'Tort Hellhole' Moves to Curtail Access

'Mississippi was targeted. We were in the cross-hairs,' said State Rep. Robert Moak, D-Bogue Chitto, who served on the Legislature's Select Committee on Civil Justice Reform that drafted the legislation. 'Now they've moved on, and we're starting to see the same thing going on in other states.' Business interests pushed with varying success in 28 states before turning to Mississippi. That state has become known for products liability actions in a handful of depressed counties known for rendering $100 million awards against corporations with no link to that jurisdiction other than a local retailer.

Mississippi adopted its package after a bruising campaign that culminated in a fractious 83-day special session. The laws include reduced joint and several liability, punitive damages caps, penalties for filing frivolous suits and restrictions on total damages from physicians, hospitals and nursing homes. Unlike other states, Mississippi banned nonresident lawyers from advertising, but an avalanche of television, newspaper, radio and direct mail ads was decidedly part of the tort reform effort. Tort reform proponents, many of them out-of-state business and insurance lobbyists, portrayed lawyers as predators feeding off loopholes in the judicial system whose greed was responsible for unemployment and poor health care. President Bush, who as governor of Texas shepherded a similar package through its legislature, barnstormed Mississippi, trumpeting the theme of trial lawyers as evildoers.

Several Mississippi plaintiffs' lawyers became multimillionaires by pioneering successful litigation strategies against rich defendants such as Big Tobacco, pharmaceutical manufacturers, nursing home owners, asbestos users and insurance sellers. These lawyers, the most likely source of any constitutional challenge to the new law, have maintained low profiles since passage of the tort packet.

'It has gotten to the point around here that if I want a candidate to lose, I'll go and endorse him,' said David W. Baria, president of Mississippi Trial Lawyers. 'We think it is better to wait and see' how best to challenge the law in court rather than 'doom any effort by our participation.' Nevertheless, trial lawyers as a group are reviewing procedural avenues to find the most effective method to attack the statute in the courts, said Baria, of Baria Fyke Hawkins & Stracener in Jackson, MS.

Bob Montgomery, a lobbyist with Montgomery McGraw Collins Jones Cowan & Hembree of Canton, MS, said his firm has alerted its insurance carriers and industrial construction clients to prepare for the expected assault. 'We fully expected it to be challenged when it passed,' he said. Montgomery has charted legal arguments, studied state laws and prepared arguments for each point. Amicus brief authors are ready to roll. If history provides a lesson, the key attack will be on the $500,000 cap on damages for medical malpractice and on punitive damages in other actions. Plaintiffs argue that the caps illegally inhibit a person's access to the courts.

Illinois and Other States

In Illinois, whose constitution is nearly identical to Mississippi's, the state Supreme Court struck down similar tort laws in 1995 on grounds of due process and access to courts. 'The business tort reform laws had been crafted with those challenges in mind,' said Katherine S. Kerby, president of Mississippi Defense Lawyers Association. Hoping Mississippi does not meet a similar fate, the proponents pushed a sliding scale for the damage caps. The system links the total amount of punitives that can be levied to the defendants' net worth. The scale limits maximum punitives from $2 million to $20 million. In the 28 other states, several years passed before high courts sorted out what 'tort reform' meant. At least 12 states have found the measures unconstitutional.

No Luxury of Time

Mississippi probably will not have the luxury of time. A quirk in its elections likely will force the issue to a head sometime this year. The results of the November 2002 election disrupted the balance on the Mississippi Supreme Court, giving the edge to the bloc that more consistently supports business.

But the loser in that race, presiding Justice Chuck McRae, will hold his seat through 2003. The winner, Jess Dickinson, a Gulfport Republican who espoused conservative sentiments and was supported by insurance and business interests, will not assume the bench until Jan. 1, 2004. 'We anticipate that the plaintiffs' bar will do everything it can to challenge these laws before Justice McRae leaves the court,' said Hotra of ATRA. Chief Justice Edwin L. Pittman responded testily when confronted with critics' concerns that the outcome will depend on timing. 'The law will be sustained in view of the constitution or not,' he said. 'It won't be a unanimous decision, but it will be the right decision.'

While the organized bars are girding for a winner-take-all fight, individual sections of the law have been coming under attack. Walter W. Thompson of Clarksdale, MS, the principal of the Thompson Law Firm, said he is looking for a case in which to challenge limits on nursing home negligence claims. Thompson points out that nursing homes are, for the most part, regulated by the federal government, which imposes detailed requirements down to the number of washing machines a facility must operate. He argues that unlike medical malpractice, in which plaintiffs must present expert testimony saying the offending physician failed to meet local standards, negligence in nursing homes can be proven by submitting federally mandated checklists. 'It's federal pre-emption pure and simple,' Thompson said. 'The legislature had no business meddling in that.'

The unusual part of the Civil Justice Reform Bill is Section 12, which forbids attorneys not admitted to the Mississippi Bar from advertising in the state or soliciting clients for any expected or pending suit. The section was added during conference by legislators wanting something to take back to voters, who didn't really understand the ins and outs of tort reform, but were really angry at attorneys after the free-for-all attack by the law's proponents.

'Let's Get the Lawyers!'

Critics of the section countered that the legislation likely won't survive any serious contest. 'I think it is a sitting duck,' said First Amendment scholar Charles W. Wolfram, a professor at the Cornell Law School in Ithaca, NY. The provision is defective on many fronts, he said ' allowing Mississippi lawyers to advertise while restricting others violates the commerce clause, and banning advertising infringes on free speech rights, not to mention half-a-dozen Supreme Court decisions since Bates v. Arizona. 'It's just a very badly drafted piece of legislation,' Wolfram said. 'I can understand the politics, but it's an unusual confluence of populist politics ' let's get the lawyers! ' and cheap politics ' let's not really get them effectively.'

The only challenge thus far has been by American Lawyer Media, parent company of this publication, the Daily Business Review and the National Law Journal. Concerned that the provision would forbid distribution of magazines that include lawyer advertising, the company filed a wide constitutional challenge to the law in federal court. At a Dec. 30, 2002 hearing, the Mississippi attorney general conceded that the law did not intend to prohibit such advertising. American Lawyer Media agreed to withdraw its other constitutional claims. U.S. District Judge Henry T. Wingate dismissed the suit, finding that the advertising in the company's 23 publications does 'not expressly solicit clients for the commencement of specific litigation in Mississippi.' 'It was a narrow decision,' said T. Hunt Cole Jr., the assistant attorney general handling the suit. 'The question of what type of direct solicitation was covered by this statute will have to wait for another day.'

Business, industry and medical groups in Mississippi have talked about pushing additional tort reform measures in the legislative session that opened on Jan. 6. They are considering extending the punitive damages caps to subjectively quantified damages, such as mental anguish and pain and suffering. However, more than one lobbyist said the governing body is suffering from tort reform fatigue. The governor's Jan. 9 state of the state address was interrupted by polite applause throughout, as these speeches usually are. There was noticeable silence in the chamber when Gov. Ronnie Musgrove mentioned the tort reform legislation adopted 3 weeks earlier.

Mississippi plaintiffs' lawyers, battered by a 2-year fight with medical and business lobbyists, are seeking ways to undermine new laws that limit civil litigants' access and recoveries in the state that has been dubbed a 'tort hellhole.' Meanwhile, the tort reform juggernaut is rumbling into other states.

'We expect this to be, legislatively, the busiest year since '95,' said Michael Hotra, who handles legislative efforts for the American Tort Reform Association (ATRA) in Washington, D.C. It was his group that put Mississippi on a list of 10 'tort hellholes.' Others included jurisdictions in California, Texas, Illinois and Missouri. Hotra expects Missouri, Georgia and South Carolina to consider packages to reduce venues, strengthen proof standards and restrict civil damages. Ohio has limited medical malpractice awards to $1 million for pain and suffering. Additional action is expected there. Similar steps are expected in Florida, Nevada, Pennsylvania, and in West Virginia, where doctors on Jan. 13 marched on the state capital, blaming lawsuits for increases in malpractice insurance costs. Under pressure from the doctors, Gov. Bob Wise proposed damage caps. Texas is expected to study curtailing tactics to collect asbestos damages from the users of the product instead of the bankrupt manufacturers. Several legislatures will consider curbs on medical monitoring for future damages. Even the presidency has become involved: President George W. Bush, on Jan. 14 and again in his Jan. 28 State of the Union address, urged Congress to cap damages in medical malpractice suits.

Mississippi a Target?

'Mississippi was targeted. We were in the cross-hairs,' said State Rep. Robert Moak, D-Bogue Chitto, who served on the Legislature's Select Committee on Civil Justice Reform that drafted the legislation. 'Now they've moved on, and we're starting to see the same thing going on in other states.' Business interests pushed with varying success in 28 states before turning to Mississippi. That state has become known for products liability actions in a handful of depressed counties known for rendering $100 million awards against corporations with no link to that jurisdiction other than a local retailer.

Mississippi adopted its package after a bruising campaign that culminated in a fractious 83-day special session. The laws include reduced joint and several liability, punitive damages caps, penalties for filing frivolous suits and restrictions on total damages from physicians, hospitals and nursing homes. Unlike other states, Mississippi banned nonresident lawyers from advertising, but an avalanche of television, newspaper, radio and direct mail ads was decidedly part of the tort reform effort. Tort reform proponents, many of them out-of-state business and insurance lobbyists, portrayed lawyers as predators feeding off loopholes in the judicial system whose greed was responsible for unemployment and poor health care. President Bush, who as governor of Texas shepherded a similar package through its legislature, barnstormed Mississippi, trumpeting the theme of trial lawyers as evildoers.

Several Mississippi plaintiffs' lawyers became multimillionaires by pioneering successful litigation strategies against rich defendants such as Big Tobacco, pharmaceutical manufacturers, nursing home owners, asbestos users and insurance sellers. These lawyers, the most likely source of any constitutional challenge to the new law, have maintained low profiles since passage of the tort packet.

'It has gotten to the point around here that if I want a candidate to lose, I'll go and endorse him,' said David W. Baria, president of Mississippi Trial Lawyers. 'We think it is better to wait and see' how best to challenge the law in court rather than 'doom any effort by our participation.' Nevertheless, trial lawyers as a group are reviewing procedural avenues to find the most effective method to attack the statute in the courts, said Baria, of Baria Fyke Hawkins & Stracener in Jackson, MS.

Bob Montgomery, a lobbyist with Montgomery McGraw Collins Jones Cowan & Hembree of Canton, MS, said his firm has alerted its insurance carriers and industrial construction clients to prepare for the expected assault. 'We fully expected it to be challenged when it passed,' he said. Montgomery has charted legal arguments, studied state laws and prepared arguments for each point. Amicus brief authors are ready to roll. If history provides a lesson, the key attack will be on the $500,000 cap on damages for medical malpractice and on punitive damages in other actions. Plaintiffs argue that the caps illegally inhibit a person's access to the courts.

Illinois and Other States

In Illinois, whose constitution is nearly identical to Mississippi's, the state Supreme Court struck down similar tort laws in 1995 on grounds of due process and access to courts. 'The business tort reform laws had been crafted with those challenges in mind,' said Katherine S. Kerby, president of Mississippi Defense Lawyers Association. Hoping Mississippi does not meet a similar fate, the proponents pushed a sliding scale for the damage caps. The system links the total amount of punitives that can be levied to the defendants' net worth. The scale limits maximum punitives from $2 million to $20 million. In the 28 other states, several years passed before high courts sorted out what 'tort reform' meant. At least 12 states have found the measures unconstitutional.

No Luxury of Time

Mississippi probably will not have the luxury of time. A quirk in its elections likely will force the issue to a head sometime this year. The results of the November 2002 election disrupted the balance on the Mississippi Supreme Court, giving the edge to the bloc that more consistently supports business.

But the loser in that race, presiding Justice Chuck McRae, will hold his seat through 2003. The winner, Jess Dickinson, a Gulfport Republican who espoused conservative sentiments and was supported by insurance and business interests, will not assume the bench until Jan. 1, 2004. 'We anticipate that the plaintiffs' bar will do everything it can to challenge these laws before Justice McRae leaves the court,' said Hotra of ATRA. Chief Justice Edwin L. Pittman responded testily when confronted with critics' concerns that the outcome will depend on timing. 'The law will be sustained in view of the constitution or not,' he said. 'It won't be a unanimous decision, but it will be the right decision.'

While the organized bars are girding for a winner-take-all fight, individual sections of the law have been coming under attack. Walter W. Thompson of Clarksdale, MS, the principal of the Thompson Law Firm, said he is looking for a case in which to challenge limits on nursing home negligence claims. Thompson points out that nursing homes are, for the most part, regulated by the federal government, which imposes detailed requirements down to the number of washing machines a facility must operate. He argues that unlike medical malpractice, in which plaintiffs must present expert testimony saying the offending physician failed to meet local standards, negligence in nursing homes can be proven by submitting federally mandated checklists. 'It's federal pre-emption pure and simple,' Thompson said. 'The legislature had no business meddling in that.'

The unusual part of the Civil Justice Reform Bill is Section 12, which forbids attorneys not admitted to the Mississippi Bar from advertising in the state or soliciting clients for any expected or pending suit. The section was added during conference by legislators wanting something to take back to voters, who didn't really understand the ins and outs of tort reform, but were really angry at attorneys after the free-for-all attack by the law's proponents.

'Let's Get the Lawyers!'

Critics of the section countered that the legislation likely won't survive any serious contest. 'I think it is a sitting duck,' said First Amendment scholar Charles W. Wolfram, a professor at the Cornell Law School in Ithaca, NY. The provision is defective on many fronts, he said ' allowing Mississippi lawyers to advertise while restricting others violates the commerce clause, and banning advertising infringes on free speech rights, not to mention half-a-dozen Supreme Court decisions since Bates v. Arizona. 'It's just a very badly drafted piece of legislation,' Wolfram said. 'I can understand the politics, but it's an unusual confluence of populist politics ' let's get the lawyers! ' and cheap politics ' let's not really get them effectively.'

The only challenge thus far has been by American Lawyer Media, parent company of this publication, the Daily Business Review and the National Law Journal. Concerned that the provision would forbid distribution of magazines that include lawyer advertising, the company filed a wide constitutional challenge to the law in federal court. At a Dec. 30, 2002 hearing, the Mississippi attorney general conceded that the law did not intend to prohibit such advertising. American Lawyer Media agreed to withdraw its other constitutional claims. U.S. District Judge Henry T. Wingate dismissed the suit, finding that the advertising in the company's 23 publications does 'not expressly solicit clients for the commencement of specific litigation in Mississippi.' 'It was a narrow decision,' said T. Hunt Cole Jr., the assistant attorney general handling the suit. 'The question of what type of direct solicitation was covered by this statute will have to wait for another day.'

Business, industry and medical groups in Mississippi have talked about pushing additional tort reform measures in the legislative session that opened on Jan. 6. They are considering extending the punitive damages caps to subjectively quantified damages, such as mental anguish and pain and suffering. However, more than one lobbyist said the governing body is suffering from tort reform fatigue. The governor's Jan. 9 state of the state address was interrupted by polite applause throughout, as these speeches usually are. There was noticeable silence in the chamber when Gov. Ronnie Musgrove mentioned the tort reform legislation adopted 3 weeks earlier.