Publication Date

2016

Document Type

Article

Organizational Units

Sturm College of Law

Keywords

Non-economic damages, Cognitive bias, Counter-anchor, Anchoring bias

Abstract

Numerous studies have shown that the amount of a juror's damages decision is strongly affected by the number suggested by the plaintiffs attorney, independent of the strength of the actual evidence (a psychological effect known as "anchoring"). For scholars and policymakers, this behavior is worrisome for the legitimacy and accuracy of jury decisions, especially in the domain of non-economic damages (e.g., pain and suffering). One noted paper even concluded that "the more you ask for, the more you get. " Others believe that the damage demand must pass the "straight-face" test because outlandishly high demands will diminish credibility and risk the plaintiff losing outright.

Can defendants effectively rebut an anchor? One strategy is for defendants to offer a "counter-anchor"-a much lower proposed damage award than the plaintiffs. However, defense attorneys worry that juries may interpret such a strategy as a concession of liability. Based on this fear, some defendants allow the plaintiffs anchor to go unrebutted. But this strategy, like counter-anchors, has not been rigorously studied.

To answer these questions, we conducted a randomized controlled experiment in which we exposed mock jurors to a shortened medical malpractice trial, manipulated with six different sets of damages arguments in factorial design.

The plaintiff demanded either $250,000 or $5 million non-economic damages. The defendant responded in one of three ways: (I) offering the counter-anchor that, if any damages are awarded, they should only be $50,000; (2) ignoring the plaintiffs damage demand; or (3) attacking the plaintiffs demand as outrageous. Mock jurors were then asked to render a decision on both liability and damages. These individual jurors' results were then combined with eleven other randomly selected jurors' decisions to create a mock "jury " decision.

Our study confirmed that anchoring has a powerful effect on damages, and a small negative effect on liability determinations. However, for the expected value of the case-the average award when both liability and damage award are considered-these "credibility effects" were overwhelmed by anchoring effects. Our study also revealed that high anchors are difficult to counter. Although we found some variation in the efficacy of defense strategies when plaintiffs anchored low, none of these strategies were an effective antidote to the plaintiffs' high anchor. Additionally, and contrary to conventional belief, the defendant's choice to offer· a lower counter-anchor award did not adversely affect liability determinations. This result challenges concerns that such tactics effectively "concede" liability. These findings have important implications for policy and litigation strategy.

Numerous studies have shown that the amount of a juror's damages decision is strongly affected by the number suggested by the plaintiffs attorney, independent of the strength of the actual evidence (a psychological effect known as "anchoring"). For scholars and policymakers, this behavior is worrisome for the legitimacy and accuracy of jury decisions, especially in the domain of non-economic damages (e.g., pain and suffering). One noted paper even concluded that "the more you ask for, the more you get. " Others believe that the damage demand must pass the "straight-face" test because outlandishly high demands will diminish credibility and risk the plaintiff losing outright. Can defendants effectively rebut an anchor? One strategy is for defendants to offer a "counter-anchor"-a much lower proposed damage award than the plaintiffs. However, defense attorneys worry that juries may interpret such a strategy as a concession of liability. Based on this fear, some defendants allow the plaintiffs anchor to go unrebutted. But this strategy, like counter-anchors, has not been rigorously studied. To answer these questions, we conducted a randomized controlled experiment in which we exposed mock jurors to a shortened medical malpractice trial, manipulated with six different sets of damages arguments in factorial design.

Theplaintiffdemandedeither$250,000or$5millionnon-economicdamages. The defendant respondedinone of three ways: (I)offering thecounter-anchor that, if any damages are awarded, they should only be $50,000; (2) ignoring the plaintiffs damage demand; or (3)attacking theplaintiffs demand as outrageous. Mock jurors were then asked to render adecision on both liability and damages. These individual jurors' results werethen combined with eleven other randomly selected jurors' decisions to createamock"jury"decision.

Our study confirmedthat anchoring has a powerful effect on damages,anda small negative effect on liability determinations. However, for the expectedvalue of the case-the average award when both liability and damage awardare considered-these "credibility effects" were overwhelmedby anchoringeffects. Our study also revealed that high anchors are difficult to counter.Although we found some variation in the efficacy of defense strategies whenplaintiffs anchored low, none of these strategies were an effective antidote tothe plaintiffs' high anchor. Additionally, and contrary to conventional belief,the defendant's choice to offer· a lower· counter-anchor award did not adverselyaffect liabilitydeterminations. This resultchallengesconcernsthat suchtacticseffectively"concede"liability.Thesefindingshaveimportantimplicationsforpolicyandlitigationstrategy.

Rights Holder

John Campbell, Bernard Chao, Christopher Robertson, David Yokum

Provenance

Received from author

File Format

application/pdf

Language

English (eng)

Extent

29 pgs

File Size

6.2 MB

Publication Statement

Copyright is held by the author. User is responsible for all copyright compliance.

Publication Title

Iowa Law Review

Volume

101

First Page

543

Last Page

571

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