Flex Fitness $16.3 million verdict stayed for now

A $16.3 million jury verdict in July against Flex Fitness stemming from a personal injury lawsuit was stayed by a Los Angeles Superior Court judge Aug. 26 until appeal rights expire in late October.

Meanwhile, Flex Fitness founder Mark Nalley told SNEWS the company is waiting on any additional legal action it is considering against its insurance company for bad faith representation to first see what the insurance company, Atlantic Mutual, decides regarding an appeal.

In the case, Harold Leon Bostick, then 31 and a first-year law student, had sued Flex in April 2001, charging that a defective and dangerous design on the company’s Smith machine in the Gold’s Gym in Venice Beach, Calif., caused him to have a crushing spinal injury and be rendered a quadriplegic. A jury in a Los Angeles Superior Court awarded Bostick $16,274,966 in damages after a 23-day trial that concluded July 25. An additional punitive phase concluded July 28, awarding $1.

Nalley had charged untruths in a press release that was circulated after the verdict by the plaintiff’s attorneys, while Steven Smith, the plaintiff’s attorney with Smith, Chapman & Campbell, had told SNEWS that none of the allegations by Nalley or Flex mattered since the jury had spoken. Both sides alleged lies by the other side during and after the trial and verdict. (See SNEWS story from July 31, 2003.)

In the hearing Aug. 26, the judge and attorneys met for clarification on the verdict. At the time the judge stayed the payment to allow both sides and the insurance company time to read transcripts and to consider their appeal options.

Nalley had told SNEWS that insurance companies are bound by law to protect their clients, and if a verdict is higher than the company’s policy (in this case, $1 million) and the insurance company declined to discuss an earlier settlement, it could be responsible for any payment, not Flex. Smith did not return several phone calls prior to deadline.

Although the case has been a wake-up call to the industry to be more aware of posting warnings and instructions on equipment, Nalley said that didn’t help his company.

“We did learn that the education that’s posted on these machines,” he said, “is virtually worthless.”