Already a Bloomberg.com user?
Sign in with the same account.
TORT REFORM, THE SENSIBLE WAY
"I'm the victim!" proclaims the New Yorker cartoon character, arm in the air, bursting into a room. In an era when fewer and fewer people are willing to shoulder responsibility for their actions, the U.S. legal system has become an arena for assigning blame. Do you have a serious disease? It's the doctor's fault for not curing you, so sue. Cut yourself using a saw? It's the company's fault for not designing it to fit your hand, so sue. Somebody else, with deep pockets, is always to blame. Welcome to the litigious society: America, circa 1995.
The GOP Congress has remedies to offer, and, with one exception, is off to a good start. None too soon. The cult of victimization combined sith jury trials, contingency fees, and punitive damages in civil suits is hurting the economy. Awards are wildly out of proportion to the harm done, prompting companies to spend huge sums to protect themselves--money that could go toward investment and growth. Law firms gross more than $100 billion a year, feeding an army of nearly 800,000 lawyers, up 300% over the past 25 years.
Enough. We would prefer judges to be stricter in throwing out frivolous cases. We would like the citizenry to be more responsible. We would prefer the states to do the reforming. But in lieu of that, federal action is necessary. Hence, the congressional proposals to cap some jury verdicts, deter court actions, and get losing litigants to pay all legal fees.
Capping punitive damages at three times compensatory damages would go a long way toward curbing outlandish awards. Limiting joint liability is a good idea, too. Now, deep-pocketed companies are liable for injuries even if they are only tangentially involved in manufacturing or distributing the products alleged to be defective. That's just crazy. So is the granting of huge medical malpractice awards by juries, which would also be capped in the new legislation.
What doesn't work in Congress' package is the English Rule, which forces losers to pay winners' legal fees. It discriminates against the economically weak and is a dangerous lurch to the extremist right. Far better for judges to exercise more discipline and settle cases quickly.
The point of tort reform is not to prevent individuals from using the legal system to find legitimate redress. The issue is common sense and a return to moderation. What the U.S. has now isn't working. It's time to try something else.