If you've ever had the feeling that some big corporations don't care if you live or die, you're right -- and there's plenty of evidence to prove it.

With federal enforcement of health and safety laws in a downward spiral, the courts have been one of the few places people could defend themselves or seek restitution. Yet the Bush administration is out to change that by limiting lawsuits intended to punish corporate endangerment of workers and the public in the name of halting "junk lawsuits."

After decades of concealing and lying about dangers of their products with near- impunity, giant tobacco and asbestos corporations have faced consequences in recent years via the civil lawsuit justice system.

Damage awards in civil suits exist not only to compensate the affected people and their families, but also to punish companies with consequences that can serve as an effective deterrent.

Federal law soon will prevent class-action lawsuits (where a single lawsuit represents hundreds or even thousands of harmed people) from being brought into state courts unless at least two-thirds of plaintiffs are from a single state. Instead these suits will be brought before traditionally less-receptive federal court judges.

The law may ensure that some such suits will never be heard, thanks to a 1985 Supreme Court ruling that federal courts cannot hear class actions in which laws of affected states have "material" differences.

Yet that bill was just one front that regressive forces have presented in their drive to limit citizen ability to hold corporations accountable. Perhaps the most important battle will be over the corporate-backed attempt to limit non-economic damages -- intended to deter egregious and outrageous conduct as well as compensate victims -- to $250,000.

The Ford Pinto scandal of the 1970s demonstrates particularly well why weakening corporate liability is downright dangerous. Ford executives possessed pre-production crash test results demonstrating the car's gas tank could explode in relatively minor rear-end collisions. Internal memos revealed that Ford's managers decided settling civil lawsuits brought by victims' families would be cheaper than spending $11 per car to fix the problem. They began selling Pintos in 1971 and allowed dozens of people to die each year.

Then, in 1978, a jury awarded $124 million in punitive damages to a victim who was severely burned (equaling about six weeks profits for the company). Company executives quickly crunched new numbers which told them to fix the tanks (though the penalty wasn't strong enough to prevent a remarkably similar scenario recently with rollover-prone Ford Explorers).

Other companies took similar corrective actions after lawsuits forced them to pay punitive damages for willfully endangering customers or the public. According to a 1987 study by the corporate-funded Conference Board, product liability has "significantly affected management decision making.products have become safer."

Now "tort reform" advocates want to go back to the bad old days. Senate majority leader Bill Frist talks about "predatory trial lawyers," yet he works to grant partial immunity to corporations which knowingly produce products that kill or maim.

To appreciate how little a $250,000 penalty would impact the decisions of the largest corporations, consider that Wal-Mart would sacrifice about 35 seconds worth of revenue to meet such a "punishment."

One shouldn't assume, if Bush's agenda prevails, judges and prosecutors would be drumming their fingers in empty courtrooms. According to a Public Citizen study, corporations are160 times as likely to sue as an average person and 69 percent more likely than individual tort plaintiffs to be sanctioned for filing frivolous claims. Of course Bush's tort reform proposals don't address "runaway lawsuits" by corporations.

Yes, the system could stand some improvements. Allowing plaintiffs and their attorneys to keep the bulk of the punitive damages serves no social purpose and can lead to corruption. Instead, a substantial portion of punitive damage awards could go toward public health and safety advancement or other causes.

But if corporate lobbying groups have their way, you'll have little recourse should some company decide releasing toxic chemicals in your neighborhood makes good business sense, but courts will lower the hammer if your kids download songs from the Internet without paying.

Punitive damages go back a long way -- over 4000 years to the Babylonian Code of Hammurabi, the earliest known legal code. They have been incorporated in the laws of great civilizations since, from the Hebrews to the Romans to English common law and finally the United States .

Attempting to roll them back isn't conservative; it is a radical move that threatens a basic principle of justice which has been part of civilized society since its very beginning.

Jeffrey Kaplan is active in our San Francisco Bay Area Chapter. This article was first published in the spring 2005 issue of our newsletter The Liberator. Request a free sample.

© 2005 ReclaimDemocracy.org

 

More features on Corporate Accountability

Go to Home Page