Posts tagged Lawsuit

Does the US need a tort reform?

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Our nation is considered to be among the top legal systems in the world.  Although there are many great parts of the U.S. legal system, I believe that tort reform is much needed.  Torts are generally defined as a civil wrong, which is not caused by a breach of contract.  Every year billions of dollars are being spent to protect business owners from tort claims.  One small error in advertising a product or failure to warn people of a product’s dangers, including such dangers that arguably border on basic common sense, can cause a company to go bankrupt from exorbitant legal fines.  For instance, a gun manufacturer failed to warn its users that long-exposure to firing guns can damage hearing and was found liable for causing hearing loss injuries.

Product liability cases, such as the one just highlighted, account for over 10 million cases filed in the U.S. annually.  Cases such as these have created a world full of disclaimers.  For instance, back in 1992 the “McDonald’s Coffee Case” was making national headlines. Officially known as Liebeck v. McDonald’s Restaurants, the case was eventually settled giving Liebeck $160,000 in compensational damages and $2.7 million in punitive damages.1 Since that case, McDonald’s has placed warnings on their coffee that can be seen today.

In more recent news, on June 15, 2009 USA TODAY published an article dealing with tort reform.2  In this article, President Obama reportedly is trying desperately to curb malpractice liabilities in order to help him create universal health care.  Due to the fear of medical malpractice liabilities, the nation spends an estimated $600 to $700 billion each year on necessary care due to physicians practicing defensive medicine.3 This staggering sum is a huge factor for those who argue in favor of universal health care and a major contributor for the prohibitively high cost of health care coverage for so many Americans.

While torts are a problem for businesses, in recent years certain measures have been taken to ensure tort reform, such as the Supreme Court case of BMW of North America, Inc. v. GoreIn this case, the Supreme Court held a 5-4 verdict that limited punitive damage awards.4 While this is a far cry from total tort reform of the U.S. system, this has given tort reform advocates hopes for the future of more substantial tort reforms.  I believe that limiting product liability cases and medical malpractice cases could lead to billions of dollars in savings each year to Americans for monies spent on disclaimers and frivolous cases.

Resources:

1. http://www.lectlaw.com/files/cur78.htm

2. http://content.usatoday.com/communities/theoval/post/2009/06/68120137/1

3. Ibid

4. http://findarticles.com/p/articles/mi_qa3811/is_199810/ai_n8812153/

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