The courts: theaters of the absurd

April 05, 1995|By Philip K. Howard

BOILING WATER must be handled with care.

Every day millions of Americans nonetheless heat water past 212 degrees and make coffee with it. Many then get into their cars, hot coffee in hand. Some may burn themselves.

Most people agree that this is an ordinary risk of life. That's why the $2.7 million punitive damages verdict against McDonald's for serving 180-degree coffee, now a part of American folklore, symbolizes the judicial excesses that the new Congress is rightly seeking to cure.

But the rhetorical heat over tort reform has unfortunately scorched the middle ground between those outraged by excessive awards and those who glibly pronounce the end of justice.

The House has passed reforms that are an improvement over the status quo but fail in important respects. To improve on the House bill, the Senate should consider how we got to this state.

Forty years ago, there were no lawsuits over hot coffee. Such claims were tossed out long before a jury was selected because judges acted as gatekeepers.

Today, judges are reluctant to take on this role. They act more like referees. Any claim that can make it over a low threshold of conceivability can go before a jury.

Courts, supposedly the anchor of social sanity, have become a kind of theater, with Hollywood-sized riches available to those who give the best performance.

Anyone with the good fortune to have a misfortune can get rich on unmeasurable claims of pain and suffering. Even humdrum accidents result in feigned outrage and demands of $10 million or more.

Most people wonder how juries can come up with such absurd verdicts.

But when a lawyer narrows an argument down to one risk and rhetoric reverberates around the courtroom walls, awards can soar, as if on a magic legal carpet, far beyond the boundaries of common sense.

In the gravity-free zone of hindsight, almost anything that goes wrong can be pinned on a "risk unnecessarily taken."

McDonald's may well make its coffee hot. Perhaps some people like it that way. It stays warm longer and brews with more flavor.

Graphic photographs of third-degree burns suffered by an elderly woman -- she had placed the coffee between her legs in the car -- look as gruesome as the evidence of torture in some third-world prison.

And add that McDonald's had received over 700 complaints about the heat of its coffee in the last decade, and a huge verdict was almost inevitable.

Never mind that McDonald's sells about one billion cups of coffee a year, an indication of some market acceptance of a product whose alleged defect, its heat, is hardly hidden.

As in most such cases, the claim depends on finding some ordinary fact on which to blame an accident.

Would there have been no lawsuit if McDonald's coffee were less hot, causing only second-degree burns?

Why did that lid come off? That's a question at the heart of a similar recent claim against the Starbucks coffee chain.

Wild verdicts are often reduced on appeal -- the McDonald's award was reduced to $640,000.

But the awards are still large, and the prospect of ruinous damages has led to an extreme risk aversion that cramps ordinary decisions.

One New York City hospital estimates that up to 25 percent of its services are unnecessary and done solely for defense in potential lawsuits.

Does that make for better medical care? Or does it divert care away from other patients in need?

Innovation is the key to America's economic strength. But innovation is an invitation to liability. Anything new involves uncertainty, and a circumstance not foreseen can easily be characterized as negligence.

The House bill has some sound provisions that would avoid the millionaire-through-injury syndrome.

It limits awards on claims that lack any objective yardstick, such as punitive damages and pain and suffering awards, which traditionally were severely restricted by judges.

"How much," the closing argument now goes, "would you take to endure those excruciating burns?"

It places caps on punitive damages at $250,000 or three times the actual economic damages, whichever is greater.

For pain and suffering claims, the $250,000 cap applies only to medical malpractice cases.

And the bill doesn't touch compensatory damages -- the actual lost wages and costs of medical care -- even for claims like hot coffee.

Critics are correct in arguing that fixed caps would be unjust in extreme cases.

It would be easy, however, to add a little flexibility.

Allow judges to alter the cap if they believe the result would be unjust.

If amended to allow some judicial freedom, the bill would bring claims back to Earth without sacrificing most people's concept of justice.

More controversial is the idea of making the loser pay the winner's legal fees.

The aim is to deter frivolous lawsuits that are little more than

extortion.

Plaintiffs often have no intention of going to court and are looking for a hefty settlement. Judges unwittingly encourage this by pressing defendants to settle all cases, regardless of the merits.

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