Why Have Lawsuits? (Regulations Aren’t Enough)
In recent years, tort reform has been astoundingly popular. Industry became the victim that needed protection from trial lawyers bringing “frivolous” lawsuits on behalf of workers and consumers. Get rid of trial lawyers, some special interests argue, and government agencies are there to regulate industry and protect workers and the public. It seems that the widespread—but unexamined—support for tort reform is based on beliefs just like these. For in truth, as our recent economic crisis has taught us, these regulatory agencies cannot protect us alone and, what’s more, will not always tell us the truth when we need to know it.
For example, in 2007, a Government Accountability Office study suggested that the Environmental Protection Agency misled the public about the extent of asbestos contamination in lower Manhattan apartments. More than five years after the terrorist attacks on the World Trade Center, the EPA scheduled a second program for indoor testing and cleanup of asbestos and other contamination. In announcing the second program the EPA reported that a “very small” number of air samples showed dangerous levels of asbestos, but the agency failed to disclose that this result was entirely predictable because most of the samples—over 80 percent—were taken after residences had been cleaned through the EPA’s own program. The GAO expressed concern that, because the EPA’s report was misleading, residents might underestimate the extent of the asbestos risk and decide not to participate in the EPA’s second program for further testing and cleanup.
Regulatory agencies sometimes fail to protect the public for a variety of reasons. Government employees are, after all, people: sometimes they make mistakes. On the other hand, political pressure may affect an agency’s ability to protect the public. Industry members spend a lot of money on lobbyists to influence decision makers and protect their interests in Washington. Certainly, there were questions about the Bush administration’s commitment to health and environmental protection. In the aftermath of the 9/11 bombings, EPA employees may have wanted to, or felt pressure to, minimize public concern about the consequences of the terrorist attacks. We can’t know for sure why the EPA failed to disclose the extent of asbestos contamination, but it’s a reminder that we cannot depend on regulatory agencies alone to protect us.
But even with the best intentions and the most strenuous efforts, regulatory agencies may not be equipped to provide the protection we ask of them. The first problem is the ability to enforce the law when companies are caught violating it. OSHA can fine a company for safety violations, but even when the violations are serious, the maximum fines are too small to impact most companies. There’s no bite and so not enough reason for industry to follow the rules. Lawsuits can be expensive enough to make a company obey the law and keep workers safer.
Sometimes companies hide the information that agencies need to do their jobs. For example, the weight-control drug FenPhen and diabetes drug Rezulin were both pulled off the market after deadly side effects were discovered that had been known to the pharmaceutical companies but hidden from the FDA during the drug approval process. Lawsuits can make a company turn over documents that show what it knows or knew about the dangers of its product, and lawyers have been much more successful at getting this information than regulatory agencies in many cases.
Business interests use their lobbyists, who work to weaken regulatory oversight and to pass tort reform litigation. Tort reform is critical to industry precisely because lawsuits make it expensive to hurt workers and to place the public at risk. And this is exactly why trial lawyers keep bringing such lawsuits: because they work to make bad actors accountable when nothing else can.
