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"Losing my faith in humanity ... one neocon at a time."

Friday, February 11, 2005

Tort reform starts

posted by Jazz at 2/11/2005 09:52:00 AM


The senate has now passed a bill to put certain limits on class action lawsuits - the first step in some long overdue tort reform. (Articles on this in the nyt here and here, and in the wapo here.) As I've written here before, this is something that I looked forward to with both anticipation and trepidation. There is a definite need for some sort of reform in an America which has become increasingly litigious. But at the same time, allowing lawmakers to limit the rights of citizens to pursue grievances through the legal system leaves the door open for abuse. Large industry interests (who tend to finance most politicians) obviously have a vested interest in stopping people from suing them, and if they are overly protected, the rights of truly injured consumers could be stepped on.

This bill seems to have some flaws, but it also addresses some serious existing problems. In cases of large, multi-state class action suits, one main issue is the habit of plaintiff's lawyers to "venue shop" for a hearing in a state with laws favorable to their clients to the detriment of a fair hearing for the defendant. This bill addresses that, moving such cases to a federal level.

Protections for the consumer seem to have also been built into the bill, stating that these reforms (and subsequent transfer of the cases from state to federal courts) would not apply to "smaller" suits under $5M nor to cases where all or most of the plaintiffs were in the same state. That seems sensible to me.

Looking around at what some other bloggers are saying, though, there are still questions to be answered. Kevin Drum points out that the bill does appear to handle some serious problems, but that it may create others.
At least, that might have been my opinion except for one thing: a series of Supreme Court rulings starting in 1985 have made it difficult on procedural grounds for nationwide suits to be heard in federal court. This means there might be cases where it's impossible to bring suit in either state or federal court.
This can lead to a sort of "catch 22" situation where some suits may never be heard in either state or federal court, effectively eliminating the plaintiff's only avenue of redress.

James Joyner likes the bill in most regards, but has the same concern.
Obviously, taking away the ability to sue at all is something that even the most hard-hearted capitalist would oppose. I'm unfamiliar with the case in question, so don't know upon what basis it was decided. There may be a simple statutory solution to the problem. If the issue is constitutional, there will need to be a standardization of tort law along the lines of the Uniform Commercial Code.
Julia at the American Street takes a look at why a certain group of Democrats voted against this measure.
"...all the Democrats who voted against it were wholly motivated by their doglike devotion to trial lawyers."
I don't think that's really a fair statement. I'm sure that trial lawyers are heavily invested in the Democratic party, but I think many of these Senators have legitimate concerns over the federal vs. state issues of the bill.

Sam Heldman, an attorney himself, has a long and detailed analysis of the bill. He finds it uniformly unacceptable and brings up a number of points against it not covered by some of the other pundits. He points out that the federal court system is already clogged with more cases than it can hear, and furthermore, the wording of the bill would, in his opinion, allow a number of smaller, single state cases to still be elevated to federal court where they may be rejected or not heard at all. Interesting analysis, and well worth a look.

Dave Johnson is just flatly against this bill and finds it sufficient cause to work against the 18 Democrats who voted for it in their next primary elections. I do see problems with the bill, but that might be a bit extreme.

We will undoubtedly be posting more on this as it develops. There are a lot of details in a very long, complicated piece of legislation for people to pour over before we can determine if this is true, needed reform to the legal system, a giveaway to large corporate interests or, as is so often the case, a little bit of both.