Commentary

Getting the Lead Out

Trial lawyers, their appetites whetted by a fat share of the quarter-trillion-dollar bonanza extracted from smokers (and a $3 billion damage verdict this week), have targeted another victim: the former manufacturers of lead paint.

The Houston Chronicle (May 8) describes “a potential flood of lead- paint litigation from school districts across Texas,” patterned after Rhode Island’s ongoing lawsuit. Sheldon Whitehouse (D), Rhode Island’s attorney general, credits the multi-state tobacco settlement for his inspiration. In fact, when Whitehouse sued the lead paint companies, he hired South Carolina’s Ness, Motley, Loadholt, Richardson & Poole, one of the law firms that was pivotal in rounding up states to sue cigarette makers. Now, Ness, Motley has joined with teams of Houston and Beaumont attorneys hoping to “turn lead into gold.”

All of this might be nothing more than intriguing background for a battle between well-heeled lawyers and well- heeled paint companies, except that three corrosive ingredients have been added to the litigation formula.

First, because coordinated actions by multiple government entities can impose enormous legal fees on defendants, those actions have been used to extort money notwithstanding that the underlying case is baseless. A shakedown masquerades as law so that politicians can engorge government coffers without raising taxes.

Second, government plaintiffs are hiring outside attorneys – not on a per-hour basis, but for a contingency fee geared to the size of any damage award. Ness, Motley and their Beaumont colleagues can reportedly be signed up for a mere 40 percent of damages. In effect, private law firms, some of them major political donors, are awarded huge incentive-based contracts, thus placing the coercive power of government in the hands of parties who have a financial interest in increasing the severity of punishment. It’s like giving prosecutors a bonus for each indictment they bring in. The potential for abuse is enormous.

Third, legislatures are supposed to enact laws, not the executive or judicial branch. In too many cases, government-sponsored litigation has been a substitute for failed legislation. That process violates the principle of separation of powers – a centerpiece of the federal constitution and no less important at the state level. Evidently, none of that matters to some attorneys general, mayors, and their allies in the private bar. In an attempt to circumvent the legislative process, they are all too willing to pursue through litigation what was rejected by the legislature.

For years, trial lawyers have sued landlords over lead poisoning and, in some cases, have won large judgments. But unlike landlords, the paint and pigment companies remain unscathed. The industry’s defenders make these points: Lead was thought to be a useful component of paint. Once it was known to be harmful, paint makers voluntarily stopped using lead in interior paints in the 1950s. The industry supported a 1978 federal ban.

Well-maintained surfaces covered with lead paint are not a danger; the real culprit is poor maintenance by homeowners. Lead poisoning arises from many products besides paint. In any event, it’s impossible to prove which manufacturer’s paint, if any, was responsible.

Never mind those facts. If the blandishments of the trial lawyers prove irresistible, Texas school districts will be arguing, not that the owners or landlords of aging, substandard homes should have maintained them more diligently, but that lead poisoning in the 21st century should be blamed on the makers of paint that was used in the 1920s through the mid-1950s. That’ s bad logic, bad law, and bad public policy, directed against innocent companies that produce useful products, employ thousands of people, and haven’t used lead for nearly half a century.

Nonetheless, private attorneys have fanned out in a frenzied search for politicians anxious to squeeze big bucks from another hapless industry. So far, attorney general John Cornyn has declined to join his counterpart in Rhode Island. Cornyn has also criticized the tobacco settlement – especially the colossal $3.3 billion in legal fees that the states’ trial lawyers collected. But other Texas officials are less hesitant. Frank Sanders, chief of the litigation bureau in Harris County, has already sued. He gloats that outside lawyers will assume the costs even if the case fails. “We’ve got a situation we can’t lose,” he told the Chronicle. Some might disagree. Surely, the demise of the rule of law must be counted as a loss.

Robert A. Levy is senior fellow in constitutional studies at the Cato Institute. This article is drawn in part from “Turning Lead into Gold,” Legal Times, August 23, 1999.