Making Losers pay, Lawyers too

By Reynold N. Mason JD

Two years ago, in July 2009, Diane Schuler got drunk on vodka and  high on marijuana, then got into her minivan with her children and three of her nieces and headed home. She didn’t make it. Neither did her daughter and three of her nieces ages 5, 7 and 8, years old.  They perished in a pile of mangled steel and broken glass on the New York Taconic Parkway when, in a drug induced stupor, Ms Schuler drove the wrong way into oncoming traffic for almost two miles before the inevitable happened.  She ploughed into a minivan, killing its three passengers. Eight people died as a result of what was clearly an act of crass irresponsibility. The autopsy and toxicology tests found that there was undigested booze still is Mrs. Schuler’s stomach at the time she perished. And in the wreckage, the police found the remnants of a bottle of vodka. Now, Mr. Schuler, her husband, is suing New York State. His lawyer blames the accident on poor engineering and inadequate signage along the Taconic Parkway.

New Yorkers view this as being wrong and strong, as adding insult to injury. Even more egregious, Mr. Schuler is suing the father of his wife’s three nieces who died in the car she drove on the Taconic on that fateful day.  His lawyer claims that the grieving father was vicariously liable.  A legal fiction for deep pocket. This puts his insurance company on the hook because he owned the van Mrs. Schuler was driving at the time of this tragedy. Imagine forcing New  York to spend $millions in lawyer’s fees and expert fees to have transportation engineers testify about the proper engineering standards for highway design and signage, when everyone with half a brain knows that this tragedy occurred because Mrs. Schuler was stoned out of her mind. This is a frivolous law suit; a crap shoot and a gamble. It is a transparent ploy to blame everyone but the responsible party and have someone else pay the piper. This kind of frivolous, groundless law suit has become a plague spreading through the American Justice system. It is time we stop it.

The litigation gamble

Last May, Texas took a step in the right direction. It enacted a law making the loser in a law suit responsible for the legal fees and cost of the winner if the suit is groundless. This common sense bit of legal self defense is long overdue. Much has been written about big corporations lavishing dollars on politicians who back tort reform. But that is a smoke screen. The truth of the matter is that many people see a law suit as lottery, a chance to get rich with very little investment, and zero risk.  A lawsuit from a slip on a cracked sidewalk by a plaintiff with a claim of a resulting back injury could bring a homeowner to ruin. No injury is too minor. It costs a potential plaintiff nothing to sue his neighbor over a cracked sidewalk. Just find a lawyer who will take the case on a contingency basis and enter the litigation lottery.

Runaway juries and jackpot verdicts

Getting an expert to testify that the injury is serious and disabling is no problem. Many Personal injury lawyers work with experts, who will themselves wait to be paid until after the successful conclusion of the case. It has always me amazed the way two experts looking at the same X-ray can reach such vastly different conclusions.  The truth depends on who is paying the experts, and the opinion necessary for that side to prevail. The rest is up to the trial smarts of the lawyer.

 I once presided over a personal injury case in which the husband alleged that his wife died because of the negligence of the hospital. The evidence showed that she had a bad heart and had been treated for heart problems in the past.  She had been to two other hospitals on the two days preceding her visit to the city hospital complaining of chest pains. She was given some fluids through an IV while she waited, but perished in the waiting area before she could be seen by a doctor. The hospital hired a world renowned pathologist who explained to the jury that the women’s heart was half destroyed by previous heart problems or disease; he pointed out the difference in the color of the heart tissue and left no doubt in my mind that the diseased heart was the cause of death, rather than anything that could be blamed on that hospital.  The deceased was unemployed at the time, and her husband, the plaintiff, drove a “dollar cab”. The jury brought back a verdict of $35 million. They disregarded the evidence and were swayed by the wit and persuasive skills of an experienced lawyer.

Some pay up because they fear runaway juries who perceive insurance companies as deep pockets. There are lawyers who accept and file cases with no intention of ever taking them to trial. They know that if the case is against a large corporation or a big city it will be settled for $8 to $10 thousand nuisance value. Defendants who are insured are not willing to risk facing a jury with the possibility of major exposure, when they could resolve the case with a minimum of risk. Thousands of meritless cased are settled which would not survive a motion to dismiss.  But that costs more than nuisance value. There is absolutely no risk for a plaintiff who brings a baseless law suit. But that is about to change. South Carolina, Pennsylvania, Florida Oklahoma, Alabama, all have elected governors who favor making losers pay.

We all pay

One study as far back as 1991, found that the U.S. spends five times as much as its major industrial competitors on litigation costs. The costs of litigation over the last two generation has increased fourteen fold; tort claims run ten times higher, and malpractice claims ten times higher than that of Britain which has a loser pay system.  Frivolous law suits are not a topic of wide public interest such as health care or social security.  And it is not a wedge issue like abortion or immigration reform. Yet according to a study by the Manhattan Institute it cost $247 billion  in 2006.  It is time we hold people responsible for the cost of their own groundless actions. A plaintiff who gambles and loses should be made to compensate the winning defendant for the costs of defending himself against a baseless law suit.  And the attorney who accepts and files a frivolous law suit should be sanctioned as well. This law suit by Schuler is meritless on its face. There is no theory of law under which he can overcome the gross negligence of his wife for driving the wrong way on a highway while drunk. It does not take a lawyer to see that, except one that is blind to the contradictory facts staring him in the face. For the attorney who brings such a case and for his client as well loser pays is the remedy.