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House considers new liability lawsuit bill

Posted March 31, 2011 1:49 p.m. EDT
Updated March 31, 2011 6:42 p.m. EDT

— A Republican push to change how liability lawsuits against companies and doctors are handled was panned by consumer advocates and praised by business backers Thursday during a state House committee meeting.

The panel heard public reaction to the wide-ranging legislation introduced Wednesday to revamp "tort" lawsuits, which determine responsibility for harm and decide whether compensation is deserved. Lawmakers are expected to begin debating the bill next week.

Supporters said the moves will boost businesses by shielding them from courtroom surprises doled out by juries swayed by emotion. Opponents said North Carolina is pushing further than virtually every other state to tilt the balance of justice toward business interests.

Similar restrictions on tort lawsuits were passed into law in Wisconsin earlier this year.

"Every provision of the House tort reform bill favors corporate traders of harm to others at the expense of innocent North Carolinians who in no way caused the injury to themselves," said Dick Taylor, chief executive of North Carolina Advocates for Justice, which represents trial lawyers and criminal defense attorneys.

The proposed changes under House Bill 542 include the following:

  • Protect the makers of any drug, chemical or consumer product from lawsuits if the item was approved by or met regulatory requirements of a state or federal government agency.
  • Allow only a quarter of large damage awards intended to punish bad behavior to go to the victim, with the other 75 percent of a punitive award of more than $100,000 going to a state fund.
  • Cap at $250,000 awards for medical malpractice that caused pain, suffering, disfigurement or other non-economic damages, with an inflation adjustment every three years.
  • Add protections against medical malpractice lawsuits for adult care homes.

The legislation is part of a larger effort by GOP lawmakers working with the state's chamber of commerce, which has made liability law changes a top priority this year. The bill's sponsor and the committee's co-chairman, Rep. Johnathan Rhyne, R-Lincoln, has said the GOP is seeking to make the state's courts more business-friendly.

Attorney Janet Ward-Black held up Sunday newspaper ads to demonstrate the number of companies and products approved by regulators that would be shielded from lawsuits if the measure passes.

"Almost every single product, whether its manufactured in North Carolina, another state or another country, is affected by this bill," Ward-Black said.

Henderson physician John Faulkner said he's been both a defendant and a plaintiff in the courtroom. Nearly a decade ago, he sued a hospital and the doctors performing surgery on his wife after oxygen ignited in the operating room, severely burning her face and upper body.

The case was settled after a three-year legal fight, but he said a $250,000 cap on malpractice awards wouldn't have even paid the family's legal fees.

"What helped our family through this time was the belief" in a fair justice system, Faulkner said. "This bill harms patients. It's not in patients' best interest. You just have to look to see who this bill really favors."

Product liability defense lawyers said companies would still be accountable if they made a faulty product or warnings were inadequate. The measure would protect companies from the whims of jurors lacking scientific expertise in issuing decisions that overrule years of research and review by regulatory experts, they said.

"If the manufacturers withheld information from the regulating agency, if they misrepresented information, they don't get the benefit of that protection," said attorney Fred Rom, who represents pharmaceutical firms.

The number of malpractice cases filed in state courts has averaged nearly 480 in the past five years, with an average of 64 cases getting to trial before a jury or judge, according to the Administrative Office of the Courts. The state courts have no data on product liability cases filed.

The changes insulating doctors would make "the civil justice system more stable, more predictable and more reasonable," said Sammy Thompson, an attorney who represents insurance companies in medical malpractice lawsuits.

But Laurie Sanders, whose 6-year-old son, Christopher, died in a hospital emergency room five years ago, said she is concerned that tort reform means that people in a similar position in the future won't be able to pursue a malpractice case.

"Under this ER provision, who would have picked up the bill for his lifetime care (had he survived)?" Sanders asked. "It would be Christopher's mom."