Podcast: Discussing Florida Tort Reform with William Large and Tiffany Roddenberry

Nate Adams: Welcome to our Florida Capital Conversations podcast series. Today, our subject is Florida Tort Reform, and our guests are William Large and Tiffany Roddenberry. My name is Nathan Adams. My co-hosts are Mia McKown and Brent Cooper. We are so pleased that you have joined us today to consider another important issue associated with state government affecting the business community and our daily lives as Floridians. Well Mia, let's get started.

Mia McKown: Good afternoon, everybody. William, it's so good to see you today and have you here on our podcast. As we talked a little bit before, never did we think probably back in the day when we were at the University of Florida, that we would be here on a podcast doing this, talking about important issues going on in our state. I know a lot about your history, but why don't you tell us a little bit about your background and what you're doing here in Tallahassee as it relates, because after all, we're here about capital conversations.

William Large: Thank you for having me. Yes, a little bit about my background, I went to undergrad and law school at the University of Florida. I practiced insurance defense litigation in Orlando for about seven years, where I represented hospitals, doctors and nursing homes in primarily medical malpractice cases. I had a unique opportunity to come to Tallahassee in 2000 to work in the Bush Administration. I was the general counsel at the Florida Department of Health. I worked on several civil justice reform issues, including medical malpractice reform in 2002 and 2003. And from there, I served as Governor Jeb Bush's Deputy Chief of Staff in 2004 and 2005. And I've been running the Florida Justice Reform Institute, which is a 501(c)(4) advocacy organization that advocates for tort reform in all three branches of government since late 2005.

Mia McKown: Well, as it relates to tort reform, it seems like I mean, I wasn't too far behind you moving to Tallahassee in 2002, and it seems like during our legislative session there often talking about different tort reform measures and things of that nature. I know there was quite a bit of activity in this area this session, which is what we're here to talk about. But is there a little bit of, you know, kind of a history of tort reform that you can provide our audience just to kind of give them a little bit of a snippet of what's happened in Florida? And even to a certain extent, I mean, is Florida unique with tort reform or other states doing other things historically?

Tort Reform History and Background

William Large: Yeah, I think that the concept of tort reform or lawsuit abuse reform or civil justice reform, that's something that really I think took hold around the country beginning in the early 1990s. You saw this happen in Texas in the mid-1990s and other states. And the idea is to make our civil justice system more fair and equitable for all of Florida's citizens and not push the scales of justice in favor of either plaintiffs or defendants. And many people felt that the scales of justice had been pushed in favor of the plaintiffs over the years, and as a result many organizations, many stakeholder groups began to advocate for reforming our civil justice system. In Florida, we've seen a lot of these debates take place in various different years. It occurred in 1999, medical malpractice reform in 2002, 2003. You saw very specific issues, whether the slip and fall litigation or products liability litigation or litigation with respect to one way attorneys' fees issues. Those issues pop up from time to time. But here in 2023, this became a very important subject for Governor Ron DeSantis, and it presented itself again. So it's got a long history in the country and a history here in Florida as well.

I think that the concept of tort reform or lawsuit abuse reform or civil justice reform, that's something that really I think took hold around the country beginning in the early 1990s... And the idea is to make our civil justice system more fair and equitable for all of Florida's citizens and not push the scales of justice in favor of either plaintiffs or defendants.

Tort Systems Across the U.S.

Nate Adams: Tiffany, can you tell us a little bit about tort systems across the United States, what they look like and kind of how this new tort reform legislation fits into all that?

Tiffany Roddenberry: Sure. Well, I guess "tort system" is a very broad term, but generally we're referring to torts, which are causes of action brought by plaintiffs against defendants, premised on ideas of things like negligence or battery or assault. So it's a system of civil liability where if the plaintiff is wronged in some way, they have recourse, they can potentially sue the person who caused harm or damages. So the topics covered by this legislation are very broad. They cover everything from negligence to bad faith, which I'm sure are both topics that William could speak in greater detail about. But all of these concepts can be found across the country. I think particularly with something like comparative negligence previously, Florida followed pure comparative negligence, which meant that if the plaintiffs, regardless of the fault of the plaintiff, they could recover in proportion to however the defendants if there was consideration of both the fault of the plaintiff and the defendant. Under this legislation, Florida is moving to modified comparative negligence where there's a threshold now that if the plaintiff is at fault for their own injury to a certain percent, which I think is 50 percent or greater, then they can't recover from the defendant. The systems of comparative negligence versus contributory negligence, if there's even a little bit of fault that's attributable to the plaintiff, they can't recover. Modified comparative negligence instead weighs those, and there's a threshold which if the plaintiff's fault meets that threshold, they can't recover. But if it doesn't, they can otherwise recover from the defendant. So, Florida's moving to modify comparative negligence through this legislation, but that is something that's followed in probably about 35 states at this point. So it's actually the norm. Other concepts like bad faith, I think are just particular to Florida. So some of those concepts are probably unique in the legislation and you wouldn't find those necessarily in other states.

'Tort system' is a very broad term, but generally we're referring to torts, which are causes of action brought by plaintiffs against defendants, premised on ideas of things like negligence or battery or assault. So it's a system of civil liability where if the plaintiff is wronged in some way, they have recourse, they can potentially sue the person who caused harm or damages.

Comparative Negligence Liability System Example

Brent Cooper: So let's talk a little bit about the change to a modified comparative negligence liability system. Can you walk us through what it would look like for plaintiff A, who is 60 percent at fault for his or her injuries and plaintiff B, who is 40 percent at fault for his or her injuries? What difference does this bill make to each of those two hypothetical plaintiffs?

William Large: Yeah, thanks, Brent. That is contained in Section nine of the bill. And I think what the legislators were trying to address is, who actually caused this accident to occur. So let's take a fact pattern: someone who is 60 percent at fault on a $1 million verdict. In that fact pattern the defendant — in my hypothetical there's one plaintiff and one defendant — and the plaintiff is 60 percent at fault and the defendant is found by the jury to be 40 percent at fault. That means the defendant owes $400,000. Point four times a million. I think a lot of the legislators struggle with that, saying, well, if you're 60 percent at fault, maybe you were the main contributing cause to this accident and you shouldn't be able to recover. So now, as a result of HB 837, because in this hypothetical, the plaintiff is 60 percent at fault, they wouldn't be able to recover at all.

Reform to Insurance Bad Faith Claims

Brent Cooper: Well, Tiffany is right that the bill does cover quite a range of topics. And I think it'd be helpful to go through each of those topics and really address what reforms the bill makes. So, William, can you talk about some of the changes that were made to claims for insurance, bad faith? And for starters, if you could explain to our audience what insurance bad faith is and then what reforms the bill makes to those claims.

William Large: Sure. If you look at Section four of the bill, it deals with third party bad faith, and what was occurring in Florida when three things were present — low insurance limits, clear liability and extraordinary damages well in excess of the low limits, such as a death, a quadriplegic, a paraplegic — when those three things were present, most plaintiffs’ attorneys did not want to settle the case for the insurance limits. On the other hand, the insurer was attempting to settle the case as soon as possible, but many times insurance companies were being set up for what is known as a third-party bad faith case. And their actions in trying to settle the liability case were looked at. And oftentimes, no matter how quickly the insurance company was trying to tender the limits, if they tendered on day 14, there would be an argument that they didn't tender quick enough. So, what this bill addresses is primarily the time frame that allows an insurer to tender. So, in Section four of the bill and Subsection four of Section four, there is a 90-day safe harbor. If an insurer tenders within that time frame, they cannot be held in bad faith over and above the policy limits. And this is an opportunity for an insurer to tender. Previously, the law in Florida, which still remains under a case called Powell v. Prudential and these are known as Powell claims, insurer has a duty to tender in the absence of a demand where the facts and circumstances are clear that there is clear liability. But what wasn't clear was the time to tender. Now, this law makes that very clear. The insurer will have 90 days to tender. And that will create a safe harbor for the insurer. And they won't be held in bad faith if they do that over and above their policy limits, if they tender within 90 days.

So, what this bill addresses is primarily the time frame that allows an insurer to tender. So, in Section four of the bill and Subsection four of Section four, there is a 90-day safe harbor. If an insurer tenders within that time frame, they cannot be held in bad faith over and above the policy limits.

Changes to Attorneys' Fees Provisions

Brent Cooper: Can you also talk a little bit about the changes that were made to the entitlement to attorneys' fees in insurance cases? I think that was a pretty prominent part of the bill that a lot of people have discussed. If you could walk us through those changes, that would be helpful.

William Large: Yes. Section two, Section 10 and Section 11 of the bill deal with an issue with respect to one way attorneys' fee provisions. There are two one way fee statutes affected here. One is Florida statutes 627428. And the legislature abrogated that statute in Section 11. And the other is the one way fee for surplus lines, 6269373. And the legislature abrogated that statute in Section 10. And what I think a lot of legislators and policymakers were struggling with is that there was a lot of litigation over low dollar amounts. So what the one way fee was doing was it was encouraging litigation over small dollar amounts, such as lawsuits over a dollar, $10, $100. And the legislature wanted to address that. Now, they also addressed something else by creating a new provision in Chapter 86 for declaratory actions, and that is if there's a denial of coverage completely, an insured is entitled to fees in that case. And that's Section two of the bill. So you kind of got to read Section two, Section 10 and 11 of the bill together. And that was sort of the logic that the legislators had put together when addressing that issue.

And what I think a lot of legislators and policymakers were struggling with is that there was a lot of litigation over low dollar amounts. So what the one way fee was doing was it was encouraging litigation over small dollar amounts, such as lawsuits over a dollar, $10, $100. And the legislature wanted to address that.

Mia McKown: Is kind of the thought behind that, William, that they want the cases to actually be about real issues and harm and not just about lawyer fees? Is that kind of the concept behind it? Like you mentioned that the damages might be a dollar, but you know, these one way provisions, did the case end up being more about fees than it was about the harm?

William Large: Yeah, Mia you've hit the nail on the head there. I think legislators saw that in the property context in special session A in the tail end of 2022, and they also saw it in other contexts like PIP in auto glass cases where it wasn't about the amount in controversy. Instead, it was about the fees. So when you saw these lawsuits brought over $100, it wasn't about getting the insured $100, it was about the attorneys' fees associated with the litigation, over the $100. And I think that legislators felt that, that needed to be addressed because it was creating circumstances of vexatious litigation.

So when you saw these lawsuits brought over $100, it wasn't about getting the insured $100, it was about the attorneys' fees associated with the litigation, over the $100. And I think that legislators felt that, that needed to be addressed because it was creating circumstances of vexatious litigation.

Revisions to Medical Damages Calculations and Disclosure of Letters of Protection

Mia McKown: Let's talk about the, I guess, what we talk about, letters of protection, disclosures, LOPs. Can you tell us, if I recall, I think that's addressed in this bill as well. And maybe tell us a little bit about what that is and what changes have been made in that regard.

William Large: Yeah, that is in Section six of the bill. And an LOP is short form for a letter of protection, and it's a promise to pay a healthcare provider in the future when a verdict or settlement comes in. But what legislators were seeing with letters of protection is that they were grossly overinflated with respect to what the market price was for healthcare services in the relevant geographic area. So it wouldn't be unusual for someone to be injured and they had health insurance and they were being told by their attorney not to use their health insurance, not to see their personal physician, but instead see a physician that was referred to them by the plaintiff's attorney in question who would treat them under the letter of protection. And the letter of protection, the face value of it, it's like an IOU, it's a promise to pay in the future. The face value might be $80,000, but had the plaintiff used their health insurance, the charges may have been $10,000. The value of most negligence cases are really built upon the foundation of past medicals. The bigger past medicals are, the bigger the value of an overall case tends to be. In South Florida, the value of the case tends to be a multiple of about four times past medicals. In North Florida, it tends to be three times past medicals. So if past medicals were approximately $80,000 in South Florida, I'd expect a verdict to hit on a clear liability fact pattern of about $320,000. But if the past medicals were $10,000, I'd expect a verdict to come in at about $40,000. So there was an incentive, therefore, to increase past medicals through the use of letters of protection. And likewise the referral of the plaintiff to the treating doctor that was using the letter of protection that was protected by attorney-client privilege under a case called Worley v. YMCA, that was also addressed by this legislation, and now people will be able to expose that bias of that referral and juries will be able to hear how did the plaintiff get to the treating doctor that used the letter of protection.

[W]hat legislators were seeing with letters of protection is that they were grossly overinflated with respect to what the market price was for healthcare services in the relevant geographic
area.

Nate Adams: Tiffany, that opens up an obvious question about some of the evidentiary guidelines that are in this rule and what gets to be in front of a jury and what doesn't. Can you tell us a little bit about that?

Tiffany Roddenberry: Sure. So that's also in Section six of the legislation, and it creates a new statute in Chapter 768, describing the types of evidence that are admissible now — to show what William was talking about, both past medicals and future medical expenses — that a plaintiff might be seeking damages. And so it outlines the certain circumstances in which you can admit, what types of evidence might be admissible to show those damages. And I think it's largely getting at the collateral source rule, which otherwise forecloses the admission of certain collateral sources that might be available to recover the plaintiff's damages or medical expenses. And so the legislation pretty much breaks it down by the type of damages we're talking about. So for past medical expenses that have already been paid for, the statute says you're limited to essentially what was paid. That's the evidence that you could admit. When it comes to medical expenses that are technically already incurred but that are not yet paid, the legislation says here's the evidence that can come in, and same for future medical expenses that you want damages for. I think it's still fairly broad in allowing all of this information to come in. There is a provision later in the statute that ultimately says, though, that what can be recovered by the plaintiff’s damages encompasses what was described previously, which are what the evidence that's admissible to show those damages. But I think the point of the legislation is to try to limit damages to the actual reasonable, necessary medical expenses that a plaintiff has incurred or will incur in the future.

I think the point of the legislation is to try to limit damages to the actual reasonable, necessary medical expenses that a plaintiff has incurred or will incur in the future.

Attorney Fee Multiplier

Nate Adams: I noticed another aspect of this bill has to do with this so-called multiplier as relates to attorneys' fees and costs. Tiffany, can you tell us a little bit about what that means? That's not a term that, you know, ordinary parlance people refer to, but tell us a little bit about what the multiplier is.

Tiffany Roddenberry: Yes. And I don't even know that the legislation uses the term multiplier, but I can tell you that's what it's targeting in Section one of the bill, which describes generally how attorney's fee awards are calculated. And the basic way that you calculate that is the lodestar fee, which means what is the reasonable hourly rate of that attorney time multiplied by their reasonable amount of hours they expended on something. So it's pretty much a basic calculation. There are cases in which the Florida Supreme Court and other courts have said that when it's a contingency fee case, when the lawyers agreed to take on this matter and they're getting paid, it's contingent upon success, that perhaps in those cases we should apply a multiplier, which means we're going to take the lodestar, the basic calculation of hours expended times the attorney's hourly rate, and multiply that by one and a half to two times the amount. The idea being there should be some kind of consideration for the fact that it was contingent. To take a step back, that multiplier, there's, prior case law said that kind of multiplier would apply in only rare and exceptional circumstances. But a few years ago, the Florida Supreme Court ruled in a case called Joyce, they said no, that should not be limited to rare and exceptional circumstances. So this legislation is plainly meant to address that and to say that there is a strong presumption that lodestar be that basic calculation of hours times rate is a sufficient, a reasonable attorney's fee award, and that presumption may be overcome only in a rare and exceptional circumstance, which is arguably what the case law said prior to the Joyce decision.

Premises Liability Adjustments

Brent Cooper: One of the other areas that the bill affects is the issue of premises liability and when the owner or operator of a certain property can be held liable for different injuries that occur on that property. William, can you talk about some of the reforms the bill made to that area of the law governing torts?

William Large: Yeah, that area of the bill is Section seven and Section eight of the bill. Section seven deals with now the ability to put an intentional tortfeasor on the verdict form in a premises liability case. And I think what the legislators were hearing, they were hearing a lot of fact patterns where a tragic fact pattern had unfolded at an apartment complex where someone may have been assaulted or even murdered, and the plaintiff or the estate of the decedent brought a lawsuit against the owner of the apartment complex, claiming that their security was insufficient, arguing that there should have been better lighting, there should have been a deputy sheriff available for security. And under the law prior to the passage of HB 837, the only entities that can go on the verdict form were the defendant — in this case, in this hypothetical, the apartment complex. Now, the individual that had perpetrated the act will also be considered by the jury. And I think what was happening there is the legislators wanted the jury to hear all the facts that had led to the injury, including the acts of the intentional tortfeasor. Section eight of the bill deals with a presumption for apartment complexes if they do certain things. And if they do certain things, that creates an affirmative defense for them.

Mia McKown: One of the first cases that I handled actually was for my family, and it was a premises liability. We are not going to talk about how long ago that was, in the very beginning of my career, but fortunately, we did not have that type of situation that happened, but there was a property theft, and it was taking my parents who owned the property and trying to explain to them why they were responsible for something that really had nothing to do with them. They had never had any type of crimes or anything stolen off the property in the past to put them on notice that they needed to do anything or that people from the local hotel were actually parking on the property. So it does present a lot of, you know, issues and practical concerns for property owners. And so hopefully this will help in some way. What is the effective date?

Effective Date and Statute of Limitations

William Large: If you want to understand the effective date issues in the bill, look at Sections 28, 29.

Mia McKown: Are they staggered some or?

William Large: Well, Section 28 of the bill specifically addresses the statute of limitations issues. Now, let me just address the statute of limitations issue, because I said wade over to Section 28 of the bill. But in Florida, prior to this bill, a negligence action, the statute of limitations would have been four years. It is now two years because of this bill. Section 28 of the bill makes it clear that the accrual time has to accrue after the effective date of this bill. So that's what Section 28 addresses. Section 29 of the bill addresses instances where individuals have an insurance contract purchased prior to the effective date, and the insurance contract would run after the effective date. And the legislature made it clear with Section 29 that the provisions of the insurance contract entered into before the effective date are not affected. And there's a case called Menendez out of the Florida Supreme Court that addresses that. So that's what Section 29 of the bill addresses, and then section 30 addresses the effective date and all tort actions after the signing of the effective date will be under the new bill, absent the insurance contract issue in Section 29.

[I]n Florida, prior to this bill, a negligence action, the statute of limitations would have been four years. It is now two years because of this bill. Section 28 of the bill makes it clear that the accrual time has to accrue after the effective date of this bill.

Mia McKown: Well, in light of that, it's my understanding that there was quite a bit of activity in some of the courthouses across the state, where people I don't know if I read somewhere, but they were hurrying to the courthouse.

Tiffany Roddenberry: The race to the courthouse, yep.

Mia McKown: Right, race to the courthouse. Was some of that going on last week, Tiffany, for people not wanting to run out on their statute limitations or have the new portions of the bill apply to them?

Tiffany Roddenberry: Yes, that's my understanding. I think there's been some press about there was a definite uptick in filings, I suppose, on Thursday before the bill was signed. I know I saw some press indicating that there were clerks working overtime over the weekend to get everything, but presumably that is because of the effective date of legislation.

Impact on Florida Citizens

Nate Adams: Well, even more than that, I guess that raises, so what's the real, real world impact, you know, for the average Florida citizen trying to understand what does this mean for me? William, how would you describe that?

William Large: I think this is a big day for the average Florida citizen. I think that this bill is going to make our civil justice system more fair and equitable for all of Florida's citizens. I believe a lot of the litigation that we've seen and that the legislature heard about, legislature felt was a cost driver for all Florida citizens. And I think this is going to make our civil justice system beneficial for everyone.

I think that this bill is going to make our civil justice system more fair and equitable for all of Florida's citizens. I believe a lot of the litigation that we've seen and that the legislature heard about, legislature felt was a cost driver for all Florida citizens.

Nate Adams: William, is there anything we haven't touched on about the bill that you think is important to bring up?

William Large: I think that we've covered all the issues. I mean, I think this was extraordinary leadership on the part of the governor, on the part of Senate President and Speaker of the Florida House and the two main sponsors in the House and Senate, Senator Hudson and Representative Tommy Gregory. They spent a lot of time, effort and energy listening to stakeholders, getting these issues together, learning about certain issues with respect to our civil justice system. And they ended up having several committee hearings on these subjects and I think came up with a fair and equitable final product.

Mia McKown: Tiffany, is there anything else that you want to add to this? I appreciate both you and William kind of walking us through what's very complicated. But do you, is there anything else that we should probably let our audience know about that you think is super important?

Tiffany Roddenberry: I will say that I think this is a sea change in our civil justice system. I'm sure that as we've seen in the press, there's already been a lot of concern from the trial bar about these changes. So it will be interesting to see how all the changes unfold and how these provisions get applied in the courts.

I think this is a sea change in our civil justice system. I'm sure that as we've seen in the press, there's already been a lot of concern from the trial bar about these changes. So it will be interesting to see how all the changes unfold and how these provisions get applied in the courts.

Mia McKown: William, the burning question I want to know, is are our Gators going to be any better next football season?

William Large: My prediction is they are going to be better and we have a lot to look forward to next season.

Nate Adams: I want to thank William Large and Tiffany Roddenberry for this informative and interesting set of comments on Florida tort reform. And I also want to thank my co-hosts, Mia McKown and Brent Cooper. Most of all, I want to thank all of you for joining us today. Please plan to join us for our next Florida Capital Conversations podcast. Have a great day.