Atlanta, GA—A wrongful death case arising from the death of a worker who was burned alive at the Newell Recycling facility in East Point, GA, that resulted in a $29 million compensatory damages verdict was resolved when the parties entered into a confidential settlement shortly before the Fulton County State Court jury was to begin hearing testimony on punitive damages. Efrain Hilario et al. v. Newell Recycling of Atlanta, Inc. (2012EV015400)
On January 6, 2011, 19-year-old Erik Hilario died when the front-end loader that he was driving in order to move scrap metal around the plant grounds caught fire. According to documents and testimony in the case, as the loader pushed the metal across the paved surface, it caused a spark that ignited gasoline on the ground, engulfing Hilario and the loader.
Newell Recycling is one of the southeast’s largest scrap metal recycling companies. The business currently operates under the name Newell Recycling Southeast. The company supplies mill-ready metal from scrap to plants and foundries worldwide. It currently operates approximately 20 facilities in Georgia and other states, including its headquarters facility in East Point, where the fatal accident occurred.
At the time of the accident, the overall business included approximately 30 separate business entities with the word “Newell” in their names. Hilario’s parents and the administrator of his estate filed the wrongful death suit in 2012, originally naming several different Newell entities as defendants in the case. However, by the time the trial began, the only remaining defendant was Newell Recycling of Atlanta, Inc., the company that owned the facility where the fire occurred.
Although Hilario was driving a front-end loader at the time of his death, much of the testimony and evidence in the case concerned a different piece of equipment referred to as a puncher. The East Point facility shreds junk and surplus automobiles for recycling. For safety reasons, the vehicles cannot contain gasoline when they are shredded. The puncher is actually a process developed by Newell by which a crane drops a vehicle onto a spike, allowing the gas to drain into a nearby trough. The company often used the puncher to drain several dozen vehicles a day. Under the plaintiff’s theory of the case, a significant amount of gasoline from the junk vehicles did not drain into the trough as intended but, instead, accumulated in the area where Hilario was working and later ignited.
Plaintiffs in the case brought suit under two separate theories: premises liability, for failure to maintain safe premises where the fire occurred, and product liability, for negligent design of the puncher and failure to warn. By the time of the trial, the remaining defendant in the case, Newell Atlanta, admitted its negligence for failure to maintain safe premises but denied any liability under plaintiff’s product liability theory.
During the course of the case, Judge Diane Bessen denied various defense motions to dismiss, and for summary judgment and directed verdicts. Instead, the jury was asked to decide three key factual issues in addition to determining the amount of damages and whether punitive damages were appropriate. The first issue was whether defendant was liable under a product liability theory for either negligent design or failure to warn, which could affect the amount of punitive damages plaintiffs might receive in the case. Under O.C.G.A. §51-12-5.1, the statutory cap on punitive damages does not apply in a cause of action for product liability.
The jury was also asked to determine Erik Hilario’s employer at the time of his death. Hilario received paychecks and W-2 forms from a company called Newell Recycling, LLC, which was never a defendant in the case. However, the defense contended that Newell Recycling, LLC was only an administrative services company that performed payroll services on behalf of Newell Atlanta and other Newell business entities. Further, under the terms of an Employee Leasing Agreement, Newell Recycling, LLC, leased the services of Hilario and various other employees to Newell Atlanta. Plaintiffs, however, pointed to various corporate documents indicating that Newell Recycling, LLC, and Newell Atlanta were independent contractors and evidence that the Employee Leasing Agreement was not drafted until over a year after Hilario’s death.
The jury was asked to determine whether Hilario was an employee of Newell Atlanta, Newell Recycling, LLC, or both entities as joint employers. Under the Workers Compensation Act, plaintiffs’ tort claims against Newell Atlanta would be barred if it was either Hilario’s sole employer or a joint employer with Newell Recycling, LLC.
Finally, the jury was asked to determine to what extent Newell Recycling, LLC, may have been responsible for Hilario’s death due to the actions of its employee at the time, Anthony Eady. On the day Hilario died, Eady operated the puncher. The defense contended that Eady improperly removed the gas tanks from the scrap vehicles in violation of Newell’s guidelines, which caused the gasoline spill. A finding that Newell Recycling was partially responsible for Hilario’s death would also result in a reduction in any verdict rendered against Newell Atlanta.
After hearing nearly two weeks of testimony in the case, the jury found against defendant Newell Atlanta on all the factual issues. The jury found that Newell Recycling, LLC, was the sole employer of Hilario at the time of his death, and that Newell Atlanta was 100% at fault for Hilario’s death. The jury also found for plaintiffs on the product liability claims for negligent design and failure to warn. The jury awarded damages of $21 million for wrongful death and $8.25 million for pain and suffering, for a total verdict of $29,250,000.
The jury also found punitive damages to be appropriate and was scheduled to hear testimony on that issue the next day. However, the parties reached a final settlement in the case before any evidence was presented.
After the case, Alan Hamilton, one of the attorneys representing the plaintiffs in the case, described the case to Courtroom View Network as a “hard fought four-year battle” and complimented the defense for doing an excellent job in a difficult case. He continued, “We are very gratified that the jury found the underlying conduct in this case unacceptable and vindicated the loss our clients have lived with the past four years.”
Roger Harris, one of the defense attorneys in the case, told CVN that there were several reasons the case went to trial and that, although he believed there was legal error in the case, the settlement was in the best interest of all parties, including the Hilario family and the Newell organization. Harris also provided CVN with a written statement that said, in part: “The accident that happened on January 6, 2011, was a tragedy, and the entire Newell organization deeply regrets what happened at its East Point facility. Newell has heard the verdict loud and clear, and after several years of litigation and a trial that lasted two weeks, the case resolved post-verdict by way of a confidential settlement.This confidential settlement has the effect of fully and finally resolving many outstanding legal issues that were raised during the course of the trial, and that would have been considered by the Georgia Court of Appeals absent the settlement. Importantly, this confidential settlement brings closure to this matter for the entire Hilario family who lost their loved one, and it brings closure to this long legal battle for the Newell organization. Jeff Shiver and Alan Hamilton tried an excellent case and advocated very well on behalf of their client.”
Courtroom View Network’s previous article on the case can be found here. Steve Silver can be reached at email@example.com.
Attorneys involved in the case include Jeff Shiver and Alan Hamilton of Atlanta's Shiver Hamilton, Darren Summerville of the Summerville Firm of Atlanta, and Mark Murray of the Murray Law Firm of Atlanta for plaintiffs and Roger Harris, Lee Clayton and Daniel Kingsley of Atlanta's Swift, Currie, McGhee & Hiers, and Wayne McGrew and Neil Edwards of Atlanta's Carlock, Copeland & Stair for the defense.
Watch on-demand video of the trial as soon as it becomes available.
Not a Subscriber? Learn more about CVN's unparalleled coverage of top Georgia trials.