Sunday, February 26, 2017

Republicans Introduce Sweeping Federalization of Tort Law, Limiting Recovery to Victims

The Republicans in Congress are intent on expropriating ordinary citizens’ right to sue wrongdoers and allowing corporations and other defendants to violate the law without consequence.   

Not content to protect corporations from accountability by hobbling class actions and intimidating plaintiffs' lawyers with mandatory Rule 11 sanctions, Republicans are going for the full monty: federalized so-called “tort reform” (or what I call “tort elimination”).

Without a hearing, H.R. 1215  (Download HR1215goes to straight to markup in the House Judiciary Committee this Tuesday.  The bill was sponsored by Rep. Steve King (R-IA 4th Dist.). 

H.R. 1215 has the Orwellian name of “Protecting Access to Care Act of 2017” (because all Republican-sponsored bills about the civil justice system are named just the opposite of what they would actually do to ordinary citizens).  The name of this bill should be “Protecting Doctors and Hospitals from Liability for Wrongdoing and Protecting Insurance Companies from Having to Pay Legitimate Claims.”

Although Republicans supposedly care about “states’ rights,” this bill would eliminate (by preempting) vast swaths of state tort law.  Among the many draconian provisions of the bill:

  • It would impose a uniform 3-year statute of limitations on “health care lawsuits.”* States would be free to have a shorter one, but not a longer one.
  • It would impose a uniform $250,000 limit on noneconomic damages.
  • The bill would not limit economic damages, but it would allow states to limit economic damages, noneconomic damages, and the total amount of damages.
  • Naturally, “the jury shall not be informed about the maximum award for noneconomic damages.” Because then they might at last understand what “tort reform” means.
  • The bill would eliminate joint-and-several liability. This could deprive an innocent injured person of full compensation, while shielding a wrongdoing defendant from paying for an injury he helped to cause.
  • “Any party” would be allowed to introduce evidence of collateral source benefits.
  • An award of future damages over $50,000 would be required, at the request of “any party,” to be paid in periodic payments.
  • The bill would completely release health care providers (as defined) from any liability in a products liability action for prescribing a product approved by the FDA.

Finally, no Republican-sponsored civil justice bill would be complete without denigrating plaintiffs’ attorneys and making it even more uneconomical for plaintiffs’ attorneys to represent clients.  This bill goes so far as to call the payment to attorneys of an agreed-upon fee a “conflict of interest.”  The bill would give the court the power to restrict a contingent fee.  And “in no event shall” the contingent fee exceed 40% of the first $50,000 recovered, 33-1/3% of the next $50,000, 25% of the next $500,000, and 15% of any amount in excess of $600,000.  

So now the federal government would be dictating to the states what attorneys’ fees they could allow.  Those limits would apply even in settlement, mediation, or arbitration.

Really, guys?  This bill isn’t even getting a hearing?  Maybe to talk about its practical elimination of citizens’ ability to sue or the fact that the bill is a gift to the insurance industry?  Maybe to talk about the experience that many states, swept up in “tort reform” over the last several decades, have had with similar provisions (many of which have been held unconstitutional)?  How about the fact that the bill slavishly follows the positions of the American Tort Reform Association and the shadowy American Legislative Exchange Council?

H.R. 1215 joins five other bills introduced in the past few weeks that tilt the table in favor of corporate defendants in litigation.  Is there any item on the corporate defense wish list that we haven’t seen introduced in Congress yet?

It is possible, though, that this bill could have one positive effect.  It may induce doctors, hospitals, and insurance companies who currently refuse to participate in federal programs to do so, based upon the limited liability the bill would ensure. 

*Definition: “The term ‘health care lawsuit’ means any health care liability claim concerning the provision of goods or services for which coverage was provided in whole or in part via a Federal program, subsidy or tax benefit, or any health care liability action concerning the provision of goods or services for which coverage was provided in whole or in part via a Federal program, subsidy or tax benefit, brought in a State or Federal court or pursuant to an alternative dispute resolution system, against a health care provider regardless of the theory of liability on which the claim is based . . .”  This would presumably include Medicare, Medicaid, and the Affordable Care Act.

http://lawprofessors.typepad.com/civpro/2017/02/republicans-introduce-sweeping-federalization-of-tort-law-limiting-recovery-to-victims.html

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Comments

The key to undstanding this reform is the definition of, "The term health care lawsuit." When you place yourself under a Federal program, you have agreed to fall within the paramaters of the "Public Rights Doctrine," "Congress has plenary authority in all cases in which it has substantive legislative jurisdiction, McCulloch v. Maryland, 4 Wheat. 316 (1819), so long as the exercise of that authority does not offend some other constitutional restriction." See also,


"[w]hen the state creates rights in individuals against itself, it is not bound to provide a remedy in the courts and may withhold all remedy or it may provide an administrative remedy and make it exclusive, however mistaken its exercise. Dismuke v. United States, 297 U.S. 167, 56 S. Ct. 400, 80 L. Ed. 561 (1936); United States v. Babcock, 250 U.S. 328, 39 S. Ct. 464, 63 L. Ed. 1011 (1919); Blanc v. United States, 140 F. Supp. 481 (E.D.N.Y. 1956).

PUBLIC RIGHTS AND THE FEDERAL JUDICIAL POWER: FROM MURRAY’S LESSEE THROUGH CROWELL TO SCHOR, 35 Buff. L. Rev. 765. Fall 1986.

Some of those provisions may fall under the "Unconstitutional Conditions Doctrine," where generally the government may not condition a benefit on the forced relinquishment of a constitutional right.

I would further add, that if by other government actions, one is forced into a program they otherwise would not place themselves under, then that fact would place the entire scheme in question, and would be an unconscionable bargain.

Posted by: jeff | Feb 28, 2017 3:48:15 AM

Thank you for your comment, but it misses the point entirely. I did not suggest that Congress does not have the constitutional power to enact this bill. My implication was that the policy choices in this bill shift some or all of the risk of loss onto the innocent injured party and off the wrongdoer. This is in derogation of many states' common law and the right to jury trial.

Posted by: Patricia Moore | Feb 28, 2017 6:31:12 AM

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