MIAMI BUSINESS LITIGATION: JOINT AND SEVERAL LIABILITY FOR BUSINESS TORTS

Under an earlier version of Florida law concerning negligence claims, the doctrine of “joint and several liability” held that all tortfeasors were responsible for the total amount of the plaintiff’s injury regardless of the defendant’s individual fault giving rise to the accident. Gouty v. Schnepel, 795 So.2d 959 (Fla. 2001) (“All negligent defendants [are] held responsible for the total of the plaintiff’s damages regardless of the extent of each defendant’s fault in causing the accident” under the doctrine of joint and several liability.). This earlier version of the joint and several liability rule required codefendants to obtain contribution amongst themselves if any particular defendant wanted to decrease the amount he or she ultimately contribute to satisfy the judgment. Walt Disney World Co. v. Wood, 489 So. 2d 61 (Fla. 4th DCA 1986), approved, 515 So. 2d 198 (Fla. 1987) (“A codefendant must resort to contribution among joint tortfeasors under section 768.31, Florida Statutes, in order to obtain relief.”). This rule could be onerous for solvent judgment debtors when his or her codefendants were insolvent because the solvent judgment debtor had to satisfy the entire judgment amount. Id. (“If the codefendant is judgment proof, then under existing law the solvent defendant must pay it all.”). For example, in the case of Walt Disney World Co. v. Wood, 489 So.2d 61, the jury determined that defendant Walt Disney World was only 1 % at fault, Walt Disney World’s codefendant was 85% at fault, and the plaintiff was 14% at fault. However, the court entered judgment against defendant Walt Disney World for 86% of the total damages, and not merely 1% of the total damages. The Florida Legislature eventually changed the law of “joint and several liability” because it was obviously unjust. Peter Mavrick is a Miami business litigation attorney, and represents clients in Fort Lauderdale, Boca Raton, and Palm Beach. The Mavrick Law Firm represents businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

Florida’s Legislature partially remedied the problem by enacting a statute that replaced “joint and several liability” with “comparative fault” the law governing the State of Florida. Fla. Stat. § 768.81. The statute limits liability to the percentage of fault attributable to each defendant. Compulife Software, Inc. v. Rutstein, 2021 WL 3713173 (S.D. Fla. July 12, 2021) (“Florida is a comparative fault state, meaning that ‘[i]n a negligence action, the court shall enter judgment against each party liable on the basis of such party’s percentage of fault and not on the basis of the doctrine of joint and several liability’”). However, the comparative fault statute does not apply to intentional torts. Fla. Stat. § 768.81.

Most business torts are intentional. Therefore, Florida’s comparative fault statute will not prevent the imposition of joint and several liability. See Powerhouse, Inc. v. Walton, 557 So.2d 186 (Fla. 1st DCA 1990) (“Individual officers and agents of a corporation are personally liable for torts committed within the scope of their employment, and joint and several liability may apply to both the individual who perpetrated the tort and the company for whom he worked.”). The federal court case, Compulife Software, Inc. v. Rutstein, 2021 WL 3713173 (S.D. Fla. 7/12/2021), illustrates the potential for codefendants in a business dispute to be jointly and severally liable. There the evidence demonstrated all four defendants were involved in the misappropriation of the plaintiff’s trade secret. One defendant was involved in acquiring the plaintiff’s database through misrepresentation and deceit, two defendants were involved in acquiring the plaintiff’s database through scraping attacks, and a fourth defendant implemented the stolen trade secret to generate profit. The court determined that all four defendants were jointly and severally liable.

Defendants who are joined in the same lawsuit for alleged wrongdoing arising from the same elements of a business litigation dispute should be aware of potential imposition of joint and several liability. Where appropriate, Defendants should deploy one or more defenses or strategies seeking to offset their own liability, or alternatively, possibly seek recovery or an offset from co-defendants. This will vary on a case-by-case basis.

Peter Mavrick is a Miami business litigation lawyer, and represents clients in Fort Lauderdale, Boca Raton, and Palm Beach. This article does not serve as a substitute for legal advice tailored to a particular situation.