If you've ever had the feeling that some big corporations don't care
if you live or die, you're right -- and there's plenty of evidence to prove
it. With federal enforcement of health and safety laws in a downward spiral,
the courts have been one of the few places people could defend themselves or
seek restitution. Yet the Bush administration is out to change that by
limiting lawsuits intended to punish corporate endangerment of workers and the
public in the name of halting "junk lawsuits."
After decades of concealing and lying about dangers of their products
with near impunity, giant tobacco and asbestos corporations have faced
consequences in recent years via the civil-lawsuit justice system.
Damage awards in civil suits exist not only to compensate the affected
people and their families, but also to punish companies with consequences that
can serve as an effective deterrent. Yet "tort reform" legislation on its way
into federal law will hamstring such lawsuits. It bans class-action lawsuits
(where a single lawsuit represents hundreds, or even thousands, of harmed
people) from being brought into state courts unless at least two-thirds of
plaintiffs are from a single state. Instead, these suits would be brought
before (generally) less receptive federal court judges.
This legislation may ensure that some such suits will never be heard,
thanks to a 1985 Supreme Court ruling that federal courts cannot hear class
actions in which laws of affected states have "material" differences. The bill
is just one front that regressive Republicans have presented in their drive to
limit citizen ability to hold corporations accountable.
Perhaps the most important battle will be over the corporate-backed
attempt to limit punitive damages -- intended to deter egregious and
outrageous conduct -- to $250,000. The Ford Pinto scandal of the 1970s
demonstrates why weakening corporate liability is downright dangerous. Ford
executives possessed pre-production crash test results demonstrating the car's
gas tank could explode in relatively minor rear-end collisions. Internal memos
revealed that Ford's managers decided settling civil lawsuits brought by
victims' families would be cheaper than spending $11 per car to fix the
problem. They began selling Pintos in 1971 and allowed dozens of people to die
Then, in 1978, a jury awarded $124 million in punitive damages to a
victim who was severely burned (equaling about one year's savings from not
addressing the problem). Company executives quickly crunched new numbers which
told them to fix the tanks.
Other companies took similar corrective actions after lawsuits forced
them to pay punitive damages for willfully endangering customers or the public.
According to a 1987 study by the corporate-funded Conference Board, "Where
product liability has had a notable impact -- where it has most
significantly affected management decision-making -- has been in the quality
of the products themselves. Managers say products have become safer,
manufacturing procedures have been improved, and labels and use instructions
have become more explicit."
Now "tort reform" advocates want to go back to the bad old days. Senate
Republican leader Bill Frist of Tennessee talks about "predatory trial
lawyers" yet works to grant partial immunity to corporations which knowingly
produce products that kill or maim. If it took $124 million to get Ford's
attention in 1978, imagine how little impact a $250,000 penalty would have
today on the $162 billion company.
One shouldn't assume that if Bush's agenda prevails, judges and
prosecutors would be drumming their fingers in empty courtrooms. . According
to a Public Citizen study, corporations are 160 times as likely to sue as an
average person, and 69 percent more likely than individual tort plaintiffs to
be sanctioned for filing frivolous claims. Of course Bush's tort reform
proposals don't address "runaway lawsuits" by corporations.
Yes, the system could stand some improvements. Allowing plaintiffs and
their attorneys to keep the bulk of the punitive damages serves no social
purpose and can lead to corruption. Instead, a substantial portion of punitive
damage awards could go toward public health and safety advancement, or other
But if the regressives have their way, you'll have little recourse should
some corporation decide that releasing toxic chemicals in your neighborhood
makes good business sense, but courts will lower the hammer if your kids
download songs from the Internet without paying.
Punitive damages go back a long way -- more than 4,000 years to the
Babylonian Code of Hammurabi, the earliest known legal code. They have been
incorporated in the laws of great civilizations since, from the Hebrews to the
Romans to English common law and finally the United States. Attempting to roll
them back isn't conservative; it is a radical move that threatens a basic
principle of justice that has been part of civilized society since its very
Jeffrey Kaplan is an organizer with the San Francisco Bay chapter of ReclaimDemocracy.org, a nonprofit that seeks to restore corporate responsibility.
© 2005 San Francisco Chronicle