The threat from attack attorneys is no joke

In almost every country but the U.S., legal systems incorporate a "loser pays" principle. If you sue someone and lose, you cannot just walk away. You have to contribute something to making the victim of the lawsuit whole for what he or she has paid. We had that same principle in our legal system throughout much of American history, but it gradually died out. We also had procedural rules discouraging ill-conceived litigation. Moreover, we had rules of legal ethics prohibiting lawyers from stirring up litigation for their own benefit. However, something changed during the 1960s and 1970s. It started in the world of ideas--in the universities and the law schools. Litigation came to be seen not as a necessary evil, but as a positive good. This view can be identified with the career of consumer advocate Ralph Nader and with many of the professors who began to dominate elite law schools during that period.

According to this new view, litigation deters wrongful conduct: The more lawsuits that are filed, the more people will behave carefully. Litigation also came to be seen as a way to redistribute wealth from those who have it to those who need it. From this perspective, the more litigation there is, the more redistributive justice the courts can impose on society--and who can be against justice?

From being a last resort, then, litigation came to be seen as socially beneficial. Lawyers who advertise with billboards saying, "Sue someone and let's see how much money I can get for you," are seen not as sleazy, but public-spirited.

Given this new view of litigation, roles discouraging lawsuits ceased to make sense. This is why we began changing the roles to make it easier to sue. We liberalized the rules of discovery--those governing how a person can demand information from his opponent. We opened the door to the fishing expedition: "I don't know for sure whether you have done me any legal wrong, but please hand over the contents of your filing cabinets so that I can find out." We made it much easier to organize class actions, by which most Americans periodically are dragged into lawsuits as plaintiffs without even knowing it. We dropped many of the rules against attorneys stirring up litigation, just as we weakened traditional legal principles such as "assumption of risk." Here is what that means: If you go to a baseball game and get hit on the head by a foul ball, the old courts would have said that you have no grounds to sue because everyone knows that foul balls happen at baseball games. This no longer makes sense, however, if the point of lawsuits is to encourage ballclubs to be careful about where they let their players send their foul balls--and to redistribute wealth. So out it went, at least in many courts.

All these developments were bound to give us more litigation and, sure enough, they did. The share of America's gross national product devoted to litigation has tripled over the last 50 years. We spend two to three times more on it, in terms of percentage of GNP, as other industrial democracies. The figure for how much is spent annually on liability insurance in the U.S.--a relatively easy thing to measure--is now $721 per citizen, which comes to over $2,800 per year for a family of four. So, are we getting our money's worth?