Has time come for tort reform?

Florida Supreme Court more likely to uphold any legislation that passes

TALLAHASSEE – Every year, large corporations push a series of bills to reduce their liability, limit attorneys’ fees and reduce the amount of damages juries can award in lawsuits against them.

But unlike tax cuts, regulation reductions and other businessfriendly measures passed by the GOP-led Legislature, tort reform bills have often failed to get through amid heavy opposition from another influential group — the trial attorney lobby.

This year, however, there’s renewed momentum and higher stakes behind those efforts, including bills to limit money for asbestos victims and make it harder to prove insurance companies are delaying a claim.

Gov. Ron DeSantis’ conservative makeover of the Florida Supreme Court means new such laws are more likely to be upheld. Under the old liberal majority, the state’s high court knocked down or chipped away at laws capping fees in medical malpractice and workers compensation cases, upsetting insurers and large corporations.

DeSantis appointed three conservatives to replace three outgoing liberal justices shortly after taking office. Two of those justices have since been appointed to a federal appeals court, leaving a 4-1 conservative majority on the court.

DeSantis has also taken an interest in the tort reform push. Although he didn’t mention it as part of his official legislative agenda, he appeared at a press conference in September with representatives of both the U.S. and Florida Chambers of Commerce and groups representing large insurance companies to tout how his judicial picks were already making a difference on Florida’s “legal climate.”

Before his appointments to the bench “there was a sense that the Legislature could enact certain reforms but the chance of that getting rewritten or unwound in the courts more based on policy reasons than legal reasons was way too high,” DeSantis said.

But now, “folks are looking at Florida if they see reforms being done … they can be pretty sure that that’s going to be applied as written and you’re not going to see any type of political gymnastics being done via the judiciary. And I think that’s good,” he added.

Orlando trial attorney John Morgan doesn’t buy the talk from big businesses that tort reforms are needed to reduce litigation

and help create jobs. Unemployment is at 3 percent under the current laws, he noted.

“Usually when there’s a move for tort reform it’s when the economy is bad,” Morgan said. “The president and the governor are telling us we’re living in the best economy of our lives.”

Asbestos claims

One of the most contentious of the bills is HB 741/SB 1582, which seeks to limit the amount of money victims of asbestos contamination can claim.

Asbestos, a type of construction material used in the early 20th century, can cause cancer, and a spree of lawsuits beginning in the 1970s bankrupted several companies. Congress set up several asbestos trusts in 1994 to help compensate victims, with businesses facing liability paying into the trusts, which are payable to victims of companies that have gone insolvent.

But victims of companies that are still in business can sue them directly, without seeking money from one of the trusts. Insurers say victims’ attorneys in some cases have been withholding efforts to seek money from both the trusts and existing businesses, allowing them to seek inflated costs from those businesses.

“They’re seeking multiple recoveries for the same injury,” Rep. Tom Leek, R-Ormond Beach, sponsor of the bill, said when it passed through a House panel in January. “By not pursuing the trust immediately you are delaying and denying the money that victim could have had immediately.”

The bill would require victims’ attorneys to attest that they’ve investigated all possible asbestos claims; let courts place lawsuits against companies on hold if the victim hasn’t sought a trust claim; allow evidence in trust claims to be used in cases against existing businesses and require a trial court to deduct any trust claim award from any damages awarded from an existing business.

Opponents of the bill counter that it’s actually aimed at delaying proceedings so that damage claims go away entirely. Bill Cotterall, lobbyist for the Florida Justice Association, the main trial lawyer lobby, said patients with mesothelioma, the cancer caused by asbestos exposure, often die within six months to a year after diagnosis.

“Once that patient dies, the economic damages claim dies with them, and the insurance companies know that,” Cotterall said. “That expedited trial lets them get their case to trial while that victim is still alive.”

The Senate version of the asbestos bill faces two more committee hearings, but the House version is headed for a floor vote in that chamber.

Supersized fees

Another measure favored by insurance companies and tort reform advocates would limit the practice of supersizing attorneys’ fees after a successful case. If a case is difficult or there’s not a likelihood of success, the court can award what’s known as a “contingency fee multiplier” to the attorney’s fees if they end up winning the case. The multiplier can be between 1.5 and 2 times the initial fees.

Under HB 7071/SB 914, those multipliers could only be used in “a rare and exceptional circumstance.” Trial attorneys argue the multiplier is needed to attract lawyers to cases that otherwise wouldn’t attract competent counsel, while insurers argue there isn’t a shortage of attorneys ready to take all manner of cases in Florida.

The bills have advanced in each chamber and face one more committee hearing in the House and Senate before coming up for a floor vote.

‘Bad faith’ claims

One of the tort changes most sought-after by big business lobbies and insurances companies is SB 924, which would increase the threshold for proving “bad faith” claims against insurers. In such cases, juries can award damages against insurers for handling a claim in bad faith – deliberately delaying a claim or refusing to make a valid payout.

Insurance companies have long argued the threshold is too low for consumers to prove, that they only need to show a mistake was made in handling a claim, rather than actual malice.

Sen. Jeff Brandes, sponsor of SB 924, said the bill is needed to combat rising insurance rates and help smaller insurers still reeling from the hurricanes of 2017 and 2018. The bill doesn’t have a companion in the House, and a committee vote in the Senate was postponed Tuesday.

“You need tort reform in Florida,” said Brandes, R-St. Petersburg. “We’re one of the most litigious states in the country. It is completely unsustainable what’s going on right now and we’ve got to turn the ship.”

But insurance companies have pushed for changes to the bad faith law for years, regardless of recent price fluctuations or changes in the market.

“It’s a gigantic lie by (the insurance) industry that wants to take in premiums and not pay claims,” Morgan said.