Television pundits have spent an inordinate amount of time this year discussing the meaning of the 2010 elections in terms of the 2012 elections. Civil justice reform proponents, on the other hand, have quietly seized the initiative to enact common sense liability legislation. As a result, 2011 will go down as one of the great years for balancing civil litigation in the states.
The good news began in January and has continued through early June. No fewer than five states have enacted significant liability reforms. Most of the changes involved subjects that appealed to common sense and were easy for voters, as well as legislators, to understand.
Other highlights of the bill include capping noneconomic damages at $750,000 in most personal injury lawsuits and health care liability actions. Listed catastrophic injuries or listed actions by the defendant are subject to a $1 million limit on noneconomic damages. Punitive damages are limited to the greater of two times total compensatory damages or $500,000. There are exceptions for listed actions by the defendant, similar to those for noneconomic damages. Punitive damages in product liability cases are further limited with innocent seller protection. Food and Drug Administration compliance protection is added for drugs and medical devices. The Act removes private right of action in securities cases alleging unfair or deceptive trade practices, charging the attorney general and reporter with enforcement.
Another reform that will encourage business growth in Tennessee by discouraging forum shopping is venue reform for business defendants. This change means that a lawsuit must be brought in either the county where all or a substantial part of the events giving rise to the claim occurred, the county where the defendant’s principal office in the state is located or the county where the defendant’s agent for service of process is located, if the defendant does not maintain an office in Tennessee.
As this article is written, all four bills have been presented to the governor and await his approval.
While the news is not this good in all states, these results demonstrate what can be accomplished by a united business community when presented with a realistic opportunity to achieve reform. Indeed, the business community is taking legislative action to combat the possibility of greatly expanded liability exposures from trespassers onto private property—a problem that many people do not yet know exists.