The end of tort reform?

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Published: January 11,2010

Tags: Supreme Court, tort reform

Case before Supreme Court challenges Mississippi’s 2004 law

A case that could repeal 2004 tort reform law capping non-economic damage awards at $1 million is pending before the state Supreme Court, and more than 50 parties have filed briefs supporting or objecting to the appeal.

Mississippi’s tort reform laws, some of the most comprehensive in the nation, put an end to frivolous lawsuits and cleaned up the state’s image as a lawsuit “Mecca” offering outrageous monetary awards. The tort reform measures resulted in lower malpractice insurance premiums for doctors, more affordable health care and an attractive business climate. Non-economic damage awards include compensation for pain, suffering and emotional distress.

Double Quick Inc. v. Ronnie Lee Lymas challenges the constitutionality of the $1 million non-economic damage caps. In 2007, appellant Ronnie Lee Lymas was shot while leaving a Double Quick convenience store in Belzoni. Lymas sued Double Quick for negligence and inadequate security, and a Humphreys County jury returned a verdict for the exact amount requested by the plaintiff’s counsel: $4.1 million.

The judge however, lowered the award to $1.6 million to comply with the non-economic damages cap. The bulk of the original award was for non-economic damages. Actual damages included medical bills and loss of wages.

Lymas has appealed the decision to the state Supreme Court, asking that the cap be declared unconstitutional, according to both U.S. and Mississippi laws.

Briefs are still being filed in the case, and the briefing schedule is not final. By law, after the last brief is filed, the Court has 270 days to rule in the case. A decision could likely come this year.

In 2002, the Legislature passed two bills that capped non-economic damage awards in medical malpractices cases and also addressed punitive caps, elimination of joint liability for non-economic damages, some venue revisions, hedonic (loss of enjoyment of life) damages, some premises owner protections and some innocent seller provisions. Gov. Haley Barbour approved the bills.

In 2004, the Legislature passed a bill known as the Tort Reform Law that places caps on non-economic damages in non-medical liability civil suits at $1 million. Barbour approved the law in June of that year.

From 1994 to 2001, average jury awards in medical malpractice cases rose from $1.14 million to $3.9 million nationwide. Mississippi was then one of a few states that did not cap verdicts on noneconomic damages and became a hotbed for litigation.

Dr. Randy Easterling, president of the Mississippi State Medical Association, said that if the caps are repealed “our state would revert back to business and medical chaos” that it was in prior to 2004. The Tort Reform Law has “done wonders to keep doctors in the state taking care of Mississippians,” he said.

Easterling said the state’s litigious climate prior to the tort reform laws made it almost impossible for doctors to stay in practice due to the rising costs of medical malpractice insurance. Doctors such as OBGYNs, emergency room physicians, orthopaedic specialists and neurosurgeons found it particularly difficult to practice, he said.

“Ramifications of this touched every Mississippian and touched every corner of the economy,” Easterling said. Auto accident victims couldn’t find neurosurgeons, women in less populated areas had to drive more than an hour to Jackson to have a baby, and low-income students couldn’t get free physicals to play football because doctors couldn’t afford the liability, Easterling said. Many doctors ceased to perform risky or invasive procedures or left the state.

After the Tort Reform Law was enacted, medical insurers quickly returned to Mississippi, and companies began opening businesses in the state.

More than 50 organizations and businesses – including manufacturers, real estate professionals, bankers, medical associations, truckers, builders and contractors and poultry, propane gas and forestry associations — have joined in briefs as amici curiae, or friends of the court, urging the Court to uphold the current law.

Barbour also filed a brief supporting the caps. “Judicial repeal of the non-economic damage caps or other tort reform measures would destroy the positive progress made in recent years, crush current economic development and drive away desperately needed jobs in one of the gravest economic times in this nation’s history,” Barbour said in his brief.

The non-profit Mississippians for Economic Progress is one of many entities that has joined in submitting its support for upholding the constitutionality of the Tort Reform Law to the Court.

“Around the country, most state courts who have considered the constitutionality of caps have upheld them. Some examples include Ohio, Nebraska, West Virginia and Alaska. More than two times the number of supreme courts have upheld caps as constitutional than not,” said Brian Perry, executive director of Mississippians for Economic Progress.

“The damage caps make for good job policy for Mississippi, represent the will of the people as expressed through the Legislature and comport with Mississippi’s constitution. We hope the Court will agree,” Perry said.

Groups supporting Lymas’ appeal, such as the Magnolia Bar Association, argue that a cap on non-economic damages is a violation of the right to a jury trial as well as a violation of the separation of powers doctrine. The jury, and not the court or the Legislature, should be able to decide the amount of damages awarded to a litigant, said the Magnolia Bar in a brief submitted to the Court.

Those objecting to the appeal say that if the Court strikes down the cap, it would be violating separation of powers by acting as a “super Legislature.”

Another issue in the Lymas case is premises law. A rule has been proposed that would make business owners liable only for criminal acts that have a relationship to the business or its owner.

The Magnolia Bar objects to the new rule, arguing that the law currently requires premises owners to take reasonable steps to make their premises safe for customers, owners are in the best position to control the risk of harm and owners have a special duty to customers they invite on their property.

Law enforcement is not the best entity to be held responsible for customers since a police officer cannot remove a person from a business without being asked to do so by the business owner unless the person is committing an illegal act, the Magnolia Bar said in its brief.

Entities asking the Court to adopt the new premises law argue that making owners responsible for third-party criminal acts occurring on their premises makes the “virtual insurers of their customers’ safety.”

The Magnolia Bar said that argument is not valid because a plaintiff arguing that a business owner failed in his duty to protect him from a third-party claim could not win a lawsuit by arguing that “crime is everywhere.” A premises owner must have actual or constructive knowledge of an assailant’s violent nature, or the premises must be shown to have an atmosphere of violence for an owner to be held liable for a third-party criminal act, the Magnolia Bar said.

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