fedLabs 101: some losers oughta pay

Where does your State stand on the issue of Loser Pays?  A local newspaper article on New Year's Day got me wishing New York State had some form of Loser Pays system, to help defendants who are the victims of meritless lawsuits -- i.e., when plaintiffs continue a case even after discovery shows it is very weak.  (Schenectady (NY) Daily Gazette, "Jury clears Mayfield driver of responsibility for pedestrian's death," Jan. 1, 2005, B1, $ubscpt.)

The case in question is fairly typical: the estate of a pedestrian killed in an auto accident sues the driver for wrongful death.  But, here, there was no indication that the driver, Daniel F. Post was at fault. An article from the time of the accident in 2002 noted that Donald H. Colby was walking in the middle of a rural road late at night when struck.  Post was not charged in the incident.  Nonetheless, Colby's estate sued Post for $1 million.  Despite discovery that apparently yielded no evidence of negligence on Post's part, there was a two-day trial in November, and the Fulton County Supreme Court jury cleared the defendant.

• What did the Estate's lawyer, Anthony Casale, of the Abdella Law Offices in Goversville, NY, have to say about his losing case?   The reporter noted that Casale [using some of my least favorite phrases] "is reluctant to discuss the details of the case because the Colby family 'is looking for closure on the matter'."  "There were a lot of unanswered questions," Casale said of the accident -- "but at the end of the day there wasn't enough evidence" to substantiate the claims in the lawsuit.   So, that's it.  Unless defendant Post risks the additional expense of a frivolousness motion (which has a maximum award of $10,000), his "closure" will have to await payment of hefty legal fees.

Overlawyered.com's editor Walter Olson has written extensively on the topic of loser pays.  (this essay gives a good summary of his arguments).  Walter points out:

"America differs from all other Western democracies (indeed, from virtually all nations of any sort) in its refusal to recognize the principle that the losing side in litigation should contribute toward "making whole" its prevailing opponent.  It's long past time this country joined the world in adopting that principle; unfortunately, any steps toward doing so must contend with deeply entrenched resistance from the organized bar, which likes the system the way it is."

Like Olson's Essay, a 1997 law review article co-authored by Olson and Prof. David Bernstein (of the Volokh Conspiracy)  notes the de mimimis use of loser pays in the United States (modest programs in Alaska, Oklahoma and Oregon).  The article ended with a prediction that further experiments with loser-pays are likely in the near future, but that optimism has so far proven to be unwarranted.  For, example, Ohio's recent "tort reform" efforts failed to include loser pays (see Toledo Blade editorial, Dec. 14, 2004), and efforts in South Carolina were also unsuccessful.

• I'm afraid that Loser Pays, like calls to protect clients from unethical and excessive contingency fees, has been swept aside by the tort reform tidal wave.  Both efforts could help average folk and businesses get a fair break from our justice system, and both offer politicians the opportunity for bipartisan cooperation in the public interest. However, Democrats are under the sway of trial lawyers and Republicans under the thumb of big business, and they're all too busy fighting the bigger tort reform war.  In addition, the legal profession in general, I believe, fears that Loser Pays will result in less work for lawyers.

Opponents of Loser Pays say such legislation would limit access to justice -- that ordinary people might be dissuaded from filing non-frivolous lawsuits for fear of paying court costs if their case loses.  I have no interest in chilling plaintiffs who have valid claims, but lawsuits like Colby vs. Post are often no more than fishing expeditions and treasure hunts.  Defendants are not just deep-pocketed villains. Meritless lawsuits cause very palpable harm that also needs to be taken into account.

Why aren't we seeing an explosion of experimentation in our great Federalist Laboratory?  With so many variations and pilot programs possible, and so much experience in other countries to use as guides, the Olson & Bernstein prediction of bountiful experimentation seemed like a very good bet in 1997.  I'd like to hear what is happening in individual states now:

1. have Loser Pays programs been established in your state?  if so how are they working?
2. are there proposals pending in your legislatures, or were there recently?  if so, what are the party and ideology of the sponsors?
3. has your local bar been working on the issue of Loser Pays?  studying it? supporting or opposing pilot programs or sweeping reforms?
is anyone at your law school working on these issues?

If ever a topic deserved a weblog of its own -- or a corner in an existing blawg -- this is it. If ever a topic were ripe for 50-state, federalist incubation, this is it. So, come on Federalists, show us your stuff.