Friday, April 29, 2016

Arkansans to vote on possible med mal reform: limits to punitive damages and limits on fees

TortsProf blog is reporting that the Arkansas' attorney general recently approved the wording of a proposed ballot item to amend the constitution that would instruct the state's legislature to set a cap on punitive damages in med mal cases at no less than $250,000, to be adjusted for inflation every 2 years. 

Long time readers of this blog know I am opposed to caps in general, and caps on punitives in particular make little sense to me.  Punitive damages are meant to be used as a strong deterrent for particularly bad conduct.  The imposition of punitive damages is actually very rare, but when used by juries they are used to send a clear message.  They are also meant to be punitive.  They are supposed to hurt.  These goals are best met if punitives are unpredictable.  Once the defendants know what they punitives are likely to be, they can start calculating the risk and using a formula to count them as a cost of doing business. I am not sure what the wording at issue here is going to be or the final effect, but if it results in making the possible amounts imposed as punitives predictable then I'd say it is a bad idea.

Another aspect of the ballot item is to limit how much plaintiffs attorneys can charge their clients.  This, as usual, is an attempt to make it more difficult for victims to find legal representation, which will in turn benefit those who caused the injuries.  Reportedly, the new measure will ban lawyers from charging more than one-third as a contingency fee.  This does not sound like much but it can make a difference in some cases.

With the approval, the sponsor can begin gathering the 84,859 signatures needed to place the proposal on the November ballot. 

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