Weekly Opinion EditorialLAWSUIT REFORM IS A MORAL ISSUE!

by Steve Fair

Last week, Governor Mary Fallin signed three lawsuit reform bills into law. SB865 and SB862 along with HB 2128 were signed in a state Capitol ceremony attended by business people and physicians.

*****

S.B. 862, authored by Senator Anthony Sykes, (R-Moore), and Representative Dan Sullivan, (R-Tulsa) eliminated the “deep pocket” rule, where the defendant in a tort lawsuit is liable for the entire amount of a plaintiff’s damage regardless of their degree of fault. S.B. 865, also authored by Sykes and Sullivan, requires juries now be instructed in cases that awards for personal injury awards are not subject to federal or state income taxes.

*****

HB 2128, authored by Sykes and House Speaker Kris Steele, (R-Shawnee) places a $350,000 hard cap on non-economic damages. Caps on non-economic damages have been proven to help create jobs and lower medical liability insurance premiums in other states. H.B. 2128 will not impact economic damages, such as lost wages, medical expenses and future loss of expected wages. The bill also includes an exception to the cap in cases of malicious conduct, gross negligence and reckless disregard.

*****

Former State Representative and current Oklahoma State Chamber of Commerce CEO Fred Morgan praised the signing of the new laws saying, "For years, we have fought for lawsuit reform to help bring fairness and consistency to our courts for the business community and those who have been injured alike. We can celebrate that this day is finally here, and relish the message it sends to companies looking to relocate nationwide—that Oklahoma truly is open for business.” “We have fallen behind states like Texas, Missouri, Mississippi and others that have passed significant lawsuit reform in recent years. But, as this legislation becomes law we will be able to compete for jobs like we never have before,” Morgan concluded.

*****

Governor Fallin said, "For too long, inflated legal fees have been an unnecessary cost-driver in the private sector and a burden on the medical community. As a result, we’ve seen businesses and doctors choose to locate in other states, depriving our citizens of good jobs, reducing access to medical care and driving up the costs for medical treatment.”

*****

The ‘hard cap’ on non-economic damages was the most controversial part of the lawsuit reform package. In fact, just before the signing ceremony, six State Senators, including two Republicans, held a press conference condemning the hard caps outlined in HB 2128.

*****

State Senator Steve Russell, (R-OKC) predicted the bill “will not survive constitutional scrutiny. ”He said the legislation was an example of “putting money and business interests above the rights of citizens under the Constitution.” and reflected “a twisted set of morals.”

*****

First, Russell is not a constitutional attorney, so his opinion on whether the legislation will pass constitutional muster has about as much creditability and scholarship as a jelly salesman’s opinion. Similar lawsuit reform legislation that was signed into law last week in Oklahoma has withstood court challenges in thirty states, so it’s a little soon to predict the courts will strike the three laws down.

*****

Second, Russell attempting to tie lawsuit reform to morality is a stretch. The truth is a bad tort system is a burdensome tax on the economy. It kills jobs, lowering income, and increasing prices. Additionally, it exacts opportunity costs: every nickel a company has to plow into fighting lawsuits is a nickel less that it can plow into research and development, higher salaries for its employees, or lower costs for consumers. And Oklahoma’s unnecessarily burdensome tort system put us at a disadvantage in the global economy.

*****

Russell is right that lawsuit reform is a moral issue. By making cases easier to win and by holding out the promise of very large awards Oklahoma’s tort system encouraged litigation, discouraged one-to-one resolution of problems and the inclination to seek or offer forgiveness by offending parties. Rather than feeling shame for having caused damage to another, often potential defendants jockeyed for defensible legal positions. Expressions of regret were discouraged because there might be legal ramifications. Plaintiffs were encouraged to maximize their damages so as to increase the ultimate settlement. Personal forgiveness was discouraged because it hurt the later lawsuit. The net result was more distrust between members of the society and less human understanding. It is a moral issue- an immoral one!