The Rule of Lawyers
Walter K. Olson

FUTURECASTS online magazine
Vol. 7, No. 8, 8/1/05.


Judge-made law:



  Judicial activism in the post WW-II period has resulted in a vast increase in the powers exercised by the courts and the bar. In "The Rule of Lawyers: How the New Litigation Elite Threatens America's Rule of Law," Walter K. Olson sets forth how tort laws and procedures in state courts have been expanded to offer new and more accessible remedies for a variety of wrongs.

Judicial activism not only created entirely new causes of action - such as product liability laws - but it has also materially reduced the safeguards against abuse of existing laws and procedures, and has neglected to provide such safeguards against abuse of the new laws and procedures.

  Plaintiffs lawyers have rushed to take advantage of these new powers, using them against a variety of defendants that had previously been beyond their reach. Inevitably, there has been both use and abuse of these powers. Judicial activism not only created entirely new causes of action - such as product liability laws - but it has also materially reduced the safeguards against abuse of existing laws and procedures, and has neglected to provide such safeguards against abuse of the new laws and procedures.
  In short, the courts have materially changed the law of the land without benefit of new legislation and even in the face of legislative rejections of such laws. State legislatures had actively considered and rejected product liability laws for decades before the courts decided to enact them by judicial fiat. Statutes of limitations were swept aside, allowing claims based on decades-old transactions to be pressed against successor business entities whose current shareholders and managers had nothing to do with the transactions.
  Typical of judge made law, the new remedies were created without prior notice to potential defendants and have been applied retroactively, thus escaping the Constitutional bar against ex post facto statutory laws. The noxious impacts of such judicial activism are highlighted in this book.

Mass torts:

  An explosion of mass tort litigation - the combining of vast numbers of claims in class actions against product manufacturers - has resulted in vast recoveries.

Attorneys worked loopholes in the Federal court diversity jurisdiction procedures to keep these vast cases in friendly local state courts.

Federal courts retain many of the requirements for class action certification that prevent abuses. However, attorneys worked loopholes in the Federal court diversity jurisdiction procedures to keep these vast cases in local state courts before friendly local judges and accommodative state appellate courts. The attorneys have reaped millions and even billions in fees, even though in many cases the ostensible plaintiffs didn't even know a suit was being pursued in their names and received little or no actual recovery.

  The Class Action Fairness Act, signed February 18, 2005, 28 USC §§1711-1715, is designed to close most of the jurisdictional loopholes that prevented removal of these actions to Federal district courts. By bringing these cases into federal courts, results should be more uniform, oversight of class action settlements should be more rational, outsized attorneys fees should be constrained, and abusive forum shopping practices should be materially reduced. Issues of nationwide import should no longer be subject to resolution by local state court judges. However, the bill is not retroactive, and does not affect ongoing litigation.
  Federal district courts now have jurisdiction over any civil action in which the amount in controversy exceeds $5 million and in which there are plaintiffs and defendants from different states. Any defendant may seek removal. The one year limitation for removals under 28 USC §1453 has been eliminated, thus preventing class plaintiffs from greatly increasing their claims in state courts when removal is no longer permitted.
  There is one mandatory and one discretionary exception for federal district court jurisdiction.

  • If a major defendant and more than two thirds of the plaintiffs are from the state in which the original suit was filed, the action is to remain in the state court.

  • If a major defendant and more than one third but less than two thirds of the plaintiffs are from the state in which the original suit was filed, the district court has discretion to decline jurisdiction.

    There are three mass tort exceptions where the district courts will decline jurisdiction:

  • Where the mass torts arise from a single event in the state where the action was filed;

  • or when the claims are joined by motion of the defendants;

  • or where the claims are asserted on behalf of the general public pursuant to a state statute.

  There are also provisions addressing abuses in settlement practices and the setting of attorneys' fees. See, "The fourth branch of government," below.

The Naderite agenda called for charging ALL businesses for "air, water, noise, other environmental pollution."


Durability beyond warranty periods could be required, manufacturers could be made liable for accidents associated with their products, and drug manufacturers could be made liable for all adverse reactions and overdoses and side effects.

  The academic ferment of the 1960s and 1970s spawned Naderite and similar left wing ideological rationales for the mass tort type of judicial activism, Olson explains. The list of wrongs that these groups thought that the courts should charge against businesses was endless. The tobacco and liquor industries were obvious targets, but ALL businesses could be charged for "air, water, noise, other environmental pollution." Sugary and fatty foods could be charged for the ill health effects of their products. Durability beyond warranty periods could be required, manufacturers could be made liable for accidents associated with their products, and drug manufacturers could be made liable for all adverse reactions and overdoses and side effects.
  If this Naderite wish list of liability were fulfilled, more than half the nation's GDP would be rerouted through lawyer offices, Olson points out. Recognizing the disastrous economic consequences, the Naderites conceded  that their ambitious litigation agenda should be phased in "over a reasonable period of time." Olson contends that this is exactly what is happening, as the mass tort lawyers move from targeting asbestos and tobacco manufacturers to gun and liquor and fatty foods producers.

Plaintiffs attorneys actively look for defendants to sue rather than waiting for plaintiffs to come to them with complaints.

  Litigiousness has long been a feature of U.S. law. Olson points to a number of factors.

  • Losers do not have to pay for most of the litigation costs of the winners as is required in most other countries. This reduces the pressure to "fold their hands on weak positions."

  • Contingency fee arrangements encourage an entrepreneurial attitude among plaintiffs attorneys. They actively look for defendants to sue rather than waiting for plaintiffs to come to them with complaints.

  • Damages are set irrationally by often sympathetic juries rather than by judges who would be more concerned with uniformity of results in similar cases.

  • There is no penalty for making claims that are wildly beyond anything that could reasonably be expected to be won.

  • Juries can also impose punitive damages in amounts that are unlimited and unguided by law.

  "Punitive damages are handed down in the absence of a range of due-process protections enjoyed by defendants in criminal cases and can be levied repeatedly by juries around the country against the same defendant for the same conduct."

"'Long-arm' jurisdiction made it easier for litigants to shop around for a  court and juries convenient to them or hostile to their opponent. And, symbolically, old ideas of legal ethics were fast being overturned."

  Nevertheless, there were many safeguards against the abuse of legal process. Litigation was viewed as a destructive and last resort - something to be avoided for a wide variety of reasons.

  "While no one imagined that lawsuits could somehow be done away with entirely, our legal tradition still joined with that of every great nation's in trying to discourage lawyers from promoting them or puffing them up for their own profit. A whole set of ethical rules curbed lawyers from 'stirring up' litigation by advertising, direct solicitation of clients, or other means. Once a case was in hand, lawyers were not supposed to avail themselves of any and all lawful means to win, but were to think of themselves as quasipublic 'officers of the court.' Procedural rules assigned some of the inevitable costs of litigation to those who initiated it and not to its targets alone. Selection of forums in which to file suit was limited by various geographic rules, which had the effect of impeding the chances of 'forum shopping,' the practice of selecting a venue at which defendants would find themselves at some form of disadvantage."

  Many of these "barriers to litigation" have in recent years been knocked down, Olson points out. It is now "easier to sue and harder to get a suit dismissed."

  "'Notice pleading' invited lawyers to sue first and then begin rummaging around to see whether they had a case. Liberalization of pretrial discovery in the 1970s made it easier for lawyers to go on so-called fishing expeditions, hoping that the contents of their opponents' filing cabinets would contain something, anything, justifying their suit. 'Long-arm' jurisdiction made it easier for litigants to shop around for a court and juries convenient to them or hostile to their opponent. And, symbolically, old ideas of legal ethics were fast being overturned."

  In 1975, a sharply divided U.S. Supreme Court decided that litigation should be encouraged, not discouraged. The five member majority had come to believe in the advantages of permitting "more access to justice." It ruled that lawyers have a Constitutional right to advertise.

  "By the late 1970s, the mood and attitude in law schools had turned around, with litigation now widely seen as an engine of social progress. Lawyers who made suing a first resort could now be admired as productive and entrepreneurial. In 1975, one of the most widely quoted of the new legal ethicists [Monroe Freedman] could write of a 'professional responsibility to chase ambulances.'"

  Product liability law blossomed as a judge-made remedy after about 1955.

  "Starting from the premise that manufacturers should be made to pay more often for accidents resulting from the use of their products, courts created new duties to warn, struck down freely consented to waivers of liability as invalid, did away with accident victims' own contributory negligence as a bar to suit, and narrowed or abolished defenses based on the concept of 'assumption of risk' -- the idea that people knowingly expose themselves to many hazards in life, from the scalding nature of hot coffee that might spill in your lap to the risk of being hit by a flying pebble from a lawn mower. They began to find 'defectiveness,' not just when a product was manufactured in a way that departed from its intended design - - -, but also when a product's design itself was considered to fall short of what a court decided would be socially beneficial."

  Negligence was no longer a requirement for liability. Manufacturers would be expected to actively "reduce the hazards of life and health inherent in defective products."

  Olson does not deign to discuss the beneficial results of this new product liability remedy. These benefits are now all around us in sturdier and safer ladders, safety features in mechanized lawn and household tools and appliances, and a vast array of safety features in automobiles, that have prevented innumerable accidents and saved many lives. Of course, we have all lost the opportunity to buy cheaper goods that pose higher risks - but these extra costs have made almost no dent in the economy's robust rate of productivity increase.

Now, however, it became acceptable for lawyers to more freely initiate litigation - to act "as a sort of private attorney general." The aim was to increase the ability of courts to right wrongs and deter business misconduct.

  The availability of class action procedures was greatly expanded by removing some of the procedural limitations that had provided protection against abuse. There had been requirements for notification of class members - transmission of awards that might be gained - and certification by a judge that the class action was "likely to have merit." Now, however, it became acceptable for lawyers to more freely initiate litigation - to act "as a sort of private attorney general." The aim was to increase the ability of courts to right wrongs and deter business misconduct.
  Suddenly, it was enough to notify class members at the end of the case - not even personally, but merely by putting advertisements in some newspapers. Distribution of awards could be restricted to only those class members who affirmatively applied for them. Of course, legal fees could be vast even if class members actually gained little. Indeed, "it might make sense to give out money to an organization representing their interests, such as a consumer group."

  "The U.S. Supreme Court did away with the federal rule requiring early certification of likely merit. 'Opt-in' models of the class action, in which class members had to make a conscious decision to join, gave way to more expansive 'opt out' models, under which class members could automatically be counted as litigants unless they specifically asked not to be. In larger classes, where only a small sum was at stake per member, it was typical for most class members to take no action one way or the other, which meant that the lucky lawyer designated to manage the action might acquire a huge book of nominal 'clients' who were in no position to oversee the manner in which he handled their interests."

  Personal injury claims had never been considered suitable for class action status because, even if the existence of some wrongful conduct was the same in each case, the amount of damages was always unique for each plaintiff, and particular defenses such as contributory negligence or assumption of risk had to be individually litigated. Collective handling also eliminated individual control of litigation - a particularly important factor in personal injury cases.
  Personal injury claims were thus deemed unsuitable for class action procedures because they failed to meet "typicality" and "manageability" standards. Passive financial injury cases were more typical of class actions.
  However, the author notes, these requirements have since been brushed aside.

 "At least since the 1970s, the fastest growing share of the docket has come to consist of mass torts in which lawyers bring thousands, even tens of thousands of claims from all parts of the country alleging injury from a product design or a business practice. Today, such cases are usually pursued by means of 'pattern' or 'cookie-cutter' techniques, and are often disposed of through settlement in large batches. Sometimes the product or practice being sued over is standard among businesses in the field, and the mass tort then takes the form of industrywide litigation, in which all the companies in the field are taken to court."

  Most federal courts do not certify large, multistate class actions because the substantive state laws that govern the individual claims differ, making it difficult to resolve all issues in one combined trial.
  Many ambiguities thus remain under the 2005 Class Action Fairness Act - especially with respect to "mass actions" of consolidated individual claims where all must exceed the $75,000 claim threshold to get into federal court. Just including one claim for less that $75,000 could keep such actions in state court.

  These floods of litigation then led the courts to consolidate even individual suits - often against the wishes of one or all parties. Olson explains how plane crashes and building fires, as well as asbestos, Dalkon Shield and DES - diethylstilbestrol - litigation resulted in expansive use of class action procedures for personal injuries.


  Asbestos litigation was the first of the product liability mass tort cases. This sudden change in the law caught manufacturers, users and insurers by surprise.

  A host of businesses and their insurers were driven into bankruptcy for the sale of products considered totally lawful before the retroactive application of the new product liability law. Among the major users of asbestos had been government contractors who were required by government specifications to install asbestos insulation in warships during WW-II. However, the government was protected from suit by sovereign immunity. The author notes that, of the hundreds of billions of dollars extracted from the economy, considerably more than half was eaten up by lawyers fees and other litigation expenses.

  "Most of the early asbestos cases were filed by workers who were seriously or even fatally ill, but the caseload soon shifted toward the worried-but-well, and continued to do so to the point that by the end of the century the great majority of cases, hundreds of thousands of them, were being filed by workers who were comparatively unimpaired but were presented by their lawyers as greatly fearful of contracting future illness. And the rules of asbestos litigation were formulated in such a way that defendants wound up paying very large sums of money collectively to these uninjured claimants."

  There were procedural abuses as well. Any business even peripherally associated with asbestos became subject to vastly expensive litigation, and plaintiffs attorneys went forum shopping for favorable jurisdictions and judges.
  Olson explains how trial lawyers worked procedural loopholes to keep class and mass tort actions in friendly local courts in friendly states and prevented their removal to federal courts. The abuses of process and procedure are amply demonstrated by the author.

  "Wide-open venue laws often provided that cases from other cities and states could then be imported to the favorable jurisdiction, so that before long thousands and tens of thousands of cases might be pending in one of their favored courts in some remote part of the country, though only a handful of the cases may have arisen locally."

  These factors gave the plaintiffs attorneys vast leverage in settlement negotiations - with all defendants. Blatant strong-arm litigation tactics constituted abuse of court procedure for extortionate purposes. When favorable forums in Alabama and Florida were shut down by changes in the judges in the state supreme courts, the trial lawyers simply moved the scene of action for new suits to Mississippi.
  Many state legislatures have succeeded in passing meaningful tort reform legislation. However, the trial lawyers have often gotten the state supreme courts to rule such efforts in violation of provisions in the state constitutions, thus taking tort reform completely out of legislative control.

Breast implants:









  Breast implants, according to Olson, are a victim of claims that were "spurious from start to finish."

"Lawyers and their allies skillfully stimulated and kept going a baseless public panic to the effect that silicone breast implants were causing an epidemic of autoimmune disease in American women. In due time, studies by leading medical institutions proceeded to set the concerns to rest. By that point, however, lawyers had succeeded in recruiting hundreds of thousands of claimants, soon driving the leading producer of silicone compounds, Midland, Michigan-based Dow Corning, into bankruptcy, and even after the scientific basis of the claims was refuted, obtaining an overall settlement package valued at $7 billion, including a couple of billion in legal fees."

  Breast implants and a wide variety of other medical devices are implanted for therapeutic or cosmetic purposes in millions of patients. Inevitably, many of these patients develop other ailments.
  Scientific epidemiological studies found that affliction rates were no greater among those using implants and similar people in the general public. The trial lawyers contended otherwise, and launched a massive campaign of litigation and adverse publicity that drove major producers out of the market and even into bankruptcy. Shortages of essential devices became so extreme that Congress was ultimately forced to enact the 1998 Biomaterials Access Assurance Act providing some protections for suppliers of the raw materials used in medical implant devices.
  The diseases included a wide variety of immune and endocrine system problems and vague general maladies the causes of which remain unknown to medical science. However, the trial lawyers were in no doubt as to the causes. They had no trouble finding and hiring a variety of "experts" to testify as to the likely connection between the implants and the illnesses. The dubious nature of the studies and experience upon which this expert testimony was based did not slow the lawyers down, and the flood of hundreds of thousands of lawsuits forced many businesses to settle.
  The researchers and research institutions involved in scientific epidemiological studies that demonstrated no observable connections between the ailments and the implants were harshly  criticized and harassed by the trial lawyers and their supporting claque, including the Naderite Public Citizen's Health Research Group. Nader and the offshoot Naderite groups formed by his followers receive considerable financial support from the  plaintiffs bar and in turn cooperate in the publicity campaigns against corporate defendants.
  Ultimately, the Mayo Clinic and other highly reputable research institutions provided evidence that even the sensationalist media couldn't  ignore, and the tide of litigation ebbed. However, immense financial damage had been caused, the trial lawyers had reaped millions in fees, and breast implants and other medical implant devices had been pulled off the market.
  The U.S. Supreme Court has since set a higher standard for expert proof in these kinds of cases. Clinical experience is no longer sufficient in the federal courts. Now, expert testimony must be based on scientific proof.

  Olson's presentation of the abuses of judicial activism with respect to mass tort litigation is right on the mark - but this issue is not without another compelling side to it.
  Chemicals are now innocent until proven guilty
- and the burden of proof required is a scientific certainty. A man can be executed on evidence that would be insufficient to condemn a chemical.
  Health care professionals use many tools provided by medical science, but the delivery of health care remains essentially a clinical art - not a science. Our lives depend on the clinical evidence available to our doctors - but clinical evidence is no longer sufficient to support expert testimony in court in these cases.
  It is generally impossible to scientifically determine the harm caused by many of the witches brew of noxious chemicals loosed upon the consuming public by industry. Exposures are ubiquitous - for example, in the carpets in our homes, in perfumes and cleaning chemicals, in the polyester in our clothes, in the chemicals in the particle board in our furniture and cabinets, in the mercury in the amalgam fillings that dentists put into our mouths (they misleading call them "silver" amalgams even though they are mostly mercury), or in the chemicals that cause "that great new car smell."
  It may take years or even decades for immune or endocrine systems or other body processes to become compromised, and the harm may be due to any one or any combination of the chemical exposures during the victim's lifetime. Thus, epidemiological studies are useless, and - unlike asbestos or breast implants - many of the chemicals that contributed to the harm may no longer even be present in a victim's body when the harm manifests itself in symptoms.
  Industry has continuously disparaged claims of such chemical harm, but the victims unavoidably know that they are sick. They keep piling up in doctors' offices, clinics and hospitals that do not understand their ailments and can do little for them but provide some palliative therapies that frequently are the cause of additional problems.
  The population experiences unexplained increases in autoimmune ailments and pancreatic and endocrine ailments. Autism and childhood asthma increase to epidemic proportions, and adult onset diabetes onsets at ever earlier ages. Rare forms of cancer show up with increasing frequency. However, mostly, people suffer a wide variety of physical and mental symptoms that may not be life threatening but are frequently life ruining.
  Desperate victims increasingly seek the help of alternative health therapists - both legitimate and quacks. As the population ages and immune systems and detoxification capabilities of the aged become increasingly compromised, the number of people affected increases into the millions, inevitably imposing unsustainable burdens on health care systems.

The willing dupes of the trial lawyers have included the mainline TV news magazines. 

  The publicity campaign outside the courtroom can become more important than what happens inside the courtroom in these cases, Olson points out. The willing dupes of the trial lawyers have included the mainline TV news magazines. Olson relates how they have provided the trial lawyers with priceless publicity about auto defects that don't exist in preparation for getting juries to believe that they do exist.
  Gasoline tank explosions and truck tire rim explosions and jeep rollovers and Audi sudden accelerations were all the subject of faked tests that became the subjects of breathless exposés on ABC's 20/20, NBC's Dateline and CBS' 60 Minutes among others. Much of the material aired was provided prepackaged to the credulous news magazines by testing agencies hired by the trial lawyers.




  There were many obstacles to product liability suits against the tobacco industry. Widespread health campaigns against smoking meant that no smoker could credibly claim ignorance of the risks. Individual smokers had widely varying health experiences.

This is the "privatization" of public law enforcement by the hiring of private attorneys to press public claims on a contingency fee basis.


The plaintiffs - being the states - were able to destroy as a practical matter the tobacco industry's rights to appeal.

  However, these obstacles were finessed by getting the states to sue for the costs incurred by the states due to smoking related illnesses. The mass tort bar earned its fees by getting the states to employ them for the law suits on a contingency fee basis. The favoritism played by the various states in choosing the local law firms for the litigation was a scandal worthy of Huey Long, Olson asserts.
  This is the "privatization" of public law enforcement by the hiring of private attorneys to press public claims on a contingency fee basis. It employs a theory of liability that could, of course, be used against other products - such as lead paint, fast foods, and liquor.
  Moreover, the plaintiffs - being the states - were able to destroy as a practical matter the tobacco industry's rights to appeal. They imposed huge appeals bond requirements. This destroyed the ability of the tobacco defendants to appeal the many adverse rulings of the judges in the local courts chosen by the plaintiffs attorneys to hear the cases. Having enlisted the states as allies in the cause, the plaintiffs attorneys were also aided by state legislation in Florida and Maryland declaring certain defenses null and void and applying these laws retroactively.

  That plaintiffs trial lawyers fought dirty against the tobacco companies is beyond question. However, this was a dirty - no holds barred fight all around. Olson does not deign to examine the litigation and lobbying tactics of the tobacco companies.

  After winning an extraordinary $246 billion in the tobacco litigation settlements, suddenly, all the negative news stories about the industry ceased "almost as if a faucet had been turned off," Olson points out. It was business as usual for the tobacco companies - with the plaintiffs lawyers and the states now beneficiaries with a stake in the future success of the business.

  This is not quite true. The spread of anti-smoking legislation and municipal ordinances continues to restrict smoking rights, and businesses increasingly bar smokers from their premises. Some businesses now refuse to hire smokers.

  Olson provides a substantial chapter on the tobacco litigation. He covers in some detail the plaintiffs lawyers legal and political maneuvering - the insider deals by which various well-connected local law firms were awarded lucrative roles in the state litigation - the constitutionally and legally dubious provisions included in the Master Settlement agreement - the tactics used to avoid public scrutiny - and the staggering legal fees gained by local as well as national law firms. As of 2002, the total reaped for legal fees was expected to be about $14 billion.

Payments will rise and fall with future sales - making state governments beneficiaries of the sale of death.


New tobacco companies have been required to make payments under the settlement although they by no stretch of imagination could be charged with past wrongs.

  The settlement was in fact a tax on cigarettes and cigarette smokers - not a damages settlement, Olson convincingly argues. It was levied proportionately on new sales - not on the old sales that might provide the measure of any damages caused. Since smokers are predominantly blue collar workers, it is a regressive tax. And, it was shared with private parties - the trial lawyers.
  Payments will rise and fall with future sales - making state governments beneficiaries of the sale of death. As such, the states have acted to protect the existing tobacco companies. New tobacco companies have been required to make payments under the settlement although they by no stretch of imagination could be charged with past wrongs.
  In short, the states are now protectors of big tobacco. State law has in effect shielded them from competition by placing them within a cartel created and enforced by the states.

  ""Had tobacco executives plotted privately among themselves to raise prices, freeze market shares, confine small competitors to minor allocations on the fringe of the market, and penalize defectors and new entrants, they could have been packed off to prison as antitrust violators. This way it was all allegedly legal -- in fact, signed-off-on, blessed, and stamped by the very same attorneys general who have long posed as our country's most incorruptible enforcers of antitrust law."

  Olson disparages the settlement measures that were designed to restrict tobacco marketing. Tobacco sales and the percentage of people who smoke fell substantially during the extensive period of litigation, and have simply continued to fall since the settlement. Antismoking agitation, the substantial increase in prices, and even the anti-smoking advertising campaign, seem to be having some impact. However, somewhat ironically, teen smoking rates rose after the advertising restrictions were imposed.



That the demanded controls were a practical impossibility - and frequently would have been unlawful - did not stop the suits.

  Gun manufacturers were the next major target. Under a variety of spurious theories, they were being charged with negligent failure to control the distribution of their product. That such controls were a practical impossibility - and frequently would have been unlawful - did not stop the suits.

  "All the lawsuits demanded that gun companies adopt practices that were in no way required either by federal or state law; in some cases, lawmakers, at both levels of government had considered and pointedly rejected such measures."

  However, guns have a very powerful political lobby of their own - and municipalities are very active in the sale of all manner of surplus weapons - without the controls and safeguards they were demanding of the manufacturers. A massive effort to win by intimidation - to bankrupt the small gun manufacturers by filing numerous spurious suits - ultimately collapsed.

  Congress has now passed legislation designed to protect gun manufacturers from such ideological litigation attacks.

The fourth branch of government:










  Now, other targets are at risk. Liquor, gambling, fast food, violent video games, can all be attacked on similar grounds. (All it would take would be a willingness of states and municipalities to join in the lawsuits - something that for various reasons is not that easy to get with respect to other products.)

  "Every expansion of private lawyers' power to claim to represent the interests of large groups of clients -- through class actions, aggregative methods, and fictions of government representation -- was sold as a way to 'let the people in' - - - so that a suitably competent counterforce could be fielded against the defendant Goliaths of the legal world and the little guy at last be afforded access to justice. The much more unambiguous function of class-action suits was to further empower lawyers themselves, who could now demand a great deal more money, menace opponents with far more effective weaponry than before, and presume to speak on behalf of vast groups within the American population, secure in the knowledge that their supposed constituents would not be in a position to fire them."

  Despite many assurances that the tactics used to bag the tobacco industry would not be applied to other industries, there was an immediate frenzy to bag other targets as the tobacco litigation ended. Guns, lead paint, even cell phones, were among the industries targeted on behalf of state and local governments claiming on the basis of increased costs imposed on the health care entitlements they provided. Alcohol, fatty foods, latex gloves, managed care, defense contractors, Ritalin - these were some of the targets threatened.

  "Government officials gladly embraced the idea of hiring private lawyers on a contingency fee basis to sue for the reimbursement of public expenditures occasioned by one or another human vice or controversial business practice."

  The abuses of class action procedures are set forth by Olson in some detail. There has been a merging of practices and participants between the mass tort and traditional class action specialists.

  "Multiply by hundreds if not thousands of actions, and you get the year-in, year-out business of the class-action industry, which today files a more or less continual stream of shareholder and investor actions against big companies, consumer suits over credit card grace periods and bank check-bouncing fees, airline frequent flier programs, magazine sweepstakes and premium promotions that arguably fall short of promises, and so forth. To find likely cases, some lawyers comb through mass-market commercial agreements in search of slipups in the fine print, often highly technical. Others piggyback on government enforcement actions. Few class members opt out; and when the case settles, the accepted logic behind the lawyers' payday is that the suit has created a benefit for the class members, which entitles the lawyers to deduct a reasonable fee before the class is paid."

  The "clients" frequently get small change while the lawyers get millions. Defendants are forced to settle even spurious  claims because of the amounts involved and the costs of litigation.

  There are those who now view trial lawyers as a fourth branch of government - regulating by litigating - while enriching themselves in the process. This is at best a very dubious and crude form of regulation.

  "Any number of difficult social issues require the striking of some sort of balance among social goods: between, say, the boon of low chicken and pork prices and the tendency of feedlots to constitute a local nuisance, or between the cost-control advantages of managed health care and the danger that patients will be denied access to experimental therapies. Until very recently it had been thought that a duly elected legislature was in the best position to strike the right balance on such questions."

  Article I, Section 1, of the U.S. Constitution, Olson points out, vests "all" legislative powers in Congress - not in the courts or the trial bar.

  Defenders of these new class action litigation powers argue that they are essential because Congress is failing to do its job. Olson responds that Congress is in fact reflecting the will of the majority party - exactly as it is supposed to.

  The author does not mention that product liability law and mass tort litigation can be subject to statutory enactments. Unlike cases decided on the basis of Constitutional issues, if Congress is not in fact in "gridlock," then it can impose its will on these subjects at any time - as in fact it ultimately did with the Class Action Fairness Act of 2005. These cases fall squarely under the Commerce Clause powers of Congress.

  Regulation through litigation is a very dubious practice in any event. Olson points out that the ultimate scope of the new regulatory regime is always left uncertain pending further litigation - rules are applied retroactively to products and practices totally lawful when produced or pursued - and the costs of litigation are potentially devastating for the industries targeted.

  Of course, sometimes the courts are forced into this role. Legislatures frequently accept ambiguities in their regulatory legislation and throw the tough issues to the regulatory agencies and the courts. When the inevitable litigation arrives on their doorstep, the courts have no alternative but to fill in the blanks. Thus, all three branches of government work together on the complexities of statutory regulatory schemes.
  However, that is not the case with respect to recent changes in the law of mass torts and class action procedures - legal departures that were not required by any legislation and were frequently rejected by legislatures.

  One result has been that legislation was required to prevent the newly established product liability law from destroying particularly vulnerable activities and industries - like the production of childhood vaccines, light aircraft, and the work of community volunteers - - "situations where the consequences of open-ended liability had proved to be so damaging that trial lawyers were almost better off yielding a bit of ground than continuing to face an angry public."
  However, the trial lawyer lobby is now rich and powerful and has successfully squelched most reform efforts in the states and even in Congress (until the Bush (II) administration pushed through the 2005 Class Action Fairness Act).

  The 2005 Class Action Fairness Act has several provisions to deal with settlement abuses. For example, for purposes of establishing lawyers fees under the Act, settlements that provide merely for the issuance of consumer coupons to class plaintiffs are now evaluated according to the number of coupons actually cashed in rather than the number issued. For injunctive relief or as an alternative in coupon settlements, actual hours spent in litigation must be established to support claims for attorneys fees.
  A judicial hearing is required for the approval of coupon settlements to determine if the settlement is "fair, reasonable, and adequate for class members." Settlements must not discriminate among class plaintiffs.

  Olson concludes:

  "The new rule of lawyers brings us many evils, but perhaps the greatest is the way it robs the American people of the right to find its own future and pursue its own destiny. No doubt, democratic processes often fall short of perfection; they have not to date managed to eliminate the age-old temptations posed by enjoyable forms of human vice, or make the finest medicine readily affordable, or set our racial enmities behind us, or caused the eagle and dove to cuddle in one nest on the role of gun ownership in self-defense. But however uncertain the results of democracy, however slow and clumsy its procedures, we can feel quite sure that it is a better course than agreeing to turn over our rights of self-government to a new class of unaccountable lawyers.
  "Year upon year, we do nothing to govern our elite litigators, and the result at length is that they have decided to govern us."

  Development of the common law has been driven by efforts to provide judicial remedies for perceived wrongs. This has included both substantive and procedural elements. Product liability law and mass tort litigation simply provide the latest chapters. However, the latest chapters have fundamentally different characteristics.

  One of the guiding principles of common law development in the past was to recognize that the legislature was the legitimate lawmaking authority, and that the policies of the legislative body must guide judicial developments. This meant judicial acceptance of guidance from the policies of parliament and other legislatures as democracy developed in common law states. The legislatures were the institutions of government that spoke for the people.
  Product liability law and mass tort litigation have proceeded despite active consideration and numerous rejections by various state legislatures. The courts have thus been hijacked by the trial lawyers and turned into a political lawmaking body - the control over which all political and commercial interests must now actively fight. This is "rule by law," not "rule of law."
  The results of this politicization of the judiciary is increasingly in evidence in the increasingly bitter fights over judicial appointments and state judicial elections. Thirty eight states require judges to stand for election. Where judicial elections used to routinely be uncontested, they now increasingly involve expensive and bitter campaigns that tar both the winners and losers. Federal judicial appointments - especially Supreme Court appointments - are increasingly subject to bitter political battles in the U.S. Senate that sully the reputations of the Justices on the bench.
  Even more disturbing is the resulting steady decline in public confidence in and approval of the judiciary. As an unelected arm of government without any political constituency, public approval and confidence is all that sustains the court system and the essential rule of law that it administers. These are the noxious consequences of the partisan politicization of the nation's judicial systems launched in the last half of the 20th century in an effort to achieve parts of the liberal agenda by litigation instead of legislation.

  A second guiding principle of the common law has always been an acknowledgement of the potential for abuse of process. New remedies placed new powers in the hands of judges and attorneys. As Olson notes, courts thus always paid careful attention to the delineation of the limits of new remedies and the enforcement of established restraints against abuse of judicial process.
  Product liability law and mass tort procedures developed for several decades without any apparent concern for appropriate limits and with the active dismantling of established restraints against abuse of judicial process. It was not until 2003, in State Farm Mut. Auto. Ins. Co. v. Campbell, that the U.S. Supreme Court finally established some limits under the Fourteenth Amendment on the award by state courts of punitive damages in economic harm cases. As stated above in the segment on "Breast implants," the Supreme Court has also recently set high standards for the admission of scientific expert witness testimony.
  The results are set forth in Olson's book. The plaintiffs trial lawyers hijacked some local courts and turned them into instruments for their extortionate conduct. Even when applied in cases where there are some legitimate claims like those over asbestos, mass tort law and procedures permit excessive claims against peripheral defendants and claims on behalf of plaintiffs with little or no injury.

  However, as long as it is not a matter of Constitutional law that is involved in this form of judicial activism, Congress and the state legislatures can impose their will on these remedies and practices. Struggles over tort reform have thus properly become a regular part of the nation's political wars. In those states where this judicial activism has successfully established itself as a matter of state constitutional law, the issue has been arbitrarily removed from the political arena, and its problems have thus become much more serious.

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  Copyright © 2005 Dan Blatt