Corp Reform - Not Tort Reform

Social irresponsibility must be the answer, then!

Ted Frank at the AEI will be moderating a discussion today about managing corporate image.  I wish I was close enough to D.C. to attend, as the debate might explain why being socially irresponsible - outsourcing jobs, moving factories to countries with lax environmental laws, encouraging your employees to apply for Medicaid, getting life insurance on employees with dangerous jobs instead of improving safety conditions - is the better business practice. 

Does corporate social responsibility represent a good business strategy in the long run, or has reputation management become, in effect, an apology for making money? If so, does this trend ultimately pose a threat to free enterprise?

Source: PointofLaw.com | PointOfLaw Forum: Corporate Image Advertising and the Future of Free Enterprise

To answer the question posed above, reputation management has become, in effect, an apology for making money by exploiting workers, polluting or otherwise damaging the Earth, and putting profits well ahead of safety. 

Ted notes that Steven Hantler of DaimlerChrysler (Is it going to be Chrysler again?) will be attending.  Hantler might be familiar to you for his policy of adopting scorched Earth litigation tactics for the sole purpose of discouraging trial lawyers from suing his employer, even if the underlying case is meritorious.  Hantler also gained a reputation as being a hypocrite for spending "six figures" to defend an $8,000 claim, and then arguing that the winning plaintiff wasn't entitled to $143,000 in attorney's fees.  Apparently, "loser pays" is only fair to corporations when they aren't the loser.

Technorati tags: Steven Hantler, AEI, Steve Hantler, social responsibility, social irresponsibility

A great comment at TortDeform

Professor Charles Silver has posted about his own experience with medical malpractice, and has been responding to comments.  One of his responses warrants a post here:

It continues to be remarkable to me how willing people are to stake out positions without knowing the facts. Judging from his (her?) most recent post, Chris seems exceptionally bright and well educated. Yet, Chris was too eager to reach a conclusion about the merits of my hypothetical malpractice case. I haven’t reached a conclusion myself, and I’ve lived with the injury for over two months. In these Internet discussions of tort reform, it seems to be a sin to utter the words “I don’t know.” In real life, of course, knowing that one does not know something is often important.

Source: How Much Malpractice Coverage Does Your Doctor Have? | TortDeform

I wish Professor Silver the best and hope his condition improves.

Technorati tags: Tortdeform, Charles Silver, medical malpractice, tort reform

Real Tort Reform in Pennsylvania Introduced

 Hot off the wire, it looks like Senator Greenleaf has introduced a real tort reform bill in Pennsylvania.

PHILADELPHIA, May 8 /PRNewswire-USNewswire/ -- The Pennsylvania Trial Lawyers Association (PaTLA) today welcomed legislation recently introduced in the state legislature: a Senate bill that levels the playing field for victims of bad faith on the part of insurance companies and a House bill designed to help consumers make more informed choices when purchasing automobile insurance.

Senate Bill 745 introduced by Sen. Stewart Greenleaf would allow juries to determine fault and award damages in bad faith insurance cases. Currently in Pennsylvania, only a judge can decide bad faith, while in federal court juries make the decision in such cases. "If a jury is competent enough to decide cases involving negligence or criminal conduct-and it is--we should have confidence in them to make a determination of whether an insurance company was wrong in denying or stonewalling a claim," said Ruben Honik, President of PaTLA. "The founding fathers knew the jury system would work 200 years ago and it works today."

Source: State Trial Lawyers Applaud Bills Protecting Rights of Pennsylvania Consumers - - insurancenewsnet.com

Count on the insurers fighting tooth and nail against being forced to endure a fair trial.  And also count on the "reform" movement claiming this bill is bad public policy and either a handout or a payback to the trial bar.

Cross-posted to TortDeform 

Technorati tags: Pennsylvania, bad faith, SB 745, PATLA, tort reform, Stewart Greenleaf, insurance

If it helps lawyers, it MUST be bad

New York State Senator Eric Schneiderman has a great post at Tortdeform.com in which he discusses Republican opposition to a False Claims Act because in addition to saving taxpayers billions of dollars, it would make some trial lawyers wealthy.

But a funny thing happened when the false claims act landed on the agenda in Albany. Republican senators, who styled themselves as jealous protectors of tax dollars, railing against Medicaid fraud and abuse, emerged as staunch opponents of their own party’s solution to the problem. They insisted that government agencies, rather than individual New Yorkers, could solve the problem. As the debate unfolded, Senate Republicans revealed a truly astonishing justification for their unwillingness to support a false claims act, despite its proven effectiveness and strong GOP support in Washington DC: it would allow trial lawyers to make too much money.

Source: Tortdeform

Remember, trial lawyers are one of the largest groups of donors to the Democratic Party.  If you prevent trial lawyers from making money, you'll prevent them from funding the Democrats.  And preventing the Democrats from getting funding makes it quite a bit easier for Republicans to win, doesn't it?

Technorati tags: tort reform, false claims act, New York, fraud, Republicans, Democrats, Eric Schneiderman

Tort System Treats Doctors Better Than Most People Think

Professor Philip Peters at the University of Missouri studied 17 years worth of malpractice filings across various areas of the country, and he came to some interesting conclusions:

• Negligence matters and plaintiffs rarely win weak cases. Plaintiffs have more success in toss-up cases and have better outcomes in cases with strong evidence of medical negligence.
• Juries have the ability to recognize weak cases and agree with independent legal experts 80 to 90 percent of the time regarding such cases.
• Doctors are victorious in 50 percent of the cases that independent legal experts expected plaintiffs to win.  (Emphasis added.)
• Factors systematically favor medical defendants in the courtroom. Those factors include the defendant's superior resources, the social standing of physicians, social norms against "profiting" by injury and the jury's willingness to give physicians the "benefit of the doubt" when the evidence of negligence is conflicting.

             Source: Juries found to sympathize more with doctors in malpractice cases

The press release I linked to has a bit more about the study, but I'll see if I can't find a copy of the real thing.  Maybe this report will cause  tort "reformers" some bad luck, since this release was issued on Friday the 13th. 

Cross posted to TortDeform.com

Friday the 13th Roundup

Everyone's favorite legal commentator "Supremacy Clause" has gone off the deep end.

"Come the next terror attack, you will be able to thank a terrorist lover lawyer for saving the lives of countless terrorists."

Source: What our soldiers really need: Lawyers | Tortdeform

Eric Turkewitz writes a nice primer about medical malpractice that should clear up some misconceptions.

"Thus, at any malpractice trial, the plaintiff-patient will have to prove these three things (for which an expert is required):
1. The standard of care is breached with a departure from customary and usual practice, and not a mere error of judgment;
2. That the departure was a substantial cause of injury to the patient;
3. That the injury was very substantial. While those words don't exist as a legal threshold, they exist as a practical one."

Source: New York Personal Injury Law Blog: Medical Malpractice -- A Primer

The primary architect of Australia's tort "reform" sees the light and decides "reform" has gone too far.  (Can you imagine one of our Supreme Court judges saying such a thing?)

"Now I am sure you realise that this troll was the personification of Legislative Tort Reform. He slowly rose from the depths and, as he surfaced, he called for aid from four ghastly ogres. These took the human form of a judge, a law professor, a surgeon and a mayor. The troll and the panel of ogres crawled out of the lake and burst into action. "

Source: The Metamorphosis of Slip and Fall - Supreme Court : Lawlink NSW

Senator Kennedy wants the pharmaceutical industry to pony up $157 million in order to fix the FDA.  Do you think Merck will decry these fees as a "safety tax" that raises the cost of prescription drugs?

"``It's an important step forward because the amount of safety work that needs to be done that makes the FDA the gold standard is going to cost some money,'' said William Vaughan, a senior policy analyst in Washington with the nonprofit group Consumers Union, in an interview."

Source: Bloomberg.com: Health Care

Ted Frank lets us know that we'll finally get an answer to the burning question, "Is Excessive Regulation and Litigation Eroding U.S. Financial Competitiveness?"  I have a feeling I know how he would answer that question.

"The Committee on Capital Markets Regulation will present key elements of their reports at this AEI + Brookings series of four panels April 20. Speakers include SEC Commissioner Paul S. Atkins, Judge Douglas Ginsburg, Peter Wallison, and Michael Greve."

Source: PointofLaw.com | Information and opinion on the U.S. litigation system

If all goes well, I'll have a review of the Aqua Teen Hunger Force film this weekend.

 

Technorati tags: medical malpractice, tortdeform, australia, tort reform, turkewitz, terrorists, Ted Frank

TortDeform.Com Recap

For those of you who haven't checked out TortDeform.com yet, here's a brief recap of some of the articles I've really enjoyed.

Having Their Cake & Eating It, Too:  Cyrus comments upon a great WaPo article that points out how tort reformers want to have their cake - less legal liability - and eat it too - less governmental regulation.  My favorite quote is:

"This isn't an economic argument so much as a political one. A totalitarian state such as China may be able to duck these kinds of trade-offs, and there is no doubt Chinese exporters are more competitive as a result. But that is not realistic for an advanced democracy whose citizens prefer to use some wealth, or forgo some economic efficiency, in exchange for safer products and workplaces and more responsive corporate governance."

Perhaps moving to a slave labor system would make reformers happy.  Certainly, it would increase corporate efficiency.

Lousiana's Supreme Court Gets It Right: Also from Cyrus, this post comments upon the Lousiana Supreme Court's decision to overturn the $500k cap on medical malpractice suits.  Good news like this is rare.

GM Tears Up Our Medical System: I've often argued that before we try and "reform" the medical system, we need to fix it's inefficiencies.  How inefficient is it?

"The automaker loses about $4 million a day because of medical errors and inefficiencies."

That's over $1 billion per year.  Just for GM.  Ouch.

Michigan Gets It W R O N G:  Henry Greenspan covers just how badly broken the liability system is in my current state of Michigan. 

"Michigan suddenly hosted a parade of anti-tort luminaries. Engler teleconferenced his way into an abruptly created "Tort Reform Committee" in the State legislature. Sherman "Tiger" Joyce, President of ATRA, visited Michigan incarnate. So did Daniel Troy, former FDA Chief Counsel and "godfather" of the contemporary FDA preemption doctrine. Troy reworked an earlier paper to include a section specifically defending Michigan's 1995 law, and his talk--presented at a meeting of the Federalist Society in Ann Arbor--was webcast to relevant Michigan legislators and beyond. In the meantime, the 2006 annual meeting of ATRA, opened by special guest Karl Rove, was reportedly much preoccupied by the smoke rising in Michigan. The natives were restless. Clearly, for the pro-immunity boys (they mostly are), it was time to restore order. "

Any cause that both Tiger and Rove support pretty much has to be pure unadulterated evil. 

Justinian's Work: There's the link to see what posts I've made at TortDeform.com.  Most, but not all of my posts there will be cross-posted here.  I just need to figure out the mix.  FYI, I'll be posting at least every Thursday there.  I'm planning on a Thursday post there, and a Friday or Saturday post here.

As always, if you find something you think I'd be interested in, or have any questions, don't hesitate to email me at justinian AT corpreform.com

Who Does Tort Reform Hurt?

Among others, the police and firefighters involved in the rescue and cleanup operations of 9/11.  Cyrus over at TortDeform.com has an excellent post about the hoops injured 9/11 workers are having to jump through just to get medical treatment.

"• A mass of workers compensation claims, which were the only route to benefits for many cleanups workers, are filed by sick workers in the years after the attacks. Many of these claims denied based on both an inability to meet the high burden of proof required to show medical causation, and an overly restrictive statutes of limitations. In addition, many of the claims were contested and became stalled in an appeals process which kept victims from getting benefits for months or years.

• These claims are delayed and denied out of hand because of a shortage of funds to cover all of these claims. Instead of attempting to secure more funding to address these workers compensation claims, the state-run (and largest) workers compensation insurer simply denied meritorious claims.

• City officials went so far as to deny and contest the workers compensation claim of its own former Deputy Mayor (Rudy Washington), who was responsible for coordinating the immediate response to 9/11 on the ground in the days immediately after the attack.

• Similarly, in a workers compensation hearing, the city went so far as to argue that the fact that 9/11 happened needed to be proven to the judge." (Emphasis added.)

I generally keep my emotions in check, but I think I would have had a hard time doing so if someone suggested to me that I needed to prove 9/11 happened.  Especially if I was representing someone who was injured during the cleanup process.

Say what you want about "greedy trial lawyers," but there's not a single one of them trying to deny the medical claims of 9/11 rescue workers.  That sort of evil only can come from an insurance adjuster.

Taking Another Look At The "Tort Tax"

(As my first post for TortDeform.com, I thought I'd revist the "tort tax" argument that's sure to make the rounds in time for the November elections.) 

I’ve previously explained why the “tort tax” argument is a fallacious argument that falls apart under even casual analysis. But let’s put reality aside for a moment (as tort reformers often do) and pretend that all of the costs of the civil justice system are indeed a tax.

In case you’ve never heard it before, the “tort tax” argument claims that since roughly 2% of America’s Gross Domestic Product is related to the legal system, every U.S. citizen pays about $800 per year in “tort tax”. Of course, we don’t write a check to the IRS to pay our “tort tax” bill. Instead, this “tax” purportedly comes in the form of higher prices on goods we purchase. In other words, the “tort tax” is really a consumption tax.

While there has been a lot of debate about the real effects of consumption taxes, one thing is agreed upon by all sides: How much consumption tax an individual pays is in direct proportion to how much he or she consumes. Thus, any attempt to quantify the costs of our civil justice system on a per-person basis without looking at the expenditures of every person is doomed to failure, as no two persons consume the same amount of goods. So when a tort reformer claims every family of four pays about $3,200 per year in “tort taxes” you know that he or she either doesn’t understand how consumption taxes work, or that he or she is more interested in clever sound bites than the truth.

The “tort tax” argument may be flawed and misleading, but it can be used to rebut another common argument for tort reform: That our tort system is inherently unfair because juries in different communities may award very dissimilar compensation to individuals with very similar injuries. Tort reformers argue that fairness requires similar injuries be compensated similarly. Is this true? Not if we’re to believe the “tort tax” argument.