According to The Wall Street Journal (which is not exactly a bastion of liberalism), McDonald’s callousness was the real issue in this case and even jurors who originally thought the case was just “a tempest in a coffee pot” were overwhelmed by the evidence against the corporation.
Aside from the fact that the plaintiff in this case was a passenger, and that the car was stationary when the coffee spilled on her lap as she opened it in order to put cream into it (In other words, she was not “eating and driving”), see this list of facts that the media failed to report:
For years, McDonald’s had known they had a problem with the way they make their coffee - that their coffee was served much hotter (at least 20 degrees hotter) than at other restaurants.
McDonald’s knew its coffee sometimes caused serious injuries - more than 700 incidents of scalding coffee burns in the preceding decade had been settled by the Corporation.
The woman involved in this infamous case suffered very serious injuries - third degree burns on her groin, thighs and buttocks that required skin grafts and a seven-day hospital stay.
The woman, an 81-year old former department store clerk who had never before filed suit against anyone, said she wouldn’t have brought the lawsuit against McDonald’s had the Corporation not dismissed her request for compensation for medical bills. (If I recall correctly, she actually sought something like $10,000. for her medical expenses.)
A McDonald’s quality assurance manager testified in the case that the Corporation was aware of the risk of serving dangerously hot coffee and had no plans to either turn down the heat or to post warnings about the possibility of severe burns, even though most customers weren’t aware that it was possible to be severely burned by McDonald’s coffee.
After careful deliberation, the jury found McDonald’s was liable because the facts were overwhelmingly against the company. When it came to the punitive damages, the jury found that McDonald’s had engaged in willful, reckless, malicious, or wanton conduct, and rendered a punitive damage award of 2.7 million dollars. (The equivalent of just two days of coffee sales, McDonalds Corporation generates revenues in excess of 1.3 million dollars daily from the sale of its coffee, selling 1 billion cups each year.)
On appeal, a judge lowered the award to $480,000, a fact not widely publicized in the media. And, of course, if McDonald’s had merely paid the woman’s medical bills in the first place, they wouldn’t even have had to pay this reduced amount of money to her!
A report in Liability Week, September 29, 1997, indicated that Kathleen Gilliam, 73, suffered first degree burns when a cup of coffee spilled onto her lap. Reports at that time also indicated that McDonald’s consistently keeps its coffee at 185 degrees, still approximately 20 degrees hotter than at other restaurants. Third degree burns occur at this temperature in just two to seven seconds, requiring skin grafting, debridement and whirlpool treatments that cost tens of thousands of dollars and result in permanent disfigurement, extreme pain and disability to the victims for many months, and in some cases, years.
Incidentally, as to why McDonald’s coffee used to be brewed with extremely high temperature water is that this is a way of extracting more flavor from the grounds without using more coffee. In other words, a cost-saving measure. Of course, the coffee tastes pretty lousy that way. Note that the coffee that McDonald’s now serves is actually a much higher quality brew than they used to serve, it now tastes very good, and it is not brewed with the ultra-high temperature water of yesteryear.
In other words, they have learned to make better coffee and no longer see the need to use ultra-high temperature water. And, their newly improved coffee business is one of the factors that caused McDonald’s stock to be one of the best in returns over the past couple of years. This sort of proves that doing the right thing in the first place is better for all concerned.