The Problem of Tort Reform: Federalism and the Regulation of Lawyers
Gasaway, Robert R., Harvard Journal of Law & Public Policy
Over the past decade, the term "tort reform" has become a popular phrase among corporations, politicians, and lawyers alike. Corporations have seen tort reform as a means of controlling the massive liabilities to which they have been exposed during recent years, as certain lawyers have become more focused on amassing political influence and certain state court systems have allowed spiraling damage awards against corporate defendants. Politicians have frequently invoked the term, prominently so in the most recent Presidential election, raising hopes that executive and legislative action soon might be taken to cure what ails our nation's civil justice system. And attorneys of all stripes have often invoked the term as a label for a wide variety of legal reforms that they would happen to prefer.
To date, this extensive talk of tort reform has produced limited results. Interested parties have been quick to cite the flaws of the current tort litigation system, but efforts to correct those flaws have been largely unsuccessful. Legislative solutions to existing problems have been hard to come by, and even those measures that have been enacted have met with a host of post-enactment obstacles to success, including invalidation by state supreme courts.(1) While the term tort reform is frequently bandied about, there seems to be a lack of any consensus on what the term means, let alone what needs to be done under its banner.
What is clear is that our civil justice system faces dramatic problems of a kind unparalleled in its more than two centuries of existence. There has been a dramatic increase in the number of suits and the magnitude of liability payouts. (2) In addition to the direct losses from liability payouts, the tort system imposes costs by increasing the prices of consumer goods, discouraging technological innovation, and decreasing the supply of reasonably priced insurance. (3) One scholar has estimated that tort liability costs American individuals, businesses, municipalities, and other government bodies at least eighty billion dollars a year. (4)
Against this backdrop, the time is ripe to step back and attempt to ascertain a larger perspective on some of the causes of the current tort crisis. This Essay addresses two such factors, selected because they are often not the first that come to mind: federalism and the ethical regulations governing attorneys. Both topics, while often not considered under the rubric of "tort reform," have profoundly shaped the civil justice system as we know it today. How we approach both issues will be of great significance in future efforts to reform civil litigation and improve the administration of justice in the United States.
I. FEDERALISM, PREEMPTION, AND THE NEED TO PREVENT STATE USURPATION OF THE FEDERAL COMMERCE POWER
Perhaps no area of law has been the subject of as much attention and debate during the tenure of the Rehnquist Court as has federalism. Over the past seven years, the Supreme Court has effected wholesale changes in the way the courts view the prerogative of the States to legislate in those matters that are of local concern. Most notably, the Court has breathed life back into the Commerce Clause, ruling that neither the possession of guns near schools, (5) nor the availability of a civil remedy for gender-motivated violence, (6) were proper topics for Congressional, as opposed to state, regulation. Just as important, in its interpretation of the Eleventh Amendment and the concept of sovereign immunity, the Court clarified the circumstances in which the federal government can permit States to be haled into federal (or state) court. (7)
This renewed focus on the importance of States' prerogatives is for the good. For too long, the bedrock principle that our national government is one of enumerated powers, and the related precept that the States are distinct sovereign entities entitled to regulate that which is not delegated to the federal government, had been lost in legal and political dialogue. …