Tuesday, August 23, 2011
Since my earlier post on loser pays as a solution to frivolous lawsuits, attention to loser pays as lawsuit reform has increased, apparently largely as a result of Texas Governor Rick Perry's announcement that he is seeking the Republican nomination for President. Recall that Governor Perry in May enacted a form of loser pays in Texas. (See also this July speech by Perry discussing passage of loser pays in Texas.) Then, in August, when Governor Perry announced his candidacy for President, he included in his speech a reference to loser pays, eliciting a surprisingly large cheer from the crowd (see this video at 25 seconds). Governor Perry's presidential-campaign website then again highlighted lawsuit reform (and thereby also his loser-pays approach) by claiming that "Texas' unmatched record on job creation was based on a few simple ideas: Don't spend all the money. Keep taxes low. Make regulations fair and predictable. And stop the frivolous lawsuits that paralyze job creators." (Emphasis added.)
In response, the media and policy groups have turned their attention to loser pays. The Washington Examiner several days ago ran an editorial entitled, Lawsuit Reform Could be Big in 2012, which discussed the passage of loser pays in Texas. The Wall Street Journal Editorial Report on Fox News last weekend highlighted Perry's record on loser pays in Texas, calling it a "major, major reform." The Institute for Legal Reform of the U.S. Chamber of Commerce yesterday sent out an email blast linking a survey that asked if lawsuit reform should be part of a pro-growth agenda. And yesterday, Politico published a lengthy analysis of plaintiffs' lawyers preparing to organize politically against Governor Perry, should he be the Republican nominee, because of Perry's record on Texas tort reform: "Among litigators, there is no presidential candidate who inspires the same level of hatred — and fear — as Perry, an avowed opponent of the plaintiffs’ bar who has presided over several rounds of tort reform as governor."
What might Governor Perry do on loser-pays lawsuit reform were he to become President Perry? Perry is an avowed defender of federalism, so one would think he would not attempt to push loser pays in areas traditionally under state law (such as tort law). But he might attempt to insert loser-pays provisions in federal statutes creating causes of action. And as candidate, nominee, or president, he could significantly influence the debate in statehouses about loser pays by continuing to cite loser pays and lawsuit reform as a reason for his claimed relative success of the Texas economy in creating jobs. Stay tuned.