THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Wednesday, March 22, 1995 TAG: 9503220001
SECTION: FRONT PAGE: A14 EDITION: FINAL
TYPE: Editorial
LENGTH: Medium: 79 lines
Score three for the Republican House leadership which brought to the floor within weeks significant civil-law reforms that the Democratic House leadership had squelched for years.
Some reforms included in this legislation won't pass the Senate intact, and some may not deserve to. But in pursuing their Contract With America, congressional Republicans have at least started a process that should leave the country less puzzled, even more outraged by liability lawsuits, legal rules and verdicts that defy both common and business sense.
Several measures aim at a problem former Supreme Court Justice Lewis F. Powell Jr. perceived in 1986, when an insurance company successfully appealed a jury's punitive damages award of $3.5 million for allegedly having failed to pay $1,650.22 on a $3,000 insurance claim. It was, Justice Powell wrote in a draft opinion, ``a disturbingly common phenomenon in many states. It is long past time to bring the law of punitive damages into conformity with our notions of just punishment . . . .''
Since then, many more courts have reduced many more whoppingly punitive awards. Many more plaintiffs have filed dubious claims solely to pluck deep pockets. And many more companies have found settling even frivolous claims cheaper than defending against them or risking a sympathetic jury, even when the company sued or its product is not at fault. Few plaintiffs wind up with millions in damages, but the cost of defending against them - from liability insurance to attorneys' fees to jury awards to products yanked for fear of suits - comes out of everybody's pocket.
There must be better ways, and the House-passed package seeks them in provisions that would:
Tie attorneys' fees to outcome, sometimes requiring losers to pay winners' legal fees and sometimes reducing those fees. That would lessen the threat of frivolous suits.
Make scientific evidence admissible only if valid, reliable and pertinent to the case. Why would it not be?
Bar damages to a plaintiff whose drug or alcohol use makes him more than 50 percent responsible for his injury. That's a circumstance beyond a manufacturer's control.
Bar liability suits for injuries caused by a product made or sold more than 15 years ago and met then-existing standards.
Bar liability suits for injuries caused by medical devices or drugs approved by the Food and Drug Administration. The FDA cannot certify absolute safety of a product for all potential users, but nobody can. If that's no reason to abolish the FDA, it's also no reason to sue a manufacturer.
Limit to $250,000 awards for pain and suffering in suits involving doctors, hospitals and health-insurance companies. The injured could still collect large sums for economic and other losses.
Limit punitive damages in all state and federal civil cases (not just in product-liability cases) at $250,000 or three times the economic losses, whichever is higher. Punitive damages should bear some relation to loss, and that basic fairness should apply nationwide.
Make a company liable only for that portion of the damages attributable to its actions or its product. At issue here are equitableness, and discouraging suits filed because some potential defendant has deep pockets.
Require that stockholders who sue because a stock doesn't perform as the company predicted - and because attorneys recruit them for class-action suits - prove ``deliberate'' deception.
The provisions pertaining to shareholder suits and product liability face the least opposition in the Senate. A bipartisan alternative the Senate will consider would limit punitive damages only in product-liability cases, not in all civil cases, and would not cap awards for medical malpractice. The ``loser-pays'' legislation faces formidable objection, on grounds that it would severely limit suits by average Americans and non-profit groups. Yet those can be the suits that do the most harm to businesses, and the standards of proof in liability law, and ultimately the consumers of their products, and offer the least benefits to the public.
The result of the debate may not end precisely where congressional Republicans propose. But the debate at least has started, and offers the prospect of restoring some balance, sanity, reasonableness and law to lawsuits and their outcomes. by CNB