LEGAL: Jurors Strike Back

“A representative of a company will say whatever it takes to keep the company out of trouble.” True or false?

Vinson & Dimitrius, a Los Angeles jury consulting firm, asked 1,000 people if they agreed or disagreed with a series of statements about businesses. According to the survey, 72 percent of the respondents either agreed or strongly agreed with the quote above.

As reports of alleged business fraud and financial scandals continue to fill newspapers and television broadcasts, companies that find themselves in court discover that potential jurors are cynical about corporate ethics. A juror whose investment portfolio or IRA has dramatically decreased in value is unlikely to sympathize with any corporate misbehavior.

“You have an environment [where] the average juror is fed up, and feel[s] like there is a need for some significant justice to be done,” says an attorney who specializes in commercial and financial litigation.

Lawyers who defend corporations try to identify jurors with an anti-business bias who may try to retaliate by awarding large verdicts to plaintiffs. In July 2002, in a trial against Dearborn, Mich.-based Ford Motor Co., defense lawyers tried to gauge prospective jurors' attitudes by posing the following statement: “Corporate executives will lie to increase their profits.” Most of the jury pool agreed. The parties settled the case on confidential terms.

“You start out with [a] substantial number of people in the jury pool who are going to give less credence to [the] testimony of corporate executives just because they're corporate executives,” Ford's lawyer told The Wall Street Journal.

In another case, two former employees of an office equipment company sued the firm where they had worked, alleging fraud in connection with a stock-purchase agreement. The plaintiffs' attorney told a Tulsa, Okla., jury that, along with efforts at the federal level to deal with corporate integrity, they also should send a message. While it is not clear that the jury was sympathetic to their plea, it nevertheless awarded the plaintiffs more than $2 million in damages and, for good measure, another half million in punitive damages. In a post-trial interview, one juror confessed that the corporate ethical atmosphere had a “mild effect” when she addressed the punitive damages award.

While corporate defendants always have worried about public confidence, these days, the suspicion has become more wide-ranging and has reached new levels of intensity.

Jury consultants buttress these anecdotal reports with their own systematic studies. Los Angeles-based DecisionQuest, for example, told The Wall Street Journal that it found anti-business sentiments throughout the country based on approximately 200 mock trials it had staged.

The company's director of jury research cited a mock case involving a contract dispute where a juror reportedly said that misconduct by corporate management is a “disease that infects all big companies.” In another hypothetical case involving insurance coverage for pollution damage, a mock jury debated the likelihood that documents had been shredded. However, no evidence of shredded documents was presented, and no one claimed that any such thing had occurred.