February 23, 2004

Oklahoma Tort Reform Overdue
by Donald G. Mashburn

Governor of Oklahoma Brad Henry has revealed his tort reform initiative. Finally! It’s the first serious effort in the state by a Democratic governor. Henry proposes reforms that he says will convert Oklahoma’s tort system to “one of the best” in the nation.

Oklahoma joins some 40 states, which have passed or are considering tort reform legislation. Reform and common sense are long overdue where out-of-whack legal systems function as “jackpot justice” systems that allow tort lawyers to sue any “deep pocket” they can come up with. All they needs is a greedy client with a claim.

Such a litigious climate has long discouraged new business from choosing to locate in Oklahoma. Liability insurance is prohibitively expensive there, as it is in most states without tort reform. Such states usually suffer from chronic slow economic growth, with fewer new and better jobs.

The Governor Henry’s plan can help Oklahoma shake its image of a chronically “poor” state, and perhaps avoid being tarnished by the greed that’s reflected in the actions of tort lawyers and gullible, give-away juries.

Tort lawyers like to sue any and all deep pockets. And juries, it seems, love to make big awards in a sort of vicariousness that lets them dream of hitting the jackpot themselves. As long as states provide potential for awards that are unconscionably – dare we say stupidly? – large, they will be lumped with states with unfavorable business climates and low job opportunities.

Unjustified jury awards are common. In Alabama, a doctor, filed a lawsuit because his new Mercedes Benz’s paint was flaking off. A mentally-challenged jury awarded $22 million!

Then there was the pilot smart enough to fly a plane, but not smart enough to keep from dying from terminal dumbness. He flew his small Cessna up a mountain box canyon till the terrain was rising faster than the Cessna could climb.

In a futile attempt to turn inside the narrowing canyon, his plane struck a canyon wall and crashed on a gravel bar beside the river, killing the erring pilot. His widow’s lawyer got a jury to award millions, on the flimsy grounds that if Cessna had built a “crash-worthy” cabin, the pilot could have survived. The jury’s exorbitant award helped force Cessna to abandon the manufacture of small general aviation aircraft.

True tort reform should prevent such excessive awards. Governor Henry’s proposed reforms, among other desirable features, would limit product liability. But the first goal should be to prevent frivolous lawsuits in the first place. Henry’s plan does that.

His proposal also would cap noneconomic damages at $300,000. This does not limit actual economic damages; only those determined to be noneconomic.

An important Henry reform would be the elimination of the shared liability absurdity of the current system. The reform would protect sued defendants found to be less than 50 percent at fault from having to pay the entire award.

Under the unfair current system, defendants found to be only five percent at fault can be forced to pay the entire award if the parties found to be 95 percent at fault can’t pay. It’s a form of legalized robbery without the risk of being shot at by the holdup victim.

Some past deals between Oklahoma’s Democratic legislative leaders and governors failed the “smell” test, so there’s some skepticism as to Henry’s tort reform sincerity. It’s asking a lot of his Democratic lawyer friends in the legislature to willingly support reducing the size of tort lawyers’ share of the “jackpot justice” payoff.

But if Henry sincerely wants tort reform for Oklahoma, he’ll work to eliminate frivolous lawsuits by requiring the loser – and loser’s attorneys – to pay legal fees and court costs. Perhaps it will serve as a blue print for other states that have not yet acted to bring sanity and equity to their legal systems.

Henry should also fight to eliminate the unfair “shared liability” provisions that require a defendant with only a small liability to pay the whole award just because parties with most of the liability can’t pay.

If Henry, and like-minded governors in other states, won’t fight hard for these two features, along with an overall cap on damage awards, they’ll show they’re more interested in political smoke and mirrors to benefit their lawyer friends than they are in the welfare of their states.