TortDeform: The Civil Justice Defense Blog

Justinian Lane

How Much Is Justice Worth?

Earlier today, I was having a discussion with Ted Frank regarding the civil justice system. We were throwing studies and statistics at each other and arguing about the economics of the civil justice system. I was frustrated that neither one of us can seem to find studies that weren’t at least funded in part by agenda-driven organizations on both sides of the tort “reform” debate. I’m skeptical about any study funded with insurance money, and Ted is certainly skeptical about any study funded by the trial bar. I wished we could find some numbers to agree upon - that couldn’t be contradicted.

But then I realized something. Ted and I quarrel so much because we have different philosophies. As I noted in a comment at Overlawyered, I believe the sole purpose of the civil justice system is to administer justice. Ted, on the other hand, thinks that in addition to that duty, the civil justice system should benefit our economy. Within reason, if I present tales of woe and suffering to Ted, he’s not going to be persuaded to abandon something like damage caps. And within reason, if Ted proves to me that our civil justice system adds X number of dollars to the price of some good, that’s not going to persuade me that tort “reform” is a good thing.

Justice is expensive - unquestionably. We spend something like $40 billion a year just on the drug war. It costs some other ridiculously large amount of money housing criminals in our prison system. If we eliminated the criminal justice system, we’d surely see a reduction in our tax bill. But no one seriously argues we should curb prosecutions and let criminals go free to save a buck. If anything, it’s the opposite. We’re disgusted when we hear about criminals being released early because of overcrowding, and we hate to think our prosecutors and police lack the funds to administer justice.

Most of us will (hopefully) never have an emergency that forces us to call the police. Even if you or I never have need of the police, we still pay for them through our taxes. We do that at least in part because we like knowing the police will be there for us if we need them.

If the tort “reform” crowd is right - which I dispute - and the costs of our civil justice system ARE a “tort tax” upon goods and services paid for by all of us, what’s wrong with that? We like knowing that should we need the civil justice system, it’s there for us. So if we pay for our police and armed services to keep us safe, shouldn’t we pay for the civil justice system to allow us to enforce our rights? Of course we should.

The question then becomes one of cost. My latest argument with Ted was prompted by his repetition of the claim that “tort costs” add $500 to the cost of every car. I don’t believe that claim. (The truth is that the $500 includes safety equipment like rear seat belts and the like. Turns out that those and other safety devices were installed because of fear of litigation.) But for the sake of argument, let’s pretend it’s right.

How much, then, is a fair dollar amount to be added to the price of every car to fund the civil justice system? Apparently, $500 is too much. What about $400? Or $250? I’d point out that smog control devices add well over $500 to the cost of every new car.

Unlike the costs of the tort system, the costs of smog equipment CAN be quantified: A catalytic converter costs X, a smog pump costs Y, and the remaining gadgetry costs Z. Remove any one of those components, and you’ll immediately know how much you could save on every automobile. Try doing that with tort reform; no one at Chrysler could tell me how much the price of a new Crossfire would drop if we capped noneconomic damages, or if we instituted “loser pays,” or enacted any other “reform” to the justice system. Yet we’re supposed to take it as gospel truth that tort “reform” will in fact result in cheaper cars. OK, let’s just pretend that’s right, too. Does the promise of cheaper cars justify altering the civil justice system?

Or put another way: Is Ted right, and economic considerations should play a part in determining the rules of our civil justice system? Or am I right, and the fair and just application of fair and just laws is more important than the economic costs of the civil justice system?

Posted at 6:31 PM, Dec 13, 2006 in Civil Justice | Permalink | Comments (9) | TrackBack (1)


TrackBack

Listed below are links to weblogs that reference How Much Is Justice Worth?:

» The Dangers of "Big Tofu"? (and the weirdest and worst of the Right Wing in DMI Year In Review) from Radio Left
DMI Blog

Last week the blogs were been buzzing - or rather guffawing over a piece by a rightwing columnist claiming that consuming soy makes babies gay. (Clearly, somebody needs to visit soy-loving Asia and read up on some basic science an...

[Read More]

Tracked on December 22, 2006 11:15 AM

Comments

This suggestion is in the spirit of Ted who challenged the land pirates to start their own insurance company if they thought they were overcharging and too profitable.

If you feel torts are great, end all self-dealt immunities of the criminal cult enterprise that is the lawyer profession.

Start with the lawless immunity of the land pirates from accountability to adverse third parties. This lawless corruption is in the face of the duties of these cult criminals to these adverse third parties enumerated in the Rules of Conduct, the Rules of Evidence, and the Rules of Civil and Criminal Procedure.

Proceed to the self-dealt immunities of the lawyer indoctrinated, lawyer rent-seeking cult criminals on the bench. They have come to believe, with George III, that they speak for God, and are above the law. Self-dealt sovereign immunity is Church and violates the Establishment Clause.

By statute, reverse Hans, a land pirate self-dealt immunity that brazenly contradicts the crystal clear, high school level language of the Eleventh Amendment.

Finally, repeal that abomination of self-dealing lawyer protection, the Eleventh Amendment itself.

Until the land pirate supports the benefits of torts for the criminal cult enterprise that is the lawyer profession, the land pirate is just a liar and a hypocrite.

You, Justinian, running dog for the ATLA, either fetch the end of the self-dealt immunities of the criminal cult enterprise from all the benefits of torts, or stop insulting our intelligence.

Posted by: Supremacy Claus | December 13, 2006 08:10 PM

Just to make clear, I have absolutely NO relationship with the ATLA, other than having one article published in TRIAL magazine earlier in the year. I wasn't paid for the article, and I've never accepted even one cent from the ATLA, or any other trial lawyer association.

While I may agree with the ATLA from time to time, it's a bit of a stretch to say I'm their running dog.

Posted by: Justinian Lane | December 14, 2006 08:14 AM

Good grief. SC, take your meds.

Posted by: Seth | December 14, 2006 09:02 AM

Justinian, this is a particularly thoughtless post.

Let's take an extreme example: You and Cyrus have a dispute over who took the last cupcake, and you think Cyrus owes you $2.50 in damages. Right now, you have no recourse to the justice system: even small claims court would be too expensive to recover your $2.50. But it's possible to have a publicly-funded trial, where teams of lawyers spend weeks arguing in front of a 500-person jury (who are compensated in full for lost income at taxpayer expense) whether or not Cyrus owes you $2.50. You would surely agree that this marginal improvement in justice is not worth the millions of dollars it would cost society. Wouldn't you?

Thus, we agree on the fundamental principle: there comes a point where the economic costs of justice outweigh the marginal improvement in justice. Now we're just arguing over where that point should be.

Except you mischaracterize even that disagreement when it comes to product liability.

I don't disapprove of a tort system for defective products. Firestone should be liable for manufacturing tires where the tread separated; Sony should be liable for damage caused by exploding batteries; Jack-in-the-Box should compensate those who were injured by E.coli in their burgers (though I think consumers should be allowed to assume the risk of medium rare hamburgers). I disapprove of the idea of "defective design" for designs that are not defective for accidents that are the fault of drivers involved, and where defendants are not allowed to introduce relevant evidence that the designs are not defective. I disapprove of lawsuits against auto manufacturers accusing safety improvements like yielding seat backs of being "defective" because they work differently than the considerably less safe rigid seat backs--but manufacturers have been held liable for tens of millions of dollars because of that safety improvement that has prevented thousands of head and neck injuries. That's not justice in any sense, and not just because it's also economically inefficient and not just because those economic inefficiencies actually hurt consumers in both the pocketbook and safety.

Posted by: Ted | December 14, 2006 09:31 AM

"Right now, you have no recourse to the justice system: even small claims court would be too expensive to recover your $2.50."

You underestimate me, Ted. I once sued a company over 12 dollars. The settlement included my 12 bucks, as well as $250+ dollars in court costs and service fees. I still have a copy of the check on my wall. Cyrus, take this story as fair warning: If you eat my cupcake, I will take you to the mat.

"Thus, we agree on the fundamental principle: there comes a point where the economic costs of justice outweigh the marginal improvement in justice. Now we're just arguing over where that point should be."

For perhaps the second time this week, I agree with you. Too often, we argue over what policy should or shouldn't be enacted. That's putting the cart before the horse. We need to first establish what our goals are, and then figure out how to acheive them.

"I don't disapprove of a tort system for defective products. Firestone should be liable for manufacturing tires where the tread separated; Sony should be liable for damage caused by exploding batteries; Jack-in-the-Box should compensate those who were injured by E.coli in their burgers (though I think consumers should be allowed to assume the risk of medium rare hamburgers)." I miss the days of being able to order medium-rare hamburgers. (sigh) Seriously though, I'm glad you agree that the tort system should compensate victims. I think our disagreement here is that you support a one-size-fits-all damage cap, whereas I believe every case is different.

"I disapprove of the idea of "defective design" for designs that are not defective for accidents that are the fault of drivers involved, and where defendants are not allowed to introduce relevant evidence that the designs are not defective." Agreed, but only to a limited sense. If the driver's fault has nothing to do with the design defect, the driver's fault need not be introduced. For example, if someone fell asleep at the wheel and their airbag spontaneously deployed, the fact they fell asleep isn't really relevant. But if you're talking about some drunk driver plowing into someone and then suing the manufacturer because their seat hurt them? I agree wholeheartedly with you that the jury should know the driver was drunk.

"I disapprove of lawsuits against auto manufacturers accusing safety improvements like yielding seat backs of being "defective" because they work differently than the considerably less safe rigid seat backs--but manufacturers have been held liable for tens of millions of dollars because of that safety improvement that has prevented thousands of head and neck injuries."

I'm aware to some extent of the cases to which you're referring. However, I can't discuss them intelligently with you as I haven't seen any of the evidence presented. If you'd care to forward some my way, I would welcome the chance to review it. Too often, we succumb to the temptation to second-guess a jury because of a short news article we read. (I'm not accusing you of that.)

Posted by: Justinian Lane | December 14, 2006 11:30 AM

Justinian: Briefly, what do you think you are doing agreeing or supporting land pirates? I do not understand why you take up with cult criminals. These are horrible people trying to destroy our way of life and our economy to add yet another personal jet to their fleet of personal jets.

Here is a preview for torts class, in case you decide to undergo criminal cult indoctrination in law school.

The core of duty to another is the foreseeability of harm, without a foreseeable intervening cause.

http://www.lawnerds.com/testyourself/torts_rules.html

There are 2 acts of future forecasting in tort liability. Here is what the cult criminals will never admit in law school, in their cult indoctrination camps:

The forecasting of accidents is a supernatural power. This doctrine is from church based scholasticist philosophy. The church, to its credit, claimed only God could forecast the future. The lawyer said man could. When man could not forecast accidents in the real physical world, the lawyer stole at the point of a sword for his failure to do so.

Supernatural doctrines and church origin doctrines violate the Establishment Clause of this secular nation. At every class, ask the cult criminal doing your indoctrination in 1L about the Lotto number. "Professor, what will today's Lotto number be?" Then say, "Thievin', lyin' dumbass, if you are wrong about tonight's Lotto number, then shut up about the foreseeability of accidents." The Lotto number is far more reasonably foreseeable than negligent injury.

The law professor is a criminal cult indoctrinator by bullying, a liar, is owed no courtesy.

Posted by: Supremacy Claus | December 14, 2006 10:33 PM

Supremacy,

Is your hatred of lawyers directed only towards plaintiffs' lawyers, or against all lawyers in general? Just curious because there are plenty of rich lawyers who don't do PI work.

You raise an interesting point about supernatural powers and foreseeability. Where do you draw the line? For example, if I point a loaded gun at someone's head and pull the trigger, isn't their death reasonably foreseeable?

Posted by: Justinian Lane | December 15, 2006 09:38 AM

Justinian: I take responsibility for any misunderstanding. I hate no lawyer. I love all lawyers equally, defense, plaintiffs. I am going to a lot of trouble to help them, as proof of my sincerity.

The defense bar disappoints in not aggressively defending their clients. They will not scare, or discourage the plaintiff bar as they could easily do. The defense bar owes its job to the plaintiff bar and does not need fungible clients. They also win most of the time, and get paid every time. Both share beliefs in the supernatural.

The sun has risen in the East 1 million times before without exception. That is foreseeable with high certainty (not infinite certainty). Shooting someone in the head has a 99% mortality rate from past experience. Others have had bullets bounce off their skulls. That act is intentional and not negligent.

The burden of proof in negligence is preponderance of evidence. I don't know what the unit of weight of evidence is. Let's assume it is in probabilities. It is supposed to mean a 51% chance the plaintiff claim is true.

There are no tables showing fact specific probabilities. The jury measures these using gut feelings, a violation of the fair hearing right and the procedural due process rights of the negligence defendant. Even if you have an accident expert who may know the probabilities of a relevant accident, the expert would be excluded from the jury.

Now, spill a gallon of Mazola oil on a supermarket floor. The majority of people would walk around it. Those walking on it would slip a little but get through it OK. It is not 51% certain that anyone would get injured. It might be 1% of people who fall. Of those who fall, only 1% may have a serious or permanent injury. The majority of the injured would be stupid, frail, clumsy, old, and the injury stems from their prior defects. It is the rare negligence that comes close to a 51% certainty of injury. The chances are closer to those of correctly forecasting the Lotto numbers as demanded above.

The supermarket? It has 1000 lawsuits everyday. It is no longer upset about being sued. It is not deterred. Why? No payout is with its money. All costs are passed on to the public. The lawyer is stealing from an innocent party, the public. The public loses a little. The lawyer gains a lot. So the public does not work hard to stop this rent seeking and artificial transfer of wealth from working class shoppers to rich lawyers.

As a leftie, you have some thinking to do about the interests of working people.

Posted by: Supremacy Claus | December 15, 2006 02:24 PM

Justinian--This comes late into the conversation, but a couple of quick notes.


Part of the problem with "cost" arguments, besides inevitable ideological bias, is the related degree of speculation such arguments always entail. As a social psychologist, I was under the illusion that economics was something closer to "science." Now that I've read more from economists about my particular obsession--arguments pro and contra FDA preemption/pharma--I have lost that illusion forever.

Almost always, we are left with a hypothetical menagerie--"the dog that didn't bark," the drug that wasn't made (somehow, always a "lifesaving medicine" rather than a restless leg knock-off, the doc that didn't come, and on and on. While it is possible to extrapolate from _some_ empirical data for such claims, there are severe limits if one judges fairly. Thus, it is inevitable that one will believe the scenarios most in tune with one's prior beliefs about what is important--and these are beyond proof or disproof empirically. So we do, indeed, come back to a hierarchy of values and whatever our sociological imaginations tell us, to respond to your original query.

A couple of examples I recently ran across that surprised me. In a BusinessWeek piece from March '05 on "tort reform"--you probably know it--Michael Greve is quoted _against_ FDA preemption (not the MG I know). According to BW, he says that, since the FDA will inevitably screw up, and people will become "hysterical" when it does, that will lead to _more_ regulation--and thus greater costs, suppressed innovation, etc.. Thus, in this article, he favors some mix of public and private enforcement of accountability--regulation _and_ torts. Coming from a different place, I couldn't agree more with his conclusion.


Another example--a colleague of mine published a piece that argues that civil liability acts as an incentive for drug companies to _keep_ unsafe drugs on the market. Since Merck's withdrawal of Vioxx triggered, he suggests, a "feeding frenzy" of the usual suspects, other pharm companies have "learned" it is better to let the death toll mount than withdraw a drug, even when they know--based on risks/benefits--it genuinely _should_ be withdrawn. Thus, civil liability, in effect, functions as an accomplice to premeditated murder.


Among other things (you can imagine some of them), I was struck by the sheer cynicism inherent in this "model" of motivation. For all my own efforts to rescind Michigan's blanket immunity, I am nowhere near as one-dimensional--OK, social-psychologically stupid--about what motivates drug companies as the assumptions inherent in this "study."


So much for the "science" of economics.

Happy Holidays and Good Health!

p.s. Sorry for the absent paragraph breaks. Somehow, nothing I did would put them in.

Posted by: Henry Greenspan | December 25, 2006 01:08 AM