A Tort System In Need of Repair

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Adam Bielsky

October 21st 2002

AP Economics/ Wilson

A TORT SYSTEM IN NEED OF REPAIR

A successful New York plaintiff’s attorney drives his $145,000 Ferrari F50 down the streets of Manhattan with a bumper sticker under his license plate saying “ALL YOU NEED IS AN ACCIDENT AND A DREAM.” Living in a luxurious mansion just outside of Westchester County, this attorney, who manages a successful liability practice, flamboyantly advertises on television the slogan, “If you’ve been hurt in any kind of accident, you may be entitled to a large cash reward.” This slogan catches the eye of a woman who telephones this attorney to explain the injuries that she had recently suffered. A year later, a Bronx jury awards $4.2 million in damages to the woman who sued New York City after she slipped on a snowy sidewalk and damaged a knee joint while chasing her dog.

We have all heard the outrageous stories about the woman who spilled coffee on herself and won millions or the doctor who won millions because his BMW had a bad paint job. Lawsuit abuse is a major problem in our society and an enormous drain on the U.S. economy. In the last 20 years alone, tort fillings have risen 60 percent.

There is a tremendous need to reform America’s tort system because it is currently not working. While some progress has been made on legislative tort reform, there is still a great need for more.

In 1994, there were over 815,000 new tort cases filed-that’s a new case every thirty-nine seconds. It comes as no surprise that last year, all persons suing, including victims with legitimate injury cases, were forced to wait an average of 65 months to go to trial- 15 months longer than in 1990. Because the courts are over crowded with frivolous liability lawsuits, those with legitimate cases are forced to wait years.

Lawsuit liability abuse is strangling the American justice system because all of the courts are clogged with meritless lawsuits. Most personal injury lawyers take cases on a contingency fee basis, collecting one-third or more of jury awards. Under this system, plaintiffs’ do not have to pay anything to file lawsuits. With nothing to lose, some people abuse our legal system by filing frivolous lawsuits in an attempt to get their hands on large cash compensations, delaying justice for those who truly deserve it.

American consumers have to pay thousands of dollars in hidden costs as a result of the tort system. Businesses raise prices to cover their costs of hiring lawyers, fighting lawsuits and paying out excessively large awards as compensation for punitive damages. Here are just some examples of how the hidden lawsuit tax raises the price of consumer goods:

        -$100 of a $200 football helmet covers liability insurance

        -$20 of a $100 step-ladder covers liability insurance

        -$3000 of an $18000 pacemaker covers liability insurance

        -$170 of a $1000 of a motorized wheelchair covers liability insurance

        -$500 of a $3367 of a maternity stay covers liability insurance

        -$191 of $578 for a doctor’s fee for a tonsillectomy covers liability insurance

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Lawsuits cost the average consumer up to $1200 per year. For instance, an estimated $20 billion a year is spent on unnecessary medical testing procedures to protect doctors and hospitals against malpractice claims. Product liability and litigation concerns have led several companies and laboratories to postpone or cancel altogether their testing of promising AIDS vaccines. In the 1970’s, there were thirteen U.S.-based pharmaceutical companies conducting research in fertility and contraception. By 1988, there was only one because of the threat of liability claims. These examples demonstrate that lawsuit liabilities dampen needed scientific innovation and research. This damages America’s future.

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