U.S. Chamber of Commerce building. (Photo: Diego M. Radzinschi)
The election of Donald Trump as president made it all but certain that conservatives will be joining the U.S. Supreme Court, but there is far greater uncertainty among tort reform groups and the defense bar when it comes to legislative and regulatory efforts aimed at curbing class actions and widening the use of arbitration.
“There is cautious optimism,” said John Beisner, leader of the mass torts, insurance and consumer litigation at Skadden, Arps, Slate, Meagher & Flom in Washington. “It’s hard to know what position the new administration will take because a lot of these things haven’t been directly addressed in the campaign and there’s the question of priority levels in the initial days. There’s a limit to the number of things the administration can address, and matters in the tort reform area remain to be seen.”
For its part, the U.S. Chamber of Commerce, looking forward to a Republican Congress, plans to seek the reintroduction of bills that would force more disclosures by plaintiffs lawyers in asbestos claims and prevent plaintiffs from certifying class actions when they can’t demonstrate similar injuries, said Lisa Rickard, president of the group’s Institute for Legal Reform.
“It’s a whole new day,” she said. “You’ll see, unlike in previous years, more activity and more actions in the Congress by the business community to try to advance much-needed reforms where you’ve got the plaintiffs lawyers really abusing the civil justice process, especially with regard to asbestos litigation and class actions.”
The latter bill, introduced last year as the Fairness in Class Action Litigation Act, would wipe out about 95 percent of all class actions, said F. Paul Bland, executive director of public interest firm Public Justice in Washington.
“It would be open season for securities fraud. Antitrust laws would mostly disappear, pay equity suits on behalf of women paid less than men, predatory lending cases — everything would completely go away,” he said.
But is that something that the president-elect would support? Bland said he’s not so sure. Trump, who self-financed much of his own presidential campaign, has clashed with the Chamber of Commerce on issues like trade policy.
“It’s not clear to me that Donald Trump wants people who are essentially reliable hacks for the Chamber of Commerce,” Bland said. Contrast that with President George W. Bush, whose first bill introduced after he was reelected in 2004 was the Class Action Fairness Act, a top legislative priority for the Chamber of Commerce. “I don’t hear Trump saying anything about how his first legislative priority is helping corporations be immune from lawsuits,” Bland said.
But Thomas Girardi, president of The National Trial Lawyers, doubted that Trump would put up much of a fight if a Republican Congress pushed through tort reform measures. He said he’s aware of additional proposals in the pipeline that involve damages caps and court approval of legal fees, he said.
“I think this is a very tough time for the plaintiffs bar,” said Girardi, of Girardi Keese in Los Angeles. “And the list is endless.”
On the Chamber of Commerce’s list: Require plaintiffs attorneys to disclose litigation financing contracts, create a federal law on data breaches, and reform what Rickard called a “ton of abuse” in the Telephone Consumer Protection Act, used to file class actions over unwarranted solicitations. Beisner, at Skadden, said there’s also discussion about legislation that would address “increasingly troubling issues” in California and Missouri, where the defense bar has struggled to remove mass torts to federal courts.
In the regulatory space, there could be efforts to slow or reverse new or proposed rules from a half-dozen federal agencies restricting arbitration clauses, including the Federal Communications Commission and the U.S. Department of Health and Human Services, Rickard said. But she doubted that those rules would “come to a screeching halt.”
“It’s imperative that we make a stronger and better case on the benefit of arbitration to not only policy-makers but to the American electorate as a whole,” she said. “We’ve got to do a little more spade work in this space.”
Trump hasn’t spoken on whether he would repeal such rules, Bland said. In fact, many of his supporters and Republicans on the Hill have been at odds with the Chamber of Commerce when it comes to limiting access to the courts.
“There will be this question about whether Trump is actually going to be a genuine conservative around this issue or will be a corporate shill,” he said. “If you look at the polls, Republicans hate the idea of forced arbitration as much as Democrats do. Most of Trump’s voters aren’t saying they give the big banks what they want.”
And Trump, a real estate entrepreneur, has filed a large number of lawsuits. Despite calling the “lawsuit industry” the “biggest loser” in Tuesday’s election, the American Tort Reform Association previously has criticized Trump for his litigiousness.
And, at least initially, Trump’s got other priorities, like immigration reform and changes in free trade policies. Acknowledging those other issues, Rickard said the Chamber of Commerce isn’t just focused on Washington. Tuesday’s election added Republican governors in several states, such as Missouri, where legislative efforts to change the state’s rules on scientific experts at trial could succeed. The defense bar has blamed those rules on several substantial jury verdicts. “Obviously now there will be an opportunity to move that pretty quickly and get that signed,” Rickard said. “That would be a priority for us.”