Legislators renew efforts to change tort laws in state

In newest proposals, gone is control over rules, fees; caps on damages stay

After more than a decade of earlier proposals losing battles before the Arkansas Supreme Court, proponents of overhauling the state’s tort laws have renewed efforts in this year’s regular legislative session, in the hope that one will finally stick.

Gone are efforts from years past to limit attorneys’ fees, having stirred opposition from attorneys and the state Bar Association.

The latest proposals also lack any mention of legislative control over court rules. A failed effort last year to grant the Legislature final authority over the courts’ rules drew heavy opposition from judges, including the chief justice of the Arkansas Supreme Court.

Instead, competing measures filed in this year’s regular session focus on limiting damages in lawsuits.

One, Senate Joint Resolution 8, proposes a constitutional amendment that would allow the Legislature to set limits on punitive and noneconomic damages.

Meanwhile, identical measures — Senate Joint Resolution 7 and House Joint Resolution 1022 — would limit punitive damages only.

The differences between punitive and noneconomic damages — as well as the groups that have an interest in capping them — promises to determine the support behind either option.

In a regular session, lawmakers may refer up to three constitutional amendments to voters in the next general election, and either type

of tort proposal will have to compete for a spot on the list against other offerings on highway funding, term limits, the initiative process and frequency of legislative sessions.

The House and Senate State Agencies and Governmental Affairs committees have meetings today to continue discussing which proposals to recommend to their respective chambers. The joint resolutions must be approved by both the House and Senate.

LAWSUIT DAMAGES

Often referred to as damages for “pain and suffering,” noneconomic damages are frequently applied to personal injury and medical malpractice lawsuits, said Joshua Silverstein, a law professor at the University of Arkansas at Little Rock’s William H. Bowen School of Law. For that reason, he said, caps on such damages are often of interest to doctors and others in the medical community.

Punitive damages, on the other hand, can be applied in an array of different cases.

“Noneconomic damages are intended to compensate for actual harm done,” Silverstein said. “Punitive damages are not intended to compensate; they are intended to punish the defendant.”

Nursing homes and health care groups provided financial support for a proposed 2016 initiated amendment that would have enacted noneconomic damage caps only on medical malpractice suits.

In 2018, when the Legislature proposed an amendment, Issue 1, that included limits on both noneconomic and punitive damages, other business interests, including Walmart Inc., Tyson Foods Inc. and the trucking industry joined health care groups in support of the effort, providing hundreds of thousands of dollars in donations to a ballot campaign.

Attorneys, backed by groups including the Arkansas Bar Association and the Arkansas Trial Lawyers Association, raised comparable sums against the proposed amendments in 2016 and 2018.

Both efforts were struck down by the Arkansas Supreme Court before the November general elections in those years, as the court found fault with the wording and breadth of the amendments.

LATEST EFFORTS

Randy Zook, the president of the Arkansas State Chamber of Commerce, said Friday that the organization supports SJR8, an amendment proposed by Sen. Bart Hester, R-Cave Springs, to allow the Legislature to place caps on both punitive and noneconomic damages.

The chamber is neutral, he said, on resolutions by Rep. Sarah Capp, R-Ozark, and Sen. Gary Stubblefield, R-Branch, to apply caps only to punitive damages. Zook called such proposals a “half-measure.”

“Without noneconomic damages, it doesn’t address the whole problem,” Zook said.

Efforts to enact damage caps have faced opposing ad campaigns from legal and faith-based groups. The latter branded the lawsuit-damage limits as placing a “price tag on human life.”

In addition, a coalition aligned with advocates for nursing home patients, the Committee to Protect AR Families, has raised money in each of the past two election cycles to oppose limits on damage caps and the money spent by nursing home owners in support of those measures.

One of the state’s most prominent nursing home owners, Michael Morton of Fort Smith, is not planning to get involved with legislative efforts surrounding tort caps this session, a spokesman said earlier this month.

Prior to Issue 1 being struck down by the Arkansas Supreme Court last year, polling showed that the proposed amendment was opposed by a plurality of voters, according to Robert Coon, a lobbyist and consultant who helped conduct polls on the issue.

“The most instructive thing is to look at what Arkansas has done in the past,” Coon said. “There clearly has been support for capping punitive damages in the Legislature in the past.”

Coon added, “It would be apparent that the noneconomic damage caps hurt support for what overall would be a tort reform and conservative issue.”

COURT RULINGS

In 2003, the Legislature passed Act 649, which enacted a $1 million limit on punitive damages. The law also set stricter rules of evidence in malpractice cases. The Supreme Court rolled back portions of the law in 2007 and 2009, before striking down the damage caps as unconstitutional in a 2011 ruling.

The law, which followed a $78 million judgment against a Mena nursing home for wrongful death, was touted in part as a way to stem the rise in medical malpractice insurance rates.

But reports from the Arkansas Insurance Department in 2004 and 2005 found the law had little effect on insurance rates.

Since the high court struck down the law’s damage caps in 2011, lawmakers and interest groups unsuccessfully have sought to place proposed constitutional amendments limiting lawsuit damages on the ballots in the 2014, 2016 and 2018 elections.

By amending the Arkansas Constitution to expressly give lawmakers the authority to enact damage limits, proponents of the issue would solve the problem of the Supreme Court striking down such limits as unconstitutional. However, the Supreme Court has also found problems with the ways in which ballot issues were presented to voters.

Last year, a 6-1 ruling by the high court found that Issue 1 had impermissibly tied together several distinct proposals — including changes to court rule-making, damage caps and limits on attorneys’ fees — through a practice known as log-rolling. Months later, the proposals filed in the Legislature have stuck strictly to the issue of damage limits.

“We heard the court’s message,” Zook, the chamber president, said. “You cannot have all those [changes] together.”

The court struck down the 2016 proposed initiated amendment because “critical” parts of the measure — including caps on noneconomic damages — were improperly defined for voters.

The Legislature failed to approve a proposal in 2014.

Hester, the sponsor of SJR8, said he expected Supreme Court justices “to find a problem with everything regarding tort.” He asserted that his bill was not written to appease the court’s issues.

“I think people are tired” of the stalled efforts, said Capp, the state representative and attorney sponsoring HJR1022, the proposal on punitive damage caps. Capp said she opposed Issue 1 in 2018 and opposes caps on noneconomic damages.

“Punitive damages are different,” she said in a text message. “My proposed amendment would protect businesses from a large and expensive punitive award, while also protecting real families seeking to be made whole after a tragedy.”

Getting either Capp’s measure, SJR7 or SJR8 on the ballot in 2018 will depend on whether the issue of tort caps is at the top of the amendment proposal list of either chamber.

In 2017, Democrats in both chambers were more likely to oppose the resolution to refer Issue 1.

In the upper chamber — where Hester serves as GOP majority leader — Senate President Pro Tempore Jim Hendren, R-Sulphur Springs, said earlier this month, “There’s no question that there’s been a lot of interest on tort reform.”

But in the House, Majority Leader Marcus Richmond, R-Harvey, said Republican lawmakers are hesitant to refer another measure on the issue.

“On our end, there’s really very little appetite to pull out the old tort reform and dust it off and try again,” Richmond said. “Just from the people I’ve talked to on that, it’s just not something they want to take on again.”