Getting Justice: Why Access to Courts is a Critical Check on Corporate Abusers

1. Getting Justice: Why Access to Courts is a Critical Checkon Corporate Abusers June 9, 2007 Laura MacCleery www.citizen.org www.thewatchdogblog.org

2. A Counter to Corporate Abuse Public Citizen delivers credible information based on facts, represents everyday people in the halls of power, and fights relentlessly until we win on the issues that matter most.

3. How Most of Us See It

4. And the More Things Change…

5. The Henhouse Is Saved! We stopped NAM lobbyist Michael Baroody, nominated by Bush to chair the CPSC. Bush Nominee To Get Payment From Old Job May 16, 2007, Wednesday By STEPHEN LABATON Appointed Hobblers of Government May 18, 2007, Friday Editorial Desk Candidate for Safety Agency Withdraws Amid Criticism May 24, 2007, Thursday By STEPHEN LABATON

6. Hand in Glove Baroody oversaw NAM’s efforts to: • Eliminate or severely limit medical malpractice remedies; • Limit the ability of consumers to use class action lawsuits to seek redress; • Prevent government agencies from pursuing legal cases against companies that engage in harmful activities; and • Shield corporations from liability for damages caused by unsafe products and practices.

7. Attack on Civil Justice “What’s happening all across this country is that lawyers are filing baseless suits against hospitals and doctors. That’s just a plain fact. And they’re doing it for a simple reason. They know the medical liability system is tilted in their favor. Jury awards in medical liability cases have skyrocketed in recent years. That means every claim filed by a personal injury lawyer brings the chance of a huge payoff or a profitable settlement out of court.” - President George W. Bush (2005)

8. George Bush vs. The Facts The number of medical malpractice payments declined 15.4 percent between 1991 and 2005. Average annual payments declined 8 percent over the same period.

9. The Real Problem is Medical Error • In 1999, a landmark study by the Institute of Medicine (IOM) found that an estimated 44,000 to 98,000 patient deaths occur each year in hospitals as a result of preventable medical errors. • Another IOM report in 2006, found that “medication errors are surprisingly common and costly.” • The problem of medical errors is, in large part, a bad apples issue. Public Citizen research shows that since the start of the NPDB, 5.9 percent of U.S. doctors were responsible for 57.8 percent of medical malpractice payments. • The vast majority of doctors – 82 percent – have never had a medical malpractice payment since the NPDB was created in 1990.

10. Doctor Discipline is Lax Only 33.26 percent of doctors who made 10 or more malpractice payments were disciplined by their state board – two-thirds of these egregious repeat offenders went undisciplined. For example, Physician Number 35454 had at least 18 malpractice payments between 1991 and 2005, 12 times for improper performance of surgery, twice for improper management of surgery, once for equipment problems during surgery, once for failure to obtain consent for surgery, once for an unnecessary surgical procedure, and once for an unspecified surgical error. The total damages were $8,237,500.

11. More Bush Fear-Mongering “Because lawsuits are driving many good doctors out of practice – leaving women in nearly 1,500 American counties without a single ob-gyn – I ask the Congress to pass medical liability reform this year.” – GWB, 2006 State of the Union

12. Access Improving: A Decreasing Number of Counties Lack Ob/Gyn - Public Citizen report, February 2007 We also found that the number of ob-gyns per woman of child-bearing age in the United States has grown significantly over the past decade.

13. There is no “litigation crisis.” • Tort trials in federal court fell 80 percent between 1985 and 2003; • In state courts the number of jury trials fell 23 percent from 1992 to 2001; • Median jury verdict in tort cases plummeted 56 percent between 1992 and 2001, from $64,000 to $28,000. • Business-to-business lawsuits are 4 times as frequent as consumer lawsuits. - U.S. Department of Justice and Public Citizen research

14. Karl Rove, Pick-Pocket • Baroody was a Republican party operative. • Bringing complex cases on a contingency fee basis – you only get paid if you win – is a high-risk economic gamble by plaintiffs’ attorneys. • Reducing compensation for victims – or punitive damages – means fewer cases can be brought. • It also means that trial attorneys – who typically back Democrats – will have less money. • This issue has been treated as a partisan football – obscuring the moral harms to real people and to the integrity of our courts.

15. Destroying Corporate Accountability • Arbitrary caps hurt those without direct economic losses (i.e., older people or children); • “Loser pay” rules hurt low-income people and those who bring valid claims but lose; • The explosion of new tricks to avoid the courtroom: • federal preemption of state common law; • special insurer-dominated panels misleadingly labeled “health courts;” or • pre-dispute binding mandatory arbitration. These reduce economic exposure for corporate interests at the expense of injured victims.

16. An Evolving Duty of Care • Tort liability is a needed complement to regulatory compliance because: • It imposes an obligation based upon an evolving duty of care to ensure the safe foreseeable use of a product, and is therefore broader than a compliance standard. • Regulations can become obsolete or remain incomplete, and agencies can become captured. • For example, the U.S. federal safety standard for airbags in the 1990s measured the impact of airbags only upon a 50th percentile male dummy. But a duty of care requires automakers to make an airbag that is safe for children and all other possible users.

17. Regulatory Failure: Roof Crush This Ford E-250 would comply with a 2005 proposed new federal standard for roof crush strength, yet its occupant, Reverend Lawrence Harris, became a quadriplegic in a rollover. Rev. Harris is able to continue working for his church due to compensation from his settlement.

18. How it All Fits Together Tort law is one essential part of our health and safety system, which also includes: • regulation by government agencies to set a common baseline; and • robust sources for consumer information to enable fully informed choices in the marketplace. All three elements work symbiotically to produce evolving standards for business conduct and products. It is also a matter of fundamental justice that those responsible for harm compensate the victims.

19. Lawsuits channel the very human but very dangerous desire for revenge into a quest for justice. Lawsuits make people work through the system, not against it. Lawsuits take place in the open. Lawsuits provide procedural protections for everyone involved. To win a lawsuit you have to be right. It is not enough to be angry. Most important, lawsuits provide a space in which reason, diligence, and justice can sometimes prevail against even the richest and most powerful organizations. Lawsuits provide one of the few such spaces in America today. - Tom Baker, The Medical Malpractice Myth

20. Gagging the Courts • Secrecy agreements between parties – signed as a condition of settlement – are now commonplace. • Plaintiffs get bribed by corporate defendants and muzzled, and crucial documents about safety hazards never see the light of day. • This means that the court system – designed to serve as the canary in the mineshaft by alerting regulators about surfacing health and safety hazards – cannot function properly.

21. On March 23, 2005, the BP refinery in Texas City, Texas, exploded, killing 15 people and injuring 170 others. The explosion was the worst U.S. workplace accident in 16 years. Company e-mails showed the company had known of safety problems for more than two years before the explosion.

22. BP At Fault for Disaster • The managers of the plant –part of a corporate ‘culture of risk taking’ as noted by an internal report – compromised worker safety due to budgetary concerns and failed to upgrade process safety mechanisms that would have prevented the explosion. • Within two months, BP announced it would pay $700 million to settle claims. To avoid a trial, the company settled them quickly and kept the amounts and documents secret. • After conducting an investigation, OSHA fined BP a record $21.4 million for more than 300 willful safety violations.

23. A Victim Stands Up • Eva Rowe, whose parents were both killed in the blast, pressed BP much further. • She had two preconditions for reaching a settlement, which were to release millions of pages of documents from the case proving BP’s negligence and liability in the public domain, and for BP to honor the memory of all those killed in the blast with donations to workplace safety organizations. She got $32 million for donation. • Her Web site, at http://www.texascityexplosion.com/ contains the documents and a memorial to all of the victims.

24. Other Developments • Eva Rowe’s attorney still has a request pending before the Texas State Supreme Court to depose BP’s ex-CEO John Browne – who resigned a month ago after admitting he lied to the court. • The BP explosion also inspired new federal legislation to ensure equal treatment of workers by authorizing federal prosecutors to pursue criminal cases against employers whose willful violations of safety rules lead to the deaths of contract workers. • A criminal investigation of the BP explosion was begun by the Department of Justice, but could not proceed because such prosecutions are today only possible when a company's violations are tied to the death of a direct employee.

25. The Tort System in Action The BP case shows why tort is a necessary check on corporate abuse: • The regulatory system governing safety standards at oil refineries failed to enforce them effectively; • A corporation willfully disregarded safety standards; • This negligence caused death and severe injury; • The victims sought compensation for the company’s violation of their rights to a safe workplace; • The lawsuits brought to light internal documents which led to further investigation of the company’s negligence; and • The lawsuits also led to new legislation expanding the scope of legal protections.

26. What You Can Do • Goal of Big Business’ $Billions: to poison the jury pool. • Our response: Organize and challenge. • Our jury system is a critical bulwark of democracy: it gives ordinary citizens the tools to confront abuse of corporate power. See www.citizen.org and take action! • Coming to a state near you: • Tired ol’ “tort deform” (Oklahoma) • “Health courts” (insurer-run make-the-case-go-away panels) • Binding Mandatory Arbitration (StopBMA, DC bill) • Public funding for judicial elections • Challenge and expose corporate involvement in judicial elections (IRS and FEC complaints)

27. A Last Word Representative government and trial by jury are the heart and lungs of liberty. Without them we have no other fortification against being ridden like horses, fleeced like sheep, worked like cattle, and fed and clothed like swine and hounds. – John Adams, 1774