Boating accident at Lake Tahoe results in amputated leg. $23M.

Summary

Group of young adults rents a speed boat and tows inflatable behind the boat. Props sever leg. Includes issues of admiralty law.

The Case

Case Name: Palla v. L M Sports, Inc. et al.
Court and Case Number: United States District Court - Eastern District of California / 2:16-cv-02865-JAM-EFB
Date of Verdict or Judgment: Monday, December 02, 2019
Date Action was Filed: Monday, December 05, 2016
Type of Case: Boating Accident, Maritime (See also "Boating")
Judge or Arbitrator(s): Hon. John A. Mendez
Plaintiffs:
Manisha Palla, 25, sales representative.
Defendants:
L M Sports, Inc.
Type of Result: Bench Verdict

The Result

Gross Verdict or Award: $23,218,106.66
Award as to each Defendant:
80% to defendant Paul Garcia; 20% to defendant L M Sports, Inc.

Jointly and severally liable to plaintiff for all damages under admiralty law.
Economic Damages:
Past: $305,762.03

Future: $2,912,344.63 (to be present-valued by the court)
Non-Economic Damages:
Past: $8,000,000

Future: $12,000,000
Trial or Arbitration Time: 19 days - Bifurcated (10 days for liability; 9 days for damages).

The Attorneys

Attorney for the Plaintiff:
Dreyer Babich Buccola Wood Campora, LLP by Roger A. Dreyer and Anthony J. Garilli, Sacramento.
Attorney for the Defendant:
Hinshaw Culbertson, LLP by Pamela Schultz, Amee Mikacich, Alena Eckhardt, Forrest Booth, San Francisco.

The Experts

Plaintiff’s Medical Expert(s):
Dr. Christopher Stephenson, M.D., pain management and rehabilitation, Sacramento.

Drew Hittenberger, prosthetics, Petaluma.
Defendant's Medical Expert(s):
Dr. Suzy Kim, M.D., pain management and rehabilitation, Brea.

Rick Chavez, prosthetics, Los Angeles.
Plaintiff's Technical Expert(s):
Alison Osinski, Ph.D., boating safety and marina rental operations, Avalon.

William Kitzes, warnings and labeling.
Defendant's Technical Expert(s):
Doug Powell, boating safety and marina rental operations.

Wendy Sanders, Ph.D., mechanical engineering.

Facts and Background

Facts and Background:
On July 24, 2016, 22-year-old plaintiff Manisha Palla and twelve coworkers boarded a 24-foot boat rented from Lakeside Marina (L M Sports, Inc.) in South Lake Tahoe, California. The marina also rented and charged the group for a tube for towing.

The boat's propulsion system had dual counter-rotating propellers located approximately 17" from the swim ladder. The marina gave a brief set of instructions to the two volunteer operators from the group. They were shown the propellers and admonished to turn the boat off when picking up people in the water. The passengers were not given any instructions (or, defense counsel suugests, did not listen to) relative to tubing or safely getting into or out of the water. They were not shown the ladder nor the propellers.

Plaintiff had been on a boat four or five times in her life and had never been tubing. She decided to take a turn tubing after watching a few of her colleagues take uneventful turns before her. Garcia was operating the boat. When Garcia circled around to retrieve plaintiff, he attempted to shift the boat's throttle into neutral. He unknowingly missed neutral and left the boat in "idle reverse."

A member of the group deployed the swim ladder and plaintiff swam toward it. When she reached for the ladder, her left foot and then right leg contacted the propellers which drew her right leg into and between the counter-rotating propellers above the knee. Plaintiff remained pinned between the propellers until first responders arrived nearly 40 minutes later. Members of the group took turns pulling her up by her life jacket to keep her face out of the water because she would have been submerged otherwise. Plaintiff was eventually freed by first responders, life-flighted to Renown Medical Center in Reno, Nevada, where her right leg was amputated above the knee.
Plaintiff's Contentions:
That the marina had a duty to provide safety instructions to the entire group, and not just the operators, about tubing and propeller strikes because they rented them a tube and knew the passengers could be getting into the water.

Also, that the rental boat was not fit for its particular rental purpose because it should have been fitted with low-cost safety devices such as a propeller guard or ladder interlock device.
Defendant's Contentions:
That the incident was entirely Garcia's and plaintiff's fault. The marina and stickers on the boat instructed Garcia to shut the boat off when picking up a tuber from the water. They also instructed Garcia to never place the boat in reverse if there was somebody in the water. They were not required to fit the boat with additional safety devices and they had no duty to warn the passengers of anything.

Garcia was entirely in control of the vessel once the group left the marina. The marina had a clean safety record. The location of the ladder next to the propellers was an open and obvious condition. Plaintiff was comparatively at fault because she knew or should have known the propellers were in the back of the boat next to the ladder.

Plaintiff also assumed the risk of harm and the assumption of risk doctrine completely bars her recovery. Under Admiralty Rules and the Limitation of Liability Act, L M Sports was entitled to limit their liability to the value of the vessel ($9,500) because the vessel owners had no privity or knowledge of the negligent act(s) that caused the injury. Plaintiff failed to mitigate her damages. Further, that the Admiralty law of joint and several liability should not apply in the recreational boating context.

Injuries and Other Damages

Physical Injuries claimed by Plaintiff:
Amputation of her right leg above the knee. Lacerations to her left foot and left knee.
Physical, emotional, and mental pain and suffering. Disfigurement, disability and loss of enjoyment of life.

Special Damages

Special Damages Claimed - Past Medical: Stipulated $305,762.03
Special Damages Claimed - Future Medical: $5,031,486 (non-present value)
Special Damages Claimed - Past Lost Earnings: None made.
Special Damages Claimed - Future Lost Earnings: None made.

Additional Notes

Defendant L M Sports, Inc. filed a Limitation of Liability Act (LOLA) action, which the Court consolidated with plaintiff's case. Under LOLA, if the defendant boat owner can demonstrate they had no privity or knowledge of the negligent act(s) causing injury, they are entitled to limit their liability to the value of the vessel at the time of the incident.

Defendant L M Sports, Inc. filed and lost a motion for summary judgment. The Court ultimately bifurcated the issues of liability and damages. Since a bench trial is the general rule in Admiralty actions, the Court tried liability and determined both Garcia and L M Sports, Inc.'s negligence caused plaintiff's injuries and that L M Sports failed to show it lacked knowledge of the negligent conditions that gave rise to plaintiff's injuries.

Plaintiff made an offer in January 2018 for the remainder of defendant's eroding limits insurance policies, consisting then of less than $6 million. The offer was formally rejected and no offer was ever made by the defendant before the liability trial. The parties participated in one failed mediation session before the damage trial. Plaintiff will additionally be entitled to prejudgment interest from the date of the injury under Admiralty law.

Per defense counsel:

The court’s ruling in the Limitation of Liability Act action is now on appeal to the 9th Circuit. Recent 9th Cir. case law indicates that the trial court lacked admiralty jurisdiction, which would negate all rulings in this case.