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Logo Icon LITIGATION: A Reasonable Way to Prove Loss of Future Earnings

This past September a California Appellate Court affirmed a trial court's rejection of a $730,000.00 award for future earnings losses to an aspiring lawyer in a lawsuit against Cedars-Sinai Hospital because Plaintiff Dionna Licudine failed to prove her future earning losses with reasonable probability. As such, the Court of Appeal held that a personal injury plaintiff's damages for future earning capacity is limited to the difference between the amount that is "reasonably probable" she would have earned but for the injury, and the amount she is capable of earning after the injury.

In Licudine v. Cedars-Sinai Medical Center, C.A. 2nd/2, DAR p. 9947, Plaintiff Donna Licudine sued over complications from a 2012 gallbladder removal operation. According to testimony, the doctor performing the surgery nicked a vein while inserting a tube into an incision in her abdomen, requiring more invasive surgery causing Ms. Licudine to require use of an electronic wheelchair. Ms. Licudine, who was an undergraduate at the University of Southern California at the time of the surgery, finished her undergraduate degree and was accepted at Suffolk and New England law schools, as well as into a graduate program in public administration at Penn State. She accepted offers from both the Suffolk and Penn State and obtained medical deferments of her start date.

In her lawsuit, Ms. Licudine alleged that her injuries delayed her enrollment into law school and therefore impaired her earning capacity as an attorney. However, Ms. Licudine's only evidence of lost earning capacity as an attorney was testimony that she intended to be a lawyer and had actually been admitted into law schools. Following a $730,000.00 jury verdict for lost earning capacity, the trial court ordered a new damages trial on the ground the plaintiff had presented insufficient evidence of lost earning capacity as an attorney to support the award. On Appeal, the Court held the trial court correctly ordered a new trial because Ms. Licudine did not introduce evidence establishing a reasonable probability that she could have become qualified and able to earn a lawyer's salary or evidence as to what lawyers earn.

The Court of Appeal explained that while California cases have not previously articulated a precise standard for fixing damages for loss of future earning capacity, the "reasonable probability" standard is appropriate. Because the "reasonable probability" standard is consistent with the standard used for calculating pre-injury earning capacity and for assessing lost profits in business cases, as well as with the principle that the amount of damages need not be calculated with absolute certainty where it is certain the plaintiff suffered damages. Further, the standard avoids wholly speculative awards, and according to Justice Brian Hoffstadt "harmonizes nearly all of the patchwork of cases that specify which careers a jury may look to in assessing a plaintiff's earning capacity."

This clarification of the law may prove to be a huge blow to plaintiff's attorneys who undoubtedly benefited from the previous vague standard. While the new standard is still far from precise, it may encourage lower awards and settlements because it will allow defense attorneys to reframe the issue of future earnings under a better defined scope.