agreement in this action is fair, adequate, and reasonable.
First, further litigation in this case clearly would present issues that would be costly to resolve and that could result in protracted proceedings. Most of the evidence upon which plaintiff intended to rely to prove the outrageous conduct necessary to recover punitive damages was circumstantial and accretive. Moreover, the case would have involved difficult questions of admissibility of this evidence. For example, to establish that Tom Connor was under the influence of intoxicants on the morning of the accident, plaintiff would have relied on occurrence witnesses, the positive drug test conducted three and one-half days after the wreck, Mr. Connor's poor work attendance record, his flight from the scene, and his invocation of the fifth amendment. The last fact in particular raises delicate issues of probity and unfair prejudice. See Fed.R.Civ.P. 403. Plaintiff also would have utilized, at considerable expense, expert witnesses to show that the combination of drugs found in Mr. Connor indicated that he was a habitual drug user, which, plaintiff believed, tended to demonstrate that Mr. Connor was under the influence of drugs at the time of the collision.
Further, to establish recklessness plaintiff planned to introduce evidence of prior intrusions by Amtrak trains onto out-of-service tracks and of Amtrak accidents at Edison, New Jersey and Chase, Maryland. These events, plaintiff asserted, indicate that Amtrak was on notice that its switching procedures were inadequate and that suspicious employee work and driving records, like those of Mr. Connor's, were indicative of possible drug abuse. Obviously, proof or disproof of these occurrences implicates complex evidentiary issues and entails the introduction of numerous witnesses and documents.
Even more expensive and protracted would have been the task of developing and trying the damages phase of the case. Each of the forty-one class members would have been subject to a possible deposition. Some or all may have been required to travel the potentially considerable distance to Philadelphia and present medical testimony. Friends and relatives may have been called to corroborate their injuries.
Second, the reaction of the class to the settlement is perhaps the most significant factor to be weighed in considering its adequacy. The Court ordered notices be served on all class members, and none have lodged objections to the settlement with counsel for either party or with the Court. The utter absence of objections from the class itself militates strongly in favor of approval of the settlement.
Third, although the proceedings are relatively advanced, enough so that the parties are fully cognizant of the issues and risk involved in further litigation, and discovery has been completed, a settlement at this time would represent significant savings of trial and appeals costs.
The fourth and fifth Girsh factors, the risks of establishing liability and damages -- are considerable for both plaintiff and defendant. As discussed earlier, much of plaintiff's proof of willful misconduct was vulnerable to exclusion on Rule 403 grounds. Judicial resolution of these matters would have affected tremendously the viability of both parties' cases.
We note initially that punitive damages are not a favorite of the law, Cochetti v. Desmond, 572 F.2d 102, 105 (3d Cir. 1978), and that large punitive damage awards are not common. In this case, given that Amtrak is not a profitable company, but receives an annual government subsidy of some $ 600 million, that after The Night Owl accident Amtrak instituted a variety of back-up safety systems, and that the passengers' physical injuries on the whole were not egregious, a jury may well have found little reason to punish the company or attempt to deter any future misconduct on its part by means of a large punitive damages award.
Additionally, the bulk of damages sought here is inherently speculative. Many class members suffered only a small amount of medical and other out-of-pocket expenses.
Almost all requested damages were for pain and suffering and emotional injury. As such, because their valuation is entrusted primarily to the jury's discretion, these claims for substantial compensatory damages involved a high degree of risk. For that same reason the defendant's exposure was considerable.
Sixth, although the danger of class decertification at trial appears minimal, as noted above, the class members would have assumed a significant risk that classwide relief might not be available, and defendant would have faced the possibility of substantial damages.
Seventh, the Court has considered defendant's ability to withstand a greater judgment. There is no evidence in the record before the Court that Amtrak would be unable to satisfy a larger damages award. The short history of Amtrak, however, reveals that it has not been a profit-making enterprise, and its continuance has depended on government subsidies. The proposed settlement would obviate the risks associated with class members obtaining an even more sizeable award against defendant and thereafter discovering that it could not satisfy the judgment.
Last, the Court has evaluated the range of reasonableness of the settlement in light of all the risks associated with litigation. Plaintiff's reliance on circumstantial and accretive evidence of Amtrak's putative willful misconduct and the speculative nature of damages based on emotional distress and pain and suffering place severe obstacles to proving both liability and damages. Although an award in excess of the settlement value might be a possibility at trial, the settlement is well within the range of reasonableness identified by the Third Circuit in Girsh. It is also significant that neither counsel nor the Court has heard any objection to the proposed settlement, although members of the class received formal notice of its terms. The Court, therefore, finds that the relative considerations weigh in favor of the proposed settlement and that the proposed settlement is fair, adequate, and reasonable.
AND NOW, this 27 day of September, 1989, upon consideration of the class action settlement agreement submitted by the parties for approval pursuant to Federal Role of Civil Procedure 23(e), for the reasons set forth in this Court's Memorandum of September 27, 1989,
IT IS ORDERED that the Proposed Settlement of the above-captioned action is APPROVED.