No-class action

October 26, 2003

BARBARA A. MIKULSKI calls herself independent. Yet when the Maryland Democrat was called upon last week to buck her party's leadership and allow the Senate to take up legislation to curb abuse of class-action lawsuits, Ms. Mikulski buckled.

She said she wanted the Senate to keep talking about the measure, but what she did was prevent it from coming to the floor for debate. The mostly Republican sponsors of the bill fell one short of the 60 they need to break the Democrats' filibuster.

So another year likely will go by without federal steps to rein in trial lawyers who game the legal system for their own enrichment at the expense not only of deep-pocket defendants but also the economy at large.

At issue, in one of several "tort reform" movements percolating on Capitol Hill for a decade, is the abuse of lawsuits filed on behalf of multiple plaintiffs against a single defendant or group.

Think Erin Brockovich (or at least of the movie starring Julia Roberts) rounding up all those folks in Hinkley, Calif., to join in a lawsuit against the utility company that was polluting their water supply and making them sick. The $333 million in damages she won for those victims is one of class action's great success stories. There are many others.

But the record is also increasingly marred by cases where the lawyers are the biggest winners. Like that of the computer makers in California sued for misrepresenting the screen size of their monitors. Forty million customers were each awarded $13 rebates off the purchase of new equipment, while lawyers won $6 million in fees. Or the plaintiffs in a Bank of Boston lawsuit who won their case but wound up having to pay more in legal fees than they received in damages.

Outlandish settlements often result from a loophole in the law that allows plaintiffs' lawyers to shop for states and towns known for viewing such cases favorably. Beaumont, Texas, is one such spot.

Lawsuits filed in plaintiff-friendly courts don't even have to go to trial. Defendants settle in hopes of sparing greater expense.

The remedy backed by the Bush administration, most Republicans and some centrist Democrats calls for the largest and most complex of class-action cases to be tried in federal courts. The climate there may not be as favorable to plaintiffs but the outcomes would be more uniform throughout the country and less subject to abuse.

Democrats chose to block the bill rather than try to fix what they didn't like. Certainly it wasn't perfect. But they can't pretend that the problem with class-action suits doesn't exist. The burden is on them now to come up with a better solution - and then work for its passage.

But so many senators in both parties distrust each other and are beholden to special interests - whether it's trial lawyers or corporate defendants - that the prospects for intelligent reform are not bright. Those few in the center trying to mediate barely stand a chance.

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