When you hear the word “torte” you probably think: Mmm. Yummy.
When you hear the words “tort reform” you probably think: Change the channel.
Tort reform is not a very delicious issue and it is one about which few Americans are well-informed. The tort system is important because it represents our effort as a civilization to address the wrongs, intentional and unintentional, that we inflict on one another from time to time. As some would say more crudely, “stuff happens.” The tort system is how we deal with it after stuff happens, balancing the needs of victims with practical considerations of the injuring party.
First, a refresher from the first year of law school. A tort is an injury to a person or property, not a layered cake (unless, that is, the cake is filled with shards of glass as one creative Torts professor allegedly served to effectively drive home the homonym). Without knowing it, we are all very familiar with torts. An auto accident injury, a medical malpractice claim, a suit against a tobacco company, a claim against McDonald’s for too hot coffee – these are all torts, and there are many more.
The debate on tort reform pits tort reformers, those who feel too many meritless suits are burdening our judicial system and too large jury awards are bankrupting good companies, against tort crusaders who see tort practice as a noble battle to gain deserved compensation to victims of wrongdoing or negligence. Currently, legislatures nationwide are considering tort reform efforts that may cap jury awards or immunize entire industries from suits. These efforts are throwing out the baby with the bathwater. Effective tort reform would seek to address the problems with the system while recognizing its strengths.
For strengths, tort crusaders cite the field of defective consumer products, where the tort system and the potential for heavy penalties encourages a high degree of care for consumer safety (some would say not high enough) and does a good job of making the consumers who do bring suits whole again. Although some would argue that the costs of defending these suits is debilitating to business, if a company is unable to affordably create a product that is safe enough to not harm people, maybe that company should not be making the product in the first place.
Tort reformers, meanwhile, can point to the field of medical malpractice as particularly illustrative of the problems with the system. When doctors make mistakes, patients’ first instinct is not typically to sue. Instead, they want to know what went wrong and why, and they do not want to worry about paying to fix the mistake. The tort system completely fails to address these concerns. Doctors, spooked that any acknowledgement of fault will translate into a future massive jury award, are reluctant to communicate openly when mistakes are made, making the apology and explanation the patient wants highly unlikely. Since, as Dr. Atul Gawande notes in this week’s New Yorker, the medical profession has come up with no alternative, patients’ next step is to find a lawyer. In the end, often both winner and loser finish the process dissatisfied.
Lawyers themselves are also part of the problem. Because of lawyers and the divergence in the interests of lawyers, their clients, and society at large, the current tort system suffers from a paradoxical problem – there are both too many and too few tort suits. Why too many? Lawyers, knowing the high cost of a suit to any defendant, count on the defendant’s willingness to settle even where wrongdoing is far from clear. Such lawyers bring faulty suits fishing for deep pockets. Conversely, lawyers refuse to bring many smaller, valid claims. Despite the outcry that doctors are overrun by meritless suits, 98% of patients actually harmed by doctors never bring suit. Lawyers will not take such cases because they are not interested unless the potential recovery is enormous. This situation leaves a large segment of the population with legitimate claims and without any means of addressing their grievances.
So, how to reform the system? Here are three suggestions:
- Discourage meritless suits without discouraging suits with merit. In England, losing litigants pay the winner’s legal fees. This system highly discourages bringing suits that simply fish for deep pockets since such plaintiffs may be stuck with the defendant’s legal bills, but it goes too far. “Loser pays” removes any incentive for a plaintiff, such as one harmed by an untested but well-marketed drug, to take a chance on filing a claim. A modified loser pays system recognizing that some losing cases are brought with merit could help both discourage meritless suits and pave a smoother road for cases that deserve to be heard.
- Line up the incentives of lawyers with the incentives of their clients. Lawyers should be rewarded for bringing cases of merit even where a large award is unlikely. Providing juries with the flexibility to assess a standard “lawyer’s award” for even small recovery cases would help provide access to tort victims who cannot currently find representation and must simply swallow their losses.
- Discourage litigation and encourage less adversarial mediation. This is probably the most important step. Dr. Gawande notes that this has been done with respect to vaccines, where a small surcharge is added to every dose of a vaccine, money that goes to a fund to help pay for the expenses of the few victims whose vaccines go awry. Because victims’ needs are met up front, there is no impulse to sue and relations between parties remain cordial and productive.
The tort system needs revamping, but efforts to cap awards and immunize industries from suit only benefit defendants without recognizing the good that the system serves. A more thoughtful debate on tort reform is worth having – perhaps over a delicious layered cake (hopefully without glass).
