Organizations face risk every day, but major claims often stem from preventable failures. From false advertising and inadequate safety procedures to insufficient product warnings and failures to protect vulnerable individuals, recent cases illustrate how quickly business decisions and operational oversights can result in significant financial and legal consequences. Understanding these exposures is an important step toward strengthening your organization’s risk management strategy and ensuring the right insurance protections are in place.
Jury Awards Gaming Company $420 Million in False Advertising Lawsuit — Liability
A Las Vegas gaming company received a $420 million jury award in a false advertisement lawsuit against a rival platform that misrepresented its gameplay experience. The award is believed to be the largest in U.S. history under the Lanham Act, which governs trademark and false advertising claims. The plaintiff’s platform allows users to wager real money and compete against other players for prizes. Another company later entered the market, advertising a similar player-versus-player model. However, according to the lawsuit, despite claims that its platform allows users to take on players from around the world, the rival company was in fact matching users with bots. The plaintiff alleged that the rival company’s falsely advertised model achieved rapid success, raised advertising costs, and effectively boxed them out of the market. The jury awarded $420 million in damages to the plaintiff. However, the court could instead award disgorgement of profits, with suggested amounts of approximately $719 million (profits-based) or $652 million (cost-savings based).
High School and Nonprofit Tree-planting Organization Agree to $29 Million Settlement After Boy Killed — Liability
A Portland high school and a nonprofit tree-planting organization have agreed to a pre-trial settlement of $29 million following the death of a 14-year-old boy. According to court filings, the boy was participating in a tree-planting event to fulfill a school requirement to log a certain number of volunteering hours before graduating. Despite strong winds, rain, and thunderstorms during the event, those present continued planting shrubs and trees, contrary to National Weather Service guidance to seek shelter during thunderstorms. According to the lawsuit, the victim was struck by a large section of a cottonwood tree that fell from a height of 52 feet and died at the scene from his injuries. The terms of the settlement, including the amount paid to the boy’s mother, remain confidential.
Nutrition Company Ordered to Pay $53 Million in Baby Formula Lawsuit — Product Liability
A nutrition company has been ordered to pay $53 million in damages to the mothers of four premature babies who developed a dangerous intestinal disease after consuming the company’s formula. Three out of the four infants required surgery because of their illness, and all four continue to struggle with gastrointestinal issues, according to the families’ attorney. Although the defendant’s attorneys argued that the babies’ premature birth and prior antibiotic use may have caused the disease, the plaintiffs maintained that the company failed to warn of an increased risk of intestinal disease on the formula’s label. The jury found the company liable and awarded two families $15 million each, one $16 million and a fourth $7 million, all for pain and suffering and loss of a normal life.
Jury Awards $130 Million in Wrongful Death Case Over Failures to Protect Toddler — Liability
A Pierce County jury awarded the estate of a 2-year-old girl $130 million after finding that both the state and a daycare center failed to protect her from abuse. According to court filings, the state had previously removed the girl from her mother’s care after she was admitted to the hospital with injuries consistent with abuse. An investigation identified the mother’s boyfriend as the abuser, but the state later returned the girl to her mother on the condition that there be no contact with him. According to the lawsuit, social workers received multiple reports that the mother and her boyfriend remained in a relationship, and a visiting social worker later acknowledged that they had missed signs of bruising. Additionally, the daycare the toddler attended failed to report visible injuries to authorities, including a black eye, until a week after the girl’s death.
Major claims rarely arise from a single event alone; They’re often the result of overlooked risks, missed warning signs, or decisions that leave organizations vulnerable. While no business can eliminate every exposure, the right insurance coverage and proactive risk management strategy can help reduce the financial impact when the unexpected occurs. If you’re unsure whether your current policies are prepared to respond to these types of claims, contact our team to to review your coverage and help ensure your business is protected before a loss occurs.
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This publication is intended for informational purposes only and is not intended to be exhaustive, nor should any discussion or opinions be construed as professional advice. Readers should contact a licensed insurance professional or attorney for appropriate advice. ©2026 Zywave, Inc. All rights reserved.
