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MLN Law Obtains $54 Million in Verdicts Against Avis and Others – Avis Held Responsible for Employee’s Negligence

On February 3, 2017 and March 15, 2017, Gwinnett County juries returned verdicts of $47 million and $7 million in companion cases against Avis Budget Group, Avis Rent a Car, LLC, and related defendants.

The cases were tried before Judge Joseph Iannazzone in Gwinnett State Court.  In the first trial, the jury returned a verdict of $47 million for a woman that lost her left leg above the knee.  The jury assessed fault as follows: 50% to Avis, 1% to Avis’ security manager, 15% to Avis’ agency operator, 1% to the agent’s manager, and 33% to Byron Perry.  In the second trial, the jury returned a verdict of $7 million.  100% of the fault was apportioned 100% to Avis.

The trials occurred because on August 23, 2013, Byron Perry, an employee working at Avis’ Courtland Street location stole Avis’ Ford Edge.  After stealing the car on August 23, Perry drove through a residential neighborhood at high speed and rounded a corner at over 70 miles per hour.  He lost control of the car and struck two friends sitting on a wall in a park.

Evidence presented at trial showed that Perry had been convicted or pled to multiple felonies.  Yet no one had done a criminal background check on Mr. Perry prior to his being hired.  Further, Avis had suspected Perry might have been involved in one other theft from the Courtland Street branch prior to August 23.  However, Perry was allowed to continue working at the location.  Perry testified at the second trial that with his record (which included receipt of a stolen vehicle) hiring him to work at Avis was like hiring a sex offender to watch kids.

Two young woman were catastrophically injured in the park.  The first, 22 years old, was found at the scene, conscious and in severe pain.  She suffered multiple, severe traumatic injuries.  Both of her legs were fractured and her left leg was torn off, as a result of being dragged under the vehicle.  She was hospitalized for 32 days and underwent five (5) surgeries, including an above-knee left leg amputation and surgeries to place nails and pins in her right leg and left wrist.

The second, 21 years old, was initially found unconscious at the scene, pinned between the vehicle and a fence.  She suffered multiple traumatic injuries, including a fractured pelvis, a fractured hip, and a 12-inch laceration on her left thigh.  In the ambulance ride to the hospital, she cried out: “I am going to die.”  She spent 55 days in the hospital and underwent 19 surgeries.

These friends filed suit against Avis, Avis’ security manager, Avis’ agency operator of the Courtland Street location, and Byron Perry, who eventually pled guilty to charges arising from the crash.  The friends hired Bryce Angell who retained Michael Neff as lead counsel.  The cases were consolidated for discovery but tried separately.

Avis argued that it was not responsible for the damages.  Avis’ primary legal argument was that it could not be responsible because Courtland Street was being “independently operated” by an agent that Avis had hired and trained.

Discovery took nearly three years.  Plaintiffs were able to obtain the complete email accounts from 5 custodians, which totaled over 250,000 emails as well as hundreds of Avis stolen vehicle reports.

Within that evidence was many emails and correspondence which showed that Avis controlled the time, manner, and method of operations – especially regarding the finances / sales.  Avis kept 89% of the revenue generated at Courtland Street and paid its agent 11%.  Avis predominantly uses these agency models at the non-airport / “local” stores.  Avis supervises these stores with Territory Performance Managers that oversee the sales and finances.  Avis also oversees security at the locations with a national network of security managers.

Evidence was presented that when Avis was unique in its widespread reliance on these alleged independent agents.  In the 1970s Avis began to move away from franchisees where they may only make 7% on revenue to its agency operator model. Both Gwinnett County juries answered special interrogatories that the agency operator at issue was an Avis employee.  This is important because Avis faces liability for the torts of its employees.

The jury also heard testimony that while most of the requirements and paperwork for Avis-operated and “independently-operated” facilities were the same, they differed in one key respect: background checks.  Avis-operated facilities required background checks, while as of the date of the incident, Avis chose not to require agency operators to do criminal background checks.

At Courtland Street, Avis leased the premises and required the operators to pay no rent.  Avis’ corporate security team would conduct security audits of the locations, investigate thefts, and interview the operator’s employees.

The evidence showed that prior to the incident, Avis’ security manager interviewed Byron Perry after he had previously been suspected of being involved in another theft at the location.  The security manager testified that even though Perry was a suspect, he never pulled Perry’s employee file or did a background check.  Had a background check been done, it would have revealed that Perry was a five-time convicted felon who had spent years in prison and had a litany of theft and drug charges.  Avis’ own expert testified that hiring Byron Perry was a “zero” on a scale of 1-10.

Three months before the 2013 incident, Avis knew that the gate keys issued to two of Avis’ salespeople at the Courtland location went missing.  Avis’ security manager was notified of this fact via email. During his deposition, the security manager had testified that changing the locks would be a “high priority.”  However, the Courtland gate locks were never changed.

The jury also heard evidence that months before the incident, Avis cancelled a “performance excellence” study which was convened because Avis was seeing an increase in costs due to lost or stolen keys. The thefts were tied to Avis’ two-key system, where the company would bundle all keys and fobs for a vehicle on a single key ring, which was given to the customer.  The Plaintiffs introduced Avis documents which showed one or more keys or fobs being cut from the key ring and used to steal the cars at a later date.  Evidence at trial reflected that Perry cut and removed a vehicle key in the same manner that Avis had repeatedly seen at other locations.  The evidence allowed an inference that Perry returned after closing with one of the gate keys to steal the Ford Edge.

During discovery, Avis did not produce a location file for the agent’s prior operations.  The file, if produced, would have had any records of past thefts at the agency operator’s locations or disciplinary actions taken against him.  And there was oral testimony of two cars being stolen by one of the agent’s employees while operating in North Carolina.  However, Avis continued to promote the operator to bigger locations.  When asked his opinion of Avis continuing to give the operator more locations after the thefts, he replied, “I don’t know what they are thinking.”

At trial, the friends were represented by Michael Neff, Dwayne Adams, Susan Cremer, and Shane Peagler of the Law Office of Michael Neff, and by Michael Terry and Amanda Seals Bersinger of Bondurant, Mixson, and Elmore.

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