Winds of Change for Tort Reform

By Daniel Hawn

Published on November 20, 2004

Bolstered by its success in the 2004 campaign, in February of this year the Republican-led Congress passed a tort reform bill similar to the one shot down during the president's first term.

The new legislation redirects jurisdiction of many cases, including civil litigation cases, from state courts to the federal level. It has a direct effect on consumer class action lawsuits that top $5 million as well as those representing plaintiffs from multiple states.

Under previous law, attorneys could try lawsuits in the state and county where they felt they were most likely to have a positive outcome. The goal of the new restrictions is to prohibit lawyers from "shopping" a class action case to courts whose jurors have historically awarded large monetary settlements.

The tort reform legislation is also designed to deter lawyers from pursuing what bill proponents consider "frivolous" lawsuits. Many multi-state class actions are filed against large corporations accused of producing defective or dangerous products. The measure has made cases like these much more difficult to file.

Those opposing tort reform feel that the new legislation curtails the rights of consumers and leaves them with no recourse when an irresponsible company injures members of the public. They feel that it grants unfair protection to businesses and insurance companies that have lobbied for protection from lawsuits for years.

Without the threat of lawsuits to curb potentially dangerous cost-cutting production practices, tort reform opponents feel that corporations may put consumers at an increased risk.

Lawyers view the right to file class action lawsuits as a necessary protection for the public. From their perspective, the risk of a lawsuit forces companies to assure the safety of their products before making them available to consumers.

Those in favor of the new legislation, including President Bush, nearly all Congressional Republicans, and many small and large businesses feel that the legislation is good for business and the economy. By making it harder for large lawsuits to be heard, the potential for huge financial awards in cases of minor injury or consequence will diminish.

Since the new measure did not affect pending cases, many trial lawyers have spent the last few months gathering as many clients as they could, filing a flood of cases before the new legislation took effect. More attorneys may be looking to do the same, as the GOP is now gearing up to push through new asbestos litigation and medical malpractice tort reform bills.

These issues are sure to spawn even more heated debates between politicians, consumer activists groups, attorneys, businesses and even doctors.

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