101 Iowa L. Rev. 543 (2016)

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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: (1) offering the counter-anchor that, if any damages are awarded, they should only be $50,000; (2) ignoring the plaintiff's damage demand; or (3) attacking the plaintiff's demand as outrageous. Mock jurors were then asked to render a decision on both liability and damages. These individual 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 determination. 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.