Yesterday, in the "Economic Summit" (which means "we're getting together a bunch of Bush's campaign contributors to say that Bush is right about everything") Bush sat in on a panel called The High Costs of Lawsuit Abuse.
Surrounded by a panel of enthusiastic supporters, Bush said lawsuits against businesses and manufacturers are a drag on the economy and must be reined in. He called for a new system to deal with asbestos-related cases, and new limits on medical malpractice cases and class-action lawsuits involving groups of plaintiffs.
He chuckled and nodded as panelists at the two-day conference aired their contempt for trial lawyers.
``What you have today is business on one side, and you've got the trial lawyers on the other side. . . . You've got deep pockets colliding with shallow principles,'' Robert Nardelli, the chief executive at Home Depot, said to laughter from the audience and the president.
Shallow principles, huh? So what would you call the principles of a business that knows its practices injure and kill their own customers! Last year the Atlanta Business Chronicle took a look at the "principles" of Nardelli's company.
Home Depot also won't publicly disclose the number of customer injuries that are reported in its stores. But Rasak said the claims totaled 185 a week in 1998. He obtained that number from Home Depot in 2000 during his lawsuit against the company, one of the few cases that wasn't sealed by a confidentiality agreement prohibiting disclosure of such information. No later figure is available, but Home Depot has almost doubled its number of stores since then.
The problem with these debates about trial lawyers vs. businesses or lawyers vs. doctors, is that they ignore one important group. Victims! Some people are killed or injured by negligence on the part of businesses and/or doctors. Are there irresponsible lawyers? Of course! Should it be more difficult to file frivolous lawsuits? Sure! Should we accomplish the reduction in frivolous suits by making to cheaper to continue business practices that create victims?
An unfortunate reality is that for many (but not all, of course) businesses, decisions about safety are not decisions based on "principles," but on economics. Some companies decide that it is cheaper to settle claims with injured customers than to make the changes that would prevent the injuries in the first place. Our legal system understands this mentality, and therefore deals with these companies through non-economic damages to make it more expensive to continue to injure customers.
Making victims rich through non-economic awards is not exactly just (and it does make it more tempting for shady lawyers to file frivolous lawsuits) but it seems that huge financial losses are what it takes to get the attention of many businesses. Maybe those non-economic awards should go to research for increased product safety or reducing medical errors. Simply capping awards, however, is not effective tort reform.
1 comment:
I think the problem is *where* the financial pressure comes from. As you point out, not only are award caps not the answer, but the reality is that most lawsuits are a simple matter of economics and both sides usually have a strong incentive to settle outside the court - where the case might actually be decided fairly by a judge. The reality is, court takes a long time, is risky, expensive, and simply can be emotionally draining. Both plaintiff and defendant just want to get it over with. And ususally, the victim is the little guy with few funds to wage against a giant company in attorney's fees.
So, what if negligent businesses actually got hit where it hurts in our system... with a loss of consumers. In our areas, Lowe's is in fierce competition with Lowe's and, given the slightest reason to go to one or the other, I would switch.
So what if there was some kind of integrity rating for businesses that was widely published, easy to access, credibly obtained. Like a consumer reports for where to shop. And, what if consumers actually cared!
I'm not saying my idea is practical... just a little thought experiment.
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