Cruise Line’s Appeal Backfires: Appellate Court Overturns Limit on Medical Damages

A federal appellate court on Friday affirmed a $1.2 million jury award to a woman who broke her arm after tripping over a bucket on a cruise ship.

That may have been the least significant part of the ruling in Higgs v. Costa Crociere S.P.A. Co.

In the same decision, the 11th Circuit Court of Appeals abolished a longstanding practice by South Florida federal judges to limit medical damage awards in maritime cases to the amount paid. What’s more, the panel upheld jury instructions that told jurors they could assume the cruise line was trying to hide something because it had concealed evidence.

Houston personal injury attorney Robert Chaffin said it’s been a long fight for his client, Michigan resident Joyce D. Higgs, who is now 73. Two juries have awarded damages of more than $1 million. He said the company that owns Costa Cruises didn’t offer his client a penny for her claim until trial.

“Cruise lines, when dealing with injured people, kind of take a hard line,” he said during a telephone interview. “They make you work for your money, if you know what I mean.”

Higgs tripped over a bucket filled with dirty water after loading her plate at the breakfast buffet while abroad the Costa Luminosa on Christmas Eve, 2014. She said the bucket was placed behind a corner, so she did not see it as she turned. The fall broke her humerus and caused a permanent shoulder disability, Chaffin said.

Chaffin sued the Italian cruise line, Costa Crociere, for negligence at its home base in South Florida and won at trial. A jury awarded about $1.1 million in damages and deducted 15 percent to account for Higgs’ degree of fault. The 11th Circuit overturned the award, finding that the trial judge had inappropriately excluded evidence that Higgs had fallen down several times before.

The case went to trial again, this time with evidence about Higgs’ alleged propensity to fall presented to the jury.

Chaffin said while he prepared for trial, Costa did not disclose during discovery that one of its security employees, Kavita Kamble, had investigated Higgs’ accident and had taken photographs of the scene. Higgs’ grandson, who was also on the cruise along with several other family members, tried to take photographs but cruise line staffers blocked his access. The grandson, however, was able to see Kamble taking photos.

When responding to discovery requests, the cruise line’s attorneys said there were no photographs taken of the scene. Incensed, Higgs’ attorneys filed a motion for discovery sanctions. Costa argued that Kamble’s photos were privileged.

U.S. District Judge James I. Cohn granted Higg’s sanctions motion, saying the discovery violation was “egregious.” He approved instructions that the jury may make an “adverse inference” because the cruise line did not reveal Kamble’s investigation or her photographs.

The second jury also found in Higgs’ favor and awarded about $1.1 million in damages for pain and suffering, plus about $61,000 for medical costs.

Costa appealed the verdict, arguing that the jury’s findings were not supported by evidence and that the jury instruction had unfairly prejudiced the jury against it.

The 11th Circuit disagreed.

“The evidence showed that a Costa employee placed a bucket — more than one foot tall and filled with dirty water — behind a blind corner in a highly-trafficked breakfast buffet pathway,” the appellate court said. “That this placement would pose a danger of tripping would have been obvious to anyone, including to any employee who knowingly placed the bucket there.”

The appellate panel also upheld the jury instructions, saying Costa’s failure to reveal the identify of Kavita Kamble, despite the district court’s order to disclose all evidence, was a serious violation of discovery rules.

“Indeed, because Costa concealed her identity throughout the first trial and disclosed it only two weeks before the second, Higgs has never had the opportunity to depose her, and we still do not know what she might have said,” the panel said.

Higgs’ filed a cross-appeal that raised the issue of medical damages. The jury found that Higgs should be awarded the amount that doctors billed for her injury — about $61,000 — not the $16,000 that her health insurer, United Healthcare, paid for her treatment.

Chaffin said it is the practice of judges in the South Florida District to limit medical damage awards to the amounts actually paid. He said he had appealed rulings that imposed limits a few times before, but Higgs’ case was the first time his argument was addressed in a ruling.

The 11th Circuit said courts have long held that damage awards should not be offset by amounts paid by third parties. For example, if a woman’s car is destroyed by an accident, it should not matter that her rich uncle bought her a new car to replace when determining the amount of damages. The principle is known as the collateral source rule.

The appellate panel said a jury award for medical damages should not be reduced because the injured party had purchased insurance that covered those costs; plaintiffs are entitled to recover the reasonable value of treatment for their injuries, regardless who pays for the expenses.

On the other hand, determining the value of medical services is a tricky question because medical providers habitually bill for far more than they are paid. The panel said the amount paid for services can vary greatly depending on contracts that have been negotiated by health insurers.

Some courts have found that awarding damages based on the amount billed will lead to large overstatements of value, and so have limited awards to the paid amounts. But the 11th Circuit said limiting recovery to the amount actually paid would in effect result in uneven recoveries for plaintiffs who suffered similar injuries. For example, a person who receives care through Medicare would be paid less because the federal government drives a harder bargain than private insurers.

The court said it also would not oppose allowing defendants to enter into evidence the amount that a plaintiff actually pays for medical services.

“For these reasons, we hold that the appropriate measure of past medical expense damages in a maritime tort case is the amount determined to be reasonable by the jury upon its consideration of all relevant evidence, including the amount billed, the amount paid, and any expert testimony and other relevant evidence the parties may offer,” the court concluded.

Chaffin said the ruling will be important in future cases where medical damages are in question. “It’s a big thing,” he said.

“The rule adopted now is that both parties can offer evidence as to the reasonable and necessary costs of the medical procedures/services involved,” he explained in an email. “Jury could conceivably award full amount of bills, amount of bills actually paid or something in between. Pretty much a new rule for methodology of awarding medical costs but it makes good sense.”

The cruise line’s attorney, Richard J. McCalpin in Miami, did not respond to an email requesting comment on Friday afternoon.

About the photo: The Costa Luminosa is shown. Courtesy of Costa cruise lines.