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Verni v. Harry M. Stevens

August 3, 2006

ANTONIA VERNI, AN INFANT, BY HER GUARDIAN AD LITEM, ALBERT BURSTEIN, AND FAZILA BAKSH VERNI, INDIVIDUALLY, PLAINTIFFS-RESPONDENTS,
v.
HARRY M. STEVENS, INC. OF NEW JERSEY, ARAMARK SERVICES MANAGEMENT OF NEW JERSEY, INC., ARAMARK CORPORATION, AND ARAMARK SPORTS AND ENTERTAINMENT GROUP, INC., DEFENDANTS-APPELLANTS, AND DANIEL R. LANZARO, RONALD A. VERNI, THE NEW JERSEY SPORTS & EXPOSITION AUTHORITY, NEW YORK GIANTS, GIANTS STADIUM, SHAKERS, THE GALLERY, MICHAEL HOLDER, ELRAC, INC. D/B/A ENTERPRISE RENTAL CAR, TOYOTA MOTOR NORTH AMERICA, INC., PAUL SMITH, NATIONAL FOOTBALL LEAGUE, AND PAUL TAGLIABUE-COMMISSIONER, DEFENDANTS.



On appeal from the Superior Court of New Jersey, Law Division, Bergen County, BER-L-10488-00.

The opinion of the court was delivered by: Cuff, P.J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

APPROVED FOR PUBLICATION

Argued: May 30, 2006

Before Judges Cuff, Parrillo and Gilroy.

On October 24, 1999, plaintiffs Antonia Verni and Fazila Baksh Verni were severely injured when a car driven by defendant Daniel Lanzaro collided with the car driven by defendant Ronald A. Verni. Antonia was two years old at the time of the accident. Lanzaro had spent the afternoon at Giants Stadium and at two bars after he left the stadium. He was intoxicated at the time of the collision.

Following a lengthy trial, a jury found that Lanzaro had been served beer at Giants Stadium when he was visibly intoxicated. The jury also found that Lanzaro and the Aramark defendants were equally responsible for the injuries caused by the collision. The jury awarded compensatory damages to Antonia in the amount of $53,950,000 and to Fazila, her mother, in the amount of $6,500,000. The jury also awarded $75,000,000 in punitive damages, $65,000,000 of which was awarded to the child and $10,000,000 to her mother. The judgment against Aramark Corporation, Aramark Sports and Entertainment Group, Inc., Aramark Services Management of New Jersey, Inc. and Harry M. Stevens, Inc. of New Jersey totals $109,667,750. Due to multiple errors in the course of the trial, we reverse and remand for a new trial.

On December 14, 2000, plaintiffs Antonia Verni and Fazila Verni filed a complaint seeking compensatory and punitive damages against Lanzaro, Ronald Verni, the New Jersey Sports & Exposition Authority (Sports Authority), Giants Stadium, the New York Giants, Aramark and/or Aramark, Inc.; two bars frequented by Lanzaro after the game, Shakers and The Gallery; and Michael Holder, the passenger in Lanzaro's car. After Aramark, Inc. filed an answer in the name of Harry M. Stevens, Inc. of New Jersey, improperly pleaded as Aramark and/or Aramark, Inc., plaintiffs amended their complaint to assert a claim against Harry M. Stevens t/a Aramark. Harry M. Stevens was the owner of the stadium liquor license and the concession contract. Thereafter, a series of amended complaints were filed. At the time of trial, the beverage server defendants were identified as Harry M. Stevens, Inc. of New Jersey (HMS) and Aramark Services Management, Inc. (ASM). ASM employed the beer servers. Due to settlements and orders granting summary judgment, the remaining defendants at the time of trial were HMS, ASM and Shakers. Prior to trial, the trial judge reserved decision on a motion by defendants HMS and ASM to resolve the issue of the applicability of the Beverage Server Act to ASM. Under the Licensed Alcoholic Beverage Server Fair Liability Act (Beverage Server Act), N.J.S.A. 2A:22A-1 to -7, HMS, as the licensed alcoholic beverage server, was entitled to limit plaintiffs' proofs to whether HMS served Lanzaro when he was visibly intoxicated. Plaintiffs argued that ASM was not an agent of HMS; therefore, it could pursue a common law negligence claim against ASM that allowed more expansive proofs. On January 7, 2005, on the third day of testimony on defendants' case, the trial judge ruled that ASM was an agent of HSM; therefore, plaintiffs could not pursue a common law negligence claim versus defendants. At this point in the proceedings, the jury had heard the following evidence.

At approximately 11:00 a.m. on October 24, 1999, Lanzaro and Michael Holder arrived at Giants Stadium where the men attended a football game. Lanzaro admitted that he did not clearly remember all of the events of the day but recalled that while tailgating before the game, he had consumed two or three of the eight twelve-ounce beers he had in his truck. He described himself as a binge drinker.

The men entered the stadium at approximately 12:30 p.m. for the 1:00 p.m. kickoff. Lanzaro, who had purchased his ticket from a scalper, did not sit with Holder. Rather, he sat in the third or upper tier in section 310. Lanzaro admitted that during the first half of the game he purchased two or more sixteen ounce light beers from an unidentified individual operating a concession stand in the upper tier. Lanzaro "guzzl[ed]" the beer, drinking approximately one beer every ten minutes, and "never had an . . . empty hand," claiming he was "drunk" by the end of the first quarter.

Just before halftime, at approximately 2:30 p.m., Lanzaro left his seat and walked down the "spirals," the ramps leading to the different stadium levels, to meet Holder. En route, Lanzaro, who said he was "shit-faced," purchased "four or more" sixteen ounce light beers from an unidentified individual operating a portable beer cart in the lower level spiral. Lanzaro claimed he told the server how many beers he wanted and then "duked" or tipped the server an extra ten dollars to bypass the stadium's two-beer limit. Although Lanzaro could not recall his conversation, he said he had not been abusive, vulgar, or disrespectful because he wanted to be served, explaining that "if you're a happy drunk, people give you beer. If you're a disrespectful drunk, they cut you off."

Lanzaro walked approximately fifty to seventy-five feet to meet George Lanzaro, his brother, Lisa Lanzaro, his sister-inlaw, and Holder in the spiral by Gate D. George and Lisa, who had been sitting with Holder, confirmed that Lanzaro walked toward them carrying six sixteen-ounce beers. George claimed that Lanzaro appeared to be intoxicated because he had "a blank sta[re] look," was animated, loud, and had "a very slight sway." Lisa confirmed that Lanzaro appeared intoxicated because he was slurring his words, using rapid hand movements while talking, "his eyes were drunk . . . [l]ike floating eyeballs," and he "cupped" his cigarette. Lisa said she gave Lanzaro a sandwich because she "thought he was drunk." Neither Lisa nor George Lanzaro observed Lanzaro purchase the beer. Holder testified at trial that he could not recall whether Lanzaro had appeared intoxicated but admitted that at depositions he had testified that Lanzaro had not seemed drunk.

In any event, Lanzaro maintained that he drank only one or two of the beers he bought in the spiral and offered the rest to his family. Lanzaro then left and purchased marijuana in the spirals from an unidentified individual, but claimed he only had a "couple of hits" because he "was too drunk." He admitted, however, that he likes to smoke marijuana because it makes him "feel a little bit more drunk."

Plaintiffs produced no witnesses that actually observed Lanzaro purchasing beer at the stadium on the date of the accident, nor did they submit any internal reports that showed sales to visibly intoxicated persons on that date. For example, the reports prepared by various employees for that date revealed, in relevant part that: cashier number two in section 108 sold more than two beers to a customer; a cashier at stand 204 on the Mezzanine level sold six beers to a customer; and a bartender was the subject of a disciplinary report for consuming a beer while on duty. Moreover, all of the beer servers who were working in the vicinity of Spiral D had no recollection of serving Lanzaro and further claimed they had not served, or observed service of, visibly intoxicated customers.

Nevertheless, Officer Corey Lange of the Hasbrouck Heights Police Department, who was not present at the stadium on the date in question but who had reported to the scene of the accident, testified in uniform that during the approximately ten games he had attended sometime prior to 1999, he observed many visibly intoxicated people, including some of his friends, served beer, and had never seen anyone refused service. Lange said he stopped attending the Giants games in 2001 because he did not "want to be bothered dealing with the problems that occur in the stadium." Similarly, Lanzaro testified that he had been served at prior games at Giants Stadium when he was visibly intoxicated and that he had never been refused service. Holder also represented that he had been served beer at the stadium while visibly intoxicated.

Lanzaro and Holder left the stadium sometime around the beginning of the third quarter. Lanzaro drank a beer in the parking lot before driving to Shakers, a go-go bar. While there, Lanzaro ordered a light beer, but claimed he had only "a couple sips" because he was "done," meaning intoxicated, and then he and Holder left. Lanzaro drove to a liquor store where Holder bought a six-pack of beer and a bottle of champagne, which they brought to The Gallery, another go-go bar. The Gallery did not have a liquor license but allowed their patrons to bring alcohol. It provided cups, ice and service. Lanzaro and Holder remained at The Gallery for approximately forty minutes during which time Lanzaro admitted he may have consumed a beer, but said that he and Holder did not drink the champagne because it was for the dancers. Gunther Bilali, the owner of The Gallery, set forth in deposition testimony read to the jury that he was not present at the time, but the hosts at his establishment would not allow a visibly intoxicated patron to enter. After leaving The Gallery, Lanzaro drove to a fast food restaurant where he and Holder ate.

At approximately 5:47 p.m., shortly after leaving the restaurant, Lanzaro swerved across the lane of traffic and struck the 1999 Toyota Corolla driven by Ronald Verni. The parties stipulated that "Lanzaro's driving was the cause of the accident." Upon arrival at the scene, Officer Lange and Patrolman Thomas Barnett of the East Rutherford Police Department observed that Fazila was in the back seat "wedged behind the driver" and that Antonia, age two, who was also in the back seat, was unconscious.

Lange said that Lanzaro, who was standing on a "corner in a daze," appeared to be intoxicated. He noted that Lanzaro was swaying, his eyes were bloodshot, his hand movements were fumbling and slow, his face was flushed, and there was a "strong odor" of alcohol on his breath. Sergeants George Netelkos and George Shihanian of the Hasbrouck Heights Police Department, who arrived shortly after the accident, observed that Lanzaro was intoxicated. On a scale of one-to-ten, Netelkos described Lanzaro's level of intoxication as a ten. A test taken at 6:25 p.m. confirmed that Lanzaro had a blood-alcohol concentration (BAC) of .266 percent. Lanzaro was arrested, subsequently convicted of vehicular assault, and sentenced to a five-year term.

Fred DelMarva, plaintiffs' expert in the area of service and training relating to alcohol service, opined that defendants violated the applicable industry standard of care in failing to properly train their employees by requiring them to be TIPS certified. He explained that the six-hour-long Training for Intervention Procedure for Servers (TIPS) program effectively teaches alcohol servers how to spot behavioral cues of intoxicated patrons, and asserted that a study showed that TIPS-trained servers never served customers who had a BAC exceeding .10 percent. However, only 59% of beer servers, 21% of cashiers, and 0% of the alcohol compliance officers at the stadium were TIPS certified.

Moreover, according to DelMarva, various reports and checklists revealed that HMS and ASM violated their alcohol service policy on the date of the accident and on many other dates. He explained that defendants' "standard practice" was to serve visibly intoxicated people and not to serve only those patrons who were "excessively intoxicated." He maintained that HMS and ASM also violated the TIPS policy, which instructs servers to only sell one twelve-ounce beer per transaction, not two sixteen-ounce beers.

Furthermore, Dr. Richard Saferstein, plaintiffs' expert toxicologist, testified that at approximately 2:30 p.m. on October 24, 1999, Lanzaro was visibly intoxicated when he was served beer at the stadium. Saferstein maintained that an average person would exhibit signs of visible intoxication at a .10 percent BAC. Those signs include poor body gait, inability to stand and walk properly, poor muscular coordination, slow and unsteady hand movement, and "perhaps but not necessarily slurred speech and . . . being boisterous and loud." Saferstein also cited to a study where 100 percent of TIPS-trained alcohol servers recognized individuals with a .10 percent or higher BAC as visibly intoxicated. He conceded, however, that "tolerant" drinkers, or individuals who have become acclimated to alcohol, generally do not exhibit signs of visible intoxication at a .10 percent BAC. He concluded, however, based in part on Lisa and George's observations that Lanzaro appeared intoxicated at halftime, that Lanzaro was not a tolerant drinker. Moreover, when an individual's blood alcohol level rises rapidly, as in this case, the signs of intoxication are generally exacerbated.

Saferstein stated that at the time of the accident Lanzaro weighed one-hundred and forty-five pounds, and thus calculated that, assuming Lanzaro began drinking at 11:15 a.m., he would have had to consume the equivalent of sixteen twelve-ounce light beers over the course of the day to reach a .266 percent BAC by 6:25 p.m. Assuming Lanzaro drank three regular twelve-ounce beers in the parking lot before the game, and one beer after he left the stadium, he would have had to consume eight sixteen-ounce light beers while in the stadium. At that rate of consumption, Lanzaro would have reached a .10 percent BAC by approximately 1:30 p.m., .15 percent BAC by 2:10 p.m., and .16 to .18 percent BAC by the time he left the stadium. Thus, Saferstein concluded that Lanzaro was visibly intoxicated when he was served at the stadium, and was still intoxicated at Shakers and The Gallery.

Furthermore, according to Saferstein, even if Lanzaro had consumed three beers before the game and three beers after the game, he still would have had to consume seven sixteen-ounce light beers in the stadium, and would have reached a .10 percent BAC at 1:45 p.m. Moreover, even assuming Lanzaro was a "tolerant" drinker and showed less signs of intoxication, at his BAC level he would have been visibly intoxicated at halftime. Saferstein admitted, however, that Lanzaro would not have been visibly intoxicated at halftime if he had consumed three beers prior to entering the stadium and then had only consumed two more beers during the first half of the game.

In support of their case, plaintiffs submitted evidence of non-compliance by HMS and ASM of alcohol service policies. They presented a document signed by a portable beer stand tender on October 16, 2004, entitled "ARAMARK Giants Stadium Alcohol Policy," which provided in part that "[a]ny person with signs of extreme intoxication will be refused service of alcoholic beverages by server" (emphasis added). In addition, Sharyn Matthews, human resource manager for the Meadowlands Sports Complex, testified that a bartender could sell one beer, instead of two, to a customer who was starting to show signs of intoxication if he or she was "uncomfortable serving two beers." Similarly, Patrick Eggberg, a compliance officer hired in June 1999, testified that if a customer appeared to be intoxicated, he "would make sure that they were ID'd and that they were only served the two-beer limit . . . [o]r that they weren't served at all if they appeared to be too intoxicated." Michael D. Frey, another compliance officer, testified that a customer who was slightly intoxicated, but otherwise not causing any problems, would be served alcohol at the stadium. Nevertheless, Chris Findley, one of the concessions managers; Nicholas Valdez, a compliance officer; Shihanian, another compliance officer and one of the police officers who arrived at the scene; and Richard Roper, vice president of concessions at the Meadowlands; in addition to several beer servers and other compliance officers, testified that defendants' policy in October of 1999 was not to serve anyone who was visibly intoxicated.

In their defense, HMS and ASM presented evidence of the alcohol service policy at the stadium. John Mara, Executive Vice President of the New York Giants, testified that generally, 75,000 to 80,000 people attend each of the sold-out Giants home football games per season.*fn1 Giants Stadium and the Sports Authority allowed alcohol to be consumed at pre- and post-game tailgate parties in the parking lot, and hired security guards to monitor that area. In addition, they submitted expert testimony on the issue of whether Lanzaro would have appeared intoxicated when he purchased beer in the stadium.

Robert Pandina, defendants' expert in toxicology and addictive behavior, opined that Lanzaro, who he characterized as a tolerant or experienced drinker, had a .13 percent BAC at halftime, when he was last served alcohol. At that level, Lanzaro would not have exhibited any visible signs of intoxication. Pandina explained that his calculation was based on the assumption that Lanzaro drank three regular beers before the game, one regular beer in the parking lot after the game, a few sips of beer at Shakers, and two to four beers and a glass of champagne at The Gallery. Based on those assumptions, Pandina concluded that Lanzaro would have consumed approximately three-and-a-half sixteen-ounce beers in the stadium. Pandina admitted, however, that without accounting for alcohol tolerance, even an untrained individual could notice signs of intoxication at a .15 percent BAC.

Similarly, Herbert Moskowitz, defendants' expert in behavioral toxicity, opined that Lanzaro was "relatively tolerant to alcohol" and would not have shown signs of visible intoxication at .12 percent BAC. He explained that Lanzaro "had a very extensive drinking history" and thus was less likely to show signs of gross intoxication at lower levels because he would have learned to control his behavior. And he criticized Saferstein's citation to the TIPS study, explaining that the study only demonstrated that the program "worked very effectively in a situation where you have continual intermittent contacts with the individual drinking and you can observe them over long periods and . . . observe how much they're drinking." Moskowitz was also critical of Saferstein's failure to account for Lanzaro's marijuana use, noting that "marijuana has a powerful interactive effect with alcohol in increasing the impairment."

Finally, Gil Fried, defendants' expert in stadium risk management, opined that defendants' policies met and exceeded industry standards. Fried, who admitted that he was not a strong proponent of the TIPS program, found that defendants had appropriately trained their employees on the job. He conceded, however, that the failure to provide any training to alcohol-servers would constitute a breach of the applicable standard of care.

In 1999, the alcohol service policy at Giants Stadium included a two-beer limit per transaction, a prohibition against serving minors and patrons who were visibly intoxicated, and cessation of beer sales at the start of the third quarter. The alcohol service policy was communicated to employees through the "Serves You Right" program, in which employees were given instructions regarding alcohol awareness during orientation through signs, clipboard reminders, and pre-game instructions, and through participation in the TIPS program.

Stephen Musciano, the former General Manager of Aramark who oversaw the entire Aramark operation at Giants Stadium, explained that the TIPS program taught beer servers how to "identify visibly intoxicated people." Beer servers were responsible for enforcing the alcohol service policies, and these positions were considered "premium" jobs and were usually filled by senior, experienced union members. Joseph Pistone, the developer of the "Serves You Right" program, believed defendants' policy was to have all beer servers TIPS certified. A corporate memo dated March 29, 1999, confirmed that "[a]ll management staff and service personnel are to be Tips trained."

However, Musciano, who originally represented at deposition that all of the beer servers were TIPS certified, conceded at trial that although that was the corporate goal, in fact, not all of the beer servers were certified. Nonetheless, he believed "that most of them if not all of them had experience in alcohol management through the union." Moreover, Mathews testified that from 1998 to 2004 she had trained over 500 employees in the TIPS program.

In an effort to facilitate and check the beer servers' compliance with the stadium's alcohol service policies, approximately twenty-five alcohol compliance officers, who were not TIPS certified but were generally retired or off-duty police officers, were positioned throughout the stadium. The officers were required to fill out an "Alcohol Compliance Checklist" for every game. Plaintiffs submitted into evidence forty-two alcohol compliance checklists from 1997 to 2004, which revealed that the alcohol service policy had been violated on numerous occasions. For example, in a checklist dated December 5, 1999, the officer reported that a bartender was advised of the two-beer limit on three occasions, and another bartender was observed serving four beers to patrons throughout the first quarter.

Additionally, four undercover individuals or spotters were also positioned throughout the stadium to document violations of the alcohol service policy. Plaintiffs submitted into evidence seventeen spotters' reports dated from 1997 to 2000, which again revealed that the policies had been violated. For example, in a report dated December 13, 1999, one of the spotters reported three separate instances where a beer server sold more than two beers to a patron, and several instances where a beer server allowed patrons to pour their own beers.

Musciano, who represented during depositions that he was unaware of any of these violations, admitted that the beer servers should have been disciplined, and that records of any disciplinary action would have been placed in the employee's file. However, defendants produced only seven incident reports for the years 1997 to 1999, and eleven "Notice of Disciplinary Action" reports for the years 1997 to 2000.

I.

HMS and ASM*fn2 argue that the trial judge erred in admitting evidence of a "culture of intoxication" at the stadium. They urge that such evidence is irrelevant to the central issue in a claim against a licensed beverage server and that admission of such evidence caused undue prejudice to HSM and ASM. We agree and further hold that the error caused sufficient prejudice to the Aramark defendants and thus, a new trial is required.

By order dated November 19, 2004, the motion judge denied plaintiffs' pre-trial motion to bar ASM from raising any defense based on the Beverage Server Act. Similarly, the trial judge deflected ASM's motion at the commencement of trial to resolve the application of the Beverage Server Act to it. The judge determined that he would allow evidence of agency, as well as evidence in support of a common law negligence claim against ASM, to be admitted at trial. He ruled that he would determine the agency issue at the appropriate time and issue a limiting instruction, if one was required.

On January 5, 2005, at the conclusion of plaintiffs' case, the trial judge denied defendants' Rule 4:40-1 motion and deferred a ruling on the agency status of ASM. He said, "the issue of negligence will arise if and when I make a decision on the issue of agency." Defendants commenced the presentation of their case on January 5, 2005. On January 7, the third day of the defense case, the judge ruled that ASM was an agent of HMS and that the Beverage Server Act governed its liability. At no time, however, did the trial judge issue a limiting instruction to the jury.

The Beverage Server Act provides the exclusive remedy for dram shop causes of action. N.J.S.A. 2A:22A-4; Fisch v. Bellshot, 135 N.J. 374, 382 (1994); Truchan v. Sayreville Bar and Rest., Inc., 323 N.J. Super. 40, 53 (App. Div. 1999). Common law claims arising out of the negligent service of alcoholic beverages are thus barred by the exclusivity provisions of the Beverage Server Act. Truchan, supra, 323 N.J. Super. at 53. The statutory duty under the Beverage Server Act is set forth in N.J.S.A. 2A:22A-5, which defines negligence for purposes of civil liability as follows:

a. A person who sustains personal injury or property damage as a result of the negligent service of alcoholic beverages by a licensed alcoholic beverage server may recover damages from a licensed alcoholic beverage server only if:

(1) The server is deemed negligent pursuant to subsection b. of this section; and

(2) The injury or damage was proximately caused by the negligent service of alcoholic beverages; and

(3) The injury or damage was a foreseeable consequence of the negligent service ...


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