Bush Versus the Trial Lawyers
TUCKER, WILLIAM
Bush Versus the Trial Lawyers Not all tort reforms are created equal BY WILLIAM TUCKER President Bush went to Madison County, Illinois, last week to kick off his campaign for tort reform. "Junk...
...Federalism is working in the sense that most states get the malpractice crisis they deserve...
...Meanwhile, the actual health crisis is subsiding...
...The story began in the 1960s when Ward Stephenson, a Texas personal injury attorney, bypassed the limited awards of Worker's Compensation by suing the manufacturers of asbestos over lung damage suffered by oil-refinery workers...
...Daschle insisted anyone who had a court date would be exempt from the trust agreement—which is one reason why the 100,000-plus cases were filed last year...
...Yet medical malpractice is the issue probably least susceptible to a national solution...
...These are for "pain and suffering," "mental anguish," and other open-ended categories that allow silver-tongued lawyers to tear at jurors' hearts...
...Yet because none of the individual claims exceeded $75,000—and because at least one Madison County resident was involved—state judges are allowed to certify the class action...
...Sympathetic doctors produce sympathetic diagnoses...
...Now they're talking about $140 billion...
...There are many cases that should be kept in the state courts...
...and the Democratic legislature have tried to agree on a reform bill—so far without success...
...Today, I often cannot say that anymore...
...If Senate Democrats choose to stonewall, the progress of the bill could grind to a halt...
...A lawyer is a person skilled in circumventing the law," observed Ambrose Bierce...
...The doctors may have to accept half a loaf...
...There's a great deal of concern among conservatives about federalism and preemption," says Anderson, of the Chamber of Commerce...
...Far more pressing are class-action reform and a resolution of long-running asbestos litigation...
...The Medical Malpractice Reform Act of 2004 received only 49 votes in the Senate and is still a longshot to make it to the president's desk—even though Bush has been hammering at it since the fall campaign...
...But the event also illustrates the dilemma the Bush administration faces in pushing tort reform through Congress...
...Kaiser went bankrupt in 2002...
...Other details will have to be ironed out before passage...
...The independent reviewers found them in 4.5 percent...
...Countering this is that Senator Arlen Specter, chairman of the judiciary committee, has been at least open to tort reform— particularly the problem of asbestos suits, which have devastated the manufacturing economy of Pennsylvania...
...2) outlaw "coupon" settlements, where the class members get non-monetary awards while the lawyers collect cash...
...Some states aren't doing a bad job, but our position is it should be a federal issue...
...Hospital suits are down, and 80 new ob-gyn specialists have set up shop in the state...
...The favorite instrument for malpractice reform is a statutory limit on noneco-nomic damages...
...Trial lawyers still thrive in the Golden State, but they are not buying baseball teams or sponsoring space races...
...This would tie up the Judiciary Committee—and probably the whole country—for some time...
...Two Illinois firms—the Lakin Law Firm and Freed & Weiss—pioneered the territory, but their success has now attracted a swarm of national firms to this rural backwater...
...In a typical case, a Madison County resident spent the night at a Wyndham hotel in Chicago in 2001, then filed a class action in Edwardsville (the county seat) over a $2.67 "energy surcharge" he had been forced to pay...
...As the claims mounted, trial lawyers uncovered the Sumner Simpson papers (named for the founder of Raybestos-Manhattan), which revealed that manufacturers had known as early as the 1930s that asbestos was causing significant harm to workers' lungs...
...By some legal version of Gresham's law, however, the bad cases have eventually driven out the good...
...The last three Democratic senators to come on board last year secured a concession that specified class actions will stay in the state courts if two-thirds of the primary plaintiffs and defendants are from the same state...
...Texas voters approved identical caps in 2003, and already 40 percent of the state's doctors have received rate reductions...
...The results were published in the August 2004 issue of Academic Radiology, the journal of the profession...
...Economic damages —hospital bills, lost wages— all can be calculated, and have finite limits...
...Madison County—where judges are entertaining nearly 200 such lawsuits—became a "judicial hellhole" because of class actions, not medical malpractice...
...When Federal-Mogul, the leading manufacturer, went bankrupt, lawyers sued Kaiser Aluminum, which made the brake shoes that cut into the brake linings...
...Bethlehem Steel, Babcock & Wilcox, Combustion Engineering, and W.R...
...Lawyers began sending mobile X-ray vans to factories to screen for potential clients...
...Recently, Johns Hopkins researchers asked six independent reviewers to reexamine 492 X-rays submitted by plaintiff attorneys in support of their clients' claims of lung scarring...
...The usual outcome is that plaintiffs get a $2.67 coupon for their next visit to a Wyndham, while the lawyers collect their contingency fees in cash...
...Even a 55-vote majority is not enough to ensure passage...
...Not when combined with tens of thousands of identical claims from the "national class" of aggrieved hotel guests...
...Over 75 major corporations have now filed for Chapter 11 as a result of asbestos suits, and trial lawyers now have General Motors, Ford, Chrysler, General Electric, and Westinghouse in their sights...
...This matter has been before Congress for six years and subject to ten sets of hearings," says Lawrence Fineran, of the National Association of Manufacturers...
...Some are already repackaging their asbestos cases as "mixed dust and silica" claims, arguing these should be exempt from the agreement...
...Junk lawsuits change the way doctors do medicine," said the president, surrounded by a phalanx of doctors from southern Illinois...
...A year ago the manufacturers were offering $100 billion, while the labor unions wanted $150 billion," says Stanton Anderson, executive vice president of the U.S...
...The 2004 version had 62 supporters—more than enough for cloture—yet it died when the minority leader attached non-germane amendments concerning the minimum wage and global warming on the Senate floor...
...Instead of taking care of patients, they're worried about lawsuits...
...Currently gathering the most support in Congress is class-action reform...
...California adopted a $250,000 cap on noneco-nomic damages in 1975, and malpractice premiums have since risen only one-third as much as in the rest of the country...
...Class-action reform aims to rein in the trial lawyers' favorite racket of bundling tens of thousands of petty claims for things like phone bills and credit card charges and then bringing them before a sympathetic local judge who certifies what is, for all intents and purposes, a national class action...
...Premiums now run as high as $150,000 a year...
...All these details will have to be ironed out...
...And the reason is that other plaintiffs' attorneys are filing tens of thousands of claims every year for people who have absolutely nothing wrong with them...
...Senator Dianne Feinstein, a California Democrat, offered to come aboard if the cap were set at $500,000, as have a handful of other senators...
...Asbestos lawsuits—the country's longest-running personal injury claims—are still ravaging industrial America...
...It used to be that I could tell a man dying of mesothelioma that I could make sure his family would be taken care of," testified Steven Kazan, an Oakland plaintiff lawyer who filed his first asbestos case in 1974...
...They're all leaving because of the trial lawyers...
...A trivial matter...
...Trying a case involving thousands of claims from around the country against a national chain [Wyndham has no hotels in Madison County] before a single state judge obviously violates the spirit of the 'diversity' clause in the Constitution," says Sherman Joyce, president of the American Tort Reform Association...
...It's quite a change in our notion of federalism...
...After Johns Manville and Raybestos went bankrupt, lawyers turned on construction companies, oil companies, steelmakers, and eventually anyone who ever came near asbestos...
...And so, finally, there is medical malpractice...
...The makers of automobile brakes were sued because brake pads had been made of asbestos...
...The Class Action Reform Act would do three things: It would (1) allow class actions involving plaintiffs and defendants predominantly from different states to be removed to federal court if one party so requests...
...Unfortunately, these issues generate much less public excitement...
...William Tucker is a writer living in Brooklyn and a fellow at the Discovery Institute...
...It's not going to be easy, but the 109th Congress could be a watershed in the nation's longstanding battle to curb the excesses of trial lawyers...
...The Medical Malpractice Reform Act of 2004 would have imposed the same $250,000 cap on noneconomic damages at the national level...
...Chamber of Commerce...
...Then a Toyota executive wrote Governor Barbour telling him the state's "unfavorable litigation environment" had prompted Toyota to choose Texas over Mississippi for a new manufacturing plant...
...Barbour immediately called a special session of the legislature and pushed through a reform package that included curbs on malpractice awards...
...The subject was hushed up, however, and asbestos became a household item in the 1950s, exposing millions of people...
...Mesothelioma deaths peaked in 1992, and the incidence of asbestos-related disease is in decline...
...Over 650,000 claims are now pending, with more than 100,000 filed in 2004...
...At the other end of the spectrum, Maryland doctors are threatening job actions after absorbing premium increases totaling 61 percent over the last two years...
...Just to celebrate their success, trial lawyers raised $140,000 for three Madison County judges' reelection campaigns in 2002—a race in which all three ran unopposed...
...The bill is very much weighted toward business and opposed to consumer and civil rights," complains Edward Sherman, of Tulane Law School, who chaired an American Bar Association task force on the legislation...
...Donald Palmisano, outgoing president of the American Medical Association, complains the figure is too high: "When you get up around $500,000, the caps don't do much good...
...Yet claims keep increasing...
...The trick for the administration will be keeping all three balls in the air as it tries to guide a package through Congress...
...But pain and suffering asks jurors to use their imaginations...
...and (3) prevent settlements where some class members actually lose money or where members from the local jurisdiction receive better treatment than members from other states—both not infrequent outcomes...
...Even among plaintiff attorneys, however, there is a sense of urgency...
...Grace all fell into bankruptcy as a result of asbestos litigation...
...Daschle is now planning to continue his opposition from South Dakota...
...Medical malpractice is the best issue to lead with because it's something people get excited about," says Governor Haley Barbour, of Mississippi, who pushed a complete package through his state's legislature last year...
...Still, supporters remain optimistic...
...Tens of thousands of insulation installers, pipe fitters, and construction workers suffered miserable deaths from asbestosis and a dreaded cancer, mesothelioma, in what has been called the greatest industrial health disaster in American history...
...The compromise to which both sides have now agreed is a $100-billion-plus trust funded by asbestos-related companies to compensate present and future victims in exchange for relief from further lawsuits...
...Madison County—named the nation's worst "judicial hellhole" by the American Tort Reform Association—is a good place to start...
...Medical Mutual Liability Insurance Society of Maryland, a doctor-run consortium, is the only carrier left in the state...
...It's time to act...
...Mississippi was a tort paradise for over a decade, and doctors were moving across the river to Louisiana, where the Napoleonic Code limits abuses...
...John Edwards once won a multimillion-dollar verdict by "channeling" the thoughts of a newborn as it was allegedly injured during a difficult delivery...
...What paralyzes Congress is the fear that the lawyers will quickly burrow around the system...
...One good sign: The unions have generally excluded trial lawyers from their conferences...
...Another danger is that tort reform will be pushed off the national agenda by one or more Supreme Court nominations...
...Republican governor Robert L. Ehrlich Jr...
...Here the consensus is not nearly as broad...
...There is also the question of pending claims...
...Opponents argue the reform would swamp the federal courts...
...Were it not for Tom Daschle, Senate Bill 2062 would probably be law right now...
...I've had to change doctors four times in the last two years," says Jim Thompson, a 62-year-old retired electronics worker in rural Godfrey, Illinois...
...Dealing with cases involving parties from diverse states is one of the reasons the federal courts were created in the first place...
...The initial X-ray readers had reported abnormalities in 95.9 percent of the films...
Vol. 10 • January 2005 • No. 17
