A report published on May 3 by Marathon Strategies, an independent public relations firm, revealed a significant increase in the number of "nuclear" verdicts, or jury verdicts exceeding $10 million. The report showed a rise of 27% in 2023 compared to the previous year.
According to the report, there were 89 lawsuits that resulted in nuclear verdicts against corporate defendants last year, marking a 15-year high. The median size of nuclear verdicts in 2023 was $44 million, which is a considerable increase from $21 million in 2020. Marathon suggested that the surge in nuclear verdicts can be attributed to factors such as trial attorney tactics like "anchoring" and the "reptile theory." The reptile theory involves attorneys trying to appeal to jurors’ emotions, while anchoring is a tactic where lawyers propose an excessively large award so that the figure becomes "anchored" in the jurors’ minds.
The report also indicated that Marathon analyzed legislative measures across various states aimed at mitigating nuclear verdicts. States including Florida, Indiana, Iowa, and Montana passed bills designed to limit the size and scope of nuclear verdicts. These legislative actions included measures intended to enhance transparency surrounding third-party funding of lawsuits and impose limits on liability damages. In Florida specifically, tort reform measures enacted last year, including eliminating attorney’s fee multipliers, led to a decrease in nuclear verdicts.
According to a copy of testimony submitted by the American Property Casualty Insurance Association (APCIA) to a House Financial Services Committee hearing last year, the rise of nuclear verdicts is one factor contributing to higher insurance costs for policyholders. APCIA stated that these "exceptionally high" verdicts have forced some companies out of business while insurers have had to increase their prices due to elevated risk costs.
Nationwide data shows that over the past year, the average cost of car insurance has risen by 22.2%, according to the latest Consumer Price Index summary.
Marathon Strategies, as stated on their website, was established by Phil Singer in 2008 following two decades of experience in corporate and political communications. The firm employs a diverse team of data analysts, researchers, and attorneys.