Holidazzle Parade Crash: Firm Wins No-Fault Appeal Setting Statewide Precedent

On the evening of December 4, 1998, a crowd gathered along Nicollet Mall in downtown Minneapolis for the Holidazzle Parade. A city-owned Ford Econoline detox van, driven by a Minneapolis police officer, suddenly accelerated into the spectators. Two people were killed and nine others were injured, some critically.

Investigators traced the crash to an aftermarket Federal Signal Corporation light flasher the city had installed on the van. The device created latent electrical currents that disabled the van's brake-shift interlock, a safety feature designed to prevent the vehicle from engaging drive without the brake pedal depressed, contributing to the van lurching forward into the crowd.

Multiple civil actions followed against the City of Minneapolis and Federal Signal. A Hennepin County jury apportioned fault at 87.5 percent to the city and 12.5 percent to Federal Signal and returned a verdict of roughly $4 million for one injured family, whose claims were tried by separate counsel. Schwebel, Goetz and Sieben represented other injured victims and surviving family members in the same litigation, including the families of the two people who died; those clients resolved their claims by settlement, and the amounts were not publicly disclosed.

The firm's defining contribution came on appeal. Minnesota law capped municipal tort liability at $750,000 total for all claimants combined, an amount insufficient to cover the full range of damages. James R. Schwebel and James S. Ballentine pressed a separate no-fault insurance benefits claim, arguing that the municipal cap could not shield the city from its statutory obligation to pay basic economic loss benefits under Minnesota's No-Fault Act.

Both the Minnesota Court of Appeals, in 2001, and the Minnesota Supreme Court, in a March 2002 ruling, agreed. The Supreme Court held that a self-insured municipality must pay basic economic loss benefits up to $40,000 per person independent of the municipal tort liability cap. The ruling established that accident victims facing the hard cap on tort damages were entitled to an additional layer of recovery through the no-fault system, a precedent that reaches well beyond this single crash.

The wider litigation wound down in November 2001, when the final plaintiffs settled their claims against Federal Signal.