Trial and Error

With John Edwards in their sights, Republican spin doctors are railing against an epidemic of "lawsuit abuse" -- but the facts don't support the rhetoric.

In January 2003, President George W. Bush gave a speech in Scranton, Pennsylvania, in which he declared that the American health care system was broken. Too many people, he said, couldn't get medical care when they needed it. The solution was "getting at the source of the problem, which are the frivolous lawsuits." The political subtext, at a time when the Democratic presidential hopefuls -- including former trial lawyer John Edwards -- were gearing up, was clear: One White House aide explained that the speech was part of "Whack John Edwards Day."

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The White House has long been laying the groundwork for a campaign against the North Carolina senator, who made his fortune representing people with injury claims against doctors and corporations. Bush and other Republicans have blamed lawsuits for everything from rising health care costs to unemployment; with Edwards on the Democratic ticket, the GOP -- and its allies in the corporate world -- have dramatically turned up the volume. Treasury Secretary John Snow fired the first shot, two days after John Kerry announced his selection: "An abusive lawsuit has never created a single job, except for personal injury lawyers," he told an audience in Maine, "but baseless and excessive suits have killed many." Vice President Dick Cheney struck the same chord at a July 12 fundraiser in Pennsylvania, saying, "For the good of this economy, we need to end lawsuit abuse. Junk and frivolous lawsuits put people out of work." The Bush campaign has also unleashed a new TV ad, attacking Kerry for missing a vote "to lower health care costs by reducing frivolous lawsuits against doctors."

Behind those slogans are years of painstaking fine-tuning by Republican consultants, focus groups, and corporate think tanks. The term "lawsuit abuse" was coined in the early 1990s by Jan van Lohuizan, a Washington pollster wholater helped plan Bush's 2000 presidential campaign. More than 100 corporate-funded groups have been working to convince the public that the legal system is out of control; organizations such as the American Tort Reform Association and Citizens Against Lawsuit Abuse, using expensive PR firms and funds from companies like Philip Morris, have spent years testing sound bites and spreading stories of a court system out of control.

That multimillion-dollar investment has turned corporate concerns about such esoteric things as "joint and several liability" into a populist crusade to "stop lawsuit abuse" and return the country to the good old days when old ladies who spilled hot coffee on themselves got sympathy, not punitive damages. The U.S. Chamber of Commerce has spent more than $100 million over the past three years on TV ads and lobbying for legislation to restrict citizens' right to sue, a goal known as "tort reform." (In the courts, "tort" means an injury, which can include anything from libel to malpractice.) The issue is such a high priority for the Chamber that its president, Thomas J. Donohue, moved in the wake of Edwards' selection toward abandoning a longstanding policy of neutrality in presidential elections. Jerry Jasinowski, president of the National Association of Manufacturers, told the New York Times that businesspeople are "more frightened by [trial lawyers] than terrorists."

Yet much of the anti-lawsuit campaign is based on dubious numbers, questionable anecdotes, and, in some cases, out-and-out fiction. Consider Bush's claims of a malpractice insurance crisis in Pennsylvania. Soon after his speech, doctors marched on the Pennsylvania Capitol with placards that cried: "Need an appendectomy? Call a trial lawyer!" The Washington Post reported at least 1,100 doctors had left Pennsylvania in recent years because of rising malpractice premiums caused by lawsuits, and a Time cover story declared that nationwide, doctors were retiring because of higher premiums resulting from "multimillion-dollar judgments awarded for tragic but sometimes unavoidable outcomes."

It wasn't until nearly a year later, in April, that Pennsylvania Medical Society chairman Daniel Glunk told state legislators the truth: Rather than losing more than 1,000 doctors, Pennsylvania may have gained as many as 800 over the past two years. Around the same time, the state's deputy insurance commissioner reported that malpractice payouts had fallen for the second year in a row, and lawsuit filings were also declining. (Not that doctors necessarily benefited: Insurers, in Pennsylvania and nationwide, have raised premiums even as malpractice suits have declined.)

As for the broader "lawsuit crisis," a report from the nonprofit National Center for State Courts found that tort filings have been falling steadily over the past decade, dropping by 9 percent between 1992 and 2002. In Texas, the rate of tort filings fell by 37 percent between 1990 and 2000; in California, it plummeted 45 percent. What's more, plaintiffs lose about half the time they go to trial in state courts, according to the Bureau of Justice Statistics; in medical malpractice cases, doctors win almost three-quarters of the time.

When plaintiffs do win, the "jackpot" is getting smaller all the time. New data released in April by the Bureau of Justice Statistics shows that in jury trials in state courts, the median award fell by almost half during the 1990s -- from $65,000 to $37,000. Punitive damages, the tort reform campaign's top target, were awarded in only 6 percent of all jury trials in 2001, and the median award was $50,000.

Michael McCann, the director of the Comparative Law and Society Studies Center at the University of Washington, says anti-lawsuit rhetoric works in spite of the facts because it feeds into well-established stereotypes. "The image of the irresponsible plaintiff is right up there with the welfare queen," says McCann. "That's why Americans respond to this because it's a morality tale." Pollster Frank Luntz once told Republican members of Congress that "it's almost impossible to go too far when it comes to demonizing lawyers."

But talk of a court system run amok doesn't just make good campaign slogans. It's also a prodigious fundraising tool, as Bush has known ever since his first race for governor of Texas, in 1994. With encouragement from Karl Rove, then a consultant to Philip Morris, Bush embraced tort reform as one of his top three campaign issues. As a result, Rove later told the Washington Post, "Business groups flocked to us." Tort reformers also worked hard to put Bush in the White House. In 2000, one of the Bush presidential campaign's cochairs was Ralph Wayne, the president of the Texas Civil Justice League, a tort reform group whose board members include executives from Halliburton, Dow Chemical, and other major oil and chemical companies. Wayne told reporters that three-quarters of the league's members supported Bush's 2000 bid.

Many of them have signed on for 2004 as well. Among Bush's major fundraisers this year is Allan "Bud" Shivers Jr., a board member of Texans for Lawsuit Reform. And the Bush campaign's list of "Rangers" -- people who've pledged to raise at least $200,000 -- includes Maurice Greenberg, chief executive of AIG, the nation's largest liability insurance company. Greenberg, whose company foots the bill when doctors or companies lose lawsuits, has been a vocal tort reform advocate. Changes to the court system are also an issue for many of Bush's other corporate backers, including Exxon -- which still hasn't paid a $4.5 billion judgment from the Exxon Valdez spill -- and Halliburton, which has lobbied hard to limit asbestos claims, a move that would save it hundreds of millions of dollars.

As president, Bush has yet to deliver on his promises to enact major lawsuit restrictions, in part because most of the litigation that business is concerned with takes place in state, not federal, courts. But that hasn't stopped him from taking every opportunity to endorse tort reform, including a bill to severely limit class-action suits -- the most far-reaching change to the civil court system in decades. (If the bill were law today, cases such as the litigation over the diet drug fen-phen and several workers' lawsuits against Wal-Mart would most likely not have gone forward.)

Although 62 senators backed the legislation, it was killed by a procedural vote in July. The effort to pass the bill is likely to continue into 2005, and, contrary to the Republican campaign message, it's one instance where trial lawyers do create jobs: Major companies and business groups have hired at least 475 lobbyists to push for the measure.