Texas Governor Rick Perry claims the purpose of a tort reform bill he recently signed into law in Texas is designed to reduce the number of “frivolous lawsuits”. According to The Washington Times, this law institutes a “loser pays” system for personal injury cases in which the party that loses a court case pays all litigation fees. Most states in America require each party to pay its own litigation fees.
At first glance, the Texas Loser pays rule seems fair. After all, why should a defendant that proves it did nothing wrong have to pay its own attorneys fees? The truth is it depends on how you define fair. The overwhelming number of plaintiffs do not have the funds to pay their own attorney let alone pay the attorney for the defense if they lose. The threat of requiring a losing plaintiff to pay the defendant’s attorneys fees, (often tens of thousands of dollars) will scare many plaintiffs that have legitimate cases into not bringing a lawsuit.
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Which is more unfair – requiring a large corporation to pay its attorneys fees even when it wins or using the threat of having to pay a defendant’s attorneys fees to scare a large number of plaintiffs into abandoning legitimate cases? In my opinion, it is more unfair to use the threat of paying the defendant’s attorneys fees to discourage legitimate cases because it harms all of society. What tort reformers do not want you to know is that when legitimate cases are not brought, it harms us all because we all end up footing the bill in the form of higher health care costs. Simply put, if the wrongdoer does not pay for the medical care caused by a personal injury, then either private health insurance, Medicare, Medicaid, or workers compensation will.
In fact, some wonder if the purpose of this bill has nothing to do with reducing frivolous lawsuits. Instead it very well might be that the purpose of this bill is to help corporate interests by reducing all personal injury lawsuits even if they are not frivolous. After all, the fact that a defendant wins does not make the lawsuit frivolous. Plenty of well deserving plaintiffs lose close cases that could have gone either way. If the case went the other way I am sure the losing defendant would not be willing to admit they put on a frivolous defense.