Dear Auntie Pinko,
What is tort reform and why should I be worried about
it? Why shouldn't I support something that keeps sleazy lawyers
from making big money on dummies who spill hot coffee on themselves?
Doubtless you refer to the 1995 case of Liebeck vs. McDonald's,
in which the media heavily publicized a $2.9 million award
for the plaintiff. But the media didn't do nearly as good
a job at publicizing other facts connected with the case,
- The 79-year-old Ms Liebeck, having gone through the
drive-through window in a car driven by her grandson,
had been sitting in the stopped car, trying to get the
lid off the cup to add cream, when the 180+ degree coffee
spilled on her lap, producing 3rd degree burns over 6
percent of body-legs, thighs, and buttocks
- McDonalds official company policy was to maintain
the coffee at a temperature known to cause severe burns,
based on a cost-benefit analysis of customer satisfaction/sales
revenues vs. potential litigation awards/costs
- McDonalds refused to pay Ms Liebeck's $20,000 hospital
- The much-publicized $2.9 million award was subsequently
reduced, without much fanfare, to $640,000
The myth of bizarre and spectacular liability awards has
been aggressively promoted by the insurance industry and product
manufacturers, but facts do not support the myth. A recent
study by the RAND Institute for Civil Justice, found that
only 19% of injured people made claims and only 2% pursued
those claims in court. In fact, Business Week reports
that between 1965 and 1990, only 353 product-liability claims
produced punitive damage awards.
But what about the cost of doing business, many people ask.
How can corporations make and market products and services
cost-effectively if their bottom lines are under constant
threat from swarms of frivolous lawsuits?
Auntie Pinko recommends that anyone concerned about unrestricted
tort laws damaging the competitiveness of American businesses
study the SEC filings and prospectuses of those businesses.
I'll award a free Auntie Pinko t-shirt to the first person
who can show me one such prospectus where the company mentions
that current or potential liability cases are likely to interfere
with their profitability.
Well, maybe the insurance companies have a point, though.
Couldn't we be enjoying lower premiums if tort reform limited
If so, you couldn't tell it from Texas, Dean. In 1995, that
was precisely the argument used to pass the nation's most
rigorous tort "reform" legislation yet-that they were just
trying to help consumers out with lower premiums. Guess what?
Between 1996 and 1998, Texas auto insurance companies earned
a windfall $2.8 billion plus in additional profits due to
lower liability payouts. How much of that do you think they
passed on to consumers in the form of lowered premiums? Uh,
well, let's just say that Texas consumers are not paying lower
premiums today than they were in 1994.
Some tort reform proposals that would have particularly damaging
- Limit contingency-fee contracts between attorneys and
clients. Contingency fees are often the only way poor-
and middle-class people can afford legal assistance at
- Limit the types of cases which can be tried before a
jury, thereby denying citizens a valuable safeguard against
corruption and political influence in civil trial.s
- Increase the number of cases where a "sealed verdict"
may be awarded, thus denying the information in that case
to future plaintiffs and their lawyers
- Charging plaintiffs filing fees equivalent to a percentage
of the damages sought, thereby reducing the access of
poor citizens to civil justice.
- Implement "loser pays" rules that would have a deeply
chilling effect on citizens' willingness to seek appropriate
redress through the courts - if you lost your case you'd
have to reimburse the company you sued for hours of inflated
I don't know about you, Dean, but Auntie Pinko just doesn't
think it's worth that price to stick it a little to a few
sleazy, greedy lawyers.
But thanks for asking Auntie Pinko!
you have a question for Auntie Pinko?
Do political discussions discombobulate you? Are you a liberal
at a loss for words when those darned dittoheads babble their
endless rhetoric at you? Or are you a conservative who just
can't understand those pesky liberals and their silliness?
Auntie Pinko has an answer for everything! So ask away!