Deep pocket files: Plaintiff: McDonald’s should’ve warned me and my boss not to be gullible

by Ted Frank on September 24, 2006

McDonald’s week continues on Overlawyered (Sep. 22; Sep. 20). McDonald’s is being sued over a trend of strip search hoaxes we discussed two years ago.

Here, a caller from a payphone in Florida tricked a Hinesville, Georgia, McDonald’s male manager and 55-year-old male employee into strip searching and molesting a 19-year-old female employee, who put up with the telephone-instructed molestation for thirty minutes before putting an end to matters. The franchise immediately fired the two men three days after the February 2003 incident, and offered the female victim counseling and a new job, but she instead quit and sued the franchise and McDonald’s. McDonald’s did warn the franchise (and other franchises) about the hoax in 1999 and 2001, (and the McDonald’s training manual now explicitly rules out strip searches of employees rather than relying on common sense) but such warnings are, of course, evidence that they should have warned more, according to the plaintiffs. The district court threw out the suit against McDonald’s, and many of the claims against the franchisee.

The defendants’ attorneys apparently have little faith that the law will have the common sense the employees lacked and blame the appropriately responsible parties rather than the deep pockets: to avoid liability they are buying into the plaintiff’s theories and seeking to blame each other in September 15 arguments before the Eleventh Circuit on interlocutory appeal. Some more aggressive defense might have had an effect: “The whole thing is really stupid,” said Senior Judge Peter Fay. (Alyson M. Palmer, “Bizarre ‘Strip-Search Hoax’ Case Before 11th Circuit”, Fulton County Daily Report, Sep. 25).


Anticipating arguments for the plaintiff that anti-reformers might make:

1. That a dozen (or even a few dozen) people have fallen for the scam in the past shouldn’t create a duty for the restaurant. We’re only hearing about the telephone calls that succeeded, and we don’t know how many managers hung up on the prank caller.

2. Every failure-to-warn case is second-guessing with 20/20 hindsight. Any given warning could always be made stronger: print it in bolder text, or with a larger font-size, or in bright red. And if a corporation does shout every warning from the rooftops, as Merck did in the Vioxx cases, you can do what the plaintiffs are doing in the Vioxx cases: complain that the defendant warned about so many different things, that they “buried” the important warning, and thus failed to warn that way. Overwarning is a real danger: when one buys a new car, it invariably comes with a 300-page manual with a warning or two on every page. Do you know what each of those warnings are? I’ve had my Prius for 33 months and I sure don’t, and I’ve litigated failure-to-warn cases. Because plaintiffs’ lawyers have forced the manufacturer to include every idiot-proof possibility in the manual, I end up less warned because I don’t spend the time trying to sift the obvious from the non-obvious warnings.

3. At the end of the day, there are four responsible parties: the malicious phoner, and the three people in the restaurant who didn’t use common sense. (The minute the plaintiff withdrew consent, the strip search stopped; the males acted inappropriately and stupidly, but not criminally.) The liability system, however, gives the incentive to seek blame in the deepest pocket, whether or not that party is the most culpable or even, if one buys into this theory of tort law, the cheapest cost avoider. The adversarial legal system ceases to be a quest for the truth, and turns into a game-show of whether the attorneys can trick a judge and jury into blaming the wealthy bystander. It doesn’t have to be that way: once upon a time, rules required a defendant to be the proximate cause of the harm, and cut cases like this off at the knees. It’s ironic that reformers are being accused of “deforming” the system, when it’s the plaintiffs’ bar that caused the original deformation, while reformers are seeking rules that restore common sense to the law.

Update: Here’s a comprehensive October 9, 2005 Louisville Courier-Journal article on the hoax, which apparently was the work of a single Florida man; since his arrest, the prank calls have stopped. Plaintiffs in a Kentucky suit are complaining that McDonald’s was too slow to implement a proposed plan to add a sticker to every McDonald’s phone warning managers of the hoax. Check the comments for more details.

Update, Oct. 5: affirmed.

{ 9 comments }

1 Peter Nordberg 09.24.06 at 2:29 pm

One lesson to be drawn, here, may be that our educational system is in serious disrepair.

That said:

(1) A few dozen times? Often enough that it has repeatedly been covered in the press? Often enough that it’s a “trend“? To me, this is all sounding pretty foreseeable. I’m betting that if it happened just one time at Sullivan & Cromwell, they’d be on it pretty quick.

(2) According to the law.com story, McDonald’s warnings came in corporate memos from five or more years ago. The story also mentions (though your post doesn’t mention) that the franchise says it didn’t receive any warnings. Meanwhile, there is no information, from you or the law.com story, about whether the warnings rose above the pro forma note of nonalarm commonly sounded in corporate CYA communications — i.e., about how seriously the problem may have been taken. Yes, apparently McDonald’s does now include a strip-search prohibition in its training manual, but it’s unclear from the news story whether the manual advises trainees of this scam, or simply discourages its managers from arbitrarily requiring employees to get naked. Does it not matter, what steps the company took? It doesn’t, I guess, if it’s taken as a premise that the company should simply be immune from suit here, no matter what it did or didn’t do. But if that premise is rejected, the character of its response seems germane.

(3) More generally, you don’t really argue that the facts of this case prove your claim about the undesirability of failure-to-warn theories in general. You argue instead that “reforming” (for which I read abolishing) failure-to-warn theories would have the effect of forestalling this suit, no matter what the facts are. That’s fine, but depending on those facts, this case actually might be seen as a counter-argument to the whole abolitionist position.

(4) It seems dubious to me, in any case, that this case should be assimilated to the product warning label context. Once you grant that the corporation might have any duty to take some steps here — and yes, I know that’s your sticking point — then any corrective measure, seemingly, would involve communicating with its franchises and alerting them to the hoax. This seems more analogous to the supervision of employees than to labels warning consumers of latent dangers in products.

(5) As for the franchise itself, there’s this much to be said for the longstanding doctrine of respondeat superior: It will be a while, I suspect, before this happens at the same franchise again.

(6) I suppose legal doctrine leaves the defendants free to pursue a “consent” defense here if they really want to. But to me, it seems a little unchivalrous to accept that bland characterization so casually. We’re discussing a teenage girl, who may be very dependent on her job and her managers’ favor, and who may not understand very well how lines of law-enforcement authority in our country are drawn. In fact, if I wake up tomorrow morning to read that the Supreme Court has taken certiorari on the question whether police may outsource strip searches in exigent circumstances, I won’t necessarly assume that the story is a parody. And I’m a lawyer.

(7) It seems surreal to me that someone would see the occurrence of a lawsuit as the primary problem in this whole unfortunate train of events. This sort of thing can produce emotional scars that last a lifetime. It would be responsible corporate behavior, once alerted to the existence of this scam, to take it seriously and adopt an effective plan, to prevent it from recurring even once. From where I sit, that’s what common sense should tell us.

2 Ted 09.24.06 at 4:09 pm

Thanks for writing, Peter. Responding point by point, using the same numbering.

1) The incident occurred in 2003, and articles in the mainstream press started appearing in 2004. But even if it was earlier than that, that matters are in the press are hardly dispositive: after all, bagel injuries made it to the front page of the Washington Post, but that doesn’t require bagel or knife manufacturers to warn of the foreseeable injury.

2) This is precisely the sort of hindsight second-guessing I’m talking about. If a memo isn’t enough because there was a louder possibility available, how do you warn for anything when everything is required to be warned at at the loudest level to avoid liability?

4) I note merely that every defendant in a failure-to-warn situation, be they a franchisor, an auto manufacturer, or a pharmaceutical company, is in a damned-if-they-do/damned-if-they-don’t situation, because every warning is judged in hindsight and in isolation, and the very fact of an incident is used to “prove” that a better warning would’ve made a difference, never mind the costs of overwarning on overall safety. This is more than hypothetical, because Merck has faced punitive damages for simultaneously doing “too little” and ‘too much” warning.

5) It seems to me that the franchise did the right thing: it fired the two men, offered counseling and a new job to the woman, all at material cost to itself. What more can someone reasonably want?

6) One can feel some sympathy for the victims here (the two men suffered adverse consequences, and the fear of legal prosecution for their stupidity, and the inadvertent molester is as likely to be mortified as anything else) while at the same time recognizing they are the ones primarily responsible for their fate. I feel bad for the napping Verizon repairmen who got fired, too, but he certainly brought it on himself. At what point do people have to take responsibility for their own stupid actions? What if the caller asked the plaintiff to dip her hands in the boiling french-fry oil to search for a missing diamond ring? We trust this woman to vote and to drive an automobile, we as a society should be able to trust her with her own personal autonomy.

7) I never claimed that the lawsuit was the primary problem here; it’s just the event that is within the scope of this weblog. The primary problem here is a perverted prank caller, and perhaps the educational system that allowed three adults to be fooled like that. Out of everyone in the case, the franchisee is, at most, the fifth-most culpable, and McDonald’s the sixth-most culpable, to the extent they have any culpability at all.

We have a system that encourages lawyers to try to hold the remotely culpable liable if they have deep pockets. As a result, culpable wrongful actions are being under-deterred, the creation of wealth is being over-deterred, and sophism is being over-incentivized.

3 Peter Nordberg 09.24.06 at 5:54 pm

Always a pleasure Ted. I’m going to limit further comment to your remarks on point (4).

With consumer goods, I think the conspicuousness of the warning (its “loudness,” as you call it) shouldn’t usually be material. If the warning is there at all, intelligibly phrased in a location where the consumer can locate it if he tries, that’s enough for me — at least as regards a failure-to-warn claim. The consumer is on notice. If the consumer doesn’t want to take the trouble to open the glove compartment and look at the manual, or get out his reading glasses to check out the fine print, that’s up to him, but it should put a serious damper on failure-to-warn liability — unless perhaps we’re discussing products specifically marketed to children, blind people, or sailors.

I don’t really know enough about pharmaceutical litigation to comment with authority. But to my mind, “loudness” shouldn’t be much of an issue where the warnings are issued to learned intermediaries. We go to physicians partly because of their expert acquaintance with the effects of pharmaceuticals, and it’s reasonable to have a system that places substantial reliance on those physicians (and pharmacists, too) to research those effects and be knowledgeable about them.

The McDonald’s case seems different to me. It does not seem like a case where the defendants should be able to argue that any warning, however inconspicuous, to whomsoever issued, should exonerate them. It seems to me that as with other issues of workplace safety, the preventive steps that a responsible employer (or franchisor) might take should depend partly on the magnitude and foreseeability of the risk, as well as the potential severity of the harm. I gather from the press reports that McDonald’s has taken the position that its warning memoranda weren’t actually intended for the protection of franchisee employees at all. I also gather that the franchisee in this case claims to have been blissfully unaware of the whole problem, in which case it’s doubtful that the franchisee transmitted any warning, conspicuous or otherwise, to the employee herself. It’s fair to conclude that neither entity did anything specific to protect her.

Again, I don’t claim to know all the facts. But I find it hard to rule out, a priori, the notion that more should have been done. After this has happened a few times, I think maybe a minute should be devoted to the issue during orientation. Given those sixty seconds, I’m pretty sure that without much effort, we could fashion a cautionary presentation that would make a lasting impression. It’s not the only issue to be covered in orientation, obviously. And if we covered 480 such issues, orientation would take a whole additional working day. But the harm here seems substantial.

Severed fingers in the chili are a rare event too. But I bet that Wendy’s employee orientation has that issue covered.

4 Ted 09.24.06 at 7:00 pm

Peter, I appreciate that you take such a reasoned position on failure-to-warn claims, considerably more forgiving than the plaintiffs’ bar as a whole.

It thus pains me that I must object to your notion “But all they had to do was spend one minute on it.” That assumes that one minute would work, because if it didn’t, the attorneys argue “They only spent one minute on it!” Or, if something else happens, “They spent a full minute warning employees not to strip search one another, but no time on [obscure event X that actually happened]!” Again, this is a hindsight issue: well after McDonald’s changed its manual and included extensive warnings specific to the scheme, this still happened at restaurants.

Trivia side note on how rare an event we are talking about here: in April 2004, a similar prank was played on a Kentucky McDonald’s. The manager asked an employee to conduct the strip search; the employee refused, so the manager called in her fiance, Walter Nix, to conduct the search, and Nix followed instructions to spank a nude employee and have her perform a sex act. The call was traced to a pay phone in Florida, the calling card used was traced to a Wal-Mart, security tapes revealed that the card was purchased by a David Stewart, who has been arrested and charged. (Nix was charged with sodomy and sexual assault.) Since Stewart’s arrest, there have been no other reported incidents. “Phone records show he sometimes called as many as 10 stores before finding one where managers would take his bait.”

Separately, though I haven’t seen the Wendy’s employee manual, I’m skeptical that they have a lesson reserved for fingers in the chili. They may well have a generic procedure to call the main office if someone looks like they’re about to make a legal claim.

5 Mr L 09.25.06 at 12:25 pm

It seems to me that the franchise did the right thing: it fired the two men, offered counseling and a new job to the woman, all at material cost to itself. What more can someone reasonably want?

A million dollars? Haw haw.

Seriously though, McD’s did everything reasonable in this case, and it’s a damned pity they’re being punished for it. I suppose a cynic might note that were strip searches official policy, most of this woman’s claims would evaporate.

6 Jim Collins 09.25.06 at 1:04 pm

Peter,
You made the statement “intelligibly phrased in a location where the consumer can locate it if he tries”. I have a couple of questions. How do you define “intelligibly phrased”? How would you define “location where the consumer can locate it if he tries”? There has ben everything tried from simple phrases to symbols used to try to warn someone of a potential hazard. Always there is someone who says that they didn’t understand the warning. Your statement about the consumer about their trying to find the warnings requires that a person actually makes an effort to do something. Neither of these will prevent lawsuits. There has to be a firm determination made as to where the manufacturer’s duty to warn ends and the personal responsibility of the consumer begins. Until this happens there will never be any type of reform.

7 Peter Nordberg 09.25.06 at 3:29 pm

Jim,

I blame myself for now getting caught up in a digression from a digression.

My primary point was to distinguish the McDonald’s phone-scam case from cases involving the adequacy of product warnings. In the course of doing so, I was trying to respond to Ted’s point about the conspicuousness of product warnings, and to specify contexts in which I agreed that the degree of conspicuousness shouldn’t matter, so long as an otherwise sufficient warning is there. When there should be a product warning in the first place, or how explicit it should be, or what would make such a warning misleading — these are all difficult issues that I thought we didn’t need to get to the bottom of, in order to reach basic agreement on the narrow conspicuousness issue (in the products context). No doubt I sacrificed the purity of my expository agnosticism on those points when I added the caveat that the warning should be “intelligibly phrased.” I regret the error. My intent was to prescind from debates about the adequacy of the warning’s content, and focus exclusively on complaints involving the size of the typeface or the warning’s location in the manual.

Preventing lawsuits, of course, is a policy goal that sane people can reasonably espouse, but espousing it is not a necessary condition for sanity. In my view, there should be some lawsuits. I’m less inclined to believe that we have too many than to believe that we’ve made them too expensive and complicated, and that we often have the wrong *kind* of lawsuits. But even people who think there should be fewer lawsuits mostly agree that reducing their number is one policy consideration among many, and also that there are multiple ways to further that goal — including reducing the number of injuries.

I do think my concession on the conspicuousness point should in fact make a substantial number of products suits harder to bring than they would otherwise be. But I also think it might reduce the injuries that occasion lawsuits, if we moved toward a regime in which at least some disincentives and logistical impediments to the issuance of warnings were removed. One common complaint about warnings is that if you try to fit them all in the manual or on the packaging, each warning will be drowned out by the white noise made by all the warnings together (or so, it is feared, some plaintiff’s lawyer will argue). Personally, I’m willing to bargain that problem away. I’m willing to agree that if the manufacturer puts them there, the consumer will be conclusively presumed to have read them (unless a child or an incompetent). That may not be everything the Chamber of Commerce might want. But it is something I’m prepared to give it for free.

– Peter

8 Jim Collins 09.26.06 at 5:50 pm

Peter,
I don’t think that your statements were that much of a deviation from the main subject of this discussion. In my opinion the main subject here is where does liability stop and common sense take over? It is impossible to think of every possible situation and have the appropriate warning, policy or rule, right there ready to go. If you were omnipotent enough to have done this, there is no way to ensure that the consumer, employee or customer will abide by them. At what point has the manufacturer, employer or seller done enough to allow the responsibility to be transferred to the consumer, employee or customer? This has to be the largest Catch-22 in existance. No matter what you do you haven’t done enough or it is the wrong thing.

9 Peter Nordberg 09.27.06 at 1:45 am

Jim,

Pending wider general agreement on what constitutes “common sense,” I am forced to offer my proposals despite my possible lack of it.

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