Posted by The Crux |
Jin and Soo Chung, owners of a drycleaning business in Washington DC, conditionally withdrew their demand that defeated plaintiff (and administrative law judge) Roy Pearson pay them $83,000 to cover their legal expenses in defending against Pearson's lawsuit for $54 million over a pair of his pants that the Chungs had allegedly lost (Washington Post).
The Chungs said that supporters had donated enough money to cover their legal expenses and that they just want to get back to their lives. In exchange, the Chungs want Pearson to agree to not appeal a lower court's June ruling against Pearson. Pearson has until tomorrow to file the appeal. BN-Politics' Damozel covered the lawsuit.
The U.S. Chamber of Commerce was among the Chung's supporters, compelling me to expect yet another anti-tort campaign coming on.
No one believes that a multi-million-dollar lawsuit over an article of clothing is reasonable. Still, I'm concerned that industry groups who want to do away with even reasonable tort suits might use Pearson's suit as evidence that all 50 states' tort laws need massive changing.
Pearson's lawsuit does not reflect tort systems nationwide. It went as far as it did because of one poorly written statue in the District of Columbia. Thus, the people who caused the root problem we're now reading about are:
1) the people who wrote the statute, and
2) the people who passed it into law without reading it carefully enough.
I am a lawyer, but I'm not in private practice, so I don't directly benefit from tort suits. As a consumer, I do benefit from some tort suits -- as do all of us ordinary Amercians.
Consider the Ford Pinto case (Grimshaw v. Ford Motor Company), for example.
The case involved a lady and a boy who were riding in a Ford Pinto that got hit by another car that was going about 30 mph. The gas tank exploded, due to a faulty fuel-system design, causing a fire. The lady died, and the boy was badly burned and scarred for life.
During trial, it came out that Ford had known of the flawed fuel system but chose to not correct the flaws. Why? Because statisticians working for Ford calculated that fixing the Pinto would cost more than paying out on lawsuits over passengers' deaths and injuries (see Safety Forum).
As a person who likely will buy another car some day (and who may allow family and friends to ride in it), how does that reasoning sit with you?
The jury awarded huge punitive damages (more than $100 million) against Ford, and a judge later lowered them to under $5 million. Different states have differrent laws/rules, but judges often have the power to reduce outrageously high punitive damages (a.k.a., "punies").
The point of punitive damages is to make it more costly for companies to be careless than careful. It's like grounding a teenager for a week and telling him that if he sneaks out, he'll be grounded for two more weeks. If all manufacturers were put consumer safety above the bottom line, we wouldn't need the threat of punies to make them consider customer safety.
That's how punitive damages benefit society. If not for punies, all companies would be free to crank out cars (drugs, foods, tools, toys...) like Ford did with the Pinto: focusing more on its bottom line than on your health and safety.
The Pearson pants-case (based on one badly written statute) is extreme -- and remember, the legal system did stop him from winning. My hope is that we won't throw the baby out with the bathwater as industry groups try to use the Pearson case as evidence that we need to drastically reduce, or even wipe out, punies.
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