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http://www.forbes.com/forbes/2003/0901/025.html
Texas Tackles Toxic Torts
The depredations of trial lawyers against the American people and our
economy are finally generating effective counter-attacks. One of the
most impressive efforts to bring sanity back to our courtrooms has
occurred in Texas. There, a no-nonsense, get-it-done governor, Rick
Perry, and a Republican legislature (first time in more than 100 years
that the GOP has controlled both houses) have passed a passel of the
most sweeping judicial reform bills in America. The Lone Star State
has long been a playground for pillaging trial lawyers. No longer.
Among the positive changes:
Defendants will be responsible only for the portion of damages for
which they're actually found responsible. No more deep pockets. Often,
a company with only a tangential connection to a case is hit with
massive damage judgments merely because it has the resources.
In class actions, plaintiff fees will now have to be reasonable and
based on the hours actually worked by the lawyers. Oft-times--if you
compute the hours actually worked--class action lawyers wind up
collecting fees equivalent to tens of thousands of dollars per hour.
In many cases the consumer has gotten a nominal coupon, while the
lawyers have been paid in hard cash. Now, "the fee paid to class
counsel must be in cash and non-cash in the same percentage as the
recovery by the class."
There are incentives for parties to make and accept reasonable
pretrial settlements. "When a party refuses a pretrial settlement
offer that turns out to be as good as or better than what that party
ultimately wins," the plaintiff gets hit with some of the defendant's
costs.
There is now a 15-year statute of limitations for product-liability
claims, except in cases of diseases that may not manifest themselves
for many years after the use of a product.
No more Texaco-like bankruptcies. When Texaco was hit with an
outlandish multibillion-dollar award in the 1980s, the company had to
put up that amount as bond in order to appeal the judgment. It
couldn't and had to file for Chapter 11. Now, appeal bonds must be
reasonable and not stand in the way of a defendant's appealing an
adverse decision.
There are a number of other sensible provisions, such as allowing the
jury, when it is determining fault and cause, to know whether the
plaintiff was wearing a seat belt at the time of a vehicular accident.
Teachers have additional protection against frivolous litigation.
Punitive damage awards now require a unanimous jury verdict. And
retailers can no longer be held liable for a defective product unless
the retailer was actually responsible for it.
Governor Perry has made it clear he will push for additional sensible
reforms in the future. Thankfully for Texas and the U.S. economy, this
governor means business. Unlike so many other states, Texas, for
instance, did not resort to tax increases in order to deal with its
budgetary problems. Too bad we couldn't clone Governor Perry and have
the clone run for governor of California this fall.
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