Saturday, May 31, 2008

Self-Serving Lawsuits Carry A Hidden Cost – for You

By Diane Dimond
Of the Journal
      Who hasn't heard of that crazy lawsuit filed in Washington, D.C., last year by Judge Roy Pearson? He demanded $67 million from a dry-cleaning shop run by a Korean couple because they misplaced a pair of his trousers.
       The hardworking Jin and Soo Chung very nearly had their American dream stolen. They almost caved under the financial pressure of their forced participation in the judicial system and headed back to South Korea. Donations from outraged citizens helped them fight the injustice and showed the Chungs that America really is the land of opportunity.
       At trial, the courageous judge allowed Pearson's past behavior of “creating unnecessary litigation” (during his divorce) to be presented. Ultimately, she ruled in favor of the dry cleaners and awarded them court costs.
       Later, Pearson's contract as an Administrative Law Judge was not renewed. His reaction? You guessed it — Mr. Fancy Pants is now suing to get his job back!
       This kind of frivolous misuse of the legal system isn't as rare as you might think. Our court systems are tied up in knots with ditzy attempts to make money or to punish people for a perceived act of disrespect. Something's got to change.
       The mere possibility of a lawsuit forces businesses, public institutions and private concerns to pay for all sorts of safeguards and, naturally, that cost gets passed on to all of us.
       According to the Institute for Legal Reform, the average American family annually shells out an extra $3,500 for everyday goods and services. I don't know about you but I'd rather keep my $3,500.
       Your kids' after-school activities cost more because their club has to carry extra accident insurance. So does your supermarket, home improvement store and pharmacy. Maybe one of the businesses you deal with has already been hit with a lawsuit and is paying off a settlement. You are shouldering the burden whether you realize it or not.
       The ILR, working as an affiliate of the U.S. Chamber of Commerce, has studied the legal fairness of each state and has ranked them in terms of how often a state allows the average American's dream to be turned into a nightmare.
       New Mexico ranks toward the bottom of this bad apple pile. At number 37 only a baker's dozen states have been found to have a more negative lawsuit climate.
       You can find the entire 50 state list on line at: http://www.instituteforlegalreform.com/states/lawsuitclimate2008/ and you can listen to several stories of small business people whose livelihoods have been impacted, or destroyed, because some numbskull complainant with a willing attorney decided to try to get a payoff to go away. Can anyone say, “Tort reform?”
       Now, hold on. If you are a member of the Bar Association and you're getting set to fire off a missive lambasting me I concede there are countless lawsuits of merit filed every year by deserving plaintiffs and earnest lawyers. That's not what's being discussed here.
       This is a discussion about bringing some common sense back into our judicial system.
       A man who uses a table saw incorrectly and injures himself shouldn't automatically get a million bucks for his stupidity from the store that sold it to him. An inmate shouldn't automatically get to sue because he doesn't like prison food. A suspect who forces cops on a high-speed chase shouldn't be compensated for his injuries from the inevitable car accident. A burglar who sues a homeowner because he was hurt during the break-in should go to prison, not to the bank with a settlement check.
       And, think about this: If you live in a state with a lousy litigation atmosphere, how many new businesses do you think will move in and offer new jobs to you and your neighbors? Ummm. I'm thinking none will find your state attractive enough to invest in.
       We like to blame people for our troubles but who is really to blame for the litigation mess we find ourselves in here? Is it the complainant? The lawyer who thinks more about the 33 percent he might rake in and less about the actual merits of the case? Maybe it's the insurance company that routinely goes for out-of-court payoffs rather than fight the good fight in court. Perhaps, it's the judges who should take a cue from the jurist in the Mr. Fancy Pants case and toss out more lawsuits that don't pass the common sense smell test.
       It's a combination of all of the above. I vote for a system where these type of cases have to pass a merit panel of former judges before actually getting anywhere near a courtroom.
       Oh, and in the meantime, I want my 35 hundred dollars back.
       Diane Dimond's column appears Saturdays. E-mail to diane@dianedimond.net