Calculating Personal Injury Damages: The Gwyneth Paltrow Lawsuit

Lawsuits involving celebrities or well-known entities tend to attract a good deal of media hype, but the financial forensics side is usually not given close attention. Like we did in response to the recent Alex Murdaugh murder trial, we provide a look at the Terry Sanderson v. Gwyneth Paltrow case from an economic expert’s point of view.

Terry Sanderson, a retired optometrist, sued Gwyneth Paltrow, her ski instructor and a ski resort in Deer Valley, Utah, based on a claimed “hit-and-run” ski crash. Mr. Sanderson said that Ms. Paltrow had run into him on the ski slopes on February 26, 2016, “. . . knocking him out, causing a brain injury, four broken ribs, and other serious injuries.”

Mr. Sanderson claimed over $3 million in damages, and his complaint requested:

1. For non-economic damages in an amount to be proven at trial, including but not limited to, pain and suffering, loss of enjoyment of life, emotional distress, disfigurement and such other damages as are allowed by law;
2. For economic damages in an amount to be proven at trial, including past and future medical expenses, life care expenses, out-of-pocket expenses, and other economic damages as allowed by law;
3. For pre-judgment interest on the damages assessed by the verdict of the jury pursuant to Utah Code Section 78B-5-824, as amended;
4. For punitive damages as allowed by law;
5. For costs of suit herein;
6. For attorney fees as may be appropriate and allowable at law;
7. For such other and further damages and relief as are just and proper in the premises, and available under the law.

How Do Plaintiffs Calculate Their Claimed Damages In Personal Injury Lawsuits?

How, exactly, did Mr. Sanderson and his attorneys arrive at the $3 million figure? In general, how do plaintiffs in personal injury cases evaluate their claims?

Personal injury damages can be divided into economic and non-economic or hedonic damages. Economic damages are those that can be quantified objectively and generally include medical expenses resulting from the injury, both past and future, lost earnings and/or lost earning capacity, and loss of household services. Non-economic damages include items such as physical pain and suffering, emotional or mental anguish and pain, loss of consortium, physical impairment, disfigurement, injury to reputation, etc.

Economic damages can be quantified by plaintiffs and their counsel, but they often engage economic experts, vocational experts, medical experts, and life care planners to help support their calculations.

Non-economic damages are generally left to the trier of fact to quantify, based on the extent of the injury or the egregiousness of the defendant’s actions. Non-economic damages can amount to a large percentage of the total amount awarded to a plaintiff.

The damages awarded in personal injury disputes vary widely and usually depend on the severity of the alleged injury and the facts and circumstances of the case.

What Were the Damages Claimed In the Paltrow Trial?

Many of the media pieces about the Paltrow case gave little insight into the calculation of damages. Apparently, Mr. Sanderson initially asked for $3.1 million when he filed the lawsuit in 2019, but later amended the complaint, lowering that claim to $300,000.

During trial, however, Mr. Sanderson’s attorney, Lawrence Buhler, suggested that the jury should award him $3,276,000 in damages, based on the “cognitive decline Sanderson has experienced over the last seven years and will continue to experience for the rest of his life.”

How did Mr. Buhler value Mr. Sanderson’s alleged cognitive decline?

Mr. Buhler told the jury in opening statements that Mr. Sanderson broke four ribs, two of them completely, as a result of the accident, and that he had lost consciousness. He claimed that Mr. Sanderson is suffering from a persistent brain injury and that he will suffer from his injury for the rest of his life. He also claimed Mr. Sanderson’s ability to cope with life was diminished as a result of the accident. Mr. Buhler explained to the jury that Mr. Sanderson was a charming person before the accident, but is no longer so.

The only article we found that discussed the details behind the $3 million in damages stated, “Mr. Buhler told the jury, ‘I’m going to suggest a number, you put the number you think is fair for Terry. The full value of the harm and losses that he’s dealing with every day. I’m going to say $33.” While this calculation is, at best, vague, one would need more than 271 years at $33 per day to arrive at $3,276,000. Mr. Buhler referred to this calculation of damages in his closing statements.

Enter, Stage Left: The Witnesses and the Expert Witnesses

Several fact witnesses and expert witnesses testified in the trial. Mr. Sanderson’s witnesses contended that Ms. Paltrow ran into him, and that is the only way to explain his injuries. His doctors testified that he is struggling, and his family members narrated a decline in his cognitive abilities and described how his personality had changed dramatically.

Defense expert witnesses included a ski expert and a biomechanical engineer, who recreated the ski accident for the jury, showing that it had been Mr. Sanderson that ran into Ms. Paltrow. The defense also showed that Mr. Sanderson emailed his daughter “I’m famous” the day of the accident and a photograph that showed him pictured on ski slopes, along hiking trails, and another of him boating in the Amazon. Photos of him smiling with friends suggest that he continued to enjoy outings and activities, despite having painted a picture of having become a recluse as a result of the trauma from the ski accident that had compromised his independence and robbed him of his joie de vivre.

Defense attorney Steve Owens stated, “An end to the lawsuit could be the cure to what ails Sanderson, bringing some closure to the retired optometrist who he says has been obsessed with the case since it was filed.” This quote is a fancy way of articulating a common civil lawsuit doctrine in computing damages, that is, to make the plaintiff whole, which is to restore a plaintiff to the position he or she would have been in had the incident not occurred.

In closing statements, Mr. Buhler talked about Mr. Sanderson’s damages, consisting of the broken ribs, which had healed, and the concussion, which he contends lasted over a year and a half, and that he has suffered from permanent concussive symptoms. He stated, “Terry is dealing with his injury for 16 hours a day” and that, “The injury will last until he dies.” In terms of jury instructions, Mr. Buhler said Mr. Sanderson had about 10 years left of life, “according to what many people think,” and, “Since the crash it’s been 7 years, for a total of 17 years that Mr. Sanderson has to live with the injuries. Every day he has 16 hours dealing with this injury.”

How did Mr. Sanderson’s Lawyers Calculate his Damages?

Jury instructions detailed considering pain, suffering, and loss of enjoyment of life. In general, there are a multitude of factors that attorneys and economic experts who assist them consider. In this case, Mr. Buhler suggested to the jury that they calculate non-economic damages as 16 hours per day x 365 days a year x 17 years x $33/hour = $3,276,000.

While Mr. Buhler extensively articulated details of the alleged pain and suffering that Mr. Sanderson suffered, he failed to explain how he arrived at the $33 per hour. In fact, he only vaguely mentioned “people’s wages” but didn’t make a direct connection, let alone to how wages were relevant to a retired professional’s actual and computable damages.

Equally strange, even though Mr. Sanderson clearly had extensive medical expenses, his attorneys did not make a claim for economic damages around these expenses.

Ultimately, the jury decided in Ms. Paltrow’s favor, assigning 100% of the fault to Mr. Sanderson. As a result, the verdict for Ms. Paltrow awarded her $1 in damages. Ms. Paltrow has now dropped her claim for attorney fees.

Contact us if you need the assistance of economic experts as expert witnesses or to help with trial preparation in personal injury or wrongful death suits.

Authored by by Helga Zauner, CVA, CFE, MAFF, and Paulina Rocha, CFE.

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