some irresponsible scofflaw trying to take their hard-earned money. And it worked, to the point that the annual "awards" for frivolous lawsuits are known as "The Stellas."
As for Liebeck? The then 81 year old didn't have the money, platform, or desire to fight back, and used the money to pay for a live-in nurse. She watched company after company use her case as an excuse for tort reform, to stop the big bad consumers from hurting the poor, poor multinational billion dollar corporations, before passing in 2004 at age 91.