$10,000,000 – Warehouse Mishap

Four companies have agreed to pay a total of $10 million to a man who was rendered paraplegic when a heavy pallet allegedly fell on him from a high shelf in the warehouse where he worked.

Robert J. Mongeluzzi

In Yates v. Omnilift Inc. , according to the plaintiff's mediation memorandum, 29-year-old Neil Yates was working in the warehouse of deli products manufacturer Dietz & Watson when he was struck by an approximately 400-pound pallet that had been knocked off the highest shelf of a storage rack by a co-worker attempting to move a pallet on the rack directly behind it using a lift truck.

According to the plaintiff's memorandum, Yates suffered spinal fractures resulting in incomplete quadriplegia and complete paraplegia, closed-head injury with a subdural hematoma, transverse sternal fracture, left femur fracture, distal right fibular fracture, right fifth through seventh rib fractures, left fifth through eighth rib fractures, two collapsed lungs and spleen and liver lacerations.

The plaintiff in his memorandum alleged that the incident occurred because the racks were set up back-to-back, with no barrier separating the highest shelves, thus allowing the pallet Yates' co-worker was trying to move on one rack to be pushed onto the rack behind it, displacing the pallet on that rack and ultimately causing it to fall.

The plaintiff named four defendants in the case: Omnilift Inc., designer and distributor of the shelves on the warehouse racks that also designed, configured and erected the rack system in Dietz & Watson's warehouse; Bulldog Rack Co., from whom Omnilift had purchased the racks; Penn Industrial Installations, whom Omnilift contracted to install the racks; and Crown Equipment Corp., manufacturer of the lift truck.

The plaintiff alleged in his memorandum that Bulldog and Omnilift were aware of devices called pallet stops and backstop beams that would have created a barrier between the back-to-back racks but failed to install them.

Penn Industrial was negligent because it failed to correct the safety hazard upon post-installation inspection, the plaintiff said in his mediation memorandum.

The plaintiff's claim against Crown alleged the lift truck was defectively designed or manufactured because it did not include a vision system or camera that would have allowed the user to see where he was putting the forks of the lift on the high shelf, according to Crown's settlement conference memorandum.

Omnilift, in its own mediation memorandum, disputed the claim that Yates was hit by a pallet that fell from the top shelf of the rack.

Instead, a stack of boxes on the warehouse floor was struck by part of the lift truck and toppled over on him, Omnilift said in its memorandum.

"It is unlikely that Yates would have even survived being struck by a 450-pound load from a height of more than 30 feet," Omnilift said in its memorandum.

Bulldog said in its own settlement conference memorandum that it did not design or lay out the rack system in the Dietz & Watson warehouse, but rather Omnilift did and then ordered the component parts from Bulldog.

Bulldog said in its memorandum that these parts were totally safe.

Penn Industrial maintained in its own settlement conference memorandum that it could not be liable for installing an allegedly defective product and that, even if it had known the design and layout of the racks created an alleged hazard, it had no obligation to create or add safety devices.

Crown said in its own settlement conference memorandum that its lift truck was not defective and that lack of vision aids did not contribute to the incident because the operator of the lift truck testified that he had not had any visibility problems.

According to the plaintiff's memorandum, Yates now suffers from skin breakdown, spasticity, severe pressure ulcers and bladder and bowel dysfunction with no hope of ever walking again.

None of the defendants disputed Yates' injuries.

The plaintiff's memorandum said Yates' workers' compensation lien consisted of $1,265,197.78 in recoverable, "actually paid" medical bills and listed his lifetime medical expenses as $6,840,262, citing an expert report by Mona Yudkoff.

Yates' future medical expenses using net annual growth rates fell within a range of $6,574,500 and $10,786,700, according to an expert report by Andrew Verzilli cited in the plaintiff's mediation memorandum.

Verzilli also calculated Yates' lost earning capacity at $2,204,962, according to plaintiff's memorandum.

According to the plaintiff's memorandum, the total estimated economic damages came to $14,256,859.

Yates' attorney, Robert Mongeluzzi of Saltz Mongeluzzi Barrett & Bendesky, said the case settled Feb. 12 after about four days of mediation with Ed Edelstein of ADR Options.

Trial had been scheduled for May 15.

According to Mongeluzzi, Penn Industrial agreed to pay its $1 million policy limit, Bulldog agreed to pay $3,750,000, a little more than half of its $6 million policy limit, and Crown agreed to pay $250,000.

Omnilift agreed to pay the remaining $5 million, exhausting its own policy limit.

Saltz Mongeluzzi attorney Andrew R. Duffy, who tried the case with Mongeluzzi, said the most significant moment in the case came "30 seconds into the deposition of the president of Bulldog Manufacturing."

"[We asked] 'Sir, have you seen the rack system Omnilift put up [and] did you think it was safe or unsafe?' He said, 'I thought it was unsafe,'" said Duffy.

According to the plaintiff's memorandum, the wording of the exchange saw the plaintiff's counsel asking Von Kurty, Bulldog's president, "After you saw the rack system, did you form an opinion as to whether or not the rack system at the Dietz & Watson dry goods warehouse is a safe design?"

Kurty replied, "No, it could be safer."

Bulldog's attorney, John J. Delany III of Delany & O'Brien in Philadelphia, said his client was "very pleased" with the settlement.

He said his client agreed to settle because of Yates' ability to put over $14 million on the board at trial and because Omnilift was insured for only $5 million.

Delany said his client got a relatively good deal in the settlement.

"We saved $2.25 million off of our policy limits, which is unheard of in a case like this," he said. "Our client was pleased and the carrier was pleased."

Also unavailable at press time were Penn Industrial's counsel, Joseph P. Connor III of Paoli, Pa.-based Connor Weber & Oberlies and Crown's attorney, William J. Conroy of Campbell Campbell Edwards & Conroy in Wayne, Pa.

Omnilift's attorney, Stewart R. Singer of Salmon Ricchezza Singer & Turchi in Philadelphia, declined to comment.

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Robert J. Mongeluzzi

Office: 215-575-2989