CALA IN THE NEWS

This article is an example of CALA working and spreading the news about Lawsuit Abuse. You can access the SAN DIEGO UNION TRIBUNE AT http://www.uniontrib.com/news/uniontrib/sun/business/news_mz1b21torts.html

Taming Trouble Torts

Some wonder whether reports of litigation explosion were overblown

By Mark Sauer
STAFF WRITER  

April 21, 2002

Ten years after Stella Liebeck spilled hot coffee on her lap at a McDonald's drive-through in Albuquerque, she remains America's poster child for frivolous lawsuits.

"That's the one that really gets me," said Adrienne "Andy" Kotner, who directs the San Diego branch of Citizens Against Lawsuit Abuse. "She spills coffee, sues and gets millions. That didn't sit well with a lot of people." (Emphasis Added)

It certainly didn't.

That case became the symbol of a sue-happy society, a touchstone for the powerful and enduring image of America's litigation explosion.

It helped make a four-letter word out of "tort," the legal term for a personal-injury lawsuit.

But statistics tell a different story.

The number of personal-injury suits plummeted by about 50 percent in California over the past 15 years, according to the Judicial Council of California.

Legal researchers, judges, attorneys and consumer advocates cite several causes for the drop in lawsuits filed:

Tort reforms pushed by businesses and insurance companies coupled with certain judicial rulings have made it economically unfeasible for plaintiffs' attorneys to take low-money cases to court.

Alternative dispute resolution, in which cases are settled through arbitration or mediation instead of in court, has become increasingly popular. This is especially true in medical malpractice cases where juries consistently favor doctors and hospitals over plaintiffs at trial. The practice has become controversial, however, since consumers may not realize that some contracts require binding arbitration when disputes arise.

There has been a change in American culture regarding the right to sue. While stigma is perhaps too strong a word, injured people with legitimate claims often decide they'd rather not be perceived as the kind who goes to court. Many either settle privately for relatively little money or drop the matter entirely.

In light of the decline in lawsuits, "consumer attorneys," as California trial lawyers now call themselves, decry the "litigation-explosion myth," which they say corporations have propagated to great effect.

Exhibit 1: media-saturated "jackpot jury" verdicts.

Often cited by tort reformers are the case of an Alabama family awarded $581 million in punitive damages after claiming they were overcharged by $1,200 for two satellite dishes, and the Alabama man who won $4 million after buying a used BMW painted to look like new.

Yet lost in the hubbub is the fact that such huge jury awards often don't stand.

The BMW buyer eventually got a check for only $50,000 after the U.S. Supreme Court struck down the award as grossly unfair. The family with the satellite dishes saw their award sliced in half by the trial judge and then settled for an undisclosed amount, which some observers estimated at $1 million or less. (The threat of tying up awards for years in appeals often prompts a settlement.)

Similarly, the facts of Liebeck's case against McDonald's are rarely explored when the case is cited as an example of a runaway jury.

Liebeck, who was 79 when she sued McDonald's in 1992, suffered third-degree burns on her thighs, genitals and buttocks – 6 percent of her body – and spent a week in a hospital undergoing skin grafts.

She asked the McDonald's corporation for $20,000 to cover medical expenses and sued when they offered only $800.

Trial testimony revealed that at 180 degrees, McDonald's coffee was substantially hotter than typical restaurant coffee and corporate rules kept it that way, despite getting hundreds of coffee-scalding complaints in the previous 10 years.

Jurors awarded Liebeck $160,000 in compensation for medical expenses, physical and emotional suffering, and $2.7 million, or two days' worth of McDonald's coffee sales, in damages to punish the corporation.

The trial judge reduced the punitive award to $480,000. But the actual amount Liebeck received is not known since the parties ultimately agreed to a private settlement.

For the tort-reform movement, however, the dubious tone of publicity surrounding the McDonald's coffee case was priceless.

Kotner of Citizens Against Lawsuit Abuse said she continues to be frustrated by what she sees as the public's misunderstanding of "the real cost of frivolous lawsuits."

"Anyone can file a suit forcing a corporation to spend millions defending itself, and those costs are passed on to you and me," she said. "We are all victims of lawsuit abuse. It's really a form of extortion.

"It's all under the guise of protecting consumers. But what these suits really do is hurt consumers and make lawyers rich."

But consumer attorneys in San Diego, like Dave Casey, have decried the litigation-explosion myth for years with mixed success, especially in their conservative hometown.

"In the legal community here, nobody had to look at statistics to know this was a misperception," said Casey, vice president of the American Trial Lawyers Association and past president of both the San Diego and California consumer attorneys associations.

Many people apparently share the misperception that punitive damages are common in civil verdicts. In fact, they are awarded about 4 percent of the time.

But while far fewer lawsuits are being filed, punitive damages have soared in recent years, rankling insurers and corporations who view them as patently unfair and unpredictable.

Casey said punitive damages in personal-injury suits send a useful message to those who make unsafe products. And fewer lawsuits translate into "a success story," he added.

The automobile industry, for example, "decided it was cheaper to begin building safer cars."

Statistics support his contention. The California Highway Patrol reports that injury accidents decreased 20 percent during the 1990s. The CHP logged two fatalities for every 100 million miles driven in 1990; by 1999, the number of deaths dropped to 1.19.

(Tougher drunken-driving laws and a more mature and more experienced baby boomer generation behind the wheel also have contributed to fewer accidents, analysts say.)

Business backlash

Law professor Marc Galanter of the University of Wisconsin has a term for "the wide stream of disillusionment with the civil justice system." He calls it the "jaundiced view."

In scholarly articles that circulate widely among lawyers, Galanter holds that beginning in the 1970s, greater access to the court system by groups previously excluded, especially minorities, caused a backlash by elites who were used to setting the rules and controlling the game.

Exploiting "basic themes of our legal culture, such as individual responsibility and self-reliance," America's business elites have propagated remarkably resilient legends about the supposed litigation explosion, according to Galanter.

He said these demonstrably false legends, anonymous in origin and passed by word of mouth in the folkloric tradition, include the following:

America has 70 percent of the world's lawyers.

Juries routinely award large punitive damages.

Litigation undermines our ability to compete economically.

Courts are filled with frivolous lawsuits.

America is the most litigious society in history.

The media fuel such misconceptions by distorting stories like the McDonald's case by not providing context or even a full set of facts, Galanter contends.

He cites a study of newspaper coverage of 351 verdicts in product-liability cases against auto manufacturers between 1985 and 1996. Of these verdicts, 259 – or 74 percent – were in favor of the defendant.

But a verdict for the plaintiff was 12 times more likely to be reported in newspapers than a defense verdict, Galanter writes. And "punitive damages were awarded in only 4.6 percent of the verdicts," yet they appeared in 21 percent of the reports.

Researchers found that television coverage of such verdicts was triggered only when unusually large punitive damage awards were involved.

Tough business

Frank S. Clowney II has been a civil attorney in San Diego for 22 years. His practice has changed dramatically over that time.

Clowney spent his first 20 years suing insurance companies and corporations on behalf of injured clients. But now corporations and insurers often hire him to defend them in such lawsuits.

"When I started out, it was always the plaintiff's attorney who wanted a jury trial and the defendant, usually an insurance company, wanted a bench trial," Clowney said. "Now it's the defense asking for a jury because there has been such a polluting of the public over the last 15 years.

"There's simply an anti-lawyer, anti-tort, anti-plaintiff attitude."

Things changed dramatically in 1994 when the Republican Party declared war on tort lawyers – traditionally supporters of Democrats – in its "Contract With America." The contract stated: "Almost everyone agrees America has become a litigious society: We sue each other too often and too easily."

The Legislature in California and many other states responded by capping some damage awards to plaintiffs.

Another important change in recent years, Clowney said, is that insurance companies are far more willing to try small-money cases rather than settle.

Many insurers have gone to in-house attorneys to save legal costs and have computer programs that determine precisely what a case is worth, he said, "and they aren't willing to negotiate."

"I'm not saying that's wrong, it's just the new reality," Clowney said. "A plaintiff's attorney has to think long and hard before bringing a small-money suit because it often is not economically feasible.

"That's why young civil attorneys really struggle these days, especially in this town. The top lawyers get very good cases, the middle echelon get the decent cases and referrals, then there's the bottom of the food chain that's starving.

"I look at some of these cases as a defense attorney now and wonder what is this guy taking this for? He's either desperate, inexperienced or betting on the long shot that the insurance company will roll over. That's why we're seeing fewer filings."

Mark Sauer: (619) 293-2227; mark.sauer@uniontrib.com

Copyright 2002 Union-Tribune Publishing Co.