Posts Tagged ‘Pennzoil v. Texaco’

Texas: serious litigation reform, serious results

“How tort reform helped ignite the Texas boom”:

Over the last two decades, Texas engaged in a conversation as to the purpose and role of its civil courts. When that conversation began, the state’s courts had become virtual fiefdoms of trial lawyers. Texas recognized few limits on damages claims and imposed minimal accountability on plaintiffs. The state’s litigation environment was, unsurprisingly, toxic for business. The pushback came in the early 1980s. Lawmakers started to ask whether the Texas constitution’s commitment, spelled out in Article 1, Section 13, that “all courts shall be open, and every person for an injury done him . . . shall have remedy by due course of law” precludes putting reasonable limits on liability. The state legislature’s decision to strike a balance and roll back tort excesses marked a turning point in the state’s economic rise. Together with competitive tax and regulatory policies, tort reform sowed the field so that Texas’s pro-growth policies could take root.

Comprehensive backgrounder covers such topics as the putting up of justice for sale at the pre-reform version of the elected Texas Supreme Court (the anecdote from businessman Henry J.N. Taub is especially alarming), the Texaco-Pennzoil case and the generosity to judges of the late Joe Jamail, America’s richest lawyer; early statutory enactments, struck down by the state’s high court; the turning point that came when “the general electorate finally began taking an interest in judicial elections”; the Rio Grande Valley doctor’s revolt; comprehensive reforms beginning under then-Governor George W. Bush and continuing under his successors including Rick Perry; elements of loser-pays; and the general success of tort reform, both in economic climate generally and specifically in the encouraging climate for the state’s medical sector, which includes many nationally prominent institutions. [Kathleen Hunker, City Journal]