'Loser pays' is now Texas law
There is much angst in Austin as the 82nd legislative session ended Monday, only to be followed quickly by a special session thanks to a last-minute filibuster by a Democrat state senator. Hopefully, though, the session's successes won't get lost in the noise. One of those successes is the epic defeat of the Texas Trial Lawyers Association, a millionaire trial lawyer group that once had the Texas legislature in a headlock, and is now unable to muster a single vote in the Texas Senate against the legislation it feared the most: loser pays.
The Wall Street Journal editorialized, “This Texas upgrade will build on reforms in 2003 and 2005 that have vastly improved the legal climate in what has not coincidentally become the country’s best state for job creation. Texas rewrote everything from class-action certification to product liability” — and I would add the state’s medical-malpractice reforms to that list.
No wonder the nation’s CEOs list Texas as the best state for business.
The success of ‘loser pays’ is destined to be viewed as a key victory for the Republican legislature over a group that once enjoyed almost limitless influence in the state: the Texas Trial Lawyers Association, which lobbied aggressively against the law. Prior to the reforms instituted in 2003 and 2005, Texas was an ambulance chaser’s paradise. Nowadays, even the $13 million the trial lawyers spent to defeat Perry and other pro-tort-reform Republicans in the 2010 election had little impact. In a stunning rebuke, Lt. Gov. David Dewhurst stared down the trial lawyer lobby and shepherded the measure through to a 31–0 vote in the Senate.
More important than the defeat for the TTLA, is what the reform actually does: It makes it less legally perilous to operate a business in the state of Texas.
‘Loser pays’ reform will result in fewer frivolous lawsuits, lower litigation costs, and more expedient justice for legitimate claims. Just as important, the passage of loser pays is yet another example of how Texas has taken the national lead in job creation and the fostering of a strong business climate. Immediately following Perry’s earlier reforms, the number of physicians applying to practice rose by 60 percent, filling a increasing need across the state, according to the Journal. Likewise, by tossing off the threatening shroud of frivolous lawsuits, Texas is removing yet another barrier to small business expansion and job growth.
As a bonus, trial lawyers will also have less money to spend supporting Democrats next go round.
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