Radosevich, Mozinski, Cashman & Olson, LLP,Tort Reform Manitowoc WI

TORT REFORM:

Whom will it help?

Attorney Steve Olson

For additional information: link to Radosevich, Mozinski, Cashman & Olson LLP

Imagine - it's the year 2012. Liability (tort) law reform swept the nation as a result of President Bush's 2004 campaign promise to do something about the high cost of the American legal system. As a result of Bush's re-election and expanded Republican control of Congress, medical malpractice tort reform occurred first, followed soon after by product liability limitations. Congress passed laws limiting non-economic damages to $250,000. Non-economic damages are things such as past or future pain & suffering, and emotional distress.

In 2012, you're a 26 year old mother of two. You and your husband have together decided that you will be a stay-at-home mom. You haven't worked for the last five years. Although your life has its stressful moments, particularly cooped up with your young children during Wisconsin winters, you and your husband are both glad you’ve made the decision you did.

In the spring of 2012, you're using a kitchen appliance when the device suddenly explodes, spraying you with scalding water & steam. Your face, neck & chest are horrible burned. You spend months recovering in a hospital burn center, receiving a number of skin grafts. Finally, after nine long months, your recovery is complete. However, you remain horribly disfigured. Your eyebrows are gone, as is one earlobe. Your speech has been affected, due to muscle & nerve damage to your jaw.

You slowly become more and more depressed. After returning home, you try to resume raising your children. However, your depression begins to interfere. You have a hard time looking at yourself in the mirror. You rarely leave the house. You start to let your personal grooming slip. You find it harder and harder to remain focused on your young children. The relationship with your husband chills - your marriage begins to fail.

Local fire investigators have looked into what happened. They report allegations between manufacturers have begun to fly. One says your range was turned up too high. Another says the device itself failed. A third accuses you of not properly using the device and damaging the device prior to the accident. Yet, the day of the accident, you know you used it as you always did; you also know it was never dropped or damaged.

You decide to consult an attorney who practices in the product liability field. The attorney conducts a limited investigation and declines to take your case. You can't believe it - how can this be? Unfortunately, you have run into the $250,000 cap on non-economic damages. The attorney tells you that all defendants are denying liability. This means you will have to hire several experts to prosecute your case, including doctors and engineers. This will be expensive - the attorney estimates experts, deposition costs, etc., could cost as much as $100,000 through trial. The attorney also points out that you have no economic damages, explaining economic damages are things such as lost wages or earning capacity, future medical costs, and so forth. You weren’t working at the time, therefore, you have no lost wages. Although you are badly disfigured, if you return to the workforce, your appearance would not effect your income ability. There will be no future medical treatment needed. The attorney tells you that your lawyers fees will have to be paid from whatever is ultimately awarded to you. You are told that the most you could ever be awarded is $250,000 and, with all defendants denying liability and casting blame on other defendants, it will be a long, expensive and difficult battle. The attorney also points out that, if there is to be a settlement, it would likely have to be for significantly less than $250,000. Since all defendants as a group face maximum liability of $250,000, there is no incentive for them to offer anywhere near that much. They know it will cost you quite a bit to prosecute your case, accordingly, if they offer anything it will be quite a bit less. Your attorney, knowing the long, difficult road ahead, will also likely require you to pay around 1/3 of the total amount you receive as attorney fees. Under a best case scenario, if you actually receive $250,000 from any or all of the defendants, you would pay $83,000 in attorney fees and the $100,000 in costs, leaving you only about $67,000.

Welcome to the realities of tort reform. A 26 year old woman has a life expectancy of 56.1 years, per the U.S. Department of Health and Human Services. As a badly disfigured 26 year old mother of two with a failing marriage, will $67,000 adequately compensate you for the rest of your life? That is $1,194 per year.

Do manufacturers who sell products in the United States need legal protection from people injured by their products? A study of product liability legal costs released by the Consumer Federation of America reported that, between 1987 and 1996, product liability insurance costs declined from about 36 cents for every one hundred dollars of product sales to 16 cents. That amounts to a 56% decrease. When adjusted for inflation, the cost of product liability insurance has dropped 75%. According to the U.S. Department of Justice, the number of civil trials dropped by 47 percent between 1992 and 2001, with the number of personal injury cases falling by 31.8% during the same period. During the same period, the median inflation-adjusted payout in all tort cases dropped 56.3% to $28,000. (Civil Trial Cases and Verdicts in Large Counties, 2001, Bureau of Justice Statistics, U.S. Dept. of Justice, 2004).

Tort reformers claim limits on product liability and medical malpractice claims are needed because of frivolous and horribly expensive lawsuits brought against manufacturers, retailers, physicians, hospitals and clinics. These expensive lawsuits, they argue in the case of health care, cause malpractice insurance rates to rise dramatically, pushing up ever-escalating health care costs. Yet, the truth of the matter according to the Congressional Budget Office, is that lawsuits are one of the smallest factors driving up the cost of health care: less than 2%.