You remember incorrectly; a jury found for the LOL and awarded her several millions of dollars. A judge reduced that and eventually, about $650K was paid, at least 30% to LOL's attorney.
See this web site:
http://www.stellaawards.com/stella.html
It's just one of the more egregious examples of jackpot justice.
But the real question is why? Are such suits ever a good thing? Boy, that's tricky; sometimes, corporations/governments/individuals run rough shod over others, consequences be damned (does Enron come to mind?). If MacDonalds clobbers Procter and Gamble, well, they can both afford lots of attorneys to duke it out.
But if Mr.Big, Inc., cheats a bunch of little people out of $500 each, they can either become a swarm of gnats in small claims courts (good luck collecting even if you win), or they can jointly hire some attorneys on contingency (they get paid a portion of the winnings, nothing if they lose) and sue en masse.
The problem, in my estimation, is that judges allow far too many frivolous and baseless suits to proceed; the cost of defense (not to mention bad press due to inflammatory press conferences by plaintiff lawyers) frequently is greater than just paying them off. And the payoff is often pennies (or discounts on future purchases as in a Microsoft case, which are actually free or even profitable) to millions of plaintiffs, and 1/3 of that TOTAL AMOUNT in cash to the plaintiff attorneys: like a $10 discount on future purchases for a million plaintiffs is valued at $10,000,000 for purposes of calculating attorneys fees.
If judges would just cut 'em off, make truly frivolous suits loser pays, etc., and US legislatures institute some tort reforms so that penalties for even damaging behavior would be proportional to actual damages, things would improve.
EddieO
No McDonald's settled with that lady who spilled the coffee for millions if I remember right.