White House action on civil justice reform: a menu for the new millennium.

• Author: Schwartz, Victor E.

Civil justice reform addresses the fundamentals of both the substantive law and procedural rules of the law of civil wrongs. Law students and lawyers call the law of civil wrongs "tort law;" others may know it as "liability law." For the first 200 years of our nation's history, tort law was generally created by state judges with occasional intervention by state legislatures.(1) Most tort law today continues to be developed by state courts.

From time to time over the past century, Congress also has entered the field.(2) For example, as far back as 1909, Congress enacted the Federal Employers' Liability Act ("FELA"),(3) a statute which defines rights and duties in personal injury cases brought by railroad workers against their employer railroads -- FELA is a "tort substitute" for workers' compensation in the railroad field. In 1927, Congress enacted the Longshore and Harbor Workers' Compensation Act,(4) a FELA-like statute that provides fixed awards to employees or their dependents in cases of employment-related injuries or deaths occurring upon the navigable waters of the United States.

Modern federal liability reform efforts have their roots in a project that took place from 1976 to 1980 under Presidents Ford and Carter. A Federal Interagency Task Force on Product Liability conducted an in-depth research and analysis of state product liability law. The Task Force found that the patchwork of ever-changing product liability laws in fifty-one jurisdictions (fifty states and the District of Columbia) created problems for interstate commerce.(5) Rather than propose preemption by federal law, however, the Task Force drafted a model law for use by the states.(6) The Task Force intimated that federal legislation might be needed if the states did not enact the model law in a uniform manner.(7)

The Task Force's "Model Uniform Product Liability Act" served as the basis for legislation in several states, but it was not adopted nationwide.(8) Furthermore, those states that did enact the "Uniform Act" did so "in a piecemeal fashion," rather than "uniformly."(9)

The inability of states to create clear and uniform product liability law led to a significant attempt by Congress to do the job by enacting a comprehensive federal product liability law.(10) The general, broad-sweeping legislation failed, but when products liability problems became particularly severe for a particular segment of the economy, Congress passed and President Clinton signed, industry-specific laws into effect. One such law is the General Aviation Revitalization Act of 1994, which helped prevent the demise of the entire civil aviation industry.(11) Another example is the Biomaterials Access Assurance Act of 1998, which helped assure that manufacturers of medical devices could obtain the raw materials necessary to make their life saving equipment.(12)

Regardless of one's "feelings" about the wisdom of accomplishing civil justice reform at the federal level, this past experience strongly suggests that most action has and will continue to occur at the state level. But there will, and should be, a federal role based on strong needs and sound policy. Although arty issue involving civil justice reform will tend to evoke partisan bickering, if the substance of a proposal is sound, it will appeal to those in either party, or at least to those persons whose minds are not totally closed by political action committee (PAC) dollars and influence peddling.(13)

Political reality dictates that what occurs will depend, in part, on who is President. Based on his prior record, President Bush is likely to embrace reasonable civil justice reform.(14) In contrast, Vice President Gore opposed civil justice reform while in the Senate and continued to receive substantial support from wealthy personal injury lawyers while Vice President and during his Presidential campaign.(15) President Clinton took a more middle-of-the-road position on civil justice reform issues.(16) He signed a number of civil justice measures into law, including the General Aviation Revitalization Act of 1994 and the Biomaterials Access Assurance Act of 1998, mentioned above. The influence of very powerful, wealthy personal injury lawyers contributed to his opposing other civil justice reform efforts, however.(17)

This Article addresses the major civil justice reform issues confronting the next Administration and offers some proposals for dealing with those issues. Part I proposes an "Injured Consumer's Bill of Legal Rights," which would provide much needed protection for consumers of legal services. Part II advocates increasing liability protection for school officials in order to stop frivolous lawsuits that interfere with basic educational processes. Part III recommends strengthening Rule 11 of the Federal Rules of Civil Procedure to stop baseless claims and defenses. Part IV provides a fair solution to the problem of multiple imposition of punitive damages. Part V proposes fair and balanced national standards for product liability. Part VI proposes reforming federal class action rules to better serve the legitimate purposes for which the class action was created.

1. PROMOTE INJURED CONSUMER'S BILL OF LEGAL RIGHTS

   An in-depth study conducted by HALT, a national consumer organization concerned about the legal system's treatment of ordinary Americans, found that injured plaintiffs fared quite poorly under the present legal system, particularly in relations with their own attorneys.(18) One problem HALT found is that lawyers do not provide injured clients adequate information when they sign contingency fee agreements.(19) For example, after a train derailment killed forty-seven people in Alabama, an attorney signed a contingency fee agreement with a Mexican passenger who spoke no English.(20) Personal injury plaintiffs often lack the legal knowledge to make a judgment about whether the fee is reasonable in light of the circumstances of their specific case.(21)

   Consumer confusion is augmented by lawyer advertisements, which emphasize the word "free" above everything else.(22) These advertisements often do not provide the information necessary for a reasonable marketplace decision.(23) Personal injury lawyers also may pressure potential clients to sign agreements after a recent, tragic accident involving loss of a loved one or serious personal injury.(24) These "victims" are bombarded by unsolicited, high-pressure contacts from potential plaintiffs' counsel. The Mexican train passenger described above was solicited while in his hospital bed. The husband of a passenger on ValuJet Flight 592, which crashed outside of Miami in May 1996, testified in a congressional hearing that:

   [M]embers of the legal profession started their assault [immediately after the crash]. The families had been traumatized and were not able to make rational decisions. They were directly solicited by mail, by telephone and in person. In some instances, they were scared and pressured into contingency fee contracts without proper representation or the understanding of what: they were doing.(25) Although ethics rules require lawyers to explain fee arrangements clearly and at an appropriate time, HALT found that the rules are not enforced.(26) The legal profession is self-regulated, with the enforcement of ethical rules left to local bar groups.(27) The ethical standards are policed by the same people that are supposed to be monitored. The fox is in charge of the legal chicken coup.

   Federal laws protect the vulnerable from similar "overreaching" by funeral directors, used car dealers, banks and lending institutions.(28) Consumers are left at sea, however, at a time in life when they most need protection -- when they have been hurt and receive substantial pressure from personal injury lawyers.

   The Federal Government cannot and should not be involved in regulating individual state bars, but it can protect people who enter the federal court system. Federal law can be a model for states to follow in protecting their own citizens when they enter a state court.

   An injured consumer's bill of legal rights in the federal courts should provide at least these basics:

   1. A No-Contact Period: Injured consumers deserve the right to be left free from unsolicited contact by attorneys (plaintiff and defense) and insurers, or their representatives, for at least forty-five days after an event resulting in personal injury or death. Federal law already exists to protect airline crash victims and their families.(29) Victims of other traumatic events (and their families) should be similarly protected. Current law can serve as a model for more broad-based legislation, but lobbying by personal injury lawyers has kept the penalties to a minimum. Through such means as air crash legislation penalties for early solicitation should be made harsher, and similar protection should be afforded to anyone injured in interstate commerce. Just as importantly, the laws must be enforced.

   2. Informed Decisionmaking: Plaintiffs' lawyers should be required to put all fee agreements in writing and to inform their clients on key matters before the fee agreement is signed. These key matters should include the following:

      1. The probability of a successful outcome. The ordinary citizen is not a sophisticated shopper for legal services. Most injured plaintiffs lack information to make an informed choice in hiring a personal injury attorney.(30) They do not know the value of the claim, how much effort and skill will be necessary for any attorney to pursue the claim, or the chance of success.(31) Personal injury attorneys seldom volunteer information that would remedy this inequality in bargaining power. As former Harvard President and Law School Dean Derek Bok observed: "Most plaintiffs do not know whether they have a strong case, and rare is the lawyer who will inform them (and agree to a lower percentage of the take) when they happen to have an extremely high probability of...