For the Record
The Road Back to Business as Usual
“My torts professor taught us that uncertainty about the standard of care creates what he calls a ‘cliff problem’… When we know there’s a liability cliff—some line that will be catastrophic to step across—but we don’t know exactly where the edge of the cliff is, we will avoid the ground near the cliff altogether.” That testimony, provided by Texas Christian University General Counsel Leroy Tyner to the U.S. Senate Judiciary Committee, puts into clear focus the tremendously difficult decisions businesses across our state and nation are facing today. While everyone looks forward to the day when we can resume business as usual, we all understand that given the nature of the COVID-19 pandemic, its side effects will linger for many years to come. But we also know that people must work. Businesses must operate. And they are increasingly being given the greenlight to do so by state and local governments. TLR has been working with state and federal leaders to determine if there is a way to give businesses some reassurance that they are not blindly approaching a liability cliff. At the federal level, Senate Majority Leader Mitch McConnell has designated Senator John Cornyn as the lead on liability issues.
TLR Statement on COVID-19 Liability
Any Imposition of Liability Related to the Coronavirus Must be Based on Standards that Recognize these Extraordinary Circumstances April 20, 2020 As our nation copes with the coronavirus pandemic, we are all concerned about the health and well being of our families and neighbors. We are in this together. We are experiencing a devotion to duty and a level of responsibility throughout our society that is inspiring and reminiscent of our national effort during World War II. Great courage and determination are being displayed by our healthcare providers, first responders, and the workers who are keeping the essential elements of our economy functioning – food producers, truckers, manufacturers of needed products, warehouse workers, and grocers, to name a few. As a nation, we have before us the formidable tasks of controlling and defeating the virus, restoring our society, and rebuilding our economy. A tsunami of plaintiff-lawyer inspired litigation will not assist our efforts. Quite the contrary. Greed-driven mass litigation will cause delay and division and impose costs that will hamper our recovery and impede the ability of our businesses and industries to restore our economy to its pre-virus vigor and bring us back to full employment. Businesses and professionals are
Protecting Our Frontlines
World Health Day was last week, on April 7, and there couldn’t be a more appropriate time to recognize the work and sacrifices of the healthcare profession across the globe. In the past few weeks, we’ve seen these men and women run toward danger, working around the clock and putting their own lives on the line to help those affected by COVID-19. In Texas, Gov. Greg Abbott has created a task force to help ensure these professionals have the personal protection equipment they need and that their hospitals have the resources necessary to respond to a surge in coronavirus patients. The governor has also issued orders easing licensing requirements for healthcare workers to ensure Texas has the medical workforce it needs in the coming weeks. But there’s an additional layer of protection that we should grant to the men and women on the frontlines of this pandemic: liability protection. TLR recently joined with the Texas Alliance for Patient Access, Texas Medical Association, Texas Hospital Association and others to request that Gov. Abbott issue an executive order providing liability protection during the declared disaster for physicians and other healthcare providers. “These healthcare professionals are literally risking their lives to care for
Providing Essential Services
“If the freight’s there, it’s got to move. If people are going to eat, the trucks are gonna move. If they need medical supplies, the trucks are gonna move. If we stop, the world stops.” Those are the words of 57-year-old trucker Ron Applegate, one of the individuals on the frontlines of our nation’s commercial transportation industry. On any given day, these men and women provide an essential service, ferrying the food we eat, the clothes we wear and the products that fill our homes from one destination to another. As COVID-19 has proven, that service is more critical now than ever. We’ve recently taken a closer look at a growing cottage industry that is driving litigation against commercial trucking companies. The increase in nuclear verdicts in litigation involving commercial vehicle accidents has created a corresponding increase in insurance costs for trucking companies. Because transportation costs are a meaningful component of the retail prices of consumer products, the costs of unnecessary lawsuits and unreasonable verdicts are ultimately borne by consumers. But the Tort Tax is only one consequence of the spike in trucking litigation. In some cases, companies have been forced out of business because they are unable to handle
Anatomy of a Cottage Industry
Over the past few weeks, we’ve highlighted the phenomenon of nuclear verdicts in Texas, and some of the questionable tactics used by personal injury trial lawyers pursuing trucking litigation in the Lone Star State. While trucking litigation has always existed, it seems a new cottage industry has sprung up in the last several years. According to the Texas Department of Transportation, trucking is big business in Texas: 1 in 16 Texans are employed by the trucking industry 73% of goods manufactured in Texas are transported by truck 85% of trade between Texas and Mexico is handled by trucks Texas has more interstate mileage than other state (3,200 miles) There are over 66,000 trucking industries in Texas Trucking industry wages exceed $22.5 billion with average salary of $45,000 There are over 185,000 truck drivers employed in Texas But what is it about the trucking industry, specifically, that landed it in the litigation crosshairs? To answer this question, all you have to do is follow the money. While you and I may only have $30,000 in motor vehicle liability insurance, trucking companies often have multi-million-dollar insurance policies. In other words, they have deep pockets. While it makes sense for trucking companies to
Going Nuclear
You’ve heard of nuclear explosions and the nuclear option. Nuclear verdicts? Maybe not. But as the name implies, we should all be wary of them. The widely accepted definition of a nuclear verdict is one that exceeds $10 million. But if that’s the threshold for nuclear, then Texas is quickly gaining a reputation as the home of the ultra-nuclear verdict in trucking litigation. We’ll have more on that in a future blog post. To better understand this, we need a refresher on the elements of damages in a tort action in Texas. For injury to a person or property (a tort action), a plaintiff may recover actual damages and punitive damages. The amount of money that is actually required to make the plaintiff whole constitutes actual damages. This includes economic damages, like the cost of past and future medical bills related to the injury, loss of future wages, and other quantifiable economic losses. It also includes non-economic damages, which are awarded for pain and suffering and similar items not subject to exact quantification. Punitive damages, which are awarded only in extreme circumstances, are meant to serve as a punishment or deterrent for the defendant, whose grossly negligent or intentional behavior
Driving Litigation
The Wall Street Journal recently highlighted a lawsuit issue that has increasingly become a problem in many states, including Texas: litigation against trucking companies. While it is not unusual for plaintiff attorneys to target trucking companies because of the companies’ insurance policies and assets, as the article notes, several factors have led to an increase in these lawsuits in recent years. At least one practice—used by lawyers in Texas and other states to refer potential clients for medical services—may expose the clients to “substantial risk” they may not fully appreciate. In the cases reported by the Journal, plaintiff’s lawyers refer their clients to cooperative healthcare providers who agree to provide medical care on credit, with the understanding that the provider will be paid from any settlement or judgment reached in the patient’s lawsuit against a person who allegedly caused his or her injury. The healthcare providers agree their medical services will not be billed through Medicare, private health insurance or another third-party payor. This allows the providers—who are cooperating with the plaintiff’s lawyers—to charge inflated rates and provide excessive treatments, all in a scheme to increase the damages sought in the plaintiff’s lawsuit. This can exponentially increase the “actual damages”
A Rock and A Hard Place
Texas judges are stuck between a rock and a hard place. The nature of our state’s partisan election system requires judges to raise money to run political campaigns to be elected or re-elected to a seat on the bench. Because judicial campaigns are lower profile than other races on the ballot, few voters know about the judges or are willing to make contributions to their campaigns. Instead, the natural constituency for judicial fundraising is attorneys and law firms. But the idea of judges raising money from lawyers who have appeared or might appear in their courtrooms leaves a bad taste in many Texans’ mouths. By and large, Texas judges are impartial professionals. But even the appearance of this type of conflict can shake Texans’ faith in the fairness of our legal system. Texas passed judicial campaign finance reform in 1995 to help ensure judicial campaigns are conducted fairly and ethically. Prior to these reforms, judges could raise unlimited amounts for their election campaigns. Today, individual and law firm contributions to judicial campaigns are limited and subject to detailed reporting requirements. Even with those regulations in place, Texas law firms continue to shell out big bucks to support judicial campaigns. Over
The Lone Star State is Alright, Alright, Alright
In case you missed it, native Texan and Academy Award winner Matthew McConaughey joined late night talk show host Jimmy Fallon last week for a taping in Austin. Fallon’s first question to McConaughey was, “you could live anywhere in the world if you wanted to. Why do you choose to live in Austin?” In his answer, McConaughey touched on many of the things that make Texas the best place to live and work in the nation, such as our work ethic and diversity. But it’s what he said at 1:10 into his answer that caught our attention. “We do not chase lawsuits. No, we do not chase lawsuits.” We’ve long said that a fair legal system keeps our economy strong and our state exceptional. And we’re barraged with news articles every day of other states whose legal systems are a burden to job creation. Mr. McConaughey, we couldn’t agree more. Keeping abusive lawsuits at bay is one of the things that has made the Lone Star State what it is today. And if you ask us, that’s alright, alright, alright.
Finding a Better Way
Texas is facing a fundamental question: should Texans continue to elect judges, or is it time to move to a different method? Last session, the Texas Legislature created the 15-member Texas Commission on Judicial Selection with the express purpose of answering that question. With last week’s appointments to the commission by the governor, lieutenant governor and speaker of the House, the state is poised to take a close look at how we fill seats on our judiciary. The 12 appointed commissioners join Wallace B. Jefferson, Thomas R. Phillips and Lynne Liberato, who were appointed by the Texas Supreme Court, Texas Court of Criminal Appeals and State Bar of Texas. To put things into perspective as the commission begins to undertake its work, we thought it might be helpful to look at some numbers. Considering the state as a whole, Texans elect (or help elect) 39 federal officials—the president, two U.S. senators, and 36 members of Congress. Of course, not all of these offices are on the ballot each election year. At the same time, Texans elect 204 state executive and legislative branch officers—the governor, lieutenant governor, 31 state senators, 150 state House members, and others. But then there is the