Talking Tort Reform

A former Mississippi state senator and key figure in enacting landmark lawsuit reform in his state told a group in Nashville Tuesday night that Tennessee Gov. Bill Haslam is offering up beneficial legislation of his own in that regard.

“I’ve looked at the governor’s proposed bill. In my judgment, it is a very good bill. In my judgment, it can only make your system better,” said Charlie Ross, a lawyer and past chairman of a Mississippi legislative committee that hashed out the framework for comprehensive state tort reform in 2004.

“If you look at states like Mississippi, you can see it is not just pie in the sky. I commend you. Try to pass what the governor is proposing,” Ross told an audience of about 70 people gathered for a panel discussion on tort reform at Vanderbilt University.

The program was arranged by the Tennessee Center for Policy Research, a free-market think tank that plans to hold similar forums across the state as part of the group’s new campaign “to educate Tennesseans on the benefits of lawsuit abuse reform.”

“Like many states, Tennessee is plagued by a flawed civil justice system that allows trial lawyers to abuse the process to the detriment of all Tennesseans,” according to TCPR’s new tort reform-focused website, Focus577.org, The site is named for TCPR’s calculation that lawsuit reform of the sort being proposed by the Haslam administration would result in the creation of 577 new jobs a week in Tennessee.

“Among other consequences, lawsuit abuse costs Tennesseans jobs, limits access to healthcare, and drives up the cost of goods and services,” the Focus577.org site states. “As states like Texas and Mississippi have experienced, lawsuit abuse reform can be the catalyst for substantial job and economic growth in Tennessee. Without question, simply enacting responsible reforms that lead to a more fair and just legal system will have a tremendous impact on our state’s economy.”

The discussion TCPR hosted Tuesday evening included three panelists, all of whom agreed legislation of some type is necessary in Tennessee to mitigate or limit the negative effects exceedingly large judgments can have on the overall business environment or ability of professional services providers — particularly in the field of health care — to profitably operate in the state.

Comments leaned heavily on the issue of unpredictability in the current system. The panelists said defendants need to know what the parameters and possible outcomes of cases are heading into a trial — and that currently there is little or no way to gauge what the size of an award might be.

James Blumstein, a constitutional law professor at Vanderbilt University often quoted in news articles on Tennessee legal matters, emphasized the need to have “safe harbors” of standards, narrowed and focused, and understood by all sides on the front end of a case.

Ted Frank, an adjunct fellow with the Manhattan Institute’s Center for Legal Policy, said industries cannot adequately anticipate what might happen in cases against them. He used the car manufacturing industry as an example, where the safety of specific parts of vehicles come into question.

Frank and former Sen. Ross used common phrases like “jackpot justice” to describe what has been happening.

There were differences of opinion among the panelists as to how to achieve their goals.

Blumstein said he isn’t a big advocate for simply capping damages, an approach that constitutes the thrust of what Haslam has proposed for Tennessee. “I would be very cautious about adopting a cap,” said Blumstein, who has indicated he believes any reform law that applies hard-and-fast caps is destined for serious legal challenge.

Blumstein instead advocates a system of “established scenarios,” with ranges of awards for each of them, that courts should follow. He said that would provide more structure and make awards more predictable — which the system badly needs, he added.

Blumstein compared the current civil-litigation environment with that of criminal law before the adoption of sentencing guidelines, when defendants accused of the same crimes faced wildly different punishments from jurisdiction to jurisdiction.

Frank argued that any perceived flaws in caps on awards, particularly in the arena of medical malpractice, are outweighed by the positive effects caps have by lowering the insurance premiums doctors pay in general, which in turn entices good doctors to stay instead of moving on to where it is more affordable to operate a business.

Haslam, who just last week introduced his first package of legislative proposals since taking office, has placed education and tort reform at the top of his wish list. While Haslam has made jobs his top priority, he has not made job recruitment, per se, the subject of legislation. Tort reform, however, will make the state more competitive with other states in its recruitment of jobs, the governor argues.

Haslam has called for a cap of $750,000 on non-economic, pain-and-suffering damages in a case, and a cap on punitive damages of two times compensatory damages or $500,000, whichever is greater.