Let the transformative change begin

A Texas-sized, bold idea for eliminating frivolous lawsuits

The competition between the 50 states for every new job out there just got very interesting.

I’m talking about an idea the governor of Texas has for ending frivolous lawsuits in the Lone Star State. Some believe it could attract thousands of new jobs to Texas.

Governor Rick Perry wants to create a “loser pays” system in the courts. It’s used throughout the world, but plaintiff lawyers have worked hard to keep it out of America. Under loser pays, plaintiffs who sue someone and lose have to pay the legal bills of their opponent. It would discourage nuisance lawsuits and put an end to the lottery approach to litigation in which plaintiffs have very little to lose but much to gain by filing frivolous lawsuits.

The current system has made it too easy for plaintiff lawyers to wring lucrative out-of-court settlements out of innocent people because those who have been targeted for meritless lawsuits know they’ll have to spend tens of thousands of dollars, or much, much, more, to prove their innocence.

At the same time, Governor Perry has proposed changes that would make the courts more accessible to Texans with legitimate claims without the high costs associated with a drawn-out trial. Lawsuits with claims between $10,000 and $100,000 would have expedited trial settings and limited discovery in order to get litigants in and out of the court quickly and allow swifter recovery for damages.

Americans, in general, know we live in the most lawsuit-happy nation on earth, but few of us know just how much more we’re being forced to pay for everything from medical care to consumer goods like ladders than folks in other countries because of all these lawsuits. According to researchers at the Pacific Research Institute, the average American could save a whopping $1,962 each year if the U.S. had the same number of lawsuits per capita as other industrialized countries. A loser pays system would eliminate the meritless lawsuits that drive up costs and drive away jobs.

Let’s be fair, the personal injury lawyers who’ve made a fortune off the current system will spend whatever they believe it takes to defeat this plan. However, a few years ago, Texas Governor Rick Perry was able to enact bold reforms to reduce lawsuit abuse against medical professionals there, and it attracted waves of new doctors and improved health care.