1. Pay for Performance
Reverse the economics of class-action settlements. Plaintiffs' lawyers should be paid after victims collect their money -- not before. This would have two benefits. First, it would make them more aggressive about getting the word out to class members. Second, and more important, it would filter out a high percentage of the system's silliest claims. One of the main reasons people don't bother to collect class-action benefits is that they don't perceive any injury in the first place. And if people don't think they've been hurt, it's often a strong sign that the case isn't worth bringing.
2. Penalties That Sting
Give judges stronger tools to punish renegade lawyers. Before 1993, it was mandatory for judges to impose sanctions such as public censures, fines, or orders to pay for the other side's legal expenses on lawyers who filed frivolous lawsuits. Then the Civil Rules Advisory Committee (CRAC), an obscure branch of the courts,
3. Curb the Duplication
Corporate America's preferred solution to the duplication problem is so-called preemption -- getting Congress to declare that agency approval of, say, a particular drug blocks subsequent private litigation. That would be fine if agencies had perfect foresight. But as the Vioxx episode proves, they don't. "When you preempt, you make a decision about future cases for all time," says D. Bruce Hoffman, formerly deputy director of the Bureau of Competition at the Federal Trade Commission and now in private practice. Winning preemption "should be a very steep hill [for companies] to climb."
A better solution is a package of more modest reforms. The first one would be eliminating punitive damages for injuries caused by products that have been approved by regulators. The long and involved process of winning over the FDA or NHTSA should, at a minimum, insulate managers from claims that they deserve huge financial penalties for wantonly disregarding the public good (unless executives lied to bureaucrats).
4. Exiting the Tort System
Long and complex issue examining European style "health courts" but summing up thus...
Before reengineering American justice, we should get more information about the problem and experiment with some modest steps. One would be giving juries considering emotional damages guidance about what other juries have done in similar cases. Studies have shown that this would cut down on the unpredictable verdicts that torment doctors and insurers. Another step: publicizing data on how often doctors have been sued for malpractice or disciplined by their states' medical boards.
