Shyster Heaven
April 21, 2003 by Doug Bandow The Rule of Lawyers: How the New Litigation Elite Threatens America's Rule of Law, by Walter K. Olson (St. Martin's Press, 352 pp., $25.95)
Responsibility used to be the hallmark of American freedom. Act as you wish, but accept the consequences: Smoke, get cancer. Eat, get fat. Fall down drunk, get hurt. Just don't act surprised -- and certainly don't blame anyone else.
No longer. Today the hallmark of American freedom is litigation. Act as you wish, but make sure someone else suffers the consequences. Indeed, America's liability system has become the international standard of what not to do. Walter K. Olson, a senior fellow at the Manhattan Institute, explores how the U.S. has long been hospitable to the litigious: "Even fifty years ago America was known as the land of the speculative or 'long-shot' legal case, in which an injury could come to seem a lottery ticket collectible from the nearest deep-pocket defendant."
Still, the problem back then seemed more episodic than systemic; people were usually expected to be responsible for their actions. Whole classes of lawsuits were almost unthinkable: What would-be burglar, for instance, would have sued the school system after falling through a skylight? Explains Olson: "Until sometime around 1970, it had long been taken more or less as a given that in the U.S. legal system, as in others, litigation was something to be discouraged, a destructive and costly last resort, certainly not the first line of response to ordinary social problems."
The Rule of Lawyers is the tale of how that changed, and it's not a story for the faint of heart. Olson begins the book by looking back on an amazingly prescient essay written in 1976 by Beverly C. Moore Jr., a onetime Naderite lawyer, and Fred Harris, left-wing senator from Oklahoma and failed presidential candidate. That they would call for greater use of class-action suits should come as no surprise; but they did suggest a rather breathtaking new range of causes. The tobacco and alcohol industries, they wrote, should be sued for the harm of their products; food producers should be held responsible for obesity, tooth decay, and diabetes; drug companies should pay for overdoses; automakers should be sued for accidents, and should also -- along with real-estate developers -- cover the cost of "urban congestion." And much more.
Moore and Harris were not troubled by the fact that companies would be paying for things that were not remotely their fault in any traditional understanding of negligence law. The purpose was to impose costs on business to change their behavior. The big problem then, the authors noted, was that "most victims are not even aware that they have been injured." They are now.
Moore and Harris published their article in the midst of far-reaching changes in both the substantive law and procedural rules of litigation. Product-liability law became more expansive, and class actions became easier to file. A host of barriers to suits -- such as limitations on discovery, pleading requirements, and jurisdiction restrictions -- fell. The result, explains Olson, was to "further empower lawyers themselves, who could now demand a great deal more money, menace opponents with far more effective weaponry than before, and presume to speak on behalf of vast groups within the American population, secure in the knowledge that their supposed constituents would not be in a position to fire them."
The tobacco suit -- the culmination of almost every dangerous legal trend -- may have had its genesis in the flood of asbestos litigation that started in the 1970s. Asbestos was a wonder product, providing low-cost insulation for buildings across America; alas, it turned out to hurt and kill many workers who breathed asbestos fibers. There was legitimate cause for liability, but, notes Olson, "few predicted that the new legal cases would develop into by far the largest and most complex body of injury litigation in history." Once major asbestos manufacturers like Johns Manville went bankrupt, the trial bar began suing just about any company anywhere with any connection to asbestos.
Moreover, contrary to predictions that the number of cases would fall (because the pool of people genuinely harmed by direct contact with asbestos was falling), asbestos litigation has continued to increase. "What soon enabled the caseload to begin expanding more or less without limit," writes Olson, "was the realization that there was serious money to be made in bringing cases where illness or impairment was mild or scarcely detectable."
In the case of silicone breast implants, there was never a genuine health risk at all; but the lack of any evidence of such didn't prevent multibillion-dollar litigation. The trial bar never apologized, nor did it yield up any of its ill-gotten riches. Notes Olson: "Because our legal system, unlike most countries', lacks a loser-pays principle, [trial lawyers] never did have to worry that there would be any price tag for them to pay for the damage done by unfounded litigation."
Government became a full-fledged partner of the trial bar in cases against the tobacco and gun industries, both of which Olson covers in detail. Lawyers helped finance the campaigns of state attorneys general; the attorneys general offered generous fees, around $14 billion total, to trial lawyers. Good press and lots of money was had by all. And everything was financed by a de facto tobacco tax, imposed without legislative approval and protected through a cartel restricting competition from lower-cost cigarette makers. Lawyers have been investing in politicians quite heavily, says Olson. "Never before in history had there arisen a class of individuals more munificent in their political campaign donations than American plaintiffs' lawyers, and now the tobacco lawyers were raising the bar for generosity to new and unheard-of heights."
The conflicts of interest and appearances of impropriety should have been great enough to excite the interest of the usual public-interest lobby, except that most activist "consumer" and "public interest" groups themselves are funded by the trial bar; Olson points out that Ralph Nader has been "the trial bar's most valuable asset" in the public forum.
The trial bar's political power is magnified by the existence of 50 different state court systems. Parts of the South have turned into what Olson calls the "jackpot belt," where "seemingly routine disputes" result in massive monetary awards. Unfortunately, it's not just the South that sports such "tort traps."
Juries are also at fault, and Olson is not shy about criticizing the role of this venerable institution: "Many defenders of America's present litigation arrangements see rhetorical mileage to be gained in recasting any debate about overly high, unpredictable, passion-driven, or arbitrary jury verdicts into a debate about whether you're for juries or agin 'em." But a number of reforms are possible, without stripping juries of the right to assess basic liability. Indeed, Olson suggests increasing jury power -- to take notes and ask questions, for instance. But the trial bar usually opposes such steps, since its goal is to "arrange matters so as to maximize the power trial lawyers themselves get to exert."
The consequences of the rule of lawyers have been immense: transformation of tort law to make anyone potentially liable for anything; vast wealth transfers from producers to the careless, hypersensitive, irresponsible, and venal; individual businesses, and even whole industries, ruined owing to junk science and legal misconduct; and subversion of the democratic political process as local juries and courts make national political decisions. According to The American Lawyer magazine, tobacco lawyer Wendell Gauthier (explicitly) and many other attorneys (implicitly) see "the plaintiffs bar as a de facto fourth branch of government, one that achieved regulation through litigation where legislation failed."
The prospect of controlling this fourth branch seems as remote as ever. What was learned from the tobacco-lawsuit scandal? Not much, in Olson's view. A few modest reforms resulted, but the problem remains "a simple issue of power: We first give lawyers far more power than other countries do and then provide less supervision of the way they use that power."
If the principle of self-government is to retain any meaning, Americans need to restrict that power and provide that supervision. There are many good reasons to do so. But perhaps the most important is, in Olson's words, to restore to the American people "the right to find its own future and pursue its own destiny." ©2003 National Review |
