Indiana State Fair tragedy renews cap debate

Two months after the Indiana State Fair grandstand stage collapsed during strong winds, lawyers are lining up to represent those impacted by the Aug. 13 tragedy.

But the aftermath goes far beyond the incident that killed seven people, injured more than 40 and left a state wondering whether the accident could have been prevented. Indiana attorneys and legislators are embarking on a broader discussion about the state’s current tort claim cap and whether that decades-old limit is adequate to address the scope of this situation.

A state liability investigation is ongoing. To date, the Office of the Indiana Attorney General has received 51 tort claim notices – the procedural first step for any potential lawsuit against the state. Claimants legally have 270 days to file a tort claim notice with the state. In this case, the AG has asked that customized forms be filed by Nov. 1 to help expedite financial assistance to the victims and families through the Indiana Tort Claim Fund.

By law, Indiana is limited to paying no more than $700,000 per individual or $5 million per single incident to settle tort claims. Of the 51 tort notices filed as of Oct. 7, 21 law firms have indicated they are representing at least one client. The remaining individuals are not represented but have completed the state form. So far, two firms – both in Indianapolis – have said they are doing some of the work free of charge.
 

Kenley

The bottom line is that all of the lawyers and their clients share a stake in what happens in the debate over the tort claim limit. Some have expressed concern over a suggestion that the cap be raised to address claims by state fair victims only or whether the limit be increased permanently. Sen. Luke Kenley, R-Noblesville, has been critical of what he has called a “trial lawyer’s push” for a more general cap increase for all cases, and Gov. Mitch Daniels has expressed skepticism about raising the cap in general if some of that money might go to the lawyers.

But even as attorneys fees becomes a part of the discussion on raising the tort fund limit, not everyone agrees that fees should be a consideration. Even the trial lawyers aren’t all on the same page about how they are approaching the issue.

Constitutional challenge or lawyer generosity?

Valparaiso attorney Ken Allen is taking his battle against the statutory cap to the courtroom. On Sept. 26, Allen filed a federal class-action lawsuit in the Southern District of Indiana that challenges the damage cap on grounds that it violates due process and equal protection because it denies individuals their fair share.

Allen

“The cap on damages is arbitrary and capricious,” Allen said in a news release. “The limits on liability further fosters negligence and creates a disincentive to safety by making it economical for the state to take unreasonable risks and act negligently, particularly in large functions wherein hundreds of people may be subject to harm from a single occurrence.”

Allen didn’t respond to Indiana Lawyer requests for comment about whether he thinks a court challenge or legislative action is the best way to address the cap, or if he believes the cap should be increased for state fair victims only or on a broader scale.

But Indianapolis lawyer Lance Cline with Cline Farrell Christie Lee & Caress thinks the legal community can directly influence that debate by using pro bono representation in the state fair litigation. Cline is leading behind-the-scenes discussions with a network of about 15 to 20 firms that represent about 30 clients. The group has met several times since the week after the accident, and Cline said he’s “politely nudging” other lawyers to work free of charge.

Cline

“There are no strings attached and this is not a cute lawyer trick, and this is not about getting more clients,” he said. “I’ve felt strongly about this from day one, and it’s just the right thing to do.”

Cline finds inspiration for that idea from his peers in Minnesota. Following the August 2007 Interstate 35W bridge collapse that killed 13 people and injured 145, Minnesota’s bar provided its largest-ever pro bono representation of victims. A unique consortium of 17 firms represented clients free of charge, resulting in three years of litigation and a $52.4 million settlement last year with the engineering company responsible for inspecting the bridge.

That lawyer-driven effort received national publicity, and it led to that state creating a $36.64 million fund for the victims. A $1 million cap was in place at the time of the tragedy. The attorneys worked with Minnesota lawmakers to ensure the legislation to raise the cap for that single incident was worded to exclude any attorney fees.

“That could happen here in Indiana,” Cline said.

Tony Patterson with Parr Richey Obremskey Frandsen & Patterson in Lebanon is in the group discussing pro bono options for state fair victims. A steering committee has been created to work on hiring specific experts and sharing information so costs are not duplicated. Investigation and liability details aren’t fully known yet, so attorneys aren’t able to grasp at this point what expense they might be undertaking in this litigation and what it might cost to pursue these actions.

“Each firm is going to have to work with their clients and decide what makes sense and is fair and reasonable, and all of us understand that this isn’t something we’re doing to make money, but it costs money to do this,” Patterson said. “But I’ll tell you, just talking about this communal aspect has been pretty refreshing. No matter what other lawyers decide, this is a good discussion that we should all be having about what we do for a living.”

Indianapolis firm Cohen & Malad announced it is waiving fees for clients, but only on the state-focused claims. The firm’s proposed class-action lawsuit filed in Marion Superior Court in late August was on behalf of a woman who wasn’t physically injured but had “severe emotional trauma” from witnessing the stage collapse. Managing partner Irwin Levin said the suit is designed to include all victims who are dealing with injuries and emotional stress but might not realize it within the 270-day notification period.

Levin

Levin said that fees have nothing to do with the issue of raising the cap and that the limit is arbitrary and the Legislature should follow the lead of Minnesota.

On behalf of the Defense Trial Counsel of Indiana, Terre Haute attorney Scott Kyrouac said any pro bono effort should be aimed at helping those who couldn’t otherwise obtain legal services and not to satisfy “a hidden agenda.”

“In determining if the amount of the cap is appropriate, there should be open discussions with exchange of facts and studies so that the Legislature can determine what changes, if any, are appropriate,” he said. “If there needs to be an exception to the statutory cap in the case of mass catastrophic injuries, then an informed Legislature is best to decide the same.”

Early legislative response

Rep. Ed. DeLaney, D-Indianapolis, has already voiced his support for increasing the cap for victims in this situation but has been informed by the legislative leadership that early hearings won’t be scheduled. He says he will use “every legislative maneuver” to have the cap adequacy debate sooner, and he says that many side issues may arise, such as allocation and how legal fees might be handled.

“I don’t like broad comments or implications about it being improper for a lawyer to take a fee, because that’s not my understanding of capitalism,” DeLaney said. “I’m proud of the lawyers who do that, and think it’s honorable and wise, but I won’t criticize any attorney who takes a fee for this type of complex case. I think we need to raise the limit, but it seems to me that there are other issues in this mud fight and none of those side debates help people in this situation.”

Kenley is skeptical of the increase overall and said he believes any cap increase should apply across the board and not to a specific situation such as the state fair stage collapse. The Legislature should wait until the investigation is complete and liability is clearer to have that discussion, he said.

“If the tort cap needs to be raised, we should look at all the possible situations,” he said. “If you’ve waived fees in this one situation, I don’t see that as having a bearing on how we address the cap overall.”

Still, Cline hopes more lawyers embrace the idea of what he describes as “an unprecedented showing of generosity” to the likes we haven’t seen here before, sending a good-faith message to state legislators.

“I can just hear the lawmakers in Indiana say it now: that the lawyers would get some of this money, that it’s the ‘Plaintiffs Attorney Compensation Bill.’ We have the power to diffuse that before it happens.”•