Lawsuit lunacy

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Type "accident" into Google and you'll be barraged by personal injury lawyers advertising things like "Cash for accident victims." Whether you've slipped on your neighbor's doorstep or burned your tongue on a scalding pickle, money-hungry tort lawyers want to cash in on your injury.

A few weeks ago, a woman initiated a lawsuit after someone spilled flaming rum on her in a bar.

Instead of suing the person responsible for spilling the rum, the woman decided to sue Bacardi. The reason, she claims, is that the spirit-maker's product is defective.

A tort is a wrongful action by one party that results in injury to another. Tort law serves an important purpose -- to compensate victims for their injuries. But today, tort law is routinely abused by people just looking for a payday, often seeking damages far in excess of their actual injuries.

When the fiance of a Chicago attorney broke off their engagement, the jilted betrothed did what any tort lawyer would do: She sued him, claiming his caddish move cost her lost income, psychiatric expenses, and pain and suffering. A jury bought her sob story, and awarded her $178,000 in damages.

Even when juries don't award ridiculous damages, defending oneself against these silly suits can cost thousands or even hundreds of thousands of dollars. A death-row inmate in California sued a writer for $60 million for writing a book about him. Claiming he was not guilty of 16 murders, the inmate whined that the book's characterization "defamed his good name," causing him to be "shunned by society."

The case was thrown out after a record 46 seconds, but the writer's publisher incurred $30,000 in legal defense fees.

Some cases are settled for high sums, because the defendants don't want to spend the time and money in court -- or they don't feel completely confident risking larger awards in court, even if the odds are strongly in their favor.

Cases can take two to three years to be resolved, and much longer if appealed. That costs the taxpayers money, and it ties up court availability, meaning honest people with legitimate claims have to wait for compensation behind opportunistic plaintiffs and their mercenary lawyers.

And there's the dissuasion factor. People who practice professions like medicine, for example, where the possibility something may go wrong is ever-present, are especially vulnerable to lawsuit abuse. The risk of an excessive or meritless suit discourages many good, honest doctors from practicing.

When Hazel Norton of Mississippi read about a class-action suit filed on behalf of patients taking the prescription drug Propulsid, she thought, "I might get a couple of thousand dollars" though she "didn't get hurt by Propulsid." This led to her doctor being named in the suit, and ultimately his and his pediatrician wife's decision to leave their medical practice.

In some medical professions -- like women's health -- excessive lawsuits have created an outright crisis. The American College of Obstetricians and Gynecologists (ACOG) reports that more than 76 percent of ACOG Fellows have been sued at least once.

Even though ob-gyns win over 80 percent of the cases that go to trial, the fear of being sued is devastating the profession: 1 in 7 ACOG Fellows surveyed had stopped practicing obstetrics. Meanwhile, medical students choose other fields. The upshot? It's extremely difficult to find an ob-gyn willing to perform a high-risk procedure today.

In 2000, the President's Council of Economic Advisers estimated the excessive costs of the tort system nationwide were $136 billion -- equivalent to a 3 percent tax on wages. Using their methodology, excessive costs would today exceed $198 billion, representing a yearly tax of $2,654 on a family of four.

Fortunately, there is a way to curb the costs of these crazy cases. States can impose a monetary cap on impossible-to-quantify damages, like "pain and suffering." They can also create financial penalties to discourage lawyers from consistently filing frivolous lawsuits.

In the meantime, we taxpayers will continue to pay for people like Jerry Mersereau, who recently fell off a cliff in a national park while trying to find a place to urinate in the middle of the night. Mr. Mersereau is suing the U.S. government for the "mental anguish" caused by his fall.

Tort abuse would be funny if it weren't so costly for the rest of us.

Lawrence J. McQuillan is director of business and economic studies and Hovannes Abramyan is public policy fellow at the Pacific Research Institute in San Francisco.