KANSAS CITY, Mo.--(BUSINESS WIRE)--Feb. 10, 2006--Victories and defeats in the courtroom can impact our nation's economy, with potential consequences for decades to come.
GE Insurance Solutions has been tracking and shaping efforts to level the litigation playing field - variously called tort reform or legal reform - and has published a summary of what it sees as the major legal reforms enacted during the past year and what lies ahead in 2006.
Author Joanne McMahon, Assistant General Counsel for Government Relations, says while 2005 was marked by passage of important reforms at both the federal and state level and significant court decisions, the legal reform landscape in 2006 will look different.
McMahon notes that in 2005 Congress passed legislation dealing with class action litigation, a partial shield for gun manufacturers and legislation that prohibits lawsuits against manufacturers of a drug that would cure or reduce the risk of a disease that presents a public health emergency.
Those reforms, together with state legislation that included comprehensive legal reforms, capped medical malpractice non-economic damage awards and established medical criteria for asbestos and silica claims, made 2005 an active year. McMahon also points out that a Texas judge made a powerful statement about silica litigation when she ruled that the majority of 10,000 consolidated cases had been improperly filed, sending most of those cases back to the state courts.
In contrast, McMahon says, 2006 looks to be a year when "legal reform measures will be narrowly focused, targeting specific civil litigation rules (e.g., venue, joint/several liability) or types of litigation (e.g., asbestos, silica). In most states and for many federal congressional members, 2006 will be an election year and election-year politics will affect legislative activity at both the federal and state levels."
McMahon says asbestos reform "will likely be the single most significant legal reform measure pursued in the 110th Congress." And, she continues, "bills aimed at curbing lawsuit abuse and shielding the food industry from obesity lawsuits will also likely be pursued" at the federal level.
On the state level, McMahon predicts comprehensive legal reform bills addressing a wide array of issues such as those passed in 2005 will not emerge in 2006. Rather, bills will be introduced that deal with select issues such as medical malpractice (Kentucky, New Jersey and New Hampshire), joint/several liability (Florida and West Virginia), venue (Illinois), non-economic and punitive damages (South Carolina) and asbestos/silica (Alabama, California, Kansas, Michigan, Missouri, Pennsylvania, South Carolina, Virginia and West Virginia).
In the courtroom, McMahon expects significant developments on the food and beverage front, as plaintiffs sue manufacturers for causing childhood obesity. She says: "The wheels of the mass litigation machine are constantly in motion, devising new theories of liability."
Finally, McMahon points out that the cost to defend against such all lawsuits, whether frivolous or not, continues to rise.
"Clearly, the need for a fair and balanced approach to civil litigation is important to individuals, corporate citizens and the U.S. economy," she says. "The extent to which additional legal reforms become law in 2006 - an election year - remain to be seen."
To read the paper, go to http://www.geinsurancesolutions.com/ erccorporate/inst/ic/lc/060117_year.htm. (Due to its length, this URL may need to be copied/pasted into your Internet browser's address field. Remove the extra space if one exists.)
GE Insurance Solutions (NYSE:GE) is a group of companies that protects people, property and reputations. With more than $50 billion in combined assets, GE Insurance Solutions is one of the world's leading providers of commercial insurance, reinsurance and risk management services. For more information, visit www.geinsurancesolutions.com.
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