The Arguments For and Against Tort Reform

By Christy Rakoczy
Published: 24 June 2013

Documentaries like HBO’s Hot Coffee have drawn more attention to the field of tort litigation and tort reform in recent months, but the battle for and against tort reform has been raging for years. The Hot Coffee documentary takes a look at the case of Stella Liebeck, an Albuquerque woman who famously sued McDonald’s for spilling hot coffee on herself. The case became a cause celebre for corporations and others to argue that jury awards and so-called “frivolous lawsuits” were out of control in the US.

Indeed, the documentary points out the debate about tort reform. On the one side are experts who believe that tort laws ensure that plaintiffs can pursue rewards in cases where they have been injured, ensuring that plaintiffs are held accountable for their actions. On the other side of the debate are corporations, insurance carriers and other experts, who claim that tort laws need to be reformed because they allow plaintiffs to pursue so called “jackpot justice” for profit. As HBO’s Hot Coffee notes, corporations spend considerable PR dollars ensuring that their view of “frivolous court cases” is seen by the general public.

What is Tort Reform?

Tort reform involves making changes to the tort law system that place caps on the amount of damages that people who file a civil lawsuit can recover. Civil lawsuits are filed for many types of personal injuries, from medical malpractice to car accidents to defective products.

When a civil lawsuit is filed, plaintiffs can collect both economic damages (such as medical bills and lost wages) as well as compensatory damages (money for things like pain and suffering and emotional distress or loss of companionship). Plaintiffs can also pursue punitive damages, which are specifically created to deter defendants from engaging in risky or negligent behavior again.

Tort reform places a limit on the amount of non-economic damages that can be received. In other words, the amount of pain and suffering that a person may be awarded by a jury is capped. These caps are set by individual state laws and, when they exist, the amounts and types of cases that they apply to can vary.

Arguments For Tort Reform

Arguments for tort reform primarily revolve around medical malpractice torts. In many medical malpractice cases, damages awards are very high, especially in cases of wrongful death or situations where a baby or mother is injured during the birthing process. These high damage awards increase medical malpractice insurance premiums for doctors.

The cost of the high medical malpractice insurance premiums is passed on to individuals using the health care system. A doctor who has to pay high malpractice insurance premiums, it is argued, will need to charge more to provide his services. The patients, and the system as a whole, thus have to pay. By capping medical malpractice damages, the belief is that the savings from lower malpractice premiums will be passed on to consumers, lowering the cost of health care.

Another argument is that doctors may be influenced by the risk of civil lawsuits and the potential for high damages and may begin to make medical decisions based not just on what is best for the patient, but instead on what is best for avoiding litigation. It is argued, for example, that doctors may recommend cesarean sections more often than they otherwise would do because this can reduce potential liability as they can claim that they did everything they could for the patient and used all medical tools at their disposal.

Finally, there is a concern that there will be a shortage of doctors in some fields as a result of potential tort liability and high medical malpractice premiums. Of particular concern is the field of obstetrics, where high damage awards are a serious risk.

Arguments Against Tort Reform

There are also equally compelling arguments against the concept of capping damages. In fact, tort damage caps are actually prohibited in state constitutions. One of the main arguments against tort reform is that it is unfair to the patient. Why should a person who is harmed be less-than-fully compensated for all that he or she has been through? Sometimes, injuries can be especially painful and gruesome. Some of these injuries can be permanent. If the purpose of tort law is to make a plaintiff whole, how can it be fair to arbitrarily cap the amount that a person can receive?

Another argument is that the principle of tort reform violates Constitutional rights. A jury is vested with the responsibility of hearing cases, making decisions and determining an appropriate damage award. Tort damage caps limit the power of the jury, perhaps in an inappropriate way.

Finally, one of the purposes of civil liability is to make people accountable for their actions. A doctor who is negligent or a company who makes a defective product should be responsible for paying for the cost of what they have done. The fear of civil lawsuits can help ensure that they do behave in a careful manner and that they take steps to avoid doing harm and making themselves subject to a lawsuit. How can something that urges additional care for people’s health be bad?