What Money Can’t Buy
CASE TYPE: Personal Injury | AWARD: $4.4 Million
Award: $4.4 million
Case Type: Personal Injury
Injury: Brain damage due to explosion
Defendant: Trucking company (known)
Length of Case: 1.5 years
What makes this case unique: Unusual circumstance of the meeting, strong determination of the victim’s wife, strategic purchase of annuities provided the victim’s family far more than the initial settlement.
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There is a backstory that leads up to this case. In 1971, I bought a house on Marion Avenue in Albany. I had a neighbor who was one of the wealthiest men in the Capitol Region. He and his partner, who was also a neighbor, owned vast complexes of apartment buildings. The two of them were exceedingly philanthropic. They had a third partner who lived in Troy and had been a small businessman before becoming associated with them. He combined his own efforts with the credit of those two men to purchase more upscale properties through a joint venture. However, much to their dismay, this third partner became embroiled in a scandal involving the rigging of property tax bills through political influence.
This third partner became indicted, along with several politicians, for violations involving this tax assessment rigging. All the politicians involved were convicted and sentenced to prison. However, the partner fought the matter for several years.
He was charged with perjury. New York State had opened up an investigation along with the local grand jury in Rensselaer County. He was called to testify in front of both of those investigatory bodies. In the course of his testimony, he allegedly gave different answers to the same question from each investigator. Of course, that means one of them had to be a lie.
He fought that charge for years. He hired the best criminal lawyer in the area, E. Stuart Jones, Sr. along with Herald Price Fahringer, one of the greatest trial lawyers in America at the time.
They attacked the indictment of perjury up through the courts but ultimately it was sent back to Rensselaer County for trial. Their efforts had been futile; they could not get the perjury charge dismissed.
I was sitting in my office one day taking a break and I happened to look at the newspaper, which I rarely did in the office. I noticed that this man was coming up for trial on perjury. I called my two neighbors, his real estate partners, and asked them to meet and discuss this.
They came to my office with the legal papers for their partner’s case. After looking at the files I said, “Yep! Looks like they got your partner dead to rights. He gave two different answers to the same question.”
Still, I offered to call up the Rensselaer County District Attorney and discuss the case. What these two neighbors did not know was that I had the ear of this DA in a unique way.
In the 1970s, some upstate NY county DAs were only part-time, running their own private law firms on the side. Con Cholakis, who was the DA in Rensselaer County during this time, had a day job as a labor lawyer. Since I had earlier worked for the National Labor Relations Board as a labor relations attorney, he would often call me up to ask for advice, which I never charged him for. Of course, he had to hear me out.
We met the next day and chatted for several hours. I ultimately convinced him to lower the charge to a class B misdemeanor, obstructing governmental administration. This was the lowest possible charge a person could have.
The next day, the acting county judge accepted a guilty plea to that charge. The partner paid a $100 fine, and out the door he went–a free man.
Con Cholakis always held that against me. He later became a New York State Supreme Court judge and then a federal judge. He would rough me up in court because he felt I had talked him out of doing something he should have done.
After that, my two neighbors became very interested in my well-being. They would invite me to travel with them (I never accepted). I did once or twice accept an invitation to a party by one of the partners. One of those times, my neighbor introduced me to his housekeeper of 30 years. She was a lovely African American lady. During the course of our conversation, I learned that her sister’s husband had been involved in an explosion. The family had already hired a lawyer through the union. But I suggested her sister meet with me.
We met at her husband’s bedside at Albany Medical Center. Her husband at that time was hanging between life and death. Bessie was a fascinating person. She had come north from Alabama with her husband Grady as a migrant farmworker. Eventually, Grady got a job at Niagara Mohawk (now National Grid) as a gas mechanic. She, too, worked as a cleaning lady, yet it was clear that she was a person of great intelligence and totally committed to her husband. After a detailed discussion where I outlined my experience and plans for her husband’s case, he retained me and discharged the union lawyer. (I worked out a deal to share the fees with the other attorney.)
The case accident had occurred at the Niagara Mohawk power plant in downtown Albany. There was a rather large parking lot adjacent to one end of the plant. Employees would park their cars there. There would also be truck traffic in and out, including third-party trucks on-site to do work.
The plant on this day had hired a company to do some elevated work. The truck in question had a boom that extended beyond the cab. As the driver moved the vehicle through the parking lot, he turned a corner, and the boom smacked into the furnace room. The impact punched a hole in some pipes. Grady was sitting in his car in the parking lot taking lunch. When he saw that, he realized that there was a danger of explosion. Grady exited his truck, ran to the furnace room to open the door to get as much air in there as possible.
Unfortunately, the door was locked. His heroic effort to avert an explosion failed. As he attempted to open the furnace room door, there was a tremendous explosion that could be heard and felt throughout downtown Albany.
The explosion rendered him unconscious. An ambulance was called and he was taken to Albany Medical Center. He died twice on the way to the hospital but was able to be revived.
After as much treatment as he could get at Albany Medical Center, he was sent to a nursing home in Boston called the Greenery, which had a specialized head injury unit. He remained in a semi-comatose condition from then on. After discharge from the Greenery, I negotiated a deal with a local small hospital to provide for long-term care. Bessie visited Grady every day, checked him for bed sores, did his laundry though the hospital offered her that service, hand-fed him, and cared for him as the most important thing in her life.
When the case was settled, my son, who is a gifted architect with special training in designs for the handicapped, helped build a unique home for Grady and Bessie with a variety of specialized equipment to care for Grady’s care. They lived there about 10 years until Grady passed away.
In the meantime, I brought action against the company that operated the truck.
This case was tried in United State District Court in Albany because the victim was from New York but the truck was owned by a company from Pennsylvania. Whenever there is a dispute between parties from different states, the federal court may have jurisdiction for cases like this one.
The liability of this case was pretty clear. It was ultimately a question of what the case was worth. We hired a life care planner, as well as an economist by the name of John Dowd. He was very well known but was rather unusual. He would make notes about the case and keep them in his pockets. As he testified, he would pull notes out of his pocket and read from them. It was quite a show!
One twist was this: we had been offered a package of annuities in settlement rather than cash. Two years earlier, in 1981 Congress passed the Federal Structured Settlement Act. This meant if you accepted annuities for a settlement, you didn’t have to pay taxes on the interest. But we took cash for a variety of reasons, including that we thought we could get a better deal if we bought the annuities on our own, and not through the insurance company that insured the truck. That proved to be correct.
Dowd had said on the stand it would ultimately cost about $29 million to take care of my client for the rest of his life. So I went back to the insurance company that had offered the structured settlement and purchased $29 million worth of annuities for just $2 million dollars. The rest of the money went to the family, after deducting attorney’s fees.
Why would the insurance company do that? They had estimated my client had a seven-year life expectancy. The first annuity paid $50,000 a month, and after some years a new one would kick in that paid $100,000, and so on. However, they believed my client wouldn’t live long enough for them to pay out more than I had for the annuities. They figured on a large profit.
After 10 years, the insurance company called me to ask if they could buy back the annuities. They were losing a lot of money. But there was no deal. My client ultimately lived 13 years. Towards the end, the insurance company was paying the family $250,000 a month. The insurance company had made a huge underwriting error. Most importantly, they had not put Bessie into their calculations. She took care of her husband like a newborn infant and that significantly extended Grady’s life, despite his badly brain-injured. Bessie had devotedly provided around-the-clock loving care for her husband–care that money could not buy.