March 30, 2006

Honorable Joseph J. Roberts, Jr, Speaker
New Jersey General Assembly
State House, Trenton, NJ 08625

Honorable Richard J. Codey, President
New Jersey State Senate
State House, Trenton, NJ 08625

RE: Wrongful Death Act

Dear Speaker Roberts and Senate President Codey:

I am writing to you on behalf of Consumers for Civil Justice (CCJ), a coalition of citizen, labor, civil rights, victims’ rights, environmental and public health organizations promoting the interests of New Jersey’s consumers through fair and equal access to the civil justice system and government (see cc roster of trustees) to express CCJ’s support to amend New Jersey’s Wrongful Death Act to expand damages available to grieving families when the life of a loved one is wrongfully taken. Wrongful death statutes, in general, establish a cause of action for the wrong done to an individual’s beneficiaries when the individual dies as the result of the wrongful conduct of another person.

New Jersey’s Wrongful Death Act severely limits the type of recovery available to grieving families. In New Jersey, a plaintiff in a wrongful death action may only recover pecuniary loss sustained as a result of the decedent’s death. A family member may not, therefore, recover damages for the emotional pain and suffering or the loss of society caused by the decedent’s wrongful death. And the award for pecuniary (economy) loss does not even begin to compensate for the emotional and social loss of a family member, whether that is a parent or a small child. Furthermore, because parties responsible for a wrongful death know that even if they go to trial their exposure is only for pecuniary loss, they can downscale their settlement offers. If these same parties also face damages for the loss of society, companionship and mental and emotional anguish, their settlement offers will be more in line with the true losses suffered by families upon the loss of a loved one.

Currently, there are two identical bills pending in the New Jersey State Legislature to amend the State’s Wrongful Death Act to expand damages available: Senate, No. 176 (Senator J. Doria, Dem.-31) and Assembly, No. 1511 (Assemblywoman S. Oliver, Dem.-34). Additionally, there are two other identical bills pending in the legislature that clarify that surviving children in a wrongful death action continue to share in any recovery awarded under the wrongful death act: Senate, No. 68 (Senator J. Adler, Dem.-6) and Assembly, No. 2632 (Assemblyman R. Gusciora, Dem.-15).

S-176 (in the Senate Judiciary Committee) and A-1511 (in the Assembly Judiciary Committee) both expand the type of damages for which one may bring suit to include loss of society, companionship, comfort, protection, marital care, parental care, filial care, attention, advice, counsel, training, guidance or education. Also, damages in wrongful death actions would be permitted for loss of a special relationship between and among spouses, parents, children and siblings. Additionally, under these bills loss of companionship may include consideration of mental anguish and emotional pain and suffering only in the case of a surviving spouse, child, parent or in the alternative, surviving siblings. In the case of a minor child, loss of pecuniary investment by a parent is also recoverable. (It should be noted that these bills do not provide for domestic partners. This should be remedied or at least be taken under consideration by the sponsors of S-176 and A-1511 in light of the recent Domestic Partnership Act. It would seem unjust to exclude them by failure to add them to covered individuals.)

With regard to S-68 (in the Senate Judiciary Committee) and A-2632 (in the Assembly Judiciary Committee), both bills are intended to correct previous amendments to the statutes governing intestacy which made the entire estate pass to the surviving spouse of the decedent if there is a surviving spouse. The unintended consequence of that change is that in wrongful death cases where there is a spouse and children the children are not “persons entitled to take any intestate personal property of the decedent.” These bills provide that if there is a surviving spouse of the decedent and one or more surviving descendents of the decedent they shall be entitled to equal proportions for purposes of recovery under wrongful death actions.

As the loss of life is a serious matter, policy concerns dictate that a grieving family member should have the ability to recover for ALL damages caused by the wrongful death of a loved one, including mental anguish and loss of society. Furthermore, as less than ten states (including New Jersey) now limit recovery in wrongful death cases to purely economic losses, fairness and justice require that New Jersey’s Wrongful Death Act should be changed to include the most significant losses experienced by grieving families as a result of the wrongful death of a loved one.

In summary, all four of these bills could be described as the most fair, equitable and necessary laws that could be enacted in this legislative session. CCJ urges you to list the abovementioned bills for hearings in their respective committees.

Thank you for your consideration of this matter. If you have any questions or wish to schedule a meeting with representatives of CCJ, please contact Peter Guzzo, CCJ’s Executive Director and Government Affairs Agent at 609-883-7481. We look forward to hearing from you.

Very truly yours,

Myles O’Malley,

President

Cc: Honorable John Adler
      Honorable Joseph Doria
      Honorable Reed Gusciora
      Honorable Sheila Oliver
      CCJ Trustees
               AARP
               CCJ Elder Care
               CLPER
               CWA-District 1 (AFL-CIO)
               HPAE (AFL-CIO)
               Hemophilia Association of New Jersey
               Housing & Community Development Network of New Jersey
               MADD-NJ
               NJ Advisory Council on Safety & Health
               NJ Brain Injury Association of New jersey
               NJ Citizen Action
               NJ Environmental Federation
              NJ PIRG
               NJ WEC
               Physicians & Patients for Quality care
               SEIU
               Voices for Patient Protection

This letter was sent separately to Senator Lautenberg and Senator Menendez

February 13, 2006

Honorable Frank Lautenberg
One Gateway Center, 23^rd Floor
Newark, NJ 07102

Honorable Robert Menendez
One Gateway Center, 11^th Floor
Newark, New Jersey 07102

Dear Senator:

I am writing on behalf of New Jersey Consumers for Civil Justice (CCJ) to express CCJ’s opposition to S. 852, the misnamed “Fairness in Asbestos Injury Resolution (FAIR) Act,” and to urge your outspoken opposition to the bill. CCJ, a coalition of citizen, labor, civil rights, victims’ rights environmental and public health organizations (see roster of trustees below) promoting the interests of New Jersey’s consumers and victims through fair and equal access to the civil justice system and government believes that this bill is unfair, under-funded, unworkable and destined to fail victims and taxpayers alike. To make matters worse, a central premise of S. 852 is false.

According to a recent report issued by Public Citizen, State and federal courts are adequately handling asbestos injury lawsuits and are not buckling under any crushing caseload. This undercuts one of the key arguments advanced by supporters of a proposed $140 billion federal asbestos compensation trust fund. This bill is not fair or just or supported by factual evidence. Rather, S. 852 is, in reality, an industry plan to wipe out tens of billions of dollars in corporate liabilities under the guise of helping victims and, in reality, is anti-victim. Furthermore, the federal trust fund established in S. 852, if enacted into law, is unlikely to have enough money because the number of claims will exceed official projections.

Finally, courts already have at their disposal a variety of ways to handle asbestos claims, according to Public Citizen’s canvassing of judges and attorneys involved in the cases. These include:

· “Inactive dockets,” in which victims file claims but have action delayed until they learn of more serious asbestos-related disease.

· “Medical criteria,” which prevent an action from being brought unless threshold systems of illness are met.

· Litigation protocols known a “case management orders,” which are designed to find fair, quick resolution of claims, while minimizing transaction costs for the parties.

· Court efficiency measures, such as the electronic filing of documents, that speed resolution cases.

· The expediting of cases filed by more severely injured victims.

Since courts already make wide use of these techniques to handle asbestos cases and State and federal courts are not buckling under any crushing asbestos caseload, the U.S. Senate should reject S. 852 as being unnecessary and counter to both current law and court practice. Most importantly, this bill should be rejected because it is in not in the best injury of victims who were, through no fault of their own, exposed to asbestos.

In conclusion, CCJ believes that this bill will fail to treat victims fairly, while benefiting

the very companies that caused the problem. Again, on behalf of CCJ I urge you to oppose S. 852.

Very truly yours,

Peter P. Guzzo
Executive Director/Government Affairs Agent

cc: CCJ Trustees—AARP, CCJ Elder Care, CLPER, CWA-District 1 (AFL-CIO), HPAE (AFL-CIO), Hemophilia Assn. of NJ, Housing & Community Development Network of NJ, MADD-NJ, NJ Advisory Council on Safety & Health, NJ Brain Injury Ass. of NJ, NJ Citizen Action, NJ Environmental Federation, NJ PIRG, NJ WEC, Physicians & Patients for Quality Care, SEIU, Voices for Patient Protection

February 9, 2006

Honorable Joseph J. Roberts, Jr., Speaker
New Jersey General Assembly
State House, Trenton, NJ 08625

Honorable Richard Codey, President
New Jersey State Senate
State House, Trenton, NJ 08625

RE: Reference of Immunity Bills to Committees of Second Reference

Dear Speaker Roberts and Senate President Codey:

Of concern to all individuals who believe in the right of persons to access the civil justice system when injured as a result of the carelessness and unreasonable acts or omissions of others is the marked increase in the number of immunity bills introduced in the New Jersey State Legislature in recent years. These bills seek to grant civil immunity for a variety of different individuals and entities. Consumers for Civil Justice (CCJ), a coalition of citizen, labor, civil rights, victims’ rights, environmental and public health organizations promoting the interests of New Jersey’s consumers through fair and equal access to the civil justice system and government (see cc roster of trustees) is among those who oppose the piecemeal eradication of our civil justice system through enactment of individual legislation designed to address a particular industry concern, which is often unsubstantiated, about civil liability.

As many prominent defenders of our civil justice system have said, New Jersey’s civil justice system should be preserved and maintained without regard to special interest groups. Rather than allowing judge and jury to evaluate the merits of each case based on its unique facts and circumstances, immunity legislation results in denying access to the courts regardless of the merits of any particular case. People and corporations who cause harm should be accountable and responsible for the harm they cause to others. As retired New Jersey Supreme Court Justice Daniel O’Hern stated in a keynote speech to CCJ at its May 16, 2001 Awards Banquet, this is the cornerstone of our civil justice system:

Standards for justice must provide for individual justice in

Individual cases and treat injured consumers not as chattels

But as respected and dignified human beings. Unwarranted

Restrictions on juries and judges’ ability to provide compensation

Undermines the cherished principle of individual justice enshrined

In the State Constitution.

Legislating immunity is not the answer. It simply encourages those who cause harm to continue to cause harm. It relieves those who are responsible for the harm from being held accountable, often shifting the harm not only to the person injured, but to the government and taxpayers who must shoulder the costs themselves. CCJ was founded on the premise that when someone is injured, someone must bear the consequences and pay for the costs. Those who cause harm should be held accountable and responsible for the harm they caused.

In the past Legislative Session, we have seen mixed success. On the one hand, the Legislature passed and the Governor approved a bill that allows victims of childhood sex abuse to sue churches, schools and other nonprofits for the actions of employees, thus changing the law that had shielded charities from liability for employee misconduct. However, the Legislature also passed and the Governor signed into law a bill that protects New Jersey professional (minor league) baseball teams from lawsuits by fans who are conked by flying balls or bats at a stadium. This law effectively overturns a recent decision by the New Jersey Supreme Court allowing fans to sue if they are injured by a stray ball outside the seating area of a stadium.

Because of the serious impact immunity legislation has on consumers and victims of New Jersey, CCJ is requesting that all such immunity bills be given a second reference to the respective Judiciary Committees of the New Jersey State Senate and the New Jersey General Assembly if they are given a first reference to another committee. This would allow for the respective Judiciary Committees of both houses to be aware of all the immunity bills introduced in the legislature during the session and to weigh the consequences of such bills in their totality rather than having a particular committee address an immunity bill as a “unique situation,” unaware of the existence of other such bills. This would also help to establish what CCJ believes should be the guiding principle of immunity bills:

IMMUNITY BILLS SHOULD BE THE EXCEPTION, NOT THE RULE

On behalf of CCJ, I thank you for taking the time to read this letter and would be pleased to arrange for a meeting between you or your staff representatives and members of CCJ.

Very truly yours,

Peter Guzzo
Executive Director/Government Affairs Agent

cc: Honorable John Adler, Chair

Senate Judiciary Committee

Honorable Linda Greenstein, Chair

Assembly Judiciary Committee

CCJ Trustees:

AARP
CCJ Elder Care
CLPER
CWA-District (AFL-CIO)
HPAE (AFL-CIO)
Hemophilia Assn. of NJ
Housing & Community Development Network of NJ
MADD-NJ
NJ Advisory Council on Safety & Health
NJ Brain Injury Assn. of NJ
NJ Citizen Action
NJ Environmental Federation
NJ PIRG
NJ WEC
Physicians & Patients for Quality Care
SEIU
Voices for Patient Protection

The New York Times

February 7, 2006 Tuesday
Late Edition - Final

SECTION: Section A; Column 1; Editorial Desk; Pg. 20

Justice for Asbestos Victims

Just last week, the Democrats' Senate leader, Harry Reid of Nevada, failed to muster the gumption to try to stop the nomination of a right-wing ideologue to a lifetime seat on the Supreme Court. So it's shocking to hear Mr. Reid threatening now to block a bipartisan bill that would finally bring justice and compensation to victims of asbestos-related diseases. We can't imagine what Mr. Reid is trying to achieve, other than showing fealty to the trial lawyers who have been so generous to his party.

The Senate should approve the bill, which would replace the current morass of asbestos litigation with a $140 billion fund to pay the claims of victims of asbestos exposure. The fund would be financed by makers of asbestos, a carcinogenic material, and manufacturers that used it, and their insurers.

It is the product of an assiduous effort by Senator Arlen Specter, the Republican who is chairman of the Judiciary Committee, and Senator Patrick Leahy, the committee's senior Democrat. That makes it a 21st-century rarity: a thoughtful bipartisan compromise on a vexing national problem. It would create a fund to pay awards to those who are already sick, using detailed medical criteria to determine eligibility and the awards. Under this no-fault system, akin to workers' compensation, those exposed to asbestos at work but not ill would be entitled to free medical screening every three years.

Lobbyists for trial lawyers, and various companies, insurers and union interests that feel aggrieved by some aspect of the complex package, are trying to round up lawmakers to block the bill. A key test is to come today, when the majority leader, Bill Frist, has scheduled a vote to allow the Senate to begin formal consideration of the bill. Mr. Reid is trying to derail the measure even before the debate begins in earnest, and Democrats who want to see asbestos victims treated fairly should not support him.

There are other dangers ahead, including the possibility of a ''poison pill'' amendment that would expand to other communities a special provision that would make residents of Libby, Mont., a town uniquely affected by asbestos contamination, eligible for a guaranteed level of compensation without a need to show occupational exposure. Another worry is that some Republicans will try to amend the payment provisions or medical criteria in ways that would be unfair to victims.

No one can be sure that $140 billion would cover all current and future claims. But the bill would give victims the option of going to court should the trust fund run out. It would be a vast improvement over the present method of dealing with the claims of asbestos victims, which is to clog the courts and bankrupt companies while still depriving many victims a measure of justice

The New York Times

February 8, 2006 Wednesday
Late Edition - Final

SECTION: Section C; Column 5; Business/Financial Desk; Pg. 1

Senate Votes to Debate Bill For Asbestos Victims' Fund

By STEPHEN LABATON

DATELINE: WASHINGTON, Feb. 7

Backers of legislation to create a $140 billion trust fund for victims of asbestos exposure won an important victory on Tuesday evening, when the Senate voted to begin debate on the measure. The vote was 98 to 1, and came after critics dropped their opposition when they realized that they did not have enough votes to block the debate.

The bill, which would replace the current civil court approach to compensating victims with a no-fault program run by a new compensation office at the Labor Department, has provoked a lucrative lobbying brawl featuring four of the most influential interests on Capitol Hill -- manufacturers, insurers, labor groups and trial lawyers. They have showered lobbyists with fees and the lawmakers with contributions in the last year in anticipation of the showdown.

The asbestos measure still faces formidable political obstacles even though it is a priority of Republican leaders in Congress and the White House.

In the first six months of 2005 alone, more than 25 lobbying firms reported fees of more than $8 million for working on the asbestos legislation, according to Political Money Line, a nonpartisan research group that studies reports filed with Congress by lobbyists and their clients.

The largest chunk, $4.7 million, went to the Washington law firm of Swidler Berlin from the Asbestos Study Group, an organization of companies advancing the legislation. All told, Swidler has received more than $23 million representing the Asbestos Study Group. Its team is led by Thurgood Marshall Jr., a former White House official in the Clinton administration and Brian Fitzgerald, a former counsel to the Senate Judiciary Committee.

The other lobbyists listed in the most recent disclosure filings represent an array of makers and users of asbestos, insurers, trial lawyers and venture funds, which are placing bets on the winners and losers of the legislative battle.

The legislation has been opposed by a significant group of small and large companies, including Exxon Mobil, the American International Group, Allstate and BorgWarner, as well as labor unions and trial lawyers. A group of companies opposed to the legislation, known as the Coalition for Asbestos Reform, has a budget of another $3 million not mentioned in the earlier disclosure reports, according to an internal memo of the group that was made public on Tuesday by The Hill, a newspaper that covers Congress.

Supporters and critics of the legislation have exchanged accusations of being tools of lobbyists and special interests. On Monday, the Democratic leader, Senator Harry Reid of Nevada, tried to tar the companies supporting the legislation and their lobbyists by invoking the specter of Jack Abramoff, the disgraced lobbyist who pleaded guilty last month to criminal corruption charges.

''Look what we have on the Senate floor today -- asbestos legislation, legislation that, of course, is not ready to be here, but it is being brought here because of tremendous pressure by the folks downtown,'' Mr. Reid said. ''What do I mean by folks downtown? Washington has been run by lobbyists. The Jack Abramoff scandal is no surprise to people who have been watching this.

''Why do I say that this is an example of why we need lobbying reform in Washington today? This legislation is on the floor for one reason: 15 companies that are pushing this legislation. Thousands of companies oppose it.''

On Tuesday, Senator Orrin G. Hatch, Republican of Utah, replied that the critics should ''look in the mirror'' because they were the ones acting as servants of special interests.

''I'll tell you who the special interests are in this debate -- they are the law firms who are driving this with bogus lawsuits,'' said Mr. Hatch, who has sought an asbestos trust for years. ''If this bill becomes law, these lawyers will have to find another industry to bilk.''

The cloture vote on Tuesday to proceed to debate was requested by Senator Reid. He ultimately voted against his own motion to open the debate after concluding he did not have the votes to stop the legislation. Jim Manley, a spokesman for Mr. Reid, said the senator would continue to use every possible procedural maneuver to kill the legislation, including a filibuster. The sole vote to block debate on Tuesday came from Senator James M. Inhofe, a Republican of Oklahoma.

The bill, which would provide no federal money for settlement, would restrict asbestos victims from bringing their claims into court and would limit the liability of makers and insurers but force them to make contributions to the fund. It would set up a schedule of payments, based on the severity of the illness, ranging from $25,000 for breathing impairments to as much as $1.1 million for victims of mesothelioma, a lethal cancer of the lungs. Fees for lawyers would be capped at 5 percent of the final award.

The vote Tuesday evening was significant because a defeat would have all but doomed the legislation this year. Final action on the measure is weeks away, and the measure faces significant hurdles even though it has gained considerable momentum.

Senator Arlen Specter, the Pennsylvania Republican who heads the Judiciary Committee, has spent more than two years trying to negotiate a compromise involving the manufacturers, insurers, labor groups and trial lawyers. He said on Tuesday that he had been talking to senators to get them to vote for the legislation.

Mr. Specter, who enlisted Judge Edward R. Becker of the United States Court of Appeals to mediate the negotiations involving the four groups, has said the legislation is the only way to reduce the legal costs that critics say have sharply decreased the amount of money available to asbestos victims. Mr. Specter has argued that the legislation would effectively address hundreds of thousands of cases that the courts are incapable of handling.

While the bill has gained the support of major business interests, it has come under attack from Democrats and Republicans.

Liberal Democrats and consumer groups, as well as trial lawyers, say the legislation would unfairly bail out corporations and restrict compensation to victims. Conservative Republicans say the trust would take too much money from industry and could require a federal bailout. As a result, lawmakers such as Senator Judd Gregg, the New Hampshire Republican who heads the Budget Committee, are threatening to raise points of order against the bill on the ground that it violates the Senate budget rules. The budget committee's ranking Democrat, Senator Kent Conrad of North Dakota, has said that asbestos claims could exceed contributions to the fund by $150 billion over 50 years.

New York Times

February 15, 2006

Asbestos Bill Is Sidelined by the Senate

By STEPHEN LABATON

WASHINGTON, Feb. 14 — The Senate decided on Tuesday night to all but kill legislation to create a $140 billion fund to compensate victims of asbestos poisoning.

Supporters of the measure, led by Senator Arlen Specter, Republican of Pennsylvania, fell just short of the 60 votes needed to waive a budget objection raised about the legislation. The final vote was 58 to 41, and with powerful interests on both sides it did not break down along party lines.

Senator Bill Frist, the Republican majority leader and a strong supporter of the legislation, changed his vote from yes to no at the last moment so he would have the option of calling for a recount "at some later date," he said.

Still, advocates for the measure held out hope that they could reverse the outcome. On Tuesday night, Senator Specter, its chief sponsor, issued a statement that the one senator who was absent from the chamber, Daniel K. Inouye, Democrat of Hawaii, had told him he would vote to waive the budget objection but he had gone home because his wife was ill.

"We will have him on the motion to reconsider," Mr. Specter said, "and we may change another vote or two, so we may win this one yet."

Nonetheless, the vote meant that the courts were likely to remain the primary forum for processing thousands of asbestos cases in the foreseeable future.

President Bush has made changes in the treatment of asbestos claims a legislative priority, and the Senate action was a major setback for the White House.

The bill, more than two years in the making, became a casualty of powerful business interests opposed to it, as well as of a forceful coalition of conservative and liberal senators. The conservatives argued that the measure could lead to a new and expensive federal entitlement program. The liberals maintained that the asbestos fund was not large enough to compensate victims and was a bailout for asbestos companies and their insurers.

Supporters said the bill was needed to compensate victims and their families, alleviate a crisis among manufacturers and deal with a growing number of cases in the courts.

An estimated 10,000 people die each year from exposure to asbestos, primarily in the workplace. Dozens of companies have sought bankruptcy protection to control their asbestos-related legal costs.

And by many estimates, about 60 percent of the money available to compensate victims is going to lawyers for the plaintiffs or the companies. The courts, facing growing numbers of asbestos cases, have repeatedly called on Congress for a legislative solution.

The measure failed in large part because of opposition from some asbestos makers and insurers, as well as from trial lawyers and labor unions. Some companies opposed to the legislation declared that they were being forced to pay too much into a new compensation fund, while the unions and trial lawyers saw the bill as a bailout without enough money for the victims.

Senator John Ensign, Republican of Nevada, lodged the procedural objection to the bill. He maintained that it violated a Congressional limit on spending. Conservatives have raised concerns that the fund could be insufficient and therefore require a federal bailout. Liberals also hold that the fund is insufficient, but say that is because manufacturers and insurers are not being required to contribute enough.

Earlier in the day, Senator Frist said he would not try to resurrect the legislation if it ran into obstacles this week. "If we are unsuccessful this week in addressing asbestos," he said, "that is it for this year."

Asbestos has been widely used as an insulation and construction material, and exposure to it in the workplace may not manifest itself in harmful ways until decades later. It can cause illnesses ranging in severity from relatively mild to lethal.

A study issued in May by the Rand Institute for Civil Justice found that more than 730,000 people in the United States had filed compensation claims for asbestos-related injuries from the early 1970's through the end of 2002, costing businesses and insurance companies more than $70 billion.

The legislation shunted aside on Tuesday night had been intended to replace the current civil court approach to compensating victims with a no-fault program financed by manufacturers and their insurers and run by a new compensation office at the Labor Department.

The bill would restrict asbestos victims in bringing their claims to court and limit the liability of manufacturers and insurers, but require them to make contributions to the fund.

It would set up a schedule of payments, based on the severity of the illness, ranging from $25,000 for breathing impairments to as much as $1.1 million for victims of mesothelioma, an often fatal cancer of the lungs.

Fees for lawyers would be limited to 5 percent of final awards.

Both supporters and opponents of the legislation relied on a new analysis by the Congressional Budget Office to support their positions. Senator Specter emphasized the budget office's conclusion that the legislation "would be deficit-neutral over the life of the fund."

But the opponents, including trial lawyers' groups and some manufacturers and insurers, pointed to other parts of the budget office analysis showing that its effect would not be deficit-neutral if the administrator of the $140 billion fund had to borrow heavily or if courts ruled that there was a government obligation to pay victims despite the terms of the bill.

The fund in its initial years would be financed through significant borrowing, and critics of the legislation have raised concerns about its impact if some asbestos companies were unable to meet their payments.

Illustrative of the complex political calculations on Tuesday were opposing statements by the two Democratic senators from California.

Dianne Feinstein, one of 20 sponsors, said that while the bill was not perfect, it was necessary to compensate victims and reduce high court costs. She disputed the argument that taxpayers would ultimately have to bail out the trust fund, saying asbestos victims would be able to return to the courts if it did not have enough money.

But Senator Barbara Boxer said that the bill was giving asbestos victims false hope. "Companies will go into bankruptcy," she warned. "It's a giant nightmare.

"I am very fearful that a lot of people who are going to depend on this trust fund will find out that it is not all it is cracked up to be. "The bill promises the moon. But it will not even deliver a sliver of the moon."

The New York Times

February 9, 2006 Thursday
Late Edition - Final

SECTION: Section C; Column 5; Business/Financial Desk; Pg. 3

Large and Small Businesses Part Ways on Asbestos Bill

BYLINE: By JULIE CRESWELL;

Stephen Labaton contributed reporting for this article.

As the Senate opened debate on legislation that would create a $140 billion fund for victims of asbestos, companies were gearing up for a titanic battle.

But some of the fiercest fighting will be between large and small companies. Several large companies back the bill, arguing they want to put their asbestos litigation and liabilities behind them. Smaller businesses say the bill's complicated formula for determining how much each company will have to put into the fund will drive them into Chapter 11 bankruptcy.

The bill has already pitted unions against one another and led to splits in the insurance industry, and in at least one instance it has a well-known plaintiffs' lawyer standing apart from his colleagues.

In broad strokes, the Fairness in Asbestos Injury Resolution Act of 2005 would restrict asbestos victims from bringing claims to court. Companies with claims against them and insurers would contribute to the fund. Based on their illnesses, victims would receive from $25,000 to $1.1 million, for those with mesothelioma, a lethal cancer of the lungs. Lawyers' fees would be capped at 5 percent of the final award.

''To American business, I think this bill is extremely important,'' said John E. Roueche III, director for investor relations at McDermott International. ''We have seen 70-plus companies that have gone into bankruptcy because of asbestos litigation and there are household-name companies that still have serious asbestos issues.''

So many companies landed in the cross hairs of asbestos litigation because the material, which was inexpensive, versatile and fireproof, was widely used in manufacturing for much of the 20th century.

It is no surprise that McDermott is in favor of the legislation. It has more than $600 million riding on the outcome of the debate. In 1978, McDermott acquired Babcock & Wilcox -- which used asbestos in the boilers it made -- along with its asbestos liability. Overwhelmed by asbestos claims, Babcock & Wilcox sought bankruptcy protection in 2000.

Under a plan that would allow it to emerge from bankruptcy as soon as this month, Babcock & Wilcox created a trust to compensate victims. That trust will initially be funded with $350 million from the company. (Its insurer will add $1.1 billion.) But if the asbestos bill is not passed by Nov. 30, the company is on the hook for an additional $605 million.

USG, parent of United States Gypsum, structured a similar deal in bankruptcy courts in late January. The company has said it used asbestos in building materials.

''In our case, the effect of this legislation is crystal clear: It will cost us $900 million if the Fair Act passes and $3.95 billion if it does not,'' said Robert E. Williams, a USG spokesman. Critics use that discrepancy as an indication that the bill is a bailout for large companies, but Mr. Williams says the big difference actually shows ''the problems and inefficiencies in the tort system.''

But for A. W. Chesterton, a 122-year-old company based in Stoneham, Mass., that used asbestos fibers in its industrial fluid sealing products, the amount of money it would be responsible for under the bill could destroy it, according to its outside legal counsel, John B. Manning.

''Its assessment under the Fair Act is going to be a minimum of $16.5 million annually for 30 years,'' Mr. Manning said. ''That $16.5 million is more than double a year's profit for this company.''

By contrast, large corporations will, at most, be responsible for $27.5 million a year for 30 years. ''You've got large companies making billions and billions a year in profits,'' Mr. Manning said. ''Having to come up with $27.5 million is nothing to them.''

Some small companies say they are probably better off fighting in the courts than paying their share under this bill. They argue that the cases against them have fallen sharply. They attribute that in part to measures in several states that have raised the bar for product liability litigation, and to growing skepticism about a number of asbestos cases amid evidence that some doctors simply rubber-stamped the filing of many questionable claims.

''We have seen a huge drop-off in the number of suits in which we have been named,'' said David M. Lascell, vice president of Hopeman Brothers, which years ago installed wall and ceiling panels containing asbestos in the interiors of ships. ''And one of the reasons is that there has been terrific success with tort reform in states like Texas and Mississippi.'' Under the bill, Hopeman would have to pay $16.5 million a year for 30 years. ''Five years of our earnings wouldn't pay for that,'' Mr. Lascell said.

(Mr. Lascell and Mr. Manning were made available by the Coalition for Asbestos Reform, a lobbying group representing small and midsize businesses against the bill.)

The bill's supporters include some unlikely allies, including Richard F. Scruggs, a trial lawyer famous for his role in tobacco litigation, who has made a great deal of money in legal fees suing on behalf of asbestos victims. ''This bill stops companies from going bankrupt and prevents trial lawyers from going after these companies and bringing them down,'' said Mr. Scruggs, who came out in support of the bill last week.

Chris Mather, a spokeswoman for the American Trial Lawyers Association, which opposes the bill, noted that Mr. Scruggs appeared to be the only trial lawyer in the country who supported the legislation.

Yesterday, the White House renewed its call for Congress to adopt legislation creating an asbestos trust, although it was not entirely satisfied with the Senate measure.

''Although the administration has serious concerns about certain provisions of the bill, the administration looks forward to working with Congress in order to strengthen and improve this important legislation,'' said a statement from the Office of Management and Budget. It did not specify which provisions the administration disliked.

Meanwhile, an analysis by Democrats on the Senate Budget Committee said the measure was ''seriously flawed'' and could force taxpayers to pay as much as $150 billion to make up for a shortfall in financing.

The bill ''sets up a fund that is destined for a taxpayer bailout, or it will provide only a fraction of what is promised to victims of asbestos,'' said Senator Kent Conrad of North Dakota, the ranking Democrat on the committee. ''It offers a false promise to victims of asbestos.''

Senator Arlen Specter, the Pennsylvania Republican who is the bill's chief sponsor, has said it is adequately financed and, in any event, taxpayers would not have to bail out the fund because if there were shortfalls, victims could return to court.

Newark Star-Ledger

February 6, 2006

A fair deal for asbestos victims, not a bonanza for trial lawyers

BY BILL FRIST

New Jersey has borne the brunt of America's ongoing asbestos liability crisis. Thousands of state families have lost loved ones, and many more suffer the consequences of asbestos-related illness. Local court dockets, meanwhile, groan under the weight of asbestos-related claims. This week, the Senate will consider a bipartisan bill that will bring relief and closure to those with asbestos-related illness: Only predatory trial lawyers stand in the way.

The legislative solution before the Senate will fix a problem that took decades to develop. For much of the 20th century, an inexpensive, versatile, fireproof family of mineral fibers called asbestos seemed like the perfect building material.

All over New Jersey, shipyards and industrial plants employed workers who handled and installed it without proper protection. Many of those workers came down with the lung disease asbestosis, and others — including some patients I treated in my medical practice — developed the incurable chest-lining cancer mesothelioma.

According to the Centers for Disease Control, New Jersey nearly tops the nation in asbestos-related deaths. Even vastly larger California had only a few more. In all, 12 of New Jersey's 21 counties rank among the 100 counties with the most asbestos deaths in the nation.

As a result, asbestos-related cases clog the courts. More than 70 companies have gone bankrupt under the weight of adverse judgments, and at least 150,000 jobs have vanished as a result. While some asbestos victims have collected millions of dollars, most have gotten nothing. When the U.S. Judicial Conference studied the issue, it found that legal proceedings over asbestos take 23 years to resolve — about twice as long as the typical liability case. As a result, many seriously ill people die before seeing a penny.

CONSUMERS FOR CIVIL JUSTICE

Without legislative action, litigation could last so long that the injured parties will die before the last asbestos case gets decided.

To make matters worse, groups of trial lawyers have begun to run television and Internet advertisements to encourage people with no symptoms to step forward and serve as plaintiffs in lawsuits against companies that knew nothing about asbestos' risks. Today, nearly 8,500 companies face claims and, according to the RAND Corp., 60 percent of those looking for money don't show any symptoms.

Without further action, experts believe, litigation could last so long that almost all of the injured parties will die before the last asbestos case gets decided. When the Supreme Court looked at the issue a few years ago, William Rehnquist, then the chief justice, came to a simple conclusion: The asbestos crisis, he said, "cries out for a legislative solution."

After years of wrangling, Sen. Arlen Specter, a Republican from Pennsylvania, and Sen. Patrick Leahy, a Democrat from Vermont, have landed on just such a solution: a fair and balanced $140 billion trust fund to make sure that victims get fair compensation. Companies that used and produced asbestos will make payments to the fund, and neutral administrators will compensate victims based on medical evidence. Asbestosis patients will get as much as $850,000, and mesothelioma victims will end up with help of as much as $1.1 million.

Those who have worked with asbestos know that the proposed settlement makes sense. Both the United Auto Workers union and the Association of Heat and Frost Insulators and Asbestos Workers have come out in support of the Specter-Leahy bill. Further delay will deliver enormous fees to trial lawyers but do little to make sure that victims get the compensation they deserve. We can't afford it. It's time for the Senate to act.

Bill Frist, a Republican from Tennessee, is Senate majority leader

Newark Star-Ledger

February 15, 2006

Asbestos fund bill dies in Senate

BY JAMES KUHNHENN KRT NEWS SERVICE

WASHINGTON — The Senate last night rejected a delicately crafted bill to relieve companies from mounting asbestos lawsuits, effectively killing the legislation in a significant setback for the White House and the Senate's Republican leadership.

In a 58-41 vote, an alliance of liberals and fiscal conservatives defeated the legislation on a parliamentary maneuver. New Jersey Democrats Robert Menendez and Frank Lautenberg voted against the measure.

Senate Majority Leader Bill Frist (R-Tenn.) reserved the right to bring the legislation back four another vote later this year, but that appeared highly unlikely, and lobbyists involved said the measure appeared dead. The House of Representatives never took it up.

The defeat leaves unresolved one of the country's most vexing legal problems — the explosion of lawsuits by asbestos victims and their families against companies that produced or used the carcinogenic fire retardant material. About 600,000 lawsuits are pending and as many as 75,000 new cases are filed annually.

The legislation would have created a ;140 billion trust fund for victims, paid by companies and their insurers. Among those the fund would have helped compensate are asbestos victims who cannot collect any money now because the company at fault has declared bankruptcy or is out of business.

The wrangling over the measure revealed splits among corporations, unions and insurers, and opposition from consumer groups and trial lawyers.

Conservatives objected to the size of the fund and to the possibility that it could require an infusion of taxpayers' money sometime in the future. Liberals complained that the fund would inadequately compensate victims.

“We are not only plunging into the darkness with this trust fun) . . . we're putting at risk the live, and fortunes of- families across America," said Sen. Richard Durbin of Illinois, the second-ranking Democratic leader.

Sen. John Ensign (R-Nev.), who was behind the procedural move that killed the measure, said he felt uncomfortable siding with trial lawyers, but said the fund may prove inadequate and require a federal bailout.

"If the problem ends up coming back to the taxpayers, it will happen at a time when the baby boomers are starting to retire," Ensign said. "The last thing we can afford to do is to enact a bill that potentially could have a major impact . . .could have a drain on our government"

Sen. Men Specter (R-Pa.), the chairman of the Judiciary Committee, implored members to keep the legislation alive. Specter was intensely involved in crafting the bill, single-handedly tweaking it until it won bipartisan support from his committee last year.

"We have a chance to establish public policy in the interest of Americans," he said.

The legislation has been a lobbying bonanza. According to the Political Money Line, a group that tracks lobbying and campaign spending, 25 lobbying firms reported receiving $8.25 million to lobby on the asbestos legislation for the first six months of 2005, the latest documents available.

In addition to lobbying, interested parties have spent money to target lawmakers with ads and media campaigns.

Interest groups divided in unusual lines for business-related legislation. Exxon Mobil Corp., for example, opposed it because it said its contribution to the fund would be too high. USG Corp., the largest maker of wallboard, lobbied for the bill, arguing that lawsuits have been a windfall for lawyers, not victims.

Newark Star Ledger

Asbestos fund bill withdrawn in Senate

Wednesday, February 15, 2006

BY LAURIE KELLMAN

Associated Press

WASHINGTON -- Opponents of a $140 billion trust fund for asbestos victims forced Senate leaders to withdraw it yesterday, but its sponsors said they would bring it back up. Next time, they predicted, the bill would pass.

"As John Paul Jones said, we have just begun to fight," declared Judiciary Committee Chairman Arlen Specter (R-Pa.).

The 58-41 vote to send the bill back to the Judiciary Committee was a severe setback. Opponents said the fund would be drained by claims against it, leave taxpayers liable and violate federal budget rules.

The bill's supporters needed 60 votes to keep the measure alive on the Senate floor. They had 59 before Sen. Bill Frist (R-Tenn.) switched his vote at the last minute in a procedural move that allows him to bring it up again.

Sen. Daniel Inouye (D-Hawaii) did not vote. Specter said Inouye would have been the 60th vote that would have kept the vote alive.

"He went home because his wife was sick," Specter said. "We will have him on the motion to reconsider, and we may change another vote or two so we may win this one yet." New Jersey Democrats Frank Lautenberg and Robert Menendez voted against the measure.

The cliffhanger vote followed a furious lobbying effort on the Senate floor. The bill, sought by many manufacturers and their insurers, would end decades of lawsuits that have bankrupted more than 70 businesses. According to supporters, tens of thousands of people sickened by asbestos and related diseases have gone uncompensated.

Drawing on his seniority, Judiciary Committee Arlen Specter (R-Pa.) issued a personal appeal on behalf of the bill.

"Give me the benefit of the doubt," he told the Senate moments before the vote.

Opponents and supporters crossed party lines, and businesses and labor unions were equally split. Minority Leader Harry Reid (D-Nev.) said the bill is so flawed that even two weeks of debate weren't enough to get it into acceptable shape.

"It is doomed to fail," Reid said.

The measure would have forced defendant companies that dealt with asbestos-containing products to contribute to a $140 billion trust fund from which claims would be paid to those sickened by asbestos. In exchange for payouts of up to $1.1 million, based on age and exposure level, victims would drop all asbestos-related court proceedings.

Such legislation would have spare companies that would be driven out of business by legal fees and lawsuits, supporters say. More than 70 companies have been forced into bankruptcy over asbestos litigation.

Asbestos is a fire-retardant material made up of fibers that cause illness when inhaled. The illness can lie dormant for decades, meaning future asbestos victims might be seeking damages for years to come.

For different reasons, liberals and conservatives and interest groups across the political spectrum have united to defeat the bill by setting up procedural hurdles.

The showdown vote yesterday focused on the bill's impact on the federal budget. Sen. John Ensign (R-Nev.) challenged the legislation on the grounds that claims would drain the fund and leave taxpayers holding a bill for billions of dollars.

Senate procedure required 60 votes to overcome Ensign's point of order. The bill's supporters said the challenge was a thinly veiled effort to kill the measure without drawing blame in a midterm election year.

"This point of order has become ... a backdoor way of killing this bill," said Sen. Pat Leahy (D-Vt.).

Well past lunchtime, Specter and others counting votes said both sides were within a few votes of succeeding.

Supporters insist that even though the Department of Labor would administer the fund, federal money would not be used for any costs. As evidence, they offered a new study by the nonpartisan Congressional Budget Office that found such a fund would not affect the federal deficit.

But opponents said the report leaves open the possibility of borrowing federal money if the trust fund runs dry.

"There is an enormous amount of uncertainty about the potential costs under the proposed amendment," CBO acting director Donald B. Marron wrote to senators yesterday.

Beyond Ensign's challenge, other hurdles awaited the bill. Sixty senators must agree to end debate and bring it to a vote, a procedure likely later in the week, Frist said.

Discusses "Tort Reform"

http://www.rockridgeinstitute.org/research/lakoff/tortreform/view?searchterm=Tort%20Reform

Restrictions on tort lawsuits and other kinds of lawsuits are issues near and dear to conservative hearts. The following interview with Rockridge Senior Fellow, George Lakoff, explores various aspects of “tort reform,” including the manner in which conservatives have framed the discussion, the problem with the progressive response so far, and ideas for more effective progressive framing of the debate.

Q: Professor Lakoff, why have conservatives made such a major issue of “tort reform” and “lawsuit abuse”?

Lakoff: For two main reasons. The conservative worldview includes the fundamental belief that business is only about profits. They believe that anything that interferes with the opportunity to maximize profits, including the range of protections that are so important for society, should be eliminated or at least severely restricted. And of course, lawsuits to compensate for injuries and to punish those who knowingly caused them are some of those socially important protection mechanisms that can diminish profits.

So, the right wing is attempting to destroy this system by promoting legislation to eliminate punitive damages and cap compensatory damages to relatively small sums. This legislation benefits business both by minimizing the risk of any single suit and by creating a disincentive for lawyers to take cases. Lawyers have to spend their own money to search for evidence of harm, to put together a case, and to prosecute the trial. Their compensation, if any, is a percentage of the “recovery” — the compensatory and punitive damages. Though the lawyers' fees sound high, most of those fees go to support the system. If damages are capped or eliminated, the system will break down for lack of funding.

The attack on tort suits also amounts to an attack on those lawyers who represent injured parties. Those lawyers have historically supported progressive causes and candidates. Not to put too fine a point on it, conservatives want to dry up the flow of contributions from trial lawyers by squeezing their source of income.

Q: How have conservatives mounted their attack?

Lakoff: They have very cleverly framed the public discussion and have repeated these frames so often and for so long that they have become ingrained in the public’s mind, which means that those frames have become realized physically in the brains of many members of the public.

Q: What are some of those frames?

Lakoff: To begin, the very phrase “tort reform” evokes a frame. In two words, it communicates that something is the matter with the tort system, which requires reform or correction. In this respect, the phrase is similar to another effective conservative phrase, “tax relief.” Once the public accepts these phrases, they have bought into the idea that they need to be relieved from the affliction of taxes and that they need to fix the tort system. The debate then turns to the question of how and how much. At that point, progressives can’t win the debate; the best we can do is limit the losses.

Q: What other frames have the conservatives employed?

Lakoff: They repeat the phrases “lawsuit abuse” and “frivolous lawsuits.” They refer to “greedy” and “out of control” lawyers. These words suggest that the speaker is a good, honorable, hard-working, God-fearing person. Opposition to abuse communicates reverence. Being against something frivolous is to be prudent and serious. Opposition to things out-of-control implies being orderly and law abiding.

Let’s take another expression that they often use: “litigation lottery.” In order to meaningfully use a word like “lottery” you need a frame. That frame has in it everything about a lottery. It’s gambling. It says you’re not making money by being an honest, hard working person going to work every day. You’re trying to make money just by gambling. That sets up a contrast between the kinds of people who are diligent, careful and frugal and those who want something for nothing and perhaps are willing to cheat to get it.

Once they’ve twisted the discussion to the point where people accept that lawsuits are bad things, the “tort reformers” take it another step. They say that the “frivolous lawsuits” are the cause of the high costs of health care and health insurance. Because people have accepted the frames, they are willing – even in the face of contrary evidence – to believe these statements.

Q: How have the conservatives been able to come up with such effective frames and messaging?

Lakoff: That’s easy. Time and money. Extremely well-funded conservative think tanks have been tackling these issues for the last 40 years. They have become quite expert at figuring out how to frame messages that appeal to persuadable voters.

Q: Have consumer advocates, trial lawyers, and other progressives had much success responding to these conservative frames?

Lakoff: No. Despite spending great sums of money, they have had very little success, as we’ve seen with all the new tort reform legislation at both the state and federal levels. And more legislation is in the pipeline.

Q: To what do you attribute this lack of success?

Lakoff: The primary reason is that the progressive groups you mention have fought the fight on the “tort reformers’” turf, that is they have merely offered facts to rebut the conservatives’ frames, leaving the frames intact. They’ve tried to show that lawsuits aren’t frivolous, that lawyers aren’t greedy, that plaintiffs are genuinely aggrieved. It’s like Nixon saying, “I am not a crook,” which made everyone think of Nixon as a crook. As I said before, once you go down that road you’ve already lost the fight. It’s only a question of how badly.

Q: What’s the alternative?

Lakoff: First, we have to recognize that when the right wing says “tort reform,” what they really mean is destruction of the civil justice system. Just what is the civil justice system? Most people have a frame for the criminal justice system, but not the for the civil justice system. Since a corporation isn't literally a person, it can't be put in jail for performing harmful or murderous acts. When corporations engage in practices that harm or kill people, the only way through the legal system to punish them and give them an incentive to stop their harmful practices is to sue them and make them pay.

In the civil justice system, the trial is in the form of a lawsuit. The victims of harm are the plaintiffs and the defendants are typically corporations. The roles of police and prosecutors are played by the plaintiffs' lawyers. The victims come to lawyers (the only police). The lawyers search for evidence of harmful corporate behavior. The plaintiffs' lawyers act as prosecutors. The punishments are of two kinds: compensatory damages (compensating victims for harm); and punitive damages (punishing corporations that do harm).

Since a billion-dollar corporation cannot be imprisoned, only very large compensatory and punitive damages can provide sufficient disincentives from doing harm. Given the current climate of less and less regulation of business and increasingly lax or underfunded enforcement of what regulations remain, the civil justice system is rapidly becoming society’s only line of defense. Without it, the unscrupulous can and will run roughshod over the American people, maiming people, making them seriously ill, and sometimes killing them — all in the name of profit. Limiting profits is the only deterrence in many cases. Bear in mind that conservative voters believe in deterrence. It’s a basis for their support of the death penalty, for example. Conservatives also believe in the concept of being responsible and accountable. It relates to their strict father family model for society and government that I’ve written about.

Q: With that understanding, what do progressives do?

Lakoff: What we have to do is create and communicate our own major frames, frames that communicate this fundamental role of lawsuits and trial lawyers in protecting the public. These frames must be communicated through narratives that people understand and resonate to. There are two key components here. The first is the notion of protection. The second is the idea that it is the public that is protected rather than certain individuals being compensated for injuries.

Q: Why is that important?

Lakoff: Because as a general rule, people don’t readily identify with victims. They tend to think that those victims somehow haven’t taken care of themselves properly. So the more effective frame is the bigger picture of societal protection.

Q: How would that work?

Lakoff: Let me back up slightly. Progressives must understand that the business of America is business. Most people are involved with business. Most people are honest and want to do the right thing. Trust is an essential component of a healthy, functioning business economy. But there are dishonest, unscrupulous business people that undermine that trust. We must emphasize that the marketplace itself is under threat from those bad actors. Lawyers are necessary to bring the suits that ferret out those who undermine trust and threaten the health of the marketplace.

Q: What other frames do you think would be effective?

Lakoff: Plaintiffs are and should be portrayed as courageous souls. After having suffered harm at the hands of the defendant, they must stand up to the rigors of the justice system, including intense cross-examination and personal attacks, and must display the great patience to withstand the delays of the process. They do it not just for themselves, but for the public as well.

I should emphasize that though I feel strongly about these ideas, none have yet been researched and tested. That’s something that we at Rockridge have on our plate.

Q: How do you communicate these points?

Lakoff: We must create narratives that reclaim the moral high ground: unscrupulous businesses against lawyers — the police and prosecutors — who protect the public. An important image is the open door to the courthouse. Conservatives want to slam the courthouse door shut. We want to keep it open. That concept encompasses everything from preserving the laws that protect the public, to the right of juries to impose fair damage awards that won’t be taken away by judges, to the right of plaintiffs to be able to contract with their lawyers without government interference.

Q: Are word choices important as well?

Lakoff: Of course. I’ll give you a couple of examples. I’ve already mentioned the phrase “tort reform.” This plays so well into the conservative frame. Progressives should not repeat this phrase. They should point out over and over that conservatives are trying to destroy our precious system of justice. Another example is “trial lawyers.” It’s a label that conservatives have been vilifying for a long time. It would take a lot of effort to try to revive any positive connotations. More importantly, it doesn’t communicate the frames that I’ve discussed. By contrast, “public protection attorneys” communicates the right frames and avoids the negative connotations. But this can’t be used until the idea of the civil justice system and protection is first in place in the public mind.

Remember that it’s not just a matter of words. It is a matter of conveying a complex truth to the public, a truth in the form of a high-level complex frame. This cannot be done just by describing it once. The civil justice system has to be described over and over, and portrayed in the arts and the media. Words are important, but ideas come first.

This is not a matter of one ad campaign. It must become part of the system of progressive ideas, part of the framework progressives use to think about public issues.

Q: Where do we go from here?

Lakoff: That’s what Rockridge is all about. We are in the process of writing a Progressive Manual that will offer a fresh, reframed approach to the whole range progressive values and issues. The issues we’ve talked about today will be included in our section about public protection. With help from the progressive community, we’ll be able to do our work quickly and well, and generate a product that will help reshape the political dialogue for the long term. We are running a marathon here, not a sprint.

Defense of the civil justice system is not just a trial lawyers’ issue. It is an issue for all progressives, just as “tort reform” is an issue for conservatives in general. The trial lawyers should not be standing alone here. They should be supported by the environmental community, the labor community, the anti-poverty community, and every other progressive in America. Trial lawyers are not just defending their clients; they are defending all of us by making the civil justice system possible.

Los Angeles Times – August 14, 2005
Legal Urban Legends Hold Sway

Tall tales of outrageous jury awards have helped bolster business-led
campaigns to overhaul the civil justice system.

By Myron Levin
Times Staff Writer

Merv Grazinski set his Winnebago on cruise control, slid away from the wheel and went back to fix a cup of coffee.

You can guess what happened next: The rudderless, driverless Winnebago crashed.

Grazinski blamed the manufacturer for not warning against such a maneuver in the owner's manual. He sued and won $1.75 million.

His jackpot would seem to erase any doubt that the legal system has lost its mind. Indeed, the Grazinski case has been cited often as evidence of the need to limit lawsuits and jury awards.

There's just one problem: The story is a complete fabrication.

It is one of the more comical tales in an anthology of legal urban legends that have circulated widely on the Internet, regaling millions with examples of cluelessness and greed being richly rewarded by the courts. These fables have also been widely disseminated by columnists and pundits who, in their haste to expose the gullibility of juries, did not verify the stories and were taken in themselves.

Although the origins of the tales are unknown, some observers, including George Washington University law professor Jonathan Turley, say their wide acceptance has helped to rally public opinion behind business-led campaigns to overhaul the civil justice system by restricting some types of lawsuits and capping damage awards.

"I am astonished how successful these urban legends have been in influencing policy," Turley said. "The people that created these stories did so with remarkable skill."

The tales are making the rounds at a time when business lobbyists and conservative politicians seem to have gained the upper hand in their drive to rein in lawsuits — a campaign that they call tort reform but that trial lawyers and consumer groups say is an assault on the legal rights of ordinary people.

According to the American Tort Reform Assn. — which is backed by insurance, drug, auto and other major industries — 49 states have enacted at least one measure on the group's wish list over the last two decades, including limits on punitive damages and caps on awards for pain and suffering in medical malpractice claims.

In February, President Bush signed a federal law that will make it harder to bring class-action suits in state courts.

And some polls suggest that there is public support for further change.

For example, a survey conducted for the American Tort Reform Assn. in 2003 found that by a ratio of 2 to 1, respondents believed that lawsuits were harming the economy and stifling job creation. In a survey released in June by Common Good, a conservative legal reform group, 83% of respondents said it was too easy to file invalid lawsuits, and 55% agreed with the statement that "many people use the justice system almost like a lottery — they start lawsuits to see if they can win millions."

Such fears, fanned by anecdotes like the Grazinski tale, have no empirical basis, said Joanne Doroshow, executive director of the Center for Justice and Democracy, a consumer group that opposes the agenda of the business groups. "The data tends not to support the allegation that there is an out-of-control crisis with the legal system," she said.

She and others point to surveys by the National Center for State Courts and the federal Bureau of Justice Statistics showing an apparent decline in personal injury suits and in the size of jury awards to successful plaintiffs.

But advocates of reining in lawsuits say there is no need to invent fictitious examples of legal abuse. "All false stories should be exposed," said Victor Schwartz, general counsel of the tort reform association. But "you don't have to go to the surreal" to find dubious verdicts, he added.

The group's website includes a link to what it says are real but "Looney Lawsuits," including a recent case in which a Portland, Ore., jury awarded $1.6 million to a woman who was seriously disfigured in a botched liposuction surgery. The jury imposed the judgment on the publisher of a phone directory after concluding that the company had knowingly allowed a dermatologist to falsely advertise himself as a board certified plastic surgeon.

Whether it's the rich detail of the phony yarns that resonates or the fact that people are prepared to think the worst of the legal system, the bogus tales have attracted crowds of believers.

The first time he heard of the Grazinski case, Cornell University law professor Theodore Eisenberg was a guest on a Rochester, N.Y., radio talk show. Annoyed by Eisenberg's defense of the justice system, a caller flung the Winnebago windfall in his face.

"You're saying the system's not crazy," Eisenberg recalled the man saying, "but what about this case?"

Besides the Grazinski saga, there's the mythical case of Amber Carson of Lancaster, Pa., who got into an argument with her boyfriend in a restaurant, threw a drink at him and then broke her tailbone when she slipped on the wet spot on the floor. Naturally, Carson sued — and won $113,500.

Then there's Kara Walton, a Delaware woman so eager to avoid a $3.50 cover charge that she tried sneaking into a nightclub through a bathroom window but fell and lost a couple of teeth. Walton sued and won $12,000 plus payment of dental bills.

A database search shows the Grazinski, Carson and Walton tales have been cited as true by a wide range of media outlets, including CNN; U.S. News & World Report; the American Spectator; the Oakland Tribune; the Ft. Worth Star-Telegram; the Deseret News of Salt Lake City; the Akron Beacon-Journal; the Greensboro, N.C., News & Record; and the Augusta, Ga., Chronicle.

Some later issued corrections. Chuck Thomas, a columnist for the Ventura County Star, offered a mea culpa in a follow-up column, anointing himself winner of the "Chucklehead Award."

Wide acceptance of the myths has been an eye-opener for Sheila Davis, public relations manager for Winnebago Industries in Forest City, Iowa. Davis says she has repeatedly had to explain that, no, there was no Grazinski lawsuit, and, no, the company did not have to change the owner's manual to avoid a swarm of copycat claims.

"Unfortunately, we do have some people who write about it and don't call us," Davis said.

The cases are often listed together on Internet postings as winners of the "Stella Awards," — supposedly a dubious achievement list of the nation's most outrageous and ridiculous lawsuits. Although entirely fictitious, the Stellas take their name from the real-life case of 79-year-old Stella Liebeck, whose hot-coffee case against McDonald's became the poster child for frivolous claims.

According to popular accounts of the lawsuit, Liebeck coaxed nearly $3 million from an Albuquerque jury in 1994 after being scalded by McDonald's coffee she spilled on herself while riding in a car. These are the story's best-known elements, but filling in the missing facts puts the case in a different light.

Trial testimony showed that at 180 to 190 degrees, McDonald's coffee was much hotter than that served by other restaurants or by people in their homes. The fast-food chain had received at least 700 complaints about hot coffee in the previous decade and had paid more than half a million dollars in settlements, according to trial testimony cited by the Wall Street Journal.

Liebeck's injuries were hardly minor. She suffered third-degree burns on her thighs and groin area, was hospitalized for a week and had to undergo painful skin grafts. Before filing a lawsuit, she wrote McDonald's requesting that it lower the temperature of its coffee and cover her uninsured medical bills and incidental costs of about $20,000. McDonald's offered $800.

Later, as the case neared trial, a mediator recommended that McDonald's pay a settlement of $225,000. The company refused.

Jurors ultimately awarded Liebeck $160,000 in compensatory damages and about $2.7 million in punitive damages. "The facts were so overwhelmingly against the company," one of the jurors told the Journal. "Their callous disregard was very upsetting," another said.

Soon after the verdict, the trial judge slashed the punitive damages by more than 80% to $480,000. Then the case settled for an undisclosed amount.

"The irony about the McDonald's case is that it actually, in my view, was a meaningful and worthy lawsuit," George Washington University's Turley said. Yet advocates and pundits have "made it synonymous with court abuse."

Unlike the popular version of the McDonald's case, the Stella Awards push mythmaking past mere exaggeration.

Barbara Mikkelson of Agoura Hills, who with her husband, David, operates a website dedicated to debunking urban legends (www.snopes.com), says the Stellas have sometimes appeared with an e-mail chain letter in which the mythical law firm of Hogelman, Hogelman & Thomas exhorts people to "assist our law offices in a tort reform program" by publicizing "insane jury awards." Mikkelson noted that with the way information travels on the Internet, it would be impossible to determine the original authors.

Randy Cassingham, a Colorado resident who also debunks the Stellas on his website http://www.stellaawards.com , says he is angry about the tales — not only because they are false but also because they divert attention from what he believe are real abuses in the legal system.

According to Cassingham, the Stellas allow trial lawyers to say, "See, there is no problem with frivolous lawsuits. Our opponents have to make up cases to make a point."

Although business groups are obvious beneficiaries of the fables, Schwartz of the tort reform association said his group had had nothing to do with them and was careful to verify all of its claims. "We try to be absolutely accurate in anything we're presenting," including examples of outrageous suits, Schwartz said.

In fact, Schwartz said, over-the-top self-promotion by some trial lawyers have made the best case for the need for change. "Their ads making things seem as if it's just free money" have done "more to convince the American public that we have jackpot justice than anything put out by any tort reform organization — including the 'looney lawsuits' stories," he said.

Prognosis bad for medical reform

By PETE McALEER Statehouse Bureau, (609) 292-4935

It didn't take a neurosurgeon to spot the thread connecting the three award winners at the American Trial Lawyers Association conference in Atlantic City.

The first medal went to a 24-year-old cerebral palsy sufferer, a victim of a botched delivery who told his story at a string of legislative hearings in Trenton on medical malpractice.

The second went to a journalist who exposed "how doctors shield themselves from state law" and hide medical records from patients.

The final honor belonged to ATLA New Jersey President Bruce Stern, introduced as "the best example of learning the process of being able to deliver a sound bite." By way of explanation, the speaker, ATLA member Drew Britcher, offered this Stern gem about February's doctor work stoppage: "It doesn't matter if it's a mobster or a doctor, extortion is extortion."

When he stepped down from the podium, Stern showed off his medal-winning form.

"Doctors have misdiagnosed the problem and misdiagnosed the solution," Stern told a reporter. "The New Jersey Medical Society's only interest is to destroy lawyers and the civil justice system."

About the only thing missing from the ceremony was a pinata in a white coat.

That same weekend, the American Medical Association prepared for its third Statehouse rally in Trenton, taking doctors away from their patients for another day. At the last picketing, doctors tried to win support for their cause with signs such as "When your water breaks, call your lawyer" and "Gov. McGreevey, who delivered your Jersey girl?"

A photographer caught two doctors trying to rip away a sign from a man who dared claim the real malpractice crisis was the number of preventable deaths that occur in New Jersey each year.

Marcus Welby versus Perry Mason this isn't. From the start, the debate on how to lower medical malpractice premiums has been long on hyperbolic sound bites and short on compromise. That is, unless you talk to those hurt most by the rising rates: obstetricians and neurologists.

Michelle Torchia, an obstetrician who practices in Vineland and Mays Landing, attended the first physician rally.Looking back, she said she doesn't think the event accomplished anything beyond exciting doctors. Thegovernor, Torchia noted, never acknowledged the crowd.

"We've had rhetoric and teeth gnashing on both sides," Torchia said. "Doctors are still moving out of the state ... As long as attorneys stand on one side and physicians stand on the other, we're not getting anywhere."

The Medical Society and the Trial Lawyers Association actually agree malpractice premiums are posing a problem for doctors. They disagree on the cause of the problem and thus how to solve it. The divide can be summed up in one four-letter word: caps.

Doctor groups, supported by Republicans, say the only way to lower rates is to limit pain and suffering awards in malpractice cases. Attorney groups say such limits are unconstitutional and unhelpful. They favor a plan, sponsored by Democrats in the Assembly, to subsidize doctors facing the highest premium increases.

Each group clings to its side of the caps issue like a shipwreck passenger to a life preserver. If there is a middle ground, neither side has taken a step toward it. Instead, each group offers reams of statistics and surveys to convince the Legislature and the media that they are on the right side of the caps issue. Both accuse the other side of intentionally distorting the facts.

The appeal to the public, however, consists of simple, emotional, often misleading arguments.

A national television ad paid for by the American Medical Association shows a father dying when the local trauma center where his life could have been saved is closed due to skyrocketing medical insurance rates.

Advertisements from the Association of Trial Lawyers of America trot out malpractice victims who claim their rights to a trial by jury are being taken away by greedy politicians.

Although the commercials have yet to air in New Jersey, both are running in a number of states where lawmakers are considering legislation aimed at lowering malpractice insurance rates.

Torchia said she thinks caps on pain and suffering awards are the best long-term solution for lowering rates in New Jersey, but she wouldn't turn down subsidies if that's what politicians can offer. The Medical Society dismisses subsidies as "a Band-Aid."

"We could use a Band-Aid right now," Torchia said. "At least then, calmer heads could sit down and work on the (caps) issue ... I'd just love to see a strong political figure stand up and fix it. Even if they didn't fix it to my liking, at least they'd be willing to fix it."

That's the mindset Sen. Joseph Vitale, D-Middlesex, counted on when he walked into a crowd of doctors picketing outside his Woodbridge office and borrowed one of the bullhorns.

Vitale, adamantly opposed to caps in any form, told the physicians he did not necessarily agree with their solution to the malpractice crisis, but he had their interests in mind and was trying to fashion legislation that would be fair to both their profession and their patients.

Months later, Vitale and other Senate Democrats softened their position on caps and helped pass a bill that limits doctor liability for pain and suffering awards to $300,000 but allows patients to recover an additional $700,000 from a state Excess Liability Fund.

"Both sides have to give a little," Vitale said. "In the end, it's about what we can all ultimately decide is in everyone's best interest."

Count Torchia among those willing to compromise. She's too desperate to be stubborn.

"Physicians have an obligation to put down the battle ax and enter into meaningful dialogue to solve the problem, "Torchia said. "I think we owe that to our patients."

To e-mail Pete McAleer at The Press: PMcAleer@pressofac.com

GANNETT NEWS SERVICE
Sunday, August 7, 2005

Prognosis bad on malpractice awards limit

By LEDYARD KING

WASHINGTON – New Jersey doctors should have been jubilant last month when the House passed a bill that would limit how much money patients could collect if they win lawsuits over improper treatment.

Many weren't.

Although doctors have long sought a cap on certain medical malpractice awards, they realize the bill has little chance of passing the Senate, where it has died twice before. And Garden State physicians think a federal cap is the only way they'll get relief from soaring insurance costs because the state Assembly won't enact one.

"A lot of people are getting discouraged that it's just not going to happen," said Dr. Eileen Moynihan, a Gloucester County rheumatologist and president of the Medical Society of New Jersey. "We're not getting anywhere in the state. We're not getting anywhere nationally. It's getting a lot of people down."

Patient groups who oppose the caps weren't happy either.

Worried that the insurance industry may finally win, they've renewed efforts to convince senators that such limits are arbitrary and hurt patients who might have to live with a lifetime of pain from a doctor's mistake.

"They should not be penalized because they are the victims," said Peter Guzzo, executive director of Consumers for Civil Justice.

The legislation, strongly backed by President Bush and most Republicans, would limit to $250,000 the amount a patient could receive for "non‑economic" damages, such as pain and suffering. There would be no limit to awards for medical expenses and lost wages as a result of medical malpractice. It would also limit lawyers' fees, a provision designed to curb what some see as frivolous lawsuits.

The House passed the measure July 28 on a largely party‑line vote, 230‑194. All six Republicans from New Jersey voted for the bill while the Democrats voted against it except for Rep. Rob Andrews, D‑1st Dist., who was absent for the vote.

New Jersey's two senators, Democrats Jon Corzine and Frank Lautenberg, oppose the House bill.

Doctors pushing for the cap say rising medical malpractice insurance premiums ultimately hurt patients because doctors – especially those in high‑risk specialties such as neurosurgery and obstetrics – are leaving the state and aren't being replaced.

The number of people applying for medical licenses in New Jersey dropped from 3,117 in 2002 to 2,688 in 2004, according to Jeff Lamm, a spokesman for the state Division of Consumer Affairs.

Premiums for neurosurgery, cardiology and other disciplines have doubled since 2001, according to the Medical Society of New Jersey. Neurosurgeons, for example, paid on average more than $111,000 last year for malpractice insurance, up from $55,676 in 2001.

Dr. Rick Scott, managing partner of the Orthopedic Center in Middletown, said the annual insurance premiums for his eight‑doctor practice more than doubled to over $600,000 within three years.

"It's extremely hard to recruit doctors to New Jersey when they know the malpractice costs are high," he said. "Why would you want to go to work (here) when you could lose everything you have on the whim of a jury."

But a study released in May by the Rutgers Center for State Health Policy found that the risk of an exodus of specialty doctors has been overstated. "If we're looking for a smoking gun of physicians leaving we haven't seen it yet, though clearly they're expressing dissatisfaction," said Joel Cantor, director of the center. Echoing Guzzo and other consumer activists, Cantor said much of the blame for rising premiums should be placed on insurance companies, which have had to recoup losses from poor investments by charging doctors more. But insurers and doctors say it's clearly due to an increase in lawsuits that are costly to defend.

Twenty‑seven states now have caps that limit non‑economic damages, according to researchers at the Maryland-based Agency for