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Mississippians for Economic Progress zeros in on anti-business legal climate

Economic Progress in Two Words: Tort Reform

JACKSON — On the steps of the Hinds County Courthouse the morning of Dec. 14, the leaders of a newly organized group, Mississippians for Economic Progress, were unveiling their singular agenda — tort reform — when the sun broke through the clouds.

“We considered it a good sign,” said Lex Taylor, Mississippians for Economic Progress (MFEP) chairman and president of the 800-employee Taylor Machine Works in Louisville.

Frustrated with the current legal climate in Mississippi, considered by many decision makers across the nation as a “lawsuit Mecca” because of hefty jury awards in certain counties, 40 associations, health care providers and others joined MFEP to lobby for tort reform.

“It’s an unprecedented movement,” said David Allen, vice president of MFEP and president of Mississippi Blood Services. “It’s gaining momentum every day. This is just a small swell in the water right now. It’s going to turn into a tidal wave as more people learn about it.”

Ron Aldridge, state director of the National Federation of Independent Business, said the reception from trade associations and businesspeople across the state has been “extremely good.”

“We’ve always relied generally on two or three people to take the lead, and now it’s obvious that every group is ready to take a lead in their respective areas of the state,” he said. “Some of the public sector are looking to join in because of what liability insurance costs — for cities, counties and school boards, for example — are doing to taxpayers. There’s never been a formal coalition formed like this, even when the workers’ compensation issue came up 10 years ago. That lets you know the depth of this issue.”

Advocates for tort reform point to numerous national publications and television reports that have chronicled Mississippi’s out-of-control verdicts. They say the state has gained a reputation that discourages economic development prospects, insurance companies, medical professionals and business people from doing business in the state.

“In August, our dilemma made it on the front page above the fold in The New York Times talking about our legal climate in Mississippi,” said Jerry McBride, president of the Mississippi Manufacturers Association. “Our primary purpose is to maintain a favorable business climate in the state so that businesses can stay in business, hire Mississippians and have jobs.”

Lance Stevens, past president of the Mississippi Trial Lawyers Association, attended the press conference and said, “Of course, we have great angst over the fact that our court system is being misrepresented in the local and national media. If you look at any surveys from the Mississippi Economic Council of their own members or national surveys where companies talk about what they look for when they are deciding where to locate, civil justice is not even a blip on the radar screen. They’re looking for quality education in a labor pool, infrastructure and aesthetics. That’s why Atlanta got so many great deals.”

The information sheet that MFEP members passed out at the press conference began with the question: “What is the problem?”

“Mississippi’s court system is broken and has become unfair,” it read. “The current imbalance in the court system is attracting trial lawyers from other states who are taking advantage of Mississippi’s laws and rules to win huge verdicts. This is scaring away investment, driving up the cost of goods and services, and forcing companies out of business.”

Last year, 8,071 jobs were lost in Mississippi from businesses that shut down. The year before, about 3,000 jobs were lost, said Allen.

“We don’t have a clue as to how many businesses have downsized because of the economy,” he said. “States around us — Texas, Louisiana and Alabama — have had significant tort reform. We stand out like a sore thumb.”

Stevens said tort reform hasn’t made any difference in landing new projects.

“When Nissan was making their decision about where to locate, they compared two states — Mississippi and Alabama,” he said. “I don’t care what you say, when you look over near Canton, they’re building a Nissan plant, the largest industrial project Mississippi has ever had.”

Before 1995, there was no jury verdict in Mississippi larger than $9 million. Since then, 24 verdicts have exceeded $9 million. Seven verdicts have surpassed $100 million. From 1993 to 1999, Jury Verdict Research ranked Mississippi No. 4 in million dollar judgments, the MFEP statement read.

“For example, consider the pharmacist in Fayette County who always gets hit with lawsuits,” Allen said. “She’s had nothing to do with any of this, and that scenario has been replicated across the state. Another example: the Mississippi State Medical Association recently ran an ad with a doctor on one side of a patient and lawyers on another with the tag line: ‘Who do you trust your medical health to?’ We’d like to educate people about the consequences of our current legal environment so they’ll understand what’s going on with our civil justice system in Mississippi.”

Alex Alston, chief litigator at Brunini, Grantham, Grower & Hewes, PLLC, in Jackson, said, “Tort reform is easy to say, but sometimes when you go to tinkering with something that works, you get into trouble. I know some people are very concerned about large verdicts in several counties and the Mississippi Supreme Court is working on that. But in some cases, the plaintiff is entitled to a large break because the defendant has done some outrageous thing. In many, many cases, the plaintiffs get zero. One has to be careful when they venture into ‘tort reform.’”

MFEP will coordinate efforts to pass meaningful tort reform legislation and will work to ensure fair courts by encouraging business groups’ and individuals’ involvement in judicial elections, Taylor said, adding that the group doesn’t have specific legislation drafted yet, and he isn’t sure which legislators might introduce it.

“Definitely conservative ones,” he said.

The group’s agenda calls for:

• Ensuring that individuals, companies and firms who wrongfully harm people are held accountable for truly negligent actions;

• Changing the rules that allow a personal injury lawyer to shop for a friendly jury and then combine all clients into one case;

• Sensibly relating punitive damages to the actual damages caused;

• Ensuring that a business owner is not liable for defects in a product

line that he only sells without any alteration;

• Putting controls on items such as awards for emotional distress; and

• Focusing on the election of balanced appellate judges.

Stevens said he understood the agenda, but he didn’t hear specific proposals.

“I’m for economic progress, too,” he said. “They want to create this emotional undercurrent without stating any of their proposals because when people examine their proposals, they are going to be angry.”

Stevens called MFEP a replacement for the now defunct group, Stop Lawsuit Abuse in Mississippi (SLAM).

“Insurance companies are losing money in the stock market and they want to make up the losses on the backs of innocent, injured Mississippians,” Stevens said. “They did the exact same thing in the early 1990s when the market soured, got their reforms and did not reduce rates at all.”

Stevens said health care professionals, insurance executives and big corporations were trying to undermine Mississippi’s judicial system by using it for an excuse for their b
ad busin
ess decisions.

MFEP responded, “Mississippi employers live in fear of being sued. Liability protection is becoming more and more difficult to acquire in Mississippi. Mississippi consumers and employers are seeing rapid cost increases because of runaway litigation. Insurance companies are leaving the state. Just as a rash of robberies drives residents from a neighborhood, a rash of staggering lawsuits dr

About Lynne W. Jeter

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