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Event Transcript
October 8, 2003

How Texas Tackled Tort Reform: Taking on Trial Lawyers, Inc.

MR. LAWRENCE MONE: Thank you all for coming.  I think we’ll get started.

I’m Larry Mone, President of the Manhattan Institute.  Welcome.

Many of you may know our introducer today, Andrew Napolitano, in his role as senior judicial analyst on the Fox News Channel.  His cogent comments on a variety of legal topics are drawn from a long and distinguished legal career.

Judge Napolitano received his B.A. from Princeton and his J.D. from Notre Dame.  He practiced private law from 1975 to 1987. From 1987 to 1995 he served as a judge on the Superior Court of New Jersey, where he was the youngest state judge in New Jersey ever granted lifetime tenure.

During his time on the bench, he sat in on all trial parts of the court, tried over 150 jury trials, and handled thousands of motions, sentencings and hearings.

Since re-entering private practice with the law firm of Fischbein, Badillo, Wagner & Harding, Judge Napolitano has concentrated on complex commercial, First Amendment, health and hospital and white collar criminal litigation.

His broadcast career began in ’95 when he was a weekly legal commentator for Court-TV.  From ’96 to ’97 he was a weekly legal commentator for MSNBC; and from 1998 to 2001 he was a weekly legal commentator for the Fox News Channel.

Since July of 2001, he has been broadcasting legal commentary Monday through Friday as senior judicial analyst for the Fox News Channel, and is one of the people in my mind who’s responsible for the enormous success of that cable network.  Roger Ailes has a great eye for talent.

Please join me in welcoming Judge Andrew Napolitano.

HON. ANDREW NAPOLITANO:  That’s very flattering and I thank you, Larry.

All right. Let’s get right down to why we’re here today, my friends.  A Philadelphia restaurant was ordered to pay a woman by the name of Amber Carson of Lancaster, Pennsylvania, $113,000 after she slipped on a soft drink can and broke her back. The soft drink can was on the floor because Mrs. Carson had thrown it at her boyfriend 30 seconds before she slipped and fell on it.

Terence Dixon of Bristol, Pennsylvania, was leaving a house he had just finished robbing by way of the garage.  He was not able to get out of the garage because the automatic garage door was malfunctioning, and he couldn’t get back into the house because when he pulled the door behind him that led him into the garage, the house door was locked. The family was on vacation and Mr. Dixon found himself locked in the garage for eight days.  He subsisted on a case of Pepsi and a bag of dry dog food.  He sued the homeowner’s insurance carrier for intentional infliction of emotional distress, and a jury awarded him $500,000.

Mr. Miri Grazinsky [phonetic] of Oklahoma City, Oklahoma purchased a brand new 32-foot Winnebago motor home.  On his first trip home, having driven onto the freeway, he set the cruise control at 70 miles an hour and went to use the bathroom of the motor home.  The vehicle left the freeway, crashed, fell into the side of the roadway. The jury awarded him $1,750,000 plus a new motor home.  The company actually changed their manuals on the basis of this lawsuit to warn future morons not to use the toilet while driving a motor home.

Now, I have good news and bad news.  The good news is that none of these stories is true.  They are all made up. They’ve all been circulating on the Internet for months and even years.  The bad news is in the present legal climate in the United States of America we accept them as if they were true. Because we are visited by runaway juries and gutless judges and greedy trial lawyers who would cause a ring of credibility to sound in each of these ridiculous tales.

Comes now a white knight from the Lone Star State to challenge not only fugitive Democrats by plaintiff lawyers head-on.  James Richard Perry.

By the way, I had to make a personal phone call to your office to find out it was James Richard Perry, because even the Web sites say Rick.

James Richard Perry was born on March 4, 1950 in Paint Creek, Texas. Governor Perry is a graduate of Texas A&M.  He and his wife, Anita, have two children, Griffin and Sidney.  Governor Perry is a former pilot in the United States Air Force.  He is the former Commissioner of Agriculture of the State of Texas.  He is a former representative in the House of Representatives of the State of Texas. He is, of course, the former Lieutenant Governor of the State of Texas, and he is the champion who, as the governor of that state, has taken on class actions and changed the law, has taken on medical malpractice litigation and changed the law, has taken on products liability litigation and changed the law. And he’ll tell us in a few moments exactly how he discussion it.

About four months ago, when reviewing in a very nice piece in Forbes magazine what Governor Perry has been doing in Texas, our colleague and friend Steve Forbes wrote, “This is a no-nonsense, get-it-done governor, who should be cloned to run in California.”  We won't visit that on you, Governor.

He used to be known, of course, as the guy who succeeded George W. Bush. Now, of course, he’s known as the president of the Texas Republic. And, if I might add – let’s see. Are Pataki or McGreevy here? No.  The handsomest governor in the state of the Union.

Ladies and gentlemen, friends and colleagues, the white knight of Texas, Governor Rick Perry.

GOVERNOR RICK PERRY: Judge, thank you very much.  Well done, well said.

I’m pleased to be here.  I’m honored to be in this what I consider to be the premier public policy institute in America, the Manhattan Institute.

As the judge shared with you, I did not matriculate from Harvard.  As a matter of fact, I am humbled to be standing in this room in this club behind Mr. Biddle here, or in front of Mr. Biddle, I should say.  And I’ve been asked, why did you come to New York.  Why are you here, over the course of the last three days as we’ve visited with opinion leaders and chief executive officers.  And we’re sharing with people a story about a place that’s substantially different from New York, the state of Texas. In fact, it’s so different that I tell people I’m just on a trade mission. And I might add I will consider it a success if we can go home with a trade for Derek Jeeter and Andy Petit.

For those of you who are Mets fans – and if you think it’s being a Mets fan in New York, keep in mind that a Texas team has never won a playoff series in the history of baseball. 

So New Yorkers, like a lot of Americans, are familiar with our last two governors, both well known, highly visible.  Governor Richards now splits her time between New York City and Austin. Of course, my predecessor, who’s now President of the United States. And it can be tough following in the footprints of national figures. And after serving in Austin in public office now for 19 years, I had the great distinction of being, quote, the guy that followed George W.  That’s my title.

So I think perhaps the only tougher or, I might say, even similar position would be to follow Rudy Gillian. So please tell Mayor Bloomberg that I feel his pain.

Again, I’m honored to be here. This is an extraordinary city, and to come to New York to be in the presence of men and women whose mission is to create opportunity both here and around the world. The work done by the Manhattan Institute has helped transform how we address important issues like education, crime prevention, welfare reform, legal reform. 

And it’s that last subject that I want to discuss in detail today because, to paraphrase a great economist, Steve Forbes, in Texas we’re tackling toxic torts.

And I don't speak to you today as a legal expert.  I am a former farmer and rancher and a former Air Force pilot, not a lawyer.  But I understand as someone who has run a small business that there is no greater threat posed to prosperity and growth than the triple threat of over-regulation, over-taxation and frivolous litigation.

Lawsuit abuse is one of the greatest job killers in America today.   Personal injury trial lawyers have turned a legal system designed to resolve disputes into their own personal investment vehicle to strike it rich.  They turned that system from one intended to dispense justice to a new kind of lottery that dispenses jackpot justice.

Nothing illustrates this phenomenon more than the outstanding report recently published and prepared by the Manhattan Institute, “Trial Lawyers, Inc.” The predatory practices of the trial bar are so pervasive that it can be now distinguished as its own industry, an industry that costs businesses and our economy more than $200 billion each year. The trial bar has preyed upon doctors, upon hospitals, upon businesses, even unsuspecting clients, to make their mint while the rest of us pay the price.

Prior to the enactment of meaningful tort reform a few months ago, the U.S. Chamber of Commerce designated Texas among the five worst states in terms of the litigation climate in the nation. The American Tort Reform Association last year named four Texas counties as judicial hell holes, areas where normal rules of balance and fair play under the law don’t exist.

Nowhere is the evidence of lawsuit abuse more clear than in the medical profession.  Fifty percent of all Texas doctors indicated as of the year 2000 that they had a claim filed against them.  Seven out of every eight medical malpractice case was dismissed without payment because they were deemed meritless or questionable. 

The threat of litigation has a domino effect, though, causing malpractice carriers to raise rates, which in turn force many doctors to leave Texas, or in some cases to leave the practice of medicine altogether. And ultimately this hurts patient access the most.

In the last three years the number of malpractice carriers offering policies in Texas has declined from 17 to three. Between 2001-2002, 6,500 doctors had their liability policies canceled, in many cases not because of negligence on their part but because of the high risk nature of the procedures that they perform.

We’ve seen neurosurgeons leave hospitals in medically underserved areas of the state.  Women in three out of five Texas counties do not have access to obstetricians. Imagine the hardship this creates for many pregnant women in our state, but especially those women with high risk pregnancies.

The problem has not been a lack of compassion among our medical community but a lack of protection from abusive lawsuits.

Imagine going to work every day at a children hospital in south Texas that is just across the road from a law office that has a sign out front that advertises their expertise in birth injury cases.  Our good doctors and nurses should be spending more time in the examination room rather than at the courthouse being cross-examined.

The practice of law is a noble profession. We all want to have the services of a good lawyer when we’ve been wronged.  But I will suggest that as smart as many lawyers are, they will not be able to perform brain surgery or delivery our newborn children once all of the neurosurgeons and the OB-GYNs have left the practice.

The statistics hit home when you find out it’s your doctor that is hanging up his or her stethoscope. Orthopedic surgeon Donald Malone is a good example.  He wrote his local newspaper in Fort Worth, Texas.  He wrote that his insurance premiums doubled every year during the last three years.  Doubled every year in the last three years. He writes, “It’s going to cost $72,000 to renew my policy, and I’m not the first physician in Fort Worth faced with a difficult decision about this practice, and I most certainly won't be the last. Some of my colleagues are choosing to retire early, change careers or discontinue complicated, more risky, but needed medical procedures.  Our community’s access to health care is being compromised.”

Corpus Christie family practitioner Evelyn Tobias Merrill quit her practice at age 36 when her medical premiums went up 300%, even though she had never been sued.  Her new premiums would have constituted a third of her income.

These are stories we heard all across Texas, stories that compelled us to take action despite the opposition of the powerful Texas trial bar. 

First, legislators passed caps on arbitrary non-economic damages.  Individual health care providers are no longer subject to non-economic damages above $250,000 per case.  Health care institutions are subject to a separate $250,000 cap with an entire claim not to exceed $750,000 in non-economic damages.

Texans who have been harmed will still have access to all economic damages, including lost wages and future medical costs. We have simply capped the arbitrary awards for categories like pain and suffering, mental anguish.  These award damages have quadrupled over the last decade in Texas and now comprise some two thirds of the total damages awarded in medical liability cases in Texas.

In 2001, medical liability rate increases were three times larger in states without caps than with states that had caps.  We took our reforms one step further than any other state. To prevent the delays that we knew were sure to come as the lawyers challenged the constitutionality of that law, we asked the voters to clarify the legislature’s authority, and to do so and to place it into the Texas Constitution.  And despite a very misleading $12 million advertising blitz by the trial bar, last month Texas voters protected their health care, they saved their doctors, and they restored balance to our civil justice system by passing Proposition 12.

This constitutional amendment not only provided relief to medical providers, but will allow future legislatures to cap non-economic damages in other kinds of civil action with a three fifths vote of their respective bodies.

We also placed reasonable restrictions on the use of experts for hire. To qualify as a medical expert, you must be currently practicing medicine or be teaching in an appropriate medical school. 

Our tort reforms extended greatly beyond the practice of medicine. The Wall Street Journal said Texas not only provides an example for other states, but also for Republicans in Congress.

Jim Copland, the director of Manhattan Institute’s Center for Legal Policy, recently pointed out a Texas case that illustrates the gross abuse perpetrated by lawyers who file class action suits. In Texas two auto insurers were sued for rounding up their premium bills to the next dollar.  My quarrel’s not with whether or not those insurance companies should have engaged in such a practice.  My quarrel is with the fact that the trial attorneys made $8 million while the clients made less than $6 apiece.  That’s wrong.

We passed two reforms in our class action laws.  First, we now allow defendants to appeal directly to the Supreme Court judge to decide up front, not years after the litigation, if the plaintiff really is in fact part of a class.  This can save defendants years of headache, thousands, if not millions of dollars of legal costs, because they will receive a quick determination as to whether they’re part of a class.

And, second – and I might add although it is a minor thing it is my favorite piece of legislation that we passed – we took on the scam where the lawyers receive a monetary payment while the clients receive payment in coupons.  Now in Texas, if the client gets paid in coupons, so do the lawyers.

We passed a new offer of settlement law. If a party refuses a settlement offer and receives significantly less from a jury than what was offered at settlement, they will pay the other side’s legal fees and cost from the date of the refusal. This reform will help unclog the court dockets, leaving valuable time for cases with true merit.

In Texas we also created a new standard for proportionate responsibility, to insure everyone pays their fair share.  Sometimes the individuals or entity that caused the damage isn’t in the lawsuit. Under our new law, you don’t get blamed for what you didn’t do.  And if you’re a retailer, you will be protected from a manufacturer’s mistake.  Just because you have the deepest pockets or possibly the only pockets doesn’t mean that you should pay for someone else’s mistake.

We created a way for Texas courts to be more efficient and to fairly handle large-scale litigation with a multi-district litigation rule.  And we made sure that parties will not be denied the right to appeal simply because they could not afford the required appeal bond.

In the past, defendants were forced to post bond for an amount that was equal to the jury verdict.  If a corporation was hit for a multi-million dollar verdict, they would often have to liquidate their assets just to get their day in the appeals court. That’s unfair, it’s detrimental to the preservation of jobs in Texas.  So we now have instituted fair limits tied to the defendant’s net worth.

We enacted liability limits for good Samaritans – voluntary firemen, charity volunteers, for teachers, who should not be sued for simply doing an important service. 

We closed the loophole that allowed trial lawyers to venue shop, and we did something that makes an abundance of good sense. If it can be shown that failing to wear a seatbelt contributed to a person’s injuries, that now can be admitted as evidence in a court of law.

These comprehensive reforms restore balance to the Texas justice system, while maintaining proper precautions and compensation for Texans who are truly harmed. As a leading Wall Street CEO told me earlier this year, there’s no better way to create jobs than to pass tort reform. 

And that’s part of the message that I’ve brought to New York and to the corporate CEOs and the corporate general counsels today, and through a number of the media outlets.

Texas economist Ray Perryman [phonetic] estimated that our sweeping lawsuit reforms will create more than 240,000 permanent jobs and add $36 billion to the Texas economy.

I consider economic growth and job creation to be my top priority as the governor of the state of Texas.  And I share the view of New York Governor George Pataki that you can't create jobs by passing tax hikes that kill jobs.

In Texas, we addressed tough economic times the way that families do.  We cut spending.  Unique idea.  I can give Arnold the key.  We bridged a $10 billion budget gap.  When I arrived in Austin to start the legislative session in January, we were notified by the comptroller of a $10 billion budget gap. We managed to spend $2.6 billion less in general revenue while still investing $1.2 billion more in public education. We did it by cutting the administrative overhead in substantial areas in the State of Texas.

No government in the history of mankind has ever taxed and spent its way to greater prosperity.  But with the right fiscal policies we can grow our way there. Slowly but surely good economic news is starting to appear in our state’s newspapers, a group that sometimes is accused of shunning any good news.

In August we added more jobs in Texas than any month since May of the year 2000. During the same month that California lost 30,000 jobs, Texas created over 28,000 new jobs.

In Texas we’re building better schools, aggressively cultivating new jobs and companies, avoiding the temptation to raise taxes.  And we are one of a handful of states with no personal income tax.

Our economy has diversified since the bust years of the 1980s. We are now the number one exporting state in the nation. And with an old New York coach at the helm, even the Dallas Cowboys are starting to win again.  So things truly are looking up in Texas.  That’s why I think it’s so important that we reformed out legal system, worked to reign in those escalating tort taxes that are hidden in every piece of, every product that you buy, every service that you purchase.

Today, Texas is now wide open for business.  Wide open for growth and opportunity. Because our courts no longer are under siege from the Texas trial bar. We can look to the future with much optimism.

When the private sector prospers, so do our public schools, our colleges, our universities, our health clinics and our hospitals.  A more prosperous Texas is essential to a prosperous America. And we’re doing our part to insure that this economic recovery goes forward and goes on for many years.

Thank you all for coming and allowing me to come and speak.  God bless you.


We have time for a few questions, and we’d be happy to – is that okay, Lawrence? I’m kind of taking over here.  I apologize.



MR. STEVE MALANGA: Steve Malanga from the Manhattan Institute.


MR. STEVE MALANGA: I’m interested not just in what you did but how you accomplished it. Because a number of states have tried these things and they run up against what seem to be compelling arguments from the trial bar.

For instance, trial lawyers have argued that the reason that medical malpractice premiums are rising is because of insurance companies, not because of lawsuits.  And they’ve made this case, they’ve made insurance companies out to be the bad guys.

They’ve also argued successfully in places that a cap on non-economic damages will leave people who are injured without enough money, even though it’s only non-economic damages.

I’m interested in how you managed to take on some of these arguments which have succeeded in other places.

GOVERNOR RICK PERRY: Let me give you the Cliff Notes version, which I think is very important.  It’s going to sound a bit partisan, but it’s true.

For the first time since Reconstruction 130-plus years ago in Texas, we have a Republican-controlled House of Representatives, a Republican Speaker, a Republican Senate, a Republican Lieutenant Governor, and a Republican Governor. That may sound a bit partisan.  But I will suggest to you that until Republicans stay committed to their principles and are elected to office that you will not see much progress made on the issue of tort reform in any of the other states.

Hopefully, we can take through different groups -- for instance, Bill Owens is the president, chairman, whatever the appropriate title is, of the Republican Governors Association. I will make every effort to have RGA making tort reform a national issue.

And people ask me how do you know if this is going to be a success.  I mean, how do you measure this success.  Obviously, we passed through a substantive, national model of tort reform in Texas. Two ways, in particular.

One is when a Texan is either hurt in an accident or a young high risk pregnancy is occurring in the Rio Grand Valley of Texas, that there is a physician there, that access to appropriate health care is still available in our state.  That’s the first and, I might add, the most important measurement that I will have.

The other one is when companies from your state or from other states move to Texas and say one of the reasons, one of the main reasons that we moved to Texas is because they have a legal system that is balanced, and we do not feel threatened every day by frivolous lawsuits.

And I will suggest to you that will occur and that will happen.  And there will be Republicans and Democrats alike all across America that go, “Wait a minute.  We must deal with this issue of tort reform.”

Now the other, second part of your question is how did we deal with that argument that they make. And it is a compelling argument. Let me share with you, when we were – I put my good name – my wife is a nurse. The First Lady is a very capable public speaker and a very passionate of health care.  Her father is a small town physician. She and I put our good names and our reputation on the line to go sell this proposition. Trial lawyers outspent us five to one in Dallas and in Houston.  And it was a close election.  But you have to be willing to take chances, to take risk, if you’re to – well, there was an old Texas governor who I think said it right. Sam Houston. He said, “Do right, and risk consequences.”

When we have individuals who are in public service, or for that matter private sector supporter of those individuals, who are willing to risk much to do right, you will see this type of substantive tort reform nationally.

MALE VOICE:  Governor, my name is Sam Hayman [phonetic]. I’m from the GAF Corporation. We have five plants, manufacturing plants that we own and operate in Texas, and I can just tell you you are doing God’s work there in connection with what you talked about today.

I just want to ask you about one aspect of the Texas civil justice system which I think is very hard for a lot of us to understand, and that is a system whereby the trial lawyers contribute to the political campaigns of the judges that they then practice law before, and what if anything can you do about that.

GOVERNOR RICK PERRY: If you’ll recall, in the 1980s Texas was owned lock, stock and barrel by the personal injury trial bar. They had elected the Supreme Court of Texas. And a small group of business people finally said, we must go do battle. We must risk greatly if we’re going to save the state.  And they did that.

In 1985 every Supreme Court justice in Texas was a Democrat. Today, of the 29 statewide elected offices, of which the Supreme Court are nine and the Court of Criminal Appeals are nine, they’re all Republicans – from the Governor all the way through.

Part of that was the Reagan revolution that was ongoing across America.  But it was also about men and women and corporations and entities as yourself who realized that you have to spend money in political campaigns to elect individuals that share your philosophy.  And if you’re not willing to do that, if you’re not willing to go out and work for these campaigns, to risk your time, your resources, your good name, your reputation, then your chances of changing that are slim.

In Texas we still elect our judges.  We consider that to be a right and a privilege, to elect our judges.  I understand and can intellectually make the argument that they ought to let me appoint them all. I’d do a hell of a good job. But that is not going to change any time soon in Texas.  As – and we’ve made great progress. So…

But there are still areas of the state, those four counties that you and I talked about, of Nueces, Hidalgo, and – well I mentioned them in my, those four judicial hellholes. But we will make continued progress in that state. One of the ways is by stopping the judicial, the venue shopping that’s been so rampant before.

But again, I turn that back onto you, each of you, either through this great institution or through your personal involvement in political races.  Find those individuals who philosophically are with you.  Support them. And then hold them to the rhetoric to their actions.

MALE VOICE:  In New York State, Governor, the Speaker of the State Assembly is associated with a plaintiffs’ negligence law firm. So it’s not likely to find reform in the Democratic-controlled Assembly.  But from the Republican-controlled State Senate and from Governor Pataki I don't believe that we’ve heard significant proposals for tort reform. The only person who sought it is Mayor Bloomberg in regards to lawsuits against the City.

Now, what do you do when neither party is for tort reform?

GOVERNOR RICK PERRY: Well, I think it goes back to my response, to how will I measure success in Texas.  When companies from New York relocate because the business climate has become so onerous, at that particular point in time the individuals whose taxes continue to go up, whose cost of living goes up and their quality of life goes down, at that particular point in time they will be jolted into doing what’s right.

It is exactly what has occurred in California. And from my perspective, people finally got a bellyful of government spending at all and no responsiveness back from that government.

You know, I wish I could tell you that there’s a – we did not turn the great ship of state in Texas around overnight.  In 1985, 17 years ago, there were no Republicans in statewide office.  The trial bar owned the state.  But a small group of committed conservative businessmen and women came together and started this effort to clean up the courts.  And it, it went over to the other offices. And today in Texas we are where we are because of that small group of committed individuals who risked much and, I might add, put much on the line from the standpoint of their personal resources.

MR. MICHAEL MEYERS:  Governor, I’d like to – Michael Meyers, New York Civil Rights Coalition.

I’d like to know, since you’re protecting the doctors, has there been an exodus of the trial lawyers from Texas?  And I really don’t understand how this came about in terms of – because the judge gave us anecdotes, which some of us believed.  I didn’t. But the trial lawyers are very good at TV ads and appealing to bleeding hearts.  So I don't know how they, they took the fall.

But my question to you, my second question to you is what is their comeback strategy?  If they’re staying in Texas, what’s their comeback strategy?

GOVERNOR RICK PERRY: Very good, very, very astute question.

We won in a campaign of parts. They ran some of the most extraordinary television ads in this campaign to defeat Proposition 12 that the coldest blooded one of you in here would have warmed. I mean, it was an extraordinary television ad of a young lady who had lost both her legs in an automobile accident, in an ensuing fire because of a faulty part.  And her bright, beautiful face in the aftermath of that accident came on our televisions day after day. Notwithstanding it had absolutely nothing to do with Proposition 12, and her accident and the reward that she received from that would have not been impacted at all.  The truth had nothing to do with the facts.

We won because people understand about the rationing of health care. And it became very personal with them. The places in the state – we lost this in Dallas and Houston.  We didn’t win in the major metropolitan areas of the state.  We didn’t lose where Republicans generally run very well. We lost. We won in some of the most Democratic areas in the state of Texas, who have seen their health care rationed because trial lawyers have unconsciously and greedily run their doctors away from those parts of the state – in the Rio Grand Valley, 85% plus Hispanic populations.  If I can get 50% of the vote there, I celebrate.

That’s how we won. We reached into people’s hearts and said, is it important for you, is it important for your child, injured in a Saturday night automobile accident, to have access to a neurosurgeon in your community.  Is it important for your population of young women to have access to that obstetrician so that that child and that mother can safely be taken care of.

And those two were two extraordinary competing battles for people’s minds. Again, we were outspent by an extraordinary amount.  But we won 51-49. It was a very, very close battle.  But as I like to share with people, there is not an asterisk in the Texas constitution now that says they only won by two percentage points. We changed the constitution and we changed the entire image, and I will suggest to you the future of the State of Texas.

One more question. I just got the signal.


GOVERNOR RICK PERRY: One more.  You’re the winner.  She’s with me.  She’s with me.  Her only question is what time are we leaving.

MR. ALVIN LURIE: Alvin Lurie. I’m an attorney here in the city.


MR. ALVIN LURIE: First, a suggestion as to how you might measure success, and that would be the right of decline of the trial bar in the State of Texas.  [Unintelligible] a great deal.

Question.  I haven’t heard you say anything about punitive damages.  Is that part of the tort reform?

GOVERNOR RICK PERRY: We actually capped punitive damages in 1995. So the punitive damage side was capped in 1995. And I think – was it – I’m not sure I have anyone on staff.

David, is it capped at 250,000?

MALE VOICE:  Four times the economic damages.

GOVERNOR RICK PERRY: Okay, four times the economic damages. Punitives are already capped in Texas. We did that in ’95.

Let me just address one thing, another little measurement that I think is important. And that is the lowering of medical malpractice insurance rates.

You know, I shared with you there’s only three companies now that write. Obviously, that’s going to change and they’re going to come in and start writing because there’s stability in the market now. But one of those three that does about a third of our health care providers is called the Texas Medical Liability Trust.  Three weeks out from the election they sent a letter that if Proposition 12 passed there would be an immediate 12% reduction in liability rates.  And they were good to their word. And so there’s a number of ways to measure success. That’s obviously a small one, an important one.

I don't mind if the trial bar stays in Texas.  I just don’t want them to be suing all of us.

MALE VOICE:  Thank you, Governor.

GOVERNOR RICK PERRY: Thank you all and God bless you.



Center for Legal Policy.




Hon. Rick Perry, Governor, State of Texas


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