Georgia State Capitol 1904

The Georgia Chamber of Commerce held a forum on tort reform last week. According to today’s Daily Report, Rep. Rich Golick, chair of the House Non-Civil Judiciary Committee who is a corporate attorney for Allstate Insurance Company in his “day job,” told the attendees:

“Go talk to the plaintiffs bar. … See if consensus can be struck,” he said. “I beseech you — it’s the middle of August and there is a run-off and a general election — now is a great time for quiet conversation in quiet rooms where consensus

Do advocates of more “loser pays” rules offer a solution in search of a problem?

Are people unaware of the “loser pays” sanctions that are already part of Georgia law?

As discussed in previous posts, Georgia already has five statutory “loser pays” rules, four of which passed in tort reform legislation during the time I have been practicing law, and one we have had since the Civil War. Georgia needs a sixth “loser pays” about as much as it needs a sixth law school at a time when graduates of the existing law schools have a really hard time finding

Brig. Gen. Thomas R. R. Cobb, father of Georgia’s first “loser pays” statute”

The oldest of the five “loser pays” rules in existing Georgia law has been in effect for nearly 150 years, having first appeared in the Code of 1863.

That Code was largely the work product of Thomas R. R. Cobb, son-in-law of Chief Justice Lumpkin and a foremost Georgia legal scholar of his day. He was a Confederate brigadier general who died at the Battle of  Fredericksburg only a couple of weeks before the Code for which he was largely responsible went into

Advocates of tort reform often call for “loser pays” legislation. Georgia already has five different “loser pays” rules. In earlier posts I have discussed OCGA § 9-11-68, enacted as part of tort reform legislation in 2005, which includes both the offer of judgment / offer of settlement rule and the frivolous claims and defenses rule.

O.C.G.A. § 9-15-14, enacted in 1986, provides for a motion for award of fees and expenses against a party that had asserted a claim or defense “that lacked substantial justification or that the action, or any part thereof, was interposed for delay or harassment, or

“Loser pays” is a popular theme among advocates of “tort reform,” many of whom may not understand what the popular political calls for “loser pays” or “tort reform” really mean in any detail. Perhaps some people who say they are for it do not understand that Georgia already has five “loser pays” rules that have been enacted in legislation over the years.

Yesterday I posted a summary of one of our “loser pays” rules, the offer of judgment under OCGA 9-11-68, which applies when a party rejects an offer of judgment or settlement and does not do at least 25%

We hear talk of another round of “tort reform” legislation including a “loser pays” rule. But some of the folks talking about it may not realize that Georgia already has five different “loser pays” rules.

One of the five forms of “loser pays” rules in Georgia is in O.C.G.A. § 9-11-68. Passed as part of the 2005 tort reform legislation, it provides for an award of attorney fees and expenses against a party that refuses to accept a settlement  offer and at trial does not improve upon the rejected offer by at least 25%. See Smith v. Baptiste, 287

As a personal injury attorney in Atlanta, I was initially one of those who feared the worst when the Georgia legislature passed it omnibus tort reform legislation, Senate Bill 3, in 2005.   It was as if the political power structure had done everything it possibly could to kill victims of negligence — and the lawyers who represent them.  Some thought it was the death knell for personal injury tort litgation in our state.

However, as soon as the bill passed, a few of us began to gather for a series of weekly breakfast brainstroming sessions focused on how to survive and prosper in the new environment. Those sessions helped transform the law practices of several of the participants. Other lawyers around the state began to go through the same sort of process of evaluation and change.

Three years later, we have seen an increase in the frequency and geographical distribution of impressive jury verdicts in injury and death cases. Even counties that had been viewed as black holes for plaintiffs are producing seven and eight figure jury verdicts.

The most recent was a $5 million verdict this week in a hospital malpractice wrongful death case in Gwinnett County. That case involved the death of a new mother due to a fall, as the hospital personnel had not followed fall precautions which were indicated.

Until very recently many of us had simply declined to accept cases in Gwinnett because the juries there were so notoriously hostile to personal injury and wrongful death plaintiffs. I haven’t heard how the $350,000 cap on noneconomic damages in medical malpractice cases may affect that, if at all. It would not be surprising for an economist to reach a $5 million economic valuation on the life of a promising young adult.

A couple of weeks ago in Fulton County, which used to be a big-verdict venue but in recent years has become much more conservative, there was a $54 million verdict, which was reduced to a mere $10.25 million due to the statutory cap on punitive damages which was enacted in 1987.

Last year we had a $2.3 million verdict in a trucking case in conservative, rural Gordon County..  There have even been million dollar verdicts in some of the small, rural, deeply conservative counties.

The "loser pays" provision of S.B. 3 — an "offer of setlement" feature in OCGA 9-11-68 which can require a party to pay the other side’s attorney fees and litigation expenses if it fails to do 25% better at trial than in trial than in a rejected settlement offer — was designed to intimidate and oppress plaintiffs.  However, it has primarily hurt the defense side. In one medical malpratice case, the plaintiff got some $4 million in fees and expenses added to the compensatory damage award under this provision.

There are quite a few other examples that I have not taken the time to compileon a Saturday morning of a holiday weekend.

Why have we seen an increase in substantial verdicts in Georgia after the tort reformers got everything they asked for in the legislature?  Certainly a few minor details of S.B. 3 have been held unconstitutional, but none of those points are substantially involved in these cases.

Another hypothesis is that tort reform has forced plaintiffs’ lawyers to work harder and smarter in case preparation. With so many obstacles thrown in our path, we have to work hard in investigation, in selection and preparation of experts, and in all aspects of trial strategy and preparation.

When that enhanced preparation encounters the most democratic of all institutions in American society — a jury of ordinary people from all walks of life with no political fears or aspirations related to their service on one case — serious cases can get serious verdicts.

Three years ago, one might have predicted that by now we would be out of business and our clients would be out of luck.  Today, however, it’s a great time to be a lawyer representing good people with legitimate claims of serious injury or wrongful death of a loved one.

My good friend Jay Cook from Athens, a former president of the State Bar of Georgia, wrote a stellar guest editorial that appeared on the op/ed page of the AJC this morning.  Acknowledging that plagiarism is the sincerest form of flattery, I’m reproducing the whole thing here:

First it was Vioxx. Then it was poisonous pet food. Now it’s toxic toys and chemically enhanced popcorn. Last year alone, unsafe products killed more than 8,000 Americans and sent millions more to emergency rooms. But let’s not lay the blame on the crippled regulatory agencies or the Chinese.

For once, let’s lay the blame where it really belongs: on the doorstep of those megacorporations that cut corners and break rules to gain unfair advantage over American businesses, big and small, that don’t.

Recently, The Wall Street Journal reported that Mattel, which has recalled more than 20 million dangerous toys this summer alone, has delayed reporting product defects because it finds the reporting rules "unreasonable." According to The New York Times, the Consumer Product Safety Commission has fined Mattel twice for such delays since 2001.

The commission collects millions of dollars in penalties every year from U.S. companies that import or sell products that violate mandatory safety standards, fail to report potential hazards and fail to report lawsuits and settlements for product-related injuries.

And those are just the ones that get caught.

Clearly, dangerous goods are slipping past the safety standards set by the many regulatory government agencies that are supposed to be protecting us, including the Food and Drug Administration and the Environmental Protection Agency.

Last year, Dr. David Graham, the senior FDA drug safety researcher who blew the whistle on dangers of the pain-killer Vioxx, told the Senate Finance Committee that "the FDA is incapable of protecting America from unsafe drugs or from another Vioxx."

Now we’re learning that the EPA has been suppressing a report on the possible dangers of a chemical used in microwave popcorn. Copies of the report were provided to popcorn producers last July, but kept secret from the public.

But even with potent regulatory enforcement, Americans injured by defective products have only one place to turn for a remedy: our court system. But that, too, is being neutered by the same forces that are muzzling our watchdogs. A multimillion-dollar propaganda machine has convinced many of us (and our elected officials) that tethering our tort system will improve the economy.

It may be just the opposite. A briefing paper published last year by the Economic Policy Institute concluded: "The costs of the tort system have been grossly exaggerated, and its supposed impact on job creation, research and development, productivity, and profits has been exaggerated or simply invented. With respect to job creation in particular, significant tort law change would be more likely to slow employment growth than to promote it."

But the so-called "tort reform" movement marches on in perfect step with government deregulation. We’ve watched state after state weaken the ability of citizens to seek redress in the courts.

Access to justice for "the little guy" is the real target of these "reforms"— not the "problems" they’ve trumped up to trick us into giving them what they really want: damage controls that take the teeth out of our juries and the bite out of compensating the victims of their corner-cutting.

Tort law is a small but important facet of our civil justice system. We call it a tort when somebody acts unreasonably and harms another person’s body, property, legal rights or reputation. You can’t call the police when somebody commits a tort, but you can file a suit in the civil courts to seek an appropriate legal remedy.

The rules of our tort system are roughly the same common-sense principles we all learned as kids: Everybody should play fair. The one who broke the rules of fair play should pay for the damage they caused.

Our Founding Fathers understood that we needed these systems in place to make us safe and regulate the practices of fair play.

Let’s cut to the chase: There’s nothing wrong with making an honest buck. America was built on hard work and free enterprise. There’s nothing wrong with wanting higher profits. The American Dream still lives or dies in the profit margin.

But there is something wrong when profit-making turns into corner-cutting that puts public safety in peril. And there is definitely something wrong when some conscienceless megacorporations engage in "remedy rigging": gaming the system so that even when they cheat and get caught, they get no more than a gentle slap on the hand.