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Shutting the Courtroom Door: How the Corporate Right Mobilized in the States

When an impeccably pro-business outfit like Business Week declares victory for the business lobby in shutting the courtroom door to victims of corporate negligence, you know injured consumers and workers have been losing badly. But this week's cover story, How Business Trounced The Trial Lawyers, illustrates how the corporate right leveraged campaign contributions in the last decade to hijack state policy on civil justice.

Changing State Policy: The first step was corporate lobbies recognizing that state policy mattered more than federal policy. After ignoring state policy for many years, "by the mid-'90s, national groups like the U.S. Chamber of Commerce and the American Tort Reform Assn. realized...'that the greatest return on investment is at the state level.'" This quickly led to vastly more money spent in the states than by defenders of consumer rights and changes in state law that left injured consumers and workers with few options for legal redress:

  • Courthouse doors have slammed shut on a wide variety of claims. Michigan, for example, has virtually wiped out all lawsuits against drugmakers in the state.
  • Six states have passed laws seriously restricting the kinds of asbestos suits that can be filed, and 23 now have statutes saying you can't sue the likes of McDonald's for making you fat.
  • The American Lawyer, an influential trade publication, recently declared an end to the era of mass-injury class actions...As for class actions in Texas, a series of judicial rulings has set the bar so high for a judge to approve them that it's effectively impossible to meet, practitioners say.
  • Damage limits in many states have rendered medical malpractice litigation nearly comatose.
  • Georgia, for instance, limits punitive damages to $250,000, unless "the defendant acted with a specific intent to harm," and New Hampshire bars them altogether.
  • The far-ranging changes passed by Texas lawmakers in 2003 included one that bars injury suits against a seller more than 15 years after a product is sold. One result: After a doctor was decapitated by a Houston hospital elevator in August, 2003, no suit could be filed against the manufacturer, since the elevator was too old.

Taking over the courts. Bush's political advisor, Karl Rove, was a key player in mobilizing business lobbies to intervene in judicial elections. "By 1998, had converted the makeup of the Texas Supreme Court from 100% Democratic to 100% Republican. He played a similar role in flipping Alabama's high court." "In 2004, for example, business groups spent $21.5 million on state supreme court elections, eclipsing the amount spent by plaintiffs' attorneys and their allies ($13.3 million)." The result:

  • The Alabama Supreme Court reversed 27 of 31 plaintiffs' verdicts during its 2004-05 session.
  • According to Texas Watch, an Austin consumer advocacy group, of the 69 consumer cases accepted for appeal by the Texas Supreme Court during its 2005-06 term, it decided against the consumer in 57, or 83%, a trend Texas Watch says has been consistent for the past six years.
  • "When you have a large verdict that you receive from a jury, you can't settle the case anymore because the defendants will walk in and say: We know we're going to win in the Supreme Court," says Frederick M. Baron, a Dallas attorney.

So What About the Benefits of "Tort Reform"? The business lobby has won the battle for "tort reform", so where are all the promised benefits? Remember when people said tort reform would slash health insurance costs? Instead, as a 2005 Economic Policy Institute paper detailed, the costs of medical malpractice were always overblown by "tort reform" lobbyists and health care costs continue to rise across the country. Texas was a leader in slashing injured patient rights, yet it remains the state with the highest number of uninsured in the country with family health insurance policy rates rising at a rate nearly three times faster than wages and inflation.

The only thing that has changed in the wake of "tort reform" are escalating corporate profits at the expense of consumer and workers' pocketbooks -- a triumph of using lobbying power to rob from working families to benefit the wealthy.

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