|
| Home > Legal > Why lawsuits are bad for America |
| Why lawsuits are bad for America | | Date Created: Feb 01, 2005, 11:37 PM |
The title is a play on a book by the aptly named Carl T. Bogus whose tome is called Why Lawsuits Are Good For America: Disciplined Democracy, Big Business, And the Common Law. Bogus is, of course, a lawyer so you can trust him right? I'm not a lawyer, so I don't know what I'm talking about when it comes to the law, right? Well you might be surprised.
For the sake of simplicity we're going to take them one at a time. You can tell from Bogus' title that plaintiff attorneys are liberal Democrats. Why is that? Wouldn't you think lawyers would be conservative Republicans? They used to be when I was growing up in the 60's. "disciplined democracy" is code for using lawsuits as social engineering and getting around legitimate legislation by representative democracy. "Big Business" is the all-purpose evil for liberals to deflect attention from the real problem which is Big Government (that includes Big Law), but Bogus will argue that Big Business needs to be reigned in and controlled by lawsuits. And "Common Law" I'm sure is a Bogus (and bogus) argument that the US tort litigation system is grounded in common law.
So there are a multitude of problems with the US tort litigation system and why lawsuits are actually bad for America even if they're good for Mr. Bogus, but at the moment we're going to deal with just one problem -- the worst one.
The overall worst problem with tort litigation in the US is the contingency fee used predominantly by plaintiff attorneys. The simple reason is that contingency fees create a powerful economic incentive to bring lawsuits and plaintiff attorneys thus have a huge vested interest in the outcome of the dispute. If a judge had such a vested interest, he or she would have to be recused from judging the case. Defense attorneys, however well paid, don't have such a vested interest in the outcome. Only plaintiff attorneys have this incentive.
Recall several things. It wasn't this way in the past and other countries don't allow contingency fees for good reasons. The courts are supposed to be a governmental agency with the power of enforcement to settle disputes that can't be settled out of court so that people don't take the "law into their own hands". Courts are not some place to make money and they should be used sparingly and as a last resort, not a first resort to see what lawsuit might stick or to force a settlement or convince a lay jury to award large amounts of other people's money. The rules were changed in the late 60's specifically to make it easier to sue and get around legislatures who have the legitimate power to make laws. This attempt at social engineering by lawsuit was bad enough, but in an era where too many lawyers were getting turned out, the law of unintended consequences meant that making it easy to sue on a contingency fee and potentially before a sympathetic jury could make millions of dollars for plaintiff attorneys and trial lawyers.
Recall also that a contingency fee is not only a large percentage of the award to the plaintiff (30-50%) but it comes after the court expenses are taken out of the award. And you know what lawyer expenses look like don't you? Paying the equivalent of $10,000 dollars an hour for "work" on the case seems fair doesn't it? Well look at the tobacco lawsuits as an example.
Imagine if doctors worked on a contingency fee basis. They only get paid, and paid big if they cure you. What would happen? Doctors would tend to only take the cases they think they can cure. They would start to make up diseases so that they could "cure" them. They would fight over the "good" cases. They're helping the "little guy" who can't afford treatment. Sound familiar? And while we're on that subject, how much does a doctor get paid for bringing a life into the world or saving a life? Now compare that to what John Edwards makes for suing a doctor for a "bad baby".
Contingency fees reward the subset of lawyers who are avaricious, unethical, and self-deluded enough to think they are just doing good for their clients and and society. Of course with class action suits they don't even need a client in the usual sense. What do you get when you select out the bottom-feeders in any group of people and give them power and buckets of money? Well you get more of them obviously. And they find new ways to bring more moneymaking lawsuits.
When I first made this argument that the contingency fee was the primary problem, I was chided as a free market libertarian that it was just economics and lawyers should be able to do whatever as if it were a free market economic system. Well, hate to say it but it's not a free market system of law any more than the federal government is just another big corporation. The courts are part of the government and the government has the power of guns and incarceration. If a "Big Business" company tries to sell you something or make you buy something, you can ignore them with impunity. Try doing that when you get sued. A system that has force behind it is not a free market economic situation. Lawyers are agents of the court.
But what about the lawyer's argument that the "little guy" that's been harmed can't get his day in court and can't fight the power of Big Corporations without a contingency fee lawyer to fight for them? Well groups of lawyers like Dewey Cheatum and Howe are Big Corporations too. And they have the force of the courts behind them. Big Business doesn't. The sad truth is you can buy justice in this country. Just ask OJ Simpson. If you can hire a lawyer (at whatever exorbitant rates), you can have your day in court and you can defend yourself right out of just about anything.
But what about those who don't have any money? The answer is the second thing you hear on all the TV cop shows when someone is "Mirandized". Let's repeat together now: "You have a right to an attorney. If you cannot afford one, the court will appoint one for you". That's what we do for criminal defendants. Now what about civil plaintiffs? You think you've been harmed in a non contractual dispute. (torts are harm that is not criminal and not involving a prior contract -- Contracts was where the action was back in the days of The Paper Chase before tort litigation took over, thanks to contingency fees) You can't afford an attorney (and can't get one to sue for you unless they stand to make some money). Now what do people do who can't afford a doctor?... Well in the criminal court system, if you can't afford an attorney, one is appointed for you. They're called Public Defenders. They don't make a lot of money. Socially conscious and well-meaning young lawyers often start out there but it's usually a stepping stone to the big time or they find something that pays better. (And what would happen to doctors if they were paid by the government as Public Health Providers...?)
So the answer is, if these tort cases are so important and the plaintiff can't afford to pay an attorney to plead their case at an hourly rate, why doesn't the court assign them one? You've been harmed right? You can't afford an attorney? One should be appointed for you! Makes sense doesn't it? But what would happen? First, most cases that are litigated today would be thrown out because the court gets to decide what's a worthy case, a valid use of the court's time, and has to pay for it. Suddenly no frivolous lawsuits.
The lawyers will argue that lawyers working like Public Defenders will be overworked, underpaid, and won't do a good job for their clients. Well boo-hoo. I thought they went into law to help people and do social good. Can a doctor say "I'm not paid enough to treat this patient properly. I need a contingency fee?". Not a chance. Lawyers deny the incentive and the huge vested interest they have in the outcome of a lawsuit. If there's no such incentive and they're only getting paid scale, suddenly many lawsuits don't look so necessary.
So why can't we get rid of contingency fee lawyering like most other countries? Because the lawyers and politicians who are supported by them control the system. Same problem trying to downsize Big Government. It's the ratchet effect. It only goes one way.
Next time we'll deal with some other little problems like "joint and several liability". |
|
|
|
|
|
