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To: maceng2 who wrote (149651)	2/7/2002 6:58:32 AM
From: maceng2	Respond to of 436258

The lost cause of law reform news.ft.com [edit..btw a side note on asbestos.. Message 16503893 ] President Bush's plans to tame lawsuit abuse may have become a casualty of recent events, says Patti Waldmeir Published: February 6 2002 18:17 \| Last Updated: February 7 2002 00:21 The fall-out from Enron is reshaping the institutions of American capitalism but not always in predictable and positive ways. Consider a collateral casualty of the scandal: President George W. Bush's plans to tame lawsuit abuse, arguably as great a threat to investors as the accounting practices of the once mighty Houston energy trader. Last week's State of the Union address had been expected to include a section on reform of the civil justice system, one of the chief planks of candidate Bush's election campaign. In the event he mentioned neither Enron nor legal reform - and the omissions appear to have been linked. The administration has been accused of wrongly furthering the interests of Enron in the matter of energy policy. Mr Bush could scarcely also risk the charge of favouring corporate America by tackling the problem of lawsuit abuse. Proponents of reform say they have been quietly assured by the White House that their president has not forsaken them: they expect an imminent statement in support of reform. But such optimism has proved misplaced before. Mr Bush appears to have abandoned the visions of change that danced in his head when he was a candidate. The aspirant Bush vowed to cap excessive legal fees, punish frivolous litigation, deter bad-faith lawsuits and force losers to pay under certain circumstances. But Commander-in-Chief Bush, victor of the Afghan campaign, seems to have lost interest in the issue. Only piecemeal reforms have a chance of passage through Congress this year. One measure could limit the number and impede the progress of class-action lawsuits, by forcing them out of state court and into the federal system, which has tougher standards. The US Chamber of Commerce yesterday called for the passage of that legislation, saying "abusive and frivolous lawsuits are stunting economic growth and job creation". But another measure - the only one mentioned by name in the president's speech - would extend litigation to an area of previous immunity, by allowing patients to sue health maintenance organisations for coverage decisions. The irony is that whatever Congress does, Mr Bush has already presided over one of the biggest civil justice reforms in American history: the establishment of a government fund to compensate the victims of the September 11 tragedies. The fund is a unique experiment in victim compensation. Rather than leaving victims to the vagaries of the much maligned system of "tort" or personal injury law - which could easily have bankrupted defendants such as airlines, airports and others targeted with liability - the government set up a social insurance fund for the bereaved and injured. To claim from it, victims must give up the right to sue. This reflects an implicit recognition of the flaws of civil litigation: it is intolerably slow and capricious; it cheats some victims, while feeding the greed of others; and it is inefficient, too often enriching lawyers at the expense of clients. The government fund has its critics. But it is far quicker, probably fairer, and wastes less money on legal fees. It is the only option for most families. So does the September 11 fund foreshadow a future of tort reform? Almost certainly not. All the rules were suspended on September 11: aeroplanes flew into buildings, the president hid in Nebraska, New Yorkers discovered a new civility. Small wonder that when the norms of civilised life are so violated, the rules of the legal system are also temporarily altered. But now life is largely back to normal (apart from an enduring civility among New Yorkers) and the September 11 tort reforms are viewed now, even by avid reformers, as a unique response to a terrible emergency, not a model for the future. "What happened on September 11 was a mass murder, not a mass tort," writes Leo Boyle, president of the Association of Trial Lawyers of America, the main US plaintiffs' lawyers group, in the weekly Legal Times. The tort system, he argues, is designed not just to compensate victims but to deter wrongdoing. Yet terrorists are not dissuadable by civil penalties, he concludes. The tort system would have been both overwhelmed by the magnitude of the carnage and unable to prevent a recurrence. In a perfect world, it would surely be possible to find ways to compensate other victims of mass tragedies - not just air crashes but also health disasters such as asbestos - in a similarly swift and efficient way. But Congress tried that with asbestos, attempting to set up an administrative fund to pay victims and limit their right to sue, and it failed. Compensating a few thousand people for September 11 is one thing; but millions could potentially claim from an asbestos fund, since virtually every American over 25 had some asbestos exposure. Asbestos is a far bigger problem for the tort system than September 11. With new suits being brought constantly, largely by plaintiffs who are healthy today but claim they may suffer future health problems, the problem becomes more acute by the week. Litigation has bankrupted companies that made asbestos products, so lawyers are now targeting companies with only the most peripheral connection to it, exposing a large segment of the market to potential liability. At the very least, Mr Bush should champion legislation to require asbestos claimants to demonstrate actual injury rather than future risk before suing. Since asbestos-related illnesses have a long gestation time, these claimants should be guaranteed the right to sue in future but only if and when they become sick. But with Mr Bush's mind fixed on Enron and the war, the chances of presidential attention to asbestos appear slim. That is a great shame: asbestos litigation threatens to overwhelm not just the tort system but many viable companies. Asbestos is a crisis of national proportions; it should not be ignored because other crises are newer or more gruesome.