What Is a Nuclear Verdict?
Nuclear verdicts refer to exceptionally high jury awards—generally, those exceeding $10 million. Such verdicts have become increasingly common in the past decade. In fact, a report from public relations firm Marathon Strategies stated that nuclear verdicts reached a 15-year high in 2023, with the number of such verdicts rising by 27% over those in 2022. Additionally, the report found that 27 of these verdicts were classified as “thermonuclear,” referring to jury awards above $100 million.
Various factors have contributed to these trends, including rising litigation funding, a changing legal landscape concerning liability laws and deteriorating public sentiment toward businesses. Amid growing corporate distrust, businesses are expected to meet higher operational standards and are being held more accountable for their wrongdoings. Upon being sued and taken to court, businesses frequently encounter juries sympathetic to plaintiffs. Moreover, there’s a growing perception—particularly among jurors—that businesses, especially large corporations, have the financial resources to absorb significant damages. This means juries may have fewer reservations when awarding substantial damages to plaintiffs, resulting in nuclear verdicts.
Nuclear verdicts can have far-reaching consequences for businesses of all sizes and sectors, including lasting reputational harm, underinsurance gaps and severe financial disruption. That’s why it’s essential for businesses to understand these verdicts and how to prevent them. This case study summarizes a recent nuclear verdict, outlines factors that led to the verdict, highlights associated compliance considerations and provides related risk mitigation measures.
$60 Million Negligent Hiring, Retention & Supervision Verdict
Case Details:
In September of 2018, a 54-year-old man suffered severe injuries, including a traumatic brain injury, after a security guard attacked him at the Texas Live! Entertainment complex in Arlington, Texas. The man, a former police officer and veteran, was struck over the head with a heavy glass mug, resulting in a severe laceration on his skull. Medical staff responding to the scene initially did not recognize the shards of glass embedded in his skin, and a second surgery was needed to remove them. The man also suffered cognitive impairments due to the attack and endures persistent headaches. The incident exacerbated his post-traumatic stress disorder, increased his emotional distress and diminished his quality of life.
The assault occurred after the man, his wife and two friends went into the PBR bar inside the Texas Live! complex. Bar patrons could buy souvenir beer mugs but had to leave them outside the bar on a table. According to the lawsuit, as the group left the bar, they saw several glasses on a table and asked the security guard what happened to the glasses at the end of the day. The guard answered that he takes them home and gives them to family and friends. The group recalled the conversation being friendly, and the man took one glass and went to the food court, according to the man’s attorney.
As the group ordered pizza, the security guard took the glass off a table, and the man approached him. The plaintiff’s attorney stated that the guard shoved the man to the ground violently, raised the heavy mug, and struck the back of the man’s head as the man ducked. The blow shattered the glass mug and left the man concussed. According to the man’s wife, who witnessed the attack, the security guard also punched the man in the eye. In addition to the physical and emotional injuries the man endured, the man’s wife also suffered emotional distress, and the couple faced a loss of quality of life and ongoing medical costs.
The resulting lawsuit was filed in Texas, and it alleged that the companies in charge of Texas Live! and the Inner Parish Security Corporation were negligent in hiring, retaining and supervising the security guard and failed to provide a safe environment. The complaint noted that the guard had a previous assault conviction and that he was not properly screened before hire. The plaintiff’s attorney stated that Texas law prohibited hiring an individual as a security guard with a felony battery conviction within the last 10 years, and the security guard’s felony fell within that time frame. Additionally, the lawsuit claimed the companies did not have an employment application on file and that the defendants covered up the assault by hiding surveillance video.
The defendants contended the man’s emotional injuries were not related to the bar incident and instead were linked to his existing conditions. They also disputed the extent of his physical injuries and maintained the guard was acting within his authority. They asserted it was the man who escalated the situation, and they denied there was wrongdoing in their hiring practices. They stated they were unaware of the felony conviction and that the security guard’s employment did not violate established standards.
In November 2024, the jury found for the plaintiffs and awarded a total judgment of $60,650,000. Holding the Texas Live! companies primarily accountable, the jury assessed $50 million in exemplary damages against them due to their negligent hiring and retention of the security guard and for covering up evidence. Inner Parish Security Corporation, the entity responsible for managing venue security, was held accountable for $5 million in exemplary damages for failing to screen and supervise the guard. Additionally, the jury assigned $500,000 in exemplary damages to the security guard for his violent actions during the altercation.
Factors that Led to the $60 Million Negligent Hiring, Retention & Supervision Verdict
Such negligence involves a business failing to exercise adequate care in the employment, retention or supervision of its workforce, resulting in reasonably foreseeable harm to another party. In other words, if a business knew or should have known (had it taken appropriate measures) that an employee was unfit for their role upon hiring them, and this unfitness results in illness, injury or other damages to another party, the business could be held liable for such damages.
Similarly, if a business realized or should have realized during a worker’s employment that they presented a foreseeable risk to others and failed to discipline or discharge that worker before they harmed another party, the business may be held responsible for the associated damages. Additionally, if a business neglected to reasonably control or monitor an employee’s actions, and this lack of supervision permitted the employee to harm another party, the business could be held liable for the related damages.
As it pertains to this verdict, the Texas Live! companies’ and Inner Parish Security Corporation’s failure to discover the security guard’s previous felony conviction may constitute negligent hiring and retention, and their failure to monitor his actions before harming another party may serve as evidence of negligent supervision.
Compliance Considerations for the $60 Million Negligent Hiring, Retention & Supervision Verdict
This nuclear verdict highlights compliance considerations related to negligent hiring, retention and supervision. It’s important to note that the laws regarding such negligence vary between states. Given that this verdict took place in Texas, here’s a general overview of the elements used in Texas courts to evaluate employer liability in these areas:
- Duty of care—The employer must have a legal duty to hire, supervise and retain competent employees. This may entail the following actions:
- Verifying applicants’ job qualifications, including skills and experiences
- Conducting background checks on job applicants
- Providing regular training to employees
- Monitoring and reviewing employees within their roles
- Breach of duty, foreseeability and damages—The employer’s failure to fulfill any of these duties must be a proximate cause of harm—that is, the resulting injury must have been a reasonably foreseeable outcome of the employer’s negligence.
In Texas, courts generally require that the plaintiff prove that the employer failed in its duty and that this failure directly led to the injury or harm in question. For instance, if an employer failed to conduct a background check that would have revealed a violent history, and the employee later caused a violent injury in the workplace, the employer could be found liable for negligent hiring or retention.
Risk Mitigation Measures
To avoid nuclear verdicts similar to the one resulting from this case, businesses should consider implementing the following risk mitigation strategies:
- Minimize negligent hiring, retention and supervision exposures. Implement vigilant hiring processes for all positions, including requiring job candidates to complete detailed applications, verifying their employment and educational history, contacting provided references, leveraging in-depth interviews, performing credit checks, requiring drug tests, administering aptitude tests, and conducting sufficient background checks while adhering to anti-discrimination laws and equal employment guidelines. Upon hire, employers should provide employees with proper training to set them up for success and supervise them to ensure they perform their jobs safely and correctly. Employers should also utilize periodic reviews to better gauge employees’ work performance, and they should take any complaints filed against staff seriously.
- Ensure compliance. Regularly assess workplace policies and procedures to ensure compliance with negligent hiring, retention and supervision laws and any other applicable federal, state and local regulations. Consult legal counsel for additional compliance assistance.
- Secure proper coverage. Adequate insurance is essential in today’s litigious environment. Work with a trusted insurance advisor to assess your organization’s risks and determine the appropriate policies and limits to protect against potential exposures.
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If you have questions, reach out to one of our insurance advisors to discuss specific coverage needs, so you can avoid a nuclear verdict or negligent hiring loss.