Outside the Beltway

LAWSUIT LOTTERY

James Joyner · Thursday, July 10, 2003 · 1 comment

Michael Kinsley is back in form with his piece on tort reform, simplifying a complex issue while still demonstrating its difficulty:

One subject you don’t see many anecdotes about is so-called “frivolous lawsuits,” although this is a major theme of malpractice reform crusaders. There’s a reason: Even unworthy lawsuits usually don’t look frivolous up close. A quadriplegic who wins $20 million in what critics call the “lawsuit lottery” is still a quadriplegic. He is still a quadriplegic even if others in the same situation get little or nothing. He is still a quadriplegic even if the doctor he sued did nothing in particular wrong. If you had the choice in advance, would you agree to become a quadriplegic for $20 million? Suffer severe pain in your right leg for the rest of your life for $350,000? Very few winners of what the critics call the “lawsuit lottery” actually win enough to make it a deal they would take voluntarily.

This is correct and a point often missed by people, myself included, who want to limit non-compensatory damages. But Kinsley still favors limitation, in a sense, Kinsley turns the argument on its head:

So, the direct effect of restricting the size of malpractice judgments would be to increase injustice, not to reduce it. Nevertheless, limits on malpractice lawsuits are a good idea that Democrats are wrong—and possibly foolish—to oppose. The current arrangement delivers justice at random, in widely varying amounts or not at all, depending on whether you’re feeling litigious, how good your lawyer is, or what a judge or a juror had for breakfast that day. It is less a matter of injustice than of more justice than we can afford, scattered somewhat at random.

What is wrong with a $250,000 cap on payments for pain and suffering? Why should one person get $5 million, another $500,000, and yet another nothing at all for essentially the same injury? The fact that $250,000 can’t begin to compensate for the pain and suffering a patient may have endured can demonstrate that $250,000 isn’t enough money, or it can demonstrate that money’s ability to compensate for non-monetary losses is inherently limited.

The current system is indeed a lottery, although not the kind one wants to win, because some victims get a huge settlement and others get nothing, owing to the vagaries of the jury pool and the ability of their attorneys to invoke sympathy.

An ideal system would pay all compensatory damages (that is, make people financially “whole”) and pay all like victims a similar amount for pain and suffering. And, as I’ve noted on numerous occasions, I’d prefer that punitive damages be left to the criminal courts.