Starting the Tort Reform Dialogue William Tucker
The New York Sun, December 10, 2003 'Lawsuit Hell" is this week's cover story in Newsweek. The reliably liberal weekly
has chronicled the sorry tales of doctors, teachers, ministers, and other professionals
living in fear of litigation.
These are the sorts of stories that fill schoolteachers and doctors and Little
League coaches with dread that the slightest mistake - or offense to an angry
or addled parent or patient - will drag them into litigation hell, months or years
of mounting legal fees and acrimony and uncertainty, with the remote but scary
risk of losing everything," recount staff writers Evan Thomas and John Stuart
Taylor Jr.
In offering solutions, they celebrate the work of an attorney for Manhattan's
Covington & Burling who has become the point man of tort reform, the author
of "The Death of Common Sense" and founder of Common Good, Philip Howard.
The grand irony here is that Newsweek's story appears the same week that the
reliably conservative Weekly Standard has run its own cover story titled "In Praise
(Sort of) of Trial Lawyers." For the first time in memory, a right-wing magazine
has said something positive of the plaintiff bar.
What's going on? Are liberals and conservatives changing partners? Will the Republicans
soon be fund-raising at the Association of Trial Lawyers of America while the
Democrats court the American Medical Association? Or are right and left simply
doomed to take opposite sides, no matter what the issue? As the author of the
Weekly Standard article, I feel the obligation to make some sort of explanation.
Newsweek's concerns - which come quite far along in the game - arise because
lawsuits have gone beyond the realm of corporate America. "Americans don't just
sue big corporations or bad people," says the article. (Are they really that opposite?)
"They sue doctors over misfortunes that no doctor could prevent. They sue their
school officials for disciplining their children for cheating. They sue their
local governments when they slip and fall on the side walk." In other words, trial
lawyers are no longer just targeting "deep pockets." They're going after you and
me.
My article is predicated on the longstanding conservative complaint that trial
lawyers have carved a huge gaping hole in the American economy. From Peter Huber's
"Liability" (1988) to Walter Olson's "The Litigation Explosion" (1991) to the
many articles in Forbes and Fortune, the broad consensus has been that malpractice,
product liability, and other legal strategies have become a "tort tax" amounting
to $200 billion annually. "Trial Lawyers Inc. might well be the most profitable
business in the world," intoned a recent broadside published by the Manhattan
Institute.
Hold on a minute, I suggested. Before we engage in uninhibited lawyer bashing,
let's admit that something good does come out of the tort system.In fact, torts
have become a form of private regulation, carried out without the burden of government
bureaucracy. Lawsuits can zero in on important niches of health and safety without
regulatory ineffectiveness or overkill.
In his recent book "Four Trials," for example, presidential candidate John Edwards
recounts the case of a 5-yearold girl who had 80% of her intestines sucked out
of her body and was condemned to a lifetime of feeding tubes when she became caught
on an uncovered wading pool drain. As her lawyer, Mr. Edwards discovered there
had been nearly a dozen almost identical instances of death or severe injury involving
the same drain. Aware of the problem, the company had simply dodged the issue.
"Doesn't he know this kind of thing should never be put in writing?" was the response
to one internal memo warning of the danger. In this situation, the $25 million
damage award hardly seemed inappropriate.
Republicans would be foolish to get on the wrong side of these issues (just as
Mr. Edwards is foolish to think that winning such cases qualifies him for the
presidency). Yet, despite the productive work done by trial lawyers, there are
obvious flaws in the system. Both Newsweek and the Weekly Standard are attempting
to pinpoint exactly what has gone wrong.
My view is that the system ultimately goes awry when malpractice or product liability
lawsuits runs up against the limits of nature or human tragedy. Many early malpractice
suits, for example, targeted anesthesiologists, who often underdosed or overdosed
patients, leading to side effects and operating room catastrophes. The discipline
underwent a number of reforms in the late 1970s and now lawsuits against anesthesiologists
are rare. Lawsuits against obstetricians, on the other hand, have become a counterproductive
ritual.
The principal cause of action is cerebral palsy, a condition that appears at
childbirth and results in severe lifetime disability. In the early years, malpractice
attorneys argued that CP occurred because doctors were not performing enough caesarean
deliveries. (Mr. Edwards's first big damage award was against an old-fashioned
North Carolina doctor who thought women didn't need C-sections.) Yet caesareans
have now risen from 4% of deliveries in 1970 to 25% today - and the incidence
of cerebral palsy has not fallen one bit.
Obviously, the theory is incorrect. Cerebral palsy has other causes. Many researchers
now believe it results from genetic damage or early trauma in the womb. Yet lawyers
keep bashing away at obstetricians, using the pathetic spectacle of severely inflicted
children to win the sympathy of the jury.The result is obstetricians are going
out of business and women must travel hundreds of miles to seek care.
Many veteran trial attorneys who pioneered liability law now agree the system
is riddled with excesses. The Texas billionaire attorney who bankrupted Dow Corning
over breast implants, John O'Quinn, supports a "loser pays" system that would
force attorneys to reimburse the defense's court costs when it loses. The attorney
who just won $11 billion for Alabama over ExxonMobil gas leases, Jere Beasley,
believes that punitive damages should go to the state rather than the individual
plaintiff. The Gulf Coast attorney who became a billionaire suing Texas oil companies
over asbestos, Wayne Reaud, rails against the "recruiting law firms" that have
turned asbestos litigation into an assembly line.
Damage caps, special medical courts, outlawing contingency fees - no one knows
exactly which strategy offers the best promise of curbing the tort system's excesses
while maintaining its basic advantages, but at least the discussion has begun.
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