Government Issues

TAB Issue Area:  Tort Reform

The success of the Texas economy must also be attributed to the tort reform measures passed by the Texas Legislature in recent years. Largely as a result of past successes, the 76th Legislative Session was disappointing for the lack of any meaningful tort reform. Because additional reforms are needed, TAB remains committed to the fact that tort reform has been good for business,  workers and the consumers of Texas.

Many groups masquerading as consumer interest entities have attempted to minimize the positive economic impact of tort reforms. However, these same groups refuse to say whether or not they take money from trial lawyers, thereby casting doubt on their claims and objectiveness. A recent economic study commissioned by Citizens for a Sound Economy (CSE) demonstrates that Texas businesses and consumers have benefited  greatly by the passage of tort reform. The study reveals that businesses and consumers have witnessed additional inflation reductions, increases in total household income, increased retail sales and approximately 200,000  newly–created jobs. One important point that should not be overlooked is that today Texans have greater access to the courts than in recent years.

Despite the reforms, the rapid growth of class action lawsuits has not been deterred in Texas. Class action lawsuits represent one of the most detrimental threats to business and workers. A  recent case in Texas resulted in a billion dollar settlement by a computer manufacturer, despite the fact that not a single incident of harm had occurred. Plaintiffs firms have set their sights on other industries (lead paint,  gun manufacturers, alcoholic beverage makers) and are aggressively recruiting class-action plaintiffs. These efforts have resulted in small awards for the members of the class while reaping millions, and in some instances  billions, of dollars for the attorneys filing these cases. The result of this has been a transfer of wealth to a few individuals, and a new found aggressiveness and involvement in both legislative and judicial elections.

Efforts by the plaintiffs' bar have garnered the attention of the business community and forced a renewed interest in legislative campaigns as well as the Texas courts and elected judges. This renewed focus will be necessary in light of the anticipated increase in  the number of legislative proposals designed to rollback hard fought civil reforms. Proposals to undo legislative reforms were defeated last session, but these attacks refuse to die and opponents of tort reform are organizing and promising to revive these issues in the 2001 Legislative Session. Specifically, efforts continue to undermine Texas law regarding the statute of limitations for bringing suits as well as the venue or location where these cases must be argued. Success on this front would spell disaster for Texas business, and TAB along with other groups will be working hard to maintain or strengthen current law.

TAB will again work to provide the protection of Texas law to members of charitable and volunteer organizations including local chambers of commerce. Furthermore, TAB will work tirelessly for passage of common-sense premises or property owners' protection for unforeseeable crimes and other acts committed on  their property. Despite the past reforms, lawsuits concerning property owner liability continue to proliferate.

The issue of consumer privacy continues to grow and evolve, and there are increasing calls for the legislature to craft a fair and reasonable measure that does not  unnecessarily deter business growth. While working to protect the interests of business owners and consumers alike, attention must be paid to ensure that new causes of action are not created out of the privacy effort.

These and other issues point out that while the 76th Legislative Session was disappointing for the lack of more meaningful tort reform, the threat to Texas business has not diminished. The influence wielded by trial lawyers in the last session is widely believed to be a product of the millions of dollars they gave candidates in campaign contributions. Therefore, to be effective in the 77th Legislative Session, early efforts to organize, develop and unify behind a strong agenda that capitalizes on grassroots involvement in the process is vital.

The Fall 2000 election results could hold the promise of elevating the issue of tort reform beyond the state level and onto the national stage. While the list of needed  reforms in Texas remains long, during the 2001 Texas Legislative Session, TAB through its lobbying efforts will focus its attention on supporting and passing Tort Reform measures that include the following:

Alternative Dispute Resolution. Support legislation that creates mechanisms and incentives for the use of alternative dispute resolutions versus lawsuits when attempting to settle various disputes.

Arbitration of Employment Disputes. Support legislation that encourages the use of arbitration and alternative dispute resolution for employment-related lawsuits. This measure would allow for a quick resolution and result in tremendous savings versus lawsuits.

Chamber Liability. Support legislation that would codify federal volunteer protection laws to specifically include volunteer chamber directors and chamber service  volunteers among those granted the same protection from personal liability as currently permitted by Texas law for other charitable and non-profit organizations.

Change of Venue. Oppose legislation that seeks to alter current law governing "venue" or where a case must be heard. Expected legislation affecting statutes of  limitation and venue may also seek to shift review of certain facts from a judge for consideration by a jury.

Class Action Lawsuits. Support reform efforts that would grant the Texas Supreme Court review of matters pertaining to class action suits, including: certification of  class, size and eligibility for inclusion in the class; review of available administrative remedies; and a stay of proceedings pending resolution of these and other issues.

Extension of Exclusive Remedy. Support legislation that closes the loophole in Texas law that allows an injured worker to collect money for the same injury from both the  employer and a parent or sister corporation of the employer.

Homeowners and landowners liability. Limit liability of premise owners for acts of criminals and other incidents that occur on the property, reinstate assumption of risk defense and extend protection to owner that grants access for recreational use.

Judicial Selection. Support legislation that creates a mechanism for the merit selection and non-partisan election of qualified jurists.

Settlements. Support legislation that encourages the settlement of lawsuits by both plaintiffs and defendants by providing that either party rejecting a reasonable settlement offer must bear the cost of that litigation if the prevailing party subsequently wins an award of an equal or lesser amount than the original offer.

Statutes of Limitation (SOL). Oppose any attempts to amend current law to increase the statue of limitations or timetables for filing a lawsuit.

Third-party liability. Introduce and support legislation to prevent multiple recovery against third parties for injuries that are compensable under workers' compensation insurance or other benefits.