Excessive litigation

(Ref. 303)
Problem Components
Policy issue area: Economics
Policy issue: Productivity
Description: The American legal system became burdened with excessive costs and long delays.
Symptoms: In 1989 nearly 18 million new civil cases were filed in state and Federal courts. Because of fear of civil liability 47% of U.S. manufacturers have withdrawn products from the market; 25% of manufacturers have discontinued some forms of product research; 15% of companies have laid off workers because of product liability experiences. Foreign competitors have product liability costs 20 to 50 times lower than U.S. companies. Awards are frequently distributed in an a random and capricious manner. Medical bills soar because of doctors' need for liability insurance and defensive medicine tests and procedures.
Causes: Excessive number of lawyers (70% of lawyers in the world in the U.S.) stimulate law suits; unfair or outdated legal procedures; poor drafting of legislation and regulations.
Cost of problem: Up to $300 billion annually
Solution Components
Resources: Business; alternative conflict and dispute resolution organizations.
Goal: 1. Reduce lawsuits to an acceptable level, using civil suits as the last resort
2. Provide quick resolution of legal actions
3. Make the legal profession less profitable, so that more of our youth go into productive endeavors.
Program area: Economic development
Program-remedy: 1. Legal system reform, including such steps as: capping of punitive damages; having the loser pay the winner's legal fees; reducing loss of time and money during pretrial discovery searches; making expert witnesses impartial and objective
2. Set up a system of pretrial resolution of cases through arbitration and other procedures (Alternative Dispute Resolution techniques), to encourage out-of- court settlements.
Program-prevent: 1. Set up standards for the legal profession, to prevent frivolous lawsuits, abuse of pretrial discoveries and other doubtful practices
2. Better management and professional training, to reduce hazardous products and harmful services.
Cost of program: -
Beneficiaries: Participants of the national economy; industries in the global marketplace.

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