Tort Reform Hitting Lawyers in the Pocket Book?

This sob story in Crain’s Cleveland Business is too bizzare.  A quick summary:  Plaintiff has surgery and maybe negligence occurred.  Plaintiff’s problem, while quite serious, was fixed and the plaintiff suffered no permanent harm.  Plaintiff wanted to sue, but her attorney won’t take the case because punitive damages are capped now and the plaintiff’s economic damages are small.

The lawyer quoted in the article makes it sound like that punitives were a matter of course in the case and that this poor woman who suffered little harm in an economic sense was entitled to big punitives.  Without knowing the facts it is hard to judge, but if there is little harm, then there should be damages which actually reflect the injury; and that punitives should only be used in those cases when the negligent action boarders on an intentional act.   If the Ohio tort reforms put the law back to this position, then it probably increases social welfare (assuming there is a mechanism for the injured party to get compensation for her economic harms.)  If the physician did commit negligence, then a reasonable settlement could be negotiated rather than taking the case to court.  There are enough lawyers that can represent these types of claims too.

The free lunch seems to have a higher price than it used to in Ohio.  Further, the article goes on to state that if the Ohio Supreme Court doesn’t strike down the law (which it has been known to do), then med mal litigation firms will take a hit.  This seems to me a win win.  Med mal insurance rates go down because the incentive to sue is reduced as the lottery pay-out is reduced.  Smart guys who were practicing med mal litigation now go on to be actuaries and everyone is happier!  While the evidence suggests that damage caps are not all that important in reducing average awards, they appear to be important in certain types of cases if this one data point has any meaning.

via Actuary.com