News Release

January 5, 2005

Media Contact: (202) 789-5200

Tort Reform Is Not an Issue for the Feds
States are able to limit damage awards; in-state lawsuits aren't interstate commerce

WASHINGTON--In a keynote speech today in Illinois, President Bush kicked off his campaign for federal legislation to limit damages in certain lawsuits. Cato Institute senior fellow Robert A. Levy made the following comments regarding the president's plans:

"President Bush has called medical malpractice 'a national problem that requires a national solution.' No doubt, he is correct in believing that outlandish jury verdicts can drive up insurance premiums and cause doctors to curtail services. And no doubt that scene could unfold in more than one state--perhaps threatening a malpractice mess nationwide. But not every national problem is a federal problem. State legislators, courts, doctors and their patients are not powerless. More than three dozen states have passed damage caps. All 50 states have passed, or are considering, tort reform proposals.

"Mississippi is a case in point. Two years ago, the U.S. Chamber of Commerce warned its members to avoid Mississippi's 'jackpot justice.' Doctors fled or quit and 71 insurance companies stopped doing business in the state. The result: a new law that caps pain-and-suffering, medical malpractice, and punitive damages. Not bad for a state that became infamous as a 'judicial hellhole.'

"Put bluntly, the federal government is not empowered to dictate the substantive rules of tort law. And that's especially true when we're talking about suits by in-state patients against in-state doctors for in-state malpractice. Some of the damage awards may be shocking. But they are not commerce and they are not interstate."

To reach Levy for further comment, contact the Cato media relations department at 202-789-5200 or media@cato.org.