Knave of Torts

Cooler coffee for $3 million and other lawyer bargains

Why Lawsuits Are Good for America: Disciplined Democracy, Big Business, and the Common Law, by Carl T. Bogus, New York: NYU Press, 272 pages, $34.95

"What's good for the country is good for General Motors," Charles Wilson, a former chairman of G.M. and secretary of defense, once said. He added famously that "what's good for General Motors is good for the country." In Why Lawsuits Are Good for America, Carl Bogus, a professor at Rhode Island's Roger Williams University School of Law, says the same thing about lawyers.

A prominent opponent of tort reform, Bogus believes the current tort system is just fine. Horror stories from tort reformers about excessive jury verdicts are no more than corporate whining, he argues. What's more, eye-bulging awards simply represent the continued evolution of the common law as it adapts itself to changing times.

Judging from the complete failure of tort reform legislation at the national level, Bogus speaks for a special interest group that is politically more powerful than tort reformers: well-heeled plaintiffs' lawyers. They want the public to believe that the tort system that has evolved over the past 20 to 30 years -- to the detriment of almost everyone but them -- is fueled neither by their own greed nor by the greed of their clients. The Bogus spin on this theme is that the tort system is not about compensation at all. Really. See, if the tort system is not about compensation, then greed has nothing to do with how tort law has evolved.

This is a radical concept. Most people think the purpose of the tort system is precisely to provide compensation to individuals injured by the negligence of others. But Bogus has seen through this veil: "It is often said that the twin objectives of the tort system are compensation and deterrence. This book reflects a different view....If compensation were, in fact, one of its objectives, the system would make need a determining factor in whether it would give parties recoveries; but that is not the case....My thesis [is] that we should think of the tort system more as a regulatory than a compensation system....While [government] agencies must, admittedly, be the primary instruments of regulation, I argue that they cannot do the job alone....The people, after listening to evidence and reasoned arguments, work their will in the jury box as well." (Emphasis added.)

Got that? Tort law can't be about compensation for harm negligently inflicted because "need" (rather than negligence and injury) is not the "determining factor." If you can understand that, and if you agree with it, you should have no trouble with the Bogus thesis of juries as adjunct regulatory bodies rather than managers of lotteries in which a lucky few hit it big.

In the Bogus world, plaintiffs' lawyers have protected the public from "Corporate America" where the government has abysmally failed. Is there any evidence to support this contention?

In his 1995 book Simple Rules for a Complex World, legal scholar Richard Epstein notes that there are no studies that establish any correlation between the level of litigation and the level of product safety. He suggests that technology and wealth, not product liability suits, have made homes, workplaces, and roads safer than ever before. In other areas, Epstein writes, "the accident rate has risen just as the number of lawsuits has intensified: injuries requiring emergency room care were up for such products as playground equipment, ladders, power lawn mowers, swimming pools, and chain-saws, often by as much as 100 percent, even in the face of general technological advances."

Bogus knows better. Remember that lawsuit in which a woman initially won a $2.9 million jury verdict against McDonald's for burns she suffered after purchasing coffee at a drive-through window, unwisely placing the hot beverage between her legs, and removing the cover? Well, Bogus did some "field research" to prove that this jury verdict in fact resulted in product improvement. It wasn't easy. "For this book," he writes, "I wrote to several of the national fast-food restaurant chains to find whether they had reformulated their hot beverages as a result of the McDonald's case. Most ignored my letters. Burger King sent a vaguely threatening reply declining to furnish any information but stating I had better be sure whatever I said about Burger King was accurate."

Do you suppose the reason Epstein couldn't find studies showing a correlation between the level of litigation and the level of product safety was that Corporate America was stonewalling researchers? If so, Corporate America has met its match in Carl Bogus.

Here's what happened next: "I then dispatched my research assistant to eight local McDonald's, Burger King, Dunkin' Donuts, and Wendy's restaurants, armed with a candy thermometer and instructions to purchase cups of coffee and hot chocolate and measure their temperature immediately on receipt. He found that no beverage was hotter than 157 degrees Fahrenheit. Moreover, the hot chocolate at Burger King and Dunkin' Donuts was seven to nine degrees cooler than their coffee. The McDonald's case may still provide ammunition for tort reformers and late-night talk show hosts, but it may well have saved many people -- children especially -- from serious injury." In Epstein's defense, he didn't have the benefit of the Bogus field research when he published Simple Rules. No doubt a revision will be made in subsequent editions.

Bogus claims the asbestos issue as another victory for plaintiffs' lawyers in protecting the public. After recounting what he describes as the Environmental Protection Agency's unsuccessful efforts to ban asbestos in the 1980s, Bogus writes: "Fortunately, the common law saved the day. Lawyers began filing product liability actions against asbestos manufacturers in 1964, and the more than two hundred thousand cases that have been filed on behalf of workers and others with asbestosis, lung cancer, and mesothelioma have effectively driven asbestos from the market."

Not exactly. Bogus leaves an uninformed reader with the distinct impression that the only government agency involved with asbestos was the EPA; that the EPA didn't begin "to explore ways to reduce exposure to asbestos" until 1979; that it spent 10 years after that coming up with a rule limiting exposure to asbestos; that in 1991 the U.S. Court of Appeals for the 5th Circuit overturned the EPA's rule because the courts had been packed by Reagan with judges who shared his abhorrent "commitment to libertarianism"; that the EPA, "exhausted from a twelve-year process" that came to naught, simply "gave up" and left workers unprotected; and that, but for America's trial lawyers, workers would still be sucking asbestos dust into their lungs on a daily basis.

Bogus doesn't tell you that the Occupational Safety and Health Administration first established and began to enforce strict limits on asbestos exposure in the workplace in 1971. Serious asbestosis, over the course of the next 20 years, became what the 1994 edition of Occupational Lung Disorders termed "a disappearing disease." The Bogus claim notwithstanding, plaintiffs' lawyers didn't have much to do with it. In fact, many plaintiffs' lawyers today are doing their best to make sure those employees with serious medical conditions caused by exposure to asbestos dust, such as mesothelioma and other cancers, won't receive any compensation.

That's a current target for tort reformers that Bogus remains silent about. As Roger Parloff reported in the March 4 issue of Fortune, plaintiffs' lawyers have filed hundreds of thousands of new asbestos cases in the past three years on behalf of relatively unimpaired clients with no malignant conditions. On April 1, the U.S. Supreme Court agreed to hear one in which a West Virginia jury had awarded $5.8 million in damages, including compensation for emotional distress arising from the fear of sometime in the future developing asbestos-related cancer, notwithstanding the absence of any objective medical corroboration of that fear.

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