What does a record $1 billion verdict against two trucking companies involved in a fatal crash mean for the industry? HDT Editor in Chief Deborah Lockridge shares some takeaways. - Graphic: HDT

What does a record $1 billion verdict against two trucking companies involved in a fatal crash mean for the industry? HDT Editor in Chief Deborah Lockridge shares some takeaways.

Graphic: HDT

Four years ago, a teenager was killed as he waited in a traffic backup on Interstate 95 near Jacksonville, Florida, caused by an overturned truck, when a distracted truck driver slammed into the line of traffic. A few weeks ago, it took a jury only four hours to deliver a $1 billion verdict in the case, most of it punitive damages against the trucking company whose driver caused the backup in the first place, AJD Business Services Inc.

The verdict blew the previous record for a nuclear verdict against a trucking company out of the water. As recently as 2018, the industry was stunned by a record verdict of $101 million, which was later thrown out on appeal. And less than a year ago, that was surpassed by a $411 million verdict handed down by another Florida jury, this in favor of a veteran partially paralyzed in a 2018 45-vehicle interstate pileup.

Distracted Driving Just the Beginning

According to the plaintiffs’ lawyer, as reported in the Florida Times-Union, the driver working for AJD was distracted by his cell phone, over his hours of service limit, and did not even have a commercial driver’s license.

The lawsuit also named Canadian company Kahkashan Carrier Inc. Its driver was the one who crashed into the line of stopped cars. The driver was traveling on cruise control at 70 mph, according to the case, and did not try to brake until one second before the crash. 

The family of the victim was awarded $86 million from Kahkashan Carrier for compensatory damages. For emotional distress, the court ordered AJD Business Services to pay $16 million to the teen’s mother, plus $900 million in punitive damages.

When you read about the details as reported by the Times-Union, you might think, ‘These are irresponsible motor carriers that probably deserve to be put out of business by a nuclear verdict."

AJD gave driver Russel Rogatenko a job without a background check. He didn’t even have a CDL, according to the plaintiffs’ attorneys, and he had previous violations for driving aggressively and speeding.

Yadwinder Sangha with Kahkashan Carrier, the driver who plowed into the line of stopped vehicles, was on his 25th hour of a trip that took him from Quebec all the way to Palm Beach, according to the family’s lawyers, and was unable to read English well enough to understand signs set up by Florida law enforcement warning of the crash ahead.

You might think you have nothing in common with companies with such sloppy safety practices. But there are some key takeaways that do affect the rest of the trucking industry:

1. Fleets Must Defuse Nuclear-Verdict Detonators

Trucking attorney Doug Marcello says there are some examples in this case of what he calls “nuclear verdict detonators.” These types of things must be addressed by companies long before there’s a crash. For instance, the driver for whom there was no background check, no verification of a CDL or prior violations, and the other driver who allegedly was not able to read road signs and was apparently over hours of service.

“These are all vulnerabilities, systemic and individual, that companies need to identify and rectify before the accidents,” he says. “And nuclear verdicts rarely, if ever, occur absent such correctable detonators.”

(Marcello is a trucking defense attorney with a commercial drivers licenses who, with Marcello & Kivisto LLC, has represented trucking clients across the country. He's also chief legal officer of Bluewire.)

2. Verdicts Are Designed to Put Companies Out of Business

As Marcello points out, the overwhelming amount of this verdict was reported to be for punitive damages, rather than compensatory.

“The purpose of those damages are to punish outrageous conduct that has occurred and deter such in the future,” he told HDT. “These are uninsurable in many states, resulting in companies being wholly responsible for payments in those states.”

According to the Times-Union, plaintiff’s attorney Curry Pajcic of Pajcic & Pajcic law told reporters, “This is a message to all those bad trucking companies: Play by the rules the good trucking companies play by. Whether or not they will remain in business is another story.”

It’s unclear whether, in fact, AJD Business Services is still in business. The Times-Union story said both it and Kahkashan were still in business. But a search for AJD Business Services on the Federal Motor Carrier Safety Administration’s SAFER system, while it shows Kahkashan as having one power unit, turns up a notice that AJD is inactive in the database. Trucking attorney Kristen Johnson, partner with Taylor & Associates, said AJD apparently is no longer in existence and failed to participate in the proceedings for at least the last two years.

With that in mind, she said, the reality of trying to collect is that “there is nothing there.” Johnson speculated that it’s likely the insurer paid off the maximum amount it covered soon after the accident, “and then they are out.”

It appears that soon after the verdict, Falls Lake National Insurance filed what looks to be a related suit against AJD Business Services and other defendants. The case is 3:21-cv-00828, Falls Lake National Insurance Company v. AJD Business Services, Inc. et al. Driver Rogatenko is one of those named in a “proposed summons” in court documents.

3. Percent Responsible Doesn't Add Up

An interesting facet of this case is that the jury held Rogatenko and AJD responsible for 10% of negligence and held Sangha and Kahkashan, the driver and owner of the truck that actually slammed into the line of traffic, responsible for 90%. Yet the jury clearly believed that Rogatenko and AJD needed a harsher punishment.

“This raises the importance of ‘joint and several liability’ per state laws or rules,” Marcello says. “In states in which a defendant is found 1% at fault can be made to pay 100% of a verdict and chase the other defendant for their overpayment, this would be a significant factor in such verdicts.”

4. Possible Fodder for Mandatory Collision Avoidance Technology

The news hit my inbox shortly before we had National Transportation Safety Board Member Michael Graham speak at Heavy Duty Trucking Exchange about why the NTSB believes the industry should adopt collision avoidance technology. From the newspaper reports, at least, it looks like such a system with automatic emergency braking could have prevented or mitigated the truck smashing into the stopped cars from the rear at some 70 mph.

While Graham explained that he’s not really a regulations guy and would rather see industry adopt this type of technology voluntarily, federal regulatory agencies already have automatic emergency braking in their sights.

Yet HDT’s Truck Fleet Innovators, in a panel discussion at HDTX — some of the most forward-thinking, technology-savvy, early adopters in the industry — expressed concern that the technology’s just not quite ready for prime time.

5. Bad Actors Are Bad for Trucking

This is the kind of case that has plaintiff's attorneys chomping at the bit.

“It continues to build the reputation that the plaintiff’s lawyers are trying to build about trucking, that it is a bunch of bad guys that have these distracted guys on the road,” Johnson says.

The plaintiff’s attorneys, Pajcic & Pajcic, are now able to tout the fact that they’ve gotten a $1 billion verdict against a trucking company, even though most of that verdict will likely never be paid.

“Two truckers who were distracted behind the wheel caused the death of an 18-year-old stellar college freshman on the brink of his adult life,” the company writes on its website, calling the punitive damages “a clear message to the trucking industry to stop putting reckless drivers on the roadways.”

Just a sampling of other headlines on the firm’s website touting its acumen in getting money from trucking:

  • Trucker Pays $7 Million Even Though Not Charged with Accident
  • Multi-Million Dollar Recoveries from Two Truckers that Claim Life of Young Mother
  • $1.4 Million Recovery from Sleep Deprived Trucker
  • $950,000 for Fractured Ankle Because Truck Driver on Cocaine

The bottom line, according to Marcello, “is that the failure to evaluate, identify, and correct vulnerabilities proactively can be devastating for a trucking company.”

Author

Deborah Lockridge
Deborah Lockridge

Editor in Chief

Reporting on trucking since 1990, Deborah is known for her award-winning magazine editorials and in-depth features on diverse issues, from the driver shortage to maintenance to rapidly changing technology. 28 Jesse H. Neal honors.

View Bio

Reporting on trucking since 1990, Deborah is known for her award-winning magazine editorials and in-depth features on diverse issues, from the driver shortage to maintenance to rapidly changing technology. 28 Jesse H. Neal honors.

View Bio
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