Few civil cases touch the high-dollar Pensmore suit

The trademarked Helix rebar slivers are small enough to easily fit dozens in the hand of Chateau Pensmore owner Steven Huff. But not including enough of the steel reinforcement in the construction of Huff’s sprawling 72,000-square-foot Christian County residence could turn out to be a $63 million blunder.

Through Steven T. Huff LLC, the former CIA agent and software entrepreneur is seeking $63 million in damages in a federal civil suit against contractors The Monarch Cement Co., of Humboldt, Kan., and City Wide Construction Products Co. in Ozark. The breach of contract case is a year old, but the magnitude of the claims has expert witness deadlines being extended last week ahead of a scheduled November trial.

Huff charges the companies deliberately shorted his project by 25-30 percent of the specialized rebar designed to give the concrete-block mansion additional strength to survive EF5 tornados and stand for centuries.

According to the filing, “Huff dedicated years of his life to executing his Pensmore strategy, studying the most innovative construction and green energy technologies and investing in the companies that developed them. Pensmore was to be the model, designed to change the very nature of safety and energy standards in constructing schools, hospitals and homes.”

On May 10, the case had four actions related to extending discovery before the parties conferred and agreed to May 23 and July 7 deadlines. Huff claims defendants knowingly left out 72,000 pounds of Helix they agreed to use in construction. Huff said in the filing, he was tipped to the deception by a whistleblower. Beyond the $63 million, Huff also is asking for exemplary damages to be determined by the court to deter the defendants from committing further alleged fraud.

‘The color of money’
The eight-figure lawsuit ranks among the larger contract cases a few longtime attorneys have seen in the area.

“I mean, entire hospitals have been built for $63 million,” said Frank Evans of Lathrop & Gage LLP, a civil trial practice attorney with 42 years of experience. “Off the top of my head, I can’t think of a $10 million business recovery in litigation in Greene County.”

Evans said it is very rare for civil cases, and especially contract lawsuits, to escalate as high as the Pensmore case.

“The largest verdict I’m aware of in Greene County was some years ago [following] a very tragic death of a young boy electrocuted by a defective lamp,” said David Ransin, a 34-year attorney who runs Ransin Injury Law.

Sitting Missouri State University President Clif Smart was on the Strong-Garner-Bauer PC legal team that secured a 2001 verdict of $15 million in damages for plaintiffs Charles and Ginger Foster, parents of Conor Foster. In 1995, 4-year-old Conor was playing hide-and-seek when he was electrocuted. Initially, the cause of death was undetermined. Two years later, after his father was shocked by the lamp as he reached to pick up an item and made contact with the base of the lamp and a metal air duct cover, the parents got the lamp tested and later filed suit against importers Grandrich Corp. and Catalina Industries.

Tort cases, which center on a wrongful act that leads to injury as opposed to a breach of contract, are more likely than contract suits or real property cases to be decided by a jury trial, according to a review of 2005 data by the Bureau of Justice Statistics, the most recent identified analysis of its kind. The BJS found nine out of 10 tort cases went to a jury trial as opposed to 36 percent of contract cases and 26 percent of real property suits. That year, 6 percent of jury trials awarded $1 million or more in compensatory and punitive damages.

Another Strong-Garner-Bauer civil case was a national suit that brought settlement negotiations into the billions of dollars.

Filed in 1997, longtime Springfield attorney Thomas Strong was at the center of the State of Missouri v. American Tobacco Co. Inc. case that secured a $6.7 billion settlement for the Show-Me State.

“The attorney general, Jay Nixon at that time, was talking to me about it in years before: Should Missouri sue the tobacco industry? The tobacco industry for 40 years had never paid one penny to any smoker or the descendants of a deceased smoker. It had a perfect record,” said Strong, who began practicing law in 1957 in Springfield. “But there was starting to be a clamor for somebody to sue. A person really couldn’t afford to sue the tobacco industry. They’d be bankrupt. But a state could, so some of the states got interested.”

It was a gamble. Strong said Nixon retained him without a budget to pay for services. Taking on $5 million in expenses over a four-year period, a big win was the only hope of recovery for Strong, who was appointed lead special assistant attorney general.

“As it turned out, the state never had to pay me. Part of the settlement provided that the tobacco industry would have to pay the attorneys,” Strong said of the case upheld by the Supreme Court in 2001. “At the time, and I’m sure it still is, it was the single-biggest recovery for an attorney in Missouri’s history.”

Strong said he was motivated by moral reasons to take the case.

“That’s such an evil industry. They had no conscience,” he said. “Their morals were green in color – the color of money.”

Wrongful act claims
Personal injury attorney Ransin said federal civil filings require a stated claim of damages, but state law prohibits filing specific monetary claims to discourage unnecessary suits and public attention. He said that’s why state filings often say parties are seeking damages “in excess of $25,000.” And with insurance companies pushing for confidentiality agreements with plaintiffs, he said many multimillion-dollar settlements don’t become part of the public record. “There are many settlements you’re never going to hear about,” he said.

This year, Johnson & Johnson (NYSE: JNJ) has lost two tort cases in St. Louis related to its talcum powder: a $55 million verdict on May 2 following a $72 million verdict in February. Both plaintiffs brought claims Johnson & Johnson’s talcum powder caused ovarian cancer, part of over 1,000 state and federal suits accusing the company of ignoring studies that link the disease to its baby powder and Shower-to-Shower product, according to Bloomberg news reports.

According to BJS.gov, the median total award for a plaintiff winner in jury trials in 2005 was $30,500.

In November, a local jury will convene to determine whether Huff has an extraordinary award coming to him. District Judge Beth Phillips scheduled the Pensmore jury trial to begin 8:30 a.m. Nov. 14 at the federal courthouse in Springfield.