Now, "with the stroke of a pen," he wrote, "the Appellate Division, First Department, doubled the market value of injuries in the Bronx and Manhattan."

"That it has done so through a case involving a brain injury that is not even remotely the worst brain injury reviewed by any Appellate Division is deeply problematic," Stebbins maintained.

"That it has done so in a case involving an improper summation [during a Manhattan Supreme Court jury trial] that led to an irrational $102 million nuclear verdict [which included $85.75 million in pain-and-suffering damages that were later reduced by the trial judge and further reduced on appeal] is disturbing," he further argued. "That it has done so in the middle of the economic fallout from the pandemic is inexplicable."

The lawsuit at issue was launched in 2013, after the plaintiff, Mark Perez, then age 30, toppled from a scaffold-type structure while working construction at a Long Island concert theater after another worker rammed the structure with a forklift. Perez suffered severe and debilitating brain injuries and sued Live Nation Worldwide, an entertainment company running events at the theater. He eventually won summary judgment on liability, his lawyer Benedict Morelli has said. And at a 2019 damages trial a jury awarded him the $85.75 million for past and future pain and suffering damages, along with other damages for medical care and lost wages.

In 2020, Manhattan Supreme Court Justice John Kelley set aside the jury's $75.3 million award for Perez's future pain and suffering, but allowed him to stipulate to $30.1 million in future pain and suffering damages plus $10.5 million in past pain and suffering.

Then last month, in April, a unanimous four-justice Appellate Division, First Department panel ruled Perez should take home a total of $20 million in pain-and-suffering damages. The panel said Kelly's reduced $40.6 million amount "deviates materially from what would be reasonable compensation to the extent indicated."

Perez "presented proof that he suffered a severe traumatic brain injury that resulted in encephalomalacia, cerebral atrophy, traumatic epilepsy, chronic pain and headaches, significant cognitive deficits in attention, processing speed, memory, visual perception, intellectual function, and executive functions, depression, anxiety, symptoms of post-traumatic stress, and increased risk of neurological disease, all of which are permanent in nature," the panel wrote.

"However, the jury's award of $85.75 million, reduced to $40.6 million by the trial court, is significantly higher than the awards in any of the cases cited," the panel said, "including those involving similarly devastating injuries." The panel then pointed to the 2021 First Department opinion in Hedges v. Planned Security Service in which the court had awarded $13 million in pain-and-suffering damages in a different case.

After the panel's opinion was issued, Morelli told the Law Journal that the ruling had ushered in a new, more "modern era" for pain-and-suffering damages for severely injured plaintiffs in the state. He also pointed to the Hedges case ruling this year for $13 million, while noting that in the past pain-and-suffering damages in New York have rarely risen above $5 million or $6 million once appealed.

Still, he noted that more than 15 years ago, the Appellate Division, Second Department state court had awarded $16 million to a severely injured plaintiff. And he said that he believes the First Department panel in the Perez case recognized that each personal injury plaintiff is unique and each set of injuries are unique.

Morelli also said he doesn't rule out that his client Perez's $20 million award, and the Hedges $13 million award, may sit for a long time as outliers, perhaps for years, before another pain-and-suffering damages award comes along to surpass the marks.

Critics of the Perez $20 million award, such as Stebbins and other members of the nearly 30 amici organizations that submitted briefing in the Perez appeal, have been swift in their condemnation of it and in expressing their many concerns about the award's potential ripple effect across the state, if the courts allow it to stand.

"Benedict Morelli proudly proclaimed in this paper that his appellate victory … had heralded in a new era in New York. He was right, but for the wrong reasons," Stebbins wrote, arguing that the First Department's decision "stands in stark opposition to existing law."

He then pointed to the state legislature's 1986 enactment of the statute, CPLR 5501(c), which in part states that the Appellate Division, in regard to certain categories of monetary awards, "shall determine that an award is excessive or inadequate if it deviates materially from what would be reasonable compensation."

The statute, wrote Stebbins, was enacted "to fend off a financial crisis in New York spurred by spiraling insurance premiums from rising personal injury tort awards."

"This inventive piece of judicial reform was remarkably successful and over the past 35 years, pain and suffering awards incrementally increased from the six-figures up to a de facto high of $10 million for the most catastrophic of injuries," Stebbins added, before writing that "as a consequence, New York avoided a repeat of the 1980's liability insurance crisis, the tort system enjoyed a sustained period of stability, and there was greater fairness among similarly situated plaintiffs."

Now, because of the groundbreaking Perez pain-and-suffering award, wrote Stebbins, liability insurers in the state are "determin[ing] their next course of action" and he predicted they will pass on increased insurance costs to New Yorkers whom, he said, "will either learn to live with dramatically higher costs for everyday things, including housing, or embrace an overdue idea—consistent damage caps that eluded the state in 1986."

Similarly, another amicus curiae group leader, Lev Ginsburg, senior government affairs director at the Business Council of New York State, said recently in a phone interview, "I think it's shocking that we're going into more than doubling what the next highest [pain-and-suffering damages] award has been."

"Awarding actual damages is one thing," said Ginsburg while referring to pain-and-suffering damages as "non-actual damages." But, he said, "to have let go of a logical [damages amount] range" for pain and suffering "and allowed a jury to run wild essentially, is extremely damning."

Ginsburg also said, while referring to the Business Council, which he said represents about 2,400 businesses and is the state's largest business advocacy group, "Our concern stems from what [award] does to business, what it does to consumers."

The record-high award, he said, "will just severely increase the costs of insurance premiums" for injury-tort coverage for New York businesses, "which will in turn increase the costs of goods and services throughout the state."

He also said, like Stebbins, that he fears the $20 million award will lead to lawsuit forum-shopping into the First Department's trial courts. "Why sue in Albany if you can go get $20 million pain and suffering in the Bronx or Manhattan," he said.

In addition, both he and Stebbins said they believe Perez's case was not the right case, based on its facts, for awarding $20 million.

"As defendant's [Live Nation] briefs emphasized, all of the Appellate Division's highest catastrophic injury damages involve cases where the plaintiffs suffered far more catastrophic injuries than Mr. Perez," Stebbins argued. He then contended that, for example, that "the objective testing performed by plaintiff's own treating physicians evidenced malingering" and that Perez "fortunately, enjoyed a remarkable recovery, exercising daily, including at the gym four times per week, exhibiting sharp mental acuity during five depositions and a trial, and assisting his family in home maintenance."

Morelli and his co-counsel in the Perez suit, David Saxe, a Morrison Cohen partner and a retired First Department appellate judge, did not comment for this story.

By phone, Saxe said that it would be inappropriate for him and Morelli to comment while Live Nation's recently filed motion for reargument or, in the alternative, for leave to appeal, was pending before the First Department court. But Saxe said he and Morelli would comment extensively after the appeals court rules on the pending motion.

Timothy Capowski, a Shaub, Ahmuty, Citrin & Spratt partner on Long Island who represents Live Nation in the appeal, declined to comment for this story when reached.

Briefing in the hotly contested motion appears to be complete or nearly complete, with the latest salvo coming May 6. In an affirmation in opposition filing, Morelli and Saxe argued not against defendant Live Nation's motion papers, which they'd already addressed last month, but rather submitted papers opposing the wide-ranging amici group's April 30-filed affirmation in support of motion for reargument/leave.

The amici collection, represented by Maryellen Connor, a Malaby & Bradley partner, wrote that it included organizations representing New York's municipalities, builders, advocates for affordable housing, companies doing business in New York, insurers, and civil justice organizations. And it wrote that the groups, "which represent a broad range of interest," had filed a brief in original First Department appeal requesting the court "rule in a manner that maintains the predictability of personal injury awards in New York by maintaining the customary range for pain and suffering awards."

But Morelli and Saxe, in the opposition to the amici's filing, argued the amici had no standing to file their brief addressing the pending motion to reargue or for leave to appeal.

"The moving amici curiae are not parties to this action. As such, they do not have standing to submit affirmations in support of, or in opposition to, motion practice between the parties," said Morelli and Saxe in their papers.

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