TLR vs. TM

Texans for Lawsuit Reform responds to our November 2005 article; we respond to the organization’s response.

January 2006By Comments

Shortly after the publication of senior editor Mimi Swartz’s article on the effect of tort reform in Texas (“Hurt? Injured? Need a Lawyer? Too Bad!” November 2005), TEXAS MONTHLY received a letter from Texans for Lawsuit Reform (TLR) alleging that the article contained numerous mistakes of fact and law. We agreed to address TLR’s concerns, promised that we would acknowledge and apologize for any errors in the story, and vowed to defend ourselves vigorously when we believed that TLR’s accusations lacked merit. Although we provided TLR with an unprecedented amount of space in which to publish its criticisms in the January 2006 issue, TLR eventually chose not to repeat its claims of error but rather used the space to tout its achievements. In the meantime, TLR widely disseminated its criticism of Swartz’s article and posted the letter containing its accusations on its Web site. The document that appears below is the original letter TEXAS MONTHLY received from TLR, interspersed with TEXAS MONTHLY’s responses to each charge, in italics, including our apology in the two instances where we erred, and a refutation of TLR’s charges in all other instances.

Introduction

In its November issue, TEXAS MONTHLY published an article by Mimi Swartz entitled “Hurt? Injured? Need a Lawyer? Too Bad!” The thesis of the article is that Texans for Lawsuit Reform has single-handedly manipulated Texas’s tort system to deprive injured Texans of their day in court. That thesis is neither accurate nor justified. TLR, its leadership and its 13,700 members, share a genuine concern and have real sympathy for those who have been injured by another person’s or company’s wrongful actions. TLR has no interest in a civil justice system that deprives these individuals of fair compensation for the wrongs done to them. TLR’s only goal, since its inception, has been to help Texas achieve a civil justice system that is efficient and fair to all litigants.

Ms. Swartz’s article, unfortunately, is clearly intended to support her thesis rather than to present an unbiased discussion about the Texas civil justice system. The article is misleading, inaccurate, and, in many respects, entirely incorrect in its statements of fact and law. The purpose of this memorandum is to summarize the most notable errors and omissions in the article, both legal and factual. Due to the pervasiveness of these inaccuracies and the obvious bias of the author, we formally request that TEXAS MONTHLY issue a complete correction of the erroneous and misleading statements.

TEXAS MONTHLY responds: Far from displaying bias, executive editor Mimi Swartz, a National Magazine Award–winning writer and reporter, devotes considerable space to letting the members of TLR present their story in their own words. For example, co-founder Richard Trabulsi is quoted as saying, “We’re looking for fairness, balance, and restoration of litigation to its appropriate role in society.” Swartz ends this section of the story with a statement that reflects her approach to the story: “In the battle between the trial lawyers and tort reformers, each side accuses the other of excessive greed and infinite mendacity; each side is convinced that only its side represents the truth. The middle ground is reserved for the all-too-human collateral damage of a bitter war involving big money and partisan politics, seemingly without end.” This balanced statement reflects the main focus of Swartz’s article, which is neither tort reform nor the tort reformers but the impact that tort reform has had on ordinary people who have suffered injury and loss: In many circumstances, several of which she describes, it has effectively closed the courts to victims.

In the following point-by-point discussion, the reader will come across many assertions by TLR that Swartz’s description of the law or the facts is misleading or incomplete. While we will deal with these in turn, we would simply make the obvious point here that “Hurt? Injured? Need a Lawyer? Too Bad!” is a work of journalism, not a legal treatise. It paints with a brush that is broad but not flawed. Many of Swartz’s examples are carefully couched in terms of what can happen to an injured person seeking redress, depending on the facts of the case—not what will happen to every litigant. There are many other instances in which TLR’s claim of a mistake by Swartz and TEXAS MONTHLY is nothing more than a matter of differing interpretations. Regrettably, there are two instances, one involving the law and another involving factual material, where errors appear. We acknowledge and apologize for these errors here and will do so again in our response to TLR’s specific allegations.

Ms. Swartz is Wrong in Her Statements of Law

1. The article misstates the effect of caps on noneconomic damages in medical malpractice cases.

A significant segment of the article is about a retired worker named Alvin Berry, whose doctor allegedly failed to diagnose his cancer in a reasonably timely manner. In discussing the effect of the caps on noneconomic damages in House Bill 4, Ms. Swartz states on page 167: “. . . and if he won the case, Alvin would take home substantially less than the maximum of $250,000 the state of Texas had decided an injury like his could be worth.” Using a different example to make the same point about the caps, Ms. Swartz states on page 168: “If your child is blinded at birth because of medical malpractice, there is a good chance that her only remedy is to receive a few hundred dollars a month for the rest of her life.” These statements are divorced from reality.

By enacting HB 4, the Texas Legislature has not made a determination that an injury like Alvin’s could only be worth a maximum of $250,000, nor does the bill contain anything that would limit a blinded baby’s recovery to a few hundred dollars a month. Rather, the caps in HB 4 apply only to noneconomic damages, which are inherently subjective and often speculative, and those caps can go as high as $750,000 when three or more defendants are sued (which is not uncommon). Ms. Swartz, however, wholly fails to consider that HB 4 places no limit on the recovery of economic damages, including past and future medical expenses, expenses related to physical therapy and rehabilitation, expenses related to long-term nursing care, and expenses related to medication and necessary medical equipment, lost income, and lost future earning power resulting from the injuries.

Importantly, even plaintiffs who are unemployed at the time of the injury can recover lost future earning power resulting from the injuries, because lost future earning power is measured by the lost capacity to earn money and not the loss of actual earnings. Moreover, in the case of a child with serious and permanent injuries (such as blindness), courts have presumed that the child will have diminished earning capacity, and the fact finder is asked only to decide how much to award. Economic damages such as these can often run into the hundreds of thousands of dollars, or in some cases, millions. Ms. Swartz’s complete disregard of these types of damages in describing the likely outcome of Alvin’s case and the blind baby hypothetical is simply inexcusable and misleading.

TEXAS MONTHLY responds: TLR charges that Mimi Swartz errs not only by failing to mention the ability of a plaintiff to sue for economic damages but also by leaving the impression that economic damages are subject to the $250,000 cap. Neither charge is accurate. Concerning the scope of the cap, Swartz writes that Proposition 12 amended the state constitution “to limit noneconomic damages (usually pain and suffering) in medical malpractices cases to $250,000.” Concerning the ability to sue for economic damages, Swartz writes that “medical expenses are not subject to the cap.”

The statement about Alvin’s prospective damages is presented by Swartz as his lawyer’s appraisal of his case. Alvin’s situation and the hypothetical case of the blinded baby—as well as several other examples that TLR brings up later in their letter—are presented as illustrations of “what can happen to you in Texas today.” These illustrations are unquestionably true. TLR says it is possible Alvin might receive more money if he is awarded damages for lost earnings or medical expenses or if he should be able to sue three different defendants. But his lawyer’s estimate is more plausible than TLR’s, because of other facts made clear in the story: that he is a 73-year-old retiree and therefore unlikely to have much prospect of lost income and that only one doctor is responsible for his damages. TLR’s statement that Alvin might have been able to receive as much as $750,000 under the cap if there are three or more defendants is at best incomplete. If the three or more defendants are all doctors, the cap remains at $250,000 regardless of the number of doctors involved. In order for the maximum cap of $750,000 to apply, the lawsuit must involve at least one doctor and at least two hospitals. TLR’s claim that this is “not uncommon” is self-serving and contrary to the experience of litigators Swartz interviewed.

Regarding the blinded baby, HB 4 did two things that could limit a blinded baby’s recovery to “a few hundred dollars a month.” It placed the $250,000 cap on noneconomic damages, and it also allowed the trial judge to order jury awards to be paid periodically over a long term of years, with no adjustment for inflation, instead of in a single payment, as had been the law prior to HB 4. Finally, as TLR points out, lost earnings power is both subjective and speculative. Generally, victims who come from poor households do not recover nearly as much as victims from affluent households, and retired people may not recover anything at all. Ms. Swartz does not say categorically that a blinded baby will only receive a few hundred dollars a month. Rather, she says, “There is a good chance” this could happen. How much a blinded baby would receive is necessarily speculative; it could receive more. But there is little doubt it will receive far less now than it would have received before HB 4.

2. The article misstates the Good Samaritan law.

With regard to emergency room doctors, Ms. Swartz states on page 168: “If you go to an emergency room with a heart attack and the ER doctor misreads your EKG, you must prove, in order to prevail in a lawsuit, that he was both ‘wantonly and willfully negligent.’” This is not true. Texas law does not require “wanton and willful negligence” to establish liability for medical malpractice. Ms. Swartz is apparently referring to Texas’s “Good Samaritan” statute, which provides that a person who in good faith administers emergency care is not liable in civil damages for an act performed during the emergency unless the act is willfully or wantonly negligent. Tex. Civ. Prac. & Rem. Code § 74.151(a) (Vernon 2005). Significantly, however, the statute does not apply to care “administered for or in expectation of remuneration.” Id. at § 74.151(b). Moreover, the Good Samaritan statute was already “on the books” before the passage of HB 4, in 2003. Consequently, it is wholly misleading for Ms. Swartz to suggest that HB 4 added a “wanton and willful” standard for emergency care rendered by a Good Samaritan.

TEXAS MONTHLY responds: TLR’s claim is without validity. Apparently the organization had not read its own bill. The applicable standard of proof is not found in the Good Samaritan Law [Civil Practices and Remedies Code 74.151]. In-hospital emergencies are covered by CPRC 74.153, which was part of HB 4, the TLR-backed tort reform bill of 2003. The law now requires the plaintiff to prove that the provider, “with willful and wanton negligence,” deviated from the degree of care and skill that is reasonable expected of a prudent health care provider. That standard applies even if the care was given in expectation of remuneration. Several days after sending this letter, TLR learned of their mistake and sent a subsequent letter revising its erroneous statement and charging Swartz with implying that emergency room physicians could commit negligence with impunity. This is one of many instances in which TLR chooses to take issue with what Swartz did not say, rather than what she did say. Her statement—“If you go to an emergency room with a heart attack and the ER doctor misreads your EKG, you must prove, in order to prevail in a lawsuit, that he was both ‘wantonly and willfully negligent’”—is entirely correct and implies nothing about what happens to people who receive care in an emergency room after being stabilized or receive non-emergency care.

3. The article misstates the law regarding defective drugs.

The article’s mischaracterizations of the law are not limited to reforms involving claims against medical-care providers. On page 168 of the article, Ms. Swartz states: “If you took a drug that was later recalled after studies proved it could cause fatal complications, the manufacturer can escape liability for your serious injury or death if the instructions inside the package were approved by the FDA when you took the medicine.” This statement is misleading.

Ms. Swartz is apparently referring to the presumption under Section 82.007 of the Texas Civil Practice and Remedies Code that the manufacturer of a drug is not liable under a failure to warn theory of recovery if the warnings or information that accompanied the drug were approved by the FDA. Ms. Swartz’s hypothetical omits, however, that the presumption does not apply: (1) to a claim that the drug had a design or manufacturing defect or (2) where the manufacturer withheld from or misrepresented to the FDA information about the performance of the drug in order to obtain approval of the warnings or information that accompanied the drug. See Tex. Civ. Prac. & Rem. Code § 82.007 (Vernon 2005). Thus, if the drug was defective, as Ms. Swartz’s hypothetical implies, then her statement is simply false. At a minimum, however, her statement of the law is incomplete and misleading.

TEXAS MONTHLY responds: Swartz’s statement that tort reform allows a drug manufacturer to escape liability for faulty instructions is incontestably true. The issue raised by TLR is whether Swartz misled readers by failing to write a full explanation of the presumption and its exceptions. We say no. For practical purposes, the presumption, accurately described above by TLR, determines the outcome of “failure to warn” cases in favor of the manufacturer unless the presumption can be rebutted. The law sets out only two ways to rebut the presumption, neither of which will prove useful in the vast majority of cases. Not only is this the result that can happen; it is the result that tort reform sponsors intended to happen. TLR is free to quibble with the nuances, but it can’t rationally contest the truth of Swartz’s illustration.

4. The article misstates the effect of HB 4 on the likelihood of recovery for a defective automobile.

On page 168 of the article, Ms. Swartz states: “If a driver hits your old Ford Pinto from behind and burns you beyond recognition, Ford will almost certainly [TLR’s emphasis] be able to shift the blame from its defective product to the driver of the other car.” This is rank speculation.

The allocation of blame is up to the fact finder, which must decide the allocation based on the evidence. This has been the law since before TLR was even formed, and it was not affected by HB 4. It is perfectly possible that Ford would be held 100 percent responsible—especially if the accident occurred at a low rate of speed. On the other hand, Ford would probably have a strong defense if the rear impact speed was 70 miles per hour—which might ignite any gas tank even if the driver survived such a tremendous initial impact. Motor vehicle collisions occur in many ways, which means that any categorical claim that current law means that Ford “will almost certainly” escape liability is unsupportable on its face.

TEXAS MONTHLY responds: Swartz refers to the doctrine of “proportionate responsibility,” championed by TLR in 1995 tort reform legislation, which limits the exposure of a “deep pockets” defendant who is less than 51 percent at fault for an accident. She is correct that Ford would endeavor to shift the blame for its defective product to the driver of the other car. Whether Ford would “almost certainly” be able to do so would depend, as TLR points out, upon the facts of the case. It would have been more precise for Swartz to say that tort reform has made it “more likely” that Ford will be able to shift the blame to the other driver. This is interpretation, not error.

5. The article misstates the effect of HB 4 on a negligent apartment owner’s liability.

On page 168 of the article, Ms. Swartz states: “If you live in an apartment complex that lays off security guards and fails to maintain its locks and you are raped as a result, the apartment owner can still avoid liability.” HB 4 does not, however, provide that an apartment owner can “avoid liability” under these circumstances. Rather, if a jury finds that the apartment owner was negligent, the owner can be held liable today to the same extent as before HB 4.

Ms. Swartz’s hypothetical is apparently referring to the aspect of HB 4 that provides that a jury is entitled to apportion responsibility among all of the responsible persons, including the rapist in her hypothetical. See Tex. Civ. Prac. & Rem. Code § 33.003 (Vernon 2005). However, even before the enactment of HB 4, a jury could consider the percentage responsibility of the hypothetical rapist provided that the apartment owner joined the rapist as an additional defendant in the lawsuit. The effect of HB 4 was simply to remove this procedural barrier, which, in many cases, was artificially preventing a jury from apportioning responsibility among all those potentially responsible. Its effect was not, as Ms. Swartz states, to relieve a negligent apartment owner of his or her liability.

TEXAS MONTHLY responds: Like the previous examples of the misread EKG, the child blinded at birth, the faulty drug instructions, and the Ford Pinto, the example of the apartment rape and the insulation of the apartment owner from liability is presented as illustrations of “what can happen to you in Texas today” as a consequence of tort reform. TLR’s complaint is disingenuous: The change in the law the organization so glibly claims was “procedural” enables the negligent apartment owner to shift part of his responsibility to an unknown rapist from whom the victim can recover nothing; previously, the apartment owner could be held liable for all the damages unless the owner could identify the rapist and join him as a defendant. Under the new procedure, the unknown criminal is an “X” to whom a portion of the responsibility can be assigned even if he cannot be held responsible. It is TLR, not Swartz, who misstates the effect of tort reform on a negligent apartment owner’s liability.

6. The article misstates the effect of the 1995 reforms to the proportionate liability statute.

On page 222 of the article, Ms. Swartz writes: “In the past, if a jury found that the defendant was more liable than the plaintiff, the defendant could be held liable for the entire amount of the judgment. After 1995, a defendant was on the hook for only his share of the responsibility, a concept defined by TLR as ‘proportionate liability.’ The effect was that if, say, an uninsured driver who rear-ended a poorly designed car was found to be 40 percent responsible for the resulting explosion, then the injured plaintiff would have to ‘eat’ that 40 percent—the Legislature having chosen to protect the negligent automaker instead of the innocent victim.” This passage is rife with errors. First, the comparative responsibility statute in effect prior to the 1995 reforms did not provide that every defendant who was more liable than the plaintiff was “liable for the entire amount of the judgment.” In fact, according to that version of the statute, except for certain enumerated exceptions, “a liable defendant is liable to a claimant only for the percentage of damages found by the trier of fact equal to that defendant’s percentage of responsibility” for the damages caused. See Tex. Civ. Prac. & Rem. Code § 33.013(a) (Vernon 1994). Notably, this provision of the comparative/proportionate responsibility statute was not affected by the 1995 reforms.

Equally erroneous is the implication that after the 1995 reforms a defendant can be “on the hook for only his share of the responsibility. . . .” On the contrary, even today a defendant who is attributed a percentage of responsibility greater than 50 percent continues to be jointly and several [ sic ] liable for all damages recoverable by the plaintiff. See Tex. Civ. Prac. & Rem. Code § 33.013(b)(1) (Vernon 2005). Thus, returning to Ms. Swartz’s hypothetical of a lawsuit involving an “innocent” plaintiff, a “negligent” automaker, and an uninsured driver who is found 40 percent responsible, the negligent automaker found 60 percent responsible would be jointly and severally liable even today for the all of the damages recoverable by the plaintiff. Ms. Swartz’s statement to the contrary is just plain wrong.

TEXAS MONTHLY responds: TLR is right; TEXAS MONTHLY is wrong. In Swartz’s hypothetical accident, the uninsured negligent driver was 40 percent at fault (leaving Ford to bear 60 percent of the fault). TLR correctly says that, under those circumstances, Ford would have been jointly and severally liable for 100 percent of the plaintiff’s damages, not just 60 percent. The percentages in the hypothetical accident were mistakenly transposed. The text should have read: ”If the uninsured negligent driver was 60 percent at fault (leaving Ford 40 percent at fault), then Ford’s liability would be limited to 40 percent and the innocent victim would have to ‘eat’ the other 60 percent of the damages.” TEXAS MONTHLY regrets the careless error.

7. The article overstates the probability that a plaintiff’s verdict will be overturned by appeal to the Texas Supreme Court.

In addition to misstating and mischaracterizing the substance of the law as described above, the article also significantly overstates the probability that a successful plaintiff will be reversed on appeal. On page 168 of the article, Ms. Swartz states: “. . . should [the plaintiff] by some slim chance win and the defendant appeals, [the plaintiff’s] odds of ultimately prevailing on appeal are 12 percent as of 2004—the paltry rate at which the Texas Supreme Court, which has also been subject to the influence of the tort reformers, has found for the plaintiff in cases involving harm to persons or property, according to Court Watch, an Austin-based public-interests organization.” This is inaccurate.

The Texas Supreme Court has discretion to determine which appeals it will or will not review. Thus, in cases where the plaintiff wins and the defendant appeals to the Texas Supreme Court, the plaintiff can prevail on the appeal by either: (a) persuading the Court not to review the case or (b) persuading the Court to affirm the judgment. The 12 percent statistic cited by Ms. Swartz only relates to the latter situation in which the Court decides to hear the appeal. The critical statistic that the article omits, however, is that the Texas Supreme Court refuses to hear about 90 percent of the cases appealed to it. See Texas Office of Court Administration, Annual Report of the Texas Judicial System, Fiscal Year 2004, at p. 23. Once this critical fact is considered, it is clear that Ms. Swartz’s simplistic statistical logic grossly underestimates a winning plaintiff’s odds of withstanding a defendant’s appeal to the Texas Supreme Court.

TEXAS MONTHLY responds: TLR attacks the validity of a statistic that exists in the public realm—Court Watch’s determination, verified to Swartz by a member of the Texas Supreme Court, that the court finds for the plaintiff in just 12 percent of the cases involving personal injuries or property loss—and takes Swartz to task for not ferreting out a nonexistent statistic that would require TEXAS MONTHLY to do what TLR did not do, which is to examine the outcomes of hundreds of cases the court never considered on the merits. As TLR well knows, the refusal to hear a case does not necessarily reflect the court’s philosophical leanings. It may decline to hear cases for reasons that have nothing to do with how the court might have ruled had it accepted the case: The issues involved may be too insignificant or already settled or correctly decided by the lower courts or not yet ripe for decision—to name but a few possibilities. The only meaningful gauge of the Supreme Court’s pro-defendant stance is to consider those cases in which the court rules on the merits and issues an opinion explaining its reasoning.

Ms. Swartz’s Assertions of Fact Also Are Wrong

In addition to her misleading and inaccurate legal pronouncements, Ms. Swartz has grossly misstated, mischaracterized, and omitted numerous important facts regarding TLR and its activities. Several of the more egregious examples are summarized below.

1. The article misstates the effect of tort reform on medical malpractice insurance premiums and on the return of doctors to underserved areas.

On page 258 of the article, Ms. Swartz writes: “Malpractice insurance reductions have been less than 1.5 percent since 2003, and the hoped-for return of doctors to underserved areas has not taken place.” Of all the errors of fact and law contained in the article, this failure to accurately report the favorable public policy impact of the medical liability provisions of HB 4 is the most disturbing.

As expected by the Texas Legislature when these reforms were enacted, Texas Department of Insurance fact sheets and other TDI data reveal that the combined rate cuts of all insurers of Texas physicians since HB 4 was enacted total more than 11 percent. The Texas Medical Liability Trust (TMLT), which is a doctor’s self-insurance pool, cut its doctors’ liability premium rates by 12 percent immediately upon passage of HB 4, in 2003, and reduced rates an additional 5 percent in 2004. This year, TMLT announced a $27.9 million premium reduction in a combination of rate cuts, dividends, and discounts for good claims experience, which will take effect January 1, 2006. TMLT is the largest single insurer of Texas doctors. The Joint Underwriting Association (JUA), the insurer of last resort, has reduced premiums 10 percent for doctors and 15 percent for nursing homes.

Additionally, since HB 4 became effective, 3,016 doctors have either returned to or begun practicing in Texas. The historically underserved Rio Grande Valley has added 128 physicians, including 10 pediatricians and 7 general surgeons. Jefferson, Nueces, and Victoria counties have posted impressive gains in physician growth after experiencing a net loss of physicians in the eighteen months prior to the passage of HB 4. Statewide, the ranks of heart surgeons, pediatric heart surgeons, neurosurgeons, and neurologists had declined or shown no increase in the five years preceding the passage of HB 4, but since enactment, each sub-specialty has shown healthy gains. Texas experienced a net loss of 9 orthopedic surgeons and 14 obstetricians in the three years preceding passage of HB 4. Since enactment, however, the state has a net gain of 93 orthopedic surgeons and 81 obstetricians. It is difficult to examine this objective data and understand how Ms. Swartz can credibly claim that the return of doctors to our Texas medical markets has not taken place.

TEXAS MONTHLY responds: Swartz correctly reported that the average premium rate decrease for all medical malpractice insurers in Texas since the passage of HB 4 was 1.5 percent. The source for that figure is a Texas Department of Insurance (TDI) table that was prepared at the end of the third quarter of 2004, one year after tort reform. This is a published source, not an unofficial compilation of “fact sheets,” “other data,” and announcements. It was the latest official TDI calculation available at the time the November 2005 issue of TEXAS MONTHLY went to press. TLR is correct that Texas Medical Liability Trust, which insures 37 percent of the doctors in Texas, cut its liability rates by 12 percent following the passage of HB 4. However, TLR neglects to mention that the second-largest insurer, GE Medical Protective, which insures 26 percent of the doctors, raised its rates by 10 percent. Two other companies, each with very small market shares, also raised their rates. The four actions, taken together, averaged out to the 1.5 percent rate decrease cited by Swartz.

Swartz likewise is correct that underserved areas continue to lag far behind urban Texas in their ability to attract physicians. The rate of growth of physicians in all the rural areas of the state as identified by the Texas Department of Health—Panhandle and South Plains, North Texas, Northeast Texas, Deep East Texas, rural West Texas, Central Texas, and even South Texas—has declined since the passage of tort reform, and the post–tort reform growth rate in each of those regions is smaller than the growth rate in any of the five years preceding the passage of tort reform. (For example, in South Texas, the rate of growth for physicians just before the passage of tort reform was 4.1 percent. Since tort reform, it has been 3 percent.) Meanwhile, the four urban areas (the Metroplex, Houston, San Antonio, and El Paso) have shown significant increases. This is hardly surprising, since urban areas offer physicians advantages over rural areas involving income, lifestyle, and professional facilities. Swartz’s source is unimpeachable: The Texas State Board of Medical Examiners. In response, TLR offers figures from three selected counties and part of a single region. They tout a net gain of orthopedists and obstetricians statewide, which says nothing about how many of these doctors might be in underserved areas. We wish TLR were right about doctors returning to underserved areas, but the trend apparently is getting worse, not better.

2. The article misstates TLR’s endorsements of candidates.

On page 254 of the article, Ms. Swartz states that Senator Sam Brownback “is just the kind of politician TLR likes: Republican, wealthy, with Christian right bona fides. . .” This is sheer speculation. Ms. Swartz never inquired of any of TLR’s leaders about their personal political preferences. TLR PAC decides its endorsements on a candidate’s views and positions on the Texas civil justice system, not on party, not on personal wealth, and not on a candidate’s positions on social issues or federal issues.

Naturally, there are differences of opinion on non–civil justice policy issues among TLR’s leadership, and there is wide diversity of political and policy views among the 13,700 Texas citizens who are supporters of TLR. Ms. Swartz’s statement that TLR is partisanly Republican is patently false. A partial list of Democratic candidates that TLR PAC has supported includes: Lieutenant Governor Bob Bullock; Supreme Court Justice Rose Spector and Supreme Court candidate Margaret Mirabal; Third Court of Appeals Justice Jan Patterson; State senators Ken Armbrister, Rodney Ellis, Juan Hinojosa, Eddie Lucio, Frank Madla, Mike Moncrief, John Montford, Bill Sims, John Whitmire, and Judith Zaffirini; Texas House members and candidates for the House Clyde Alexander, Jaime Capelo, Robby Cook, Henry Cuellar, Dan Ellis, David Farabee, Charles Finnell, Timoteo Garza, Roberto Gutierrez, Mark Homer, Chuck Hopson, Todd Hunter, Rob Junell, Nelda Martinez, Tom Ramsay, Allan Ritter, Patrick Rose, Abel Ruiz, Laura Salinas, Curtis Seidlits, Mark Stiles, Mark Strama, Tom Uher, and Mike Villarreal.

TEXAS MONTHLY responds: The misstatement—or, to be generous, misinterpretation—is TLR’s. Swartz’s story contains no statement that TLR is partisanly Republican. TLR put those words in her mouth. To say, as Swartz does, that TLR likes Republican candidates is hardly the same thing. Of course it does. While there are individual exceptions, Republicans tend to be more favorably disposed toward business, and consequently tort reform, than Democrats.

3. The article misstates the facts regarding TLR’s contribution to the Dale Wainwright campaign against Elizabeth Ray.

On page 228 of the article, Ms. Swartz states: “ . . . TLR’s leadership turned its attention to judicial races, investing around $1 million to defeat Elizabeth Ray, a Houston district judge, in a 2002 Republican primary runoff election for the Texas Supreme Court. In an exceptionally bitter race, TLR tarred her as a sham Republican and a friend of the plaintiff’s lawyers. Its candidate, Dale Wainwright, won.” Ms. Swartz’s factual assertions regarding TLR are wrong.

The true facts are that TLR PAC contributed a total of $15,500 to Judge Dale Wainwright’s campaign, not $1 million. Ms. Swartz does not cite who contributed the remaining $984,500 in stated contributions or the basis of her assertion that it was TLR.

Ms. Swartz’s assertion that TLR “tarred” Judge Ray is also inappropriate. TLR endorsed Judge Wainwright because it believed he was the more qualified and judicially conservative candidate. The Texas electorate agreed. Judge Ray, in contrast, raised 83 percent of her campaign funds from mass-tort plaintiff’s lawyers, including Walter Umphrey, John Eddie Williams, John O’Quinn, and Fred Baron. TLR does not “tar” a candidate when it informs the electorate of a candidate’s connection to the plaintiffs’ bar. This is information that the electorate should have in order to make an informed decision at the polls.

TEXAS MONTHLY responds. We acknowledge a major mistake here. The $1 million figure represents approximately the total amount contributed to Dale Wainwright’s campaign, not TLR’s contributions. We regret our error and apologize to TLR for the mistake. However, it is noteworthy that TLR also erred in stating that it contributed only $15,500 to the Wainwright campaign, though its mistake was hardly of the same magnitude as ours. TLR made three cash contributions to the Wainwright campaign totaling $17,500 and also donated fax, postage, and other services, including $7,436.11 for direct mail services, for a total of around $27,000. TLR’s mistake in no way excuses our own.

4. The article misstates the facts regarding TLR’s contributions to George W. Bush’s gubernatorial campaigns.

On page 220 of the article, Ms. Swartz states: “There was a new governor too: George W. Bush, who had defeated Ann Richards, in 1994, by sticking to four issues, one of which was tort reform. (By the time he was reelected, in 1998, TLR and similar groups had given more than $4 million to his two campaigns.)” This is wrong. TLR PAC contributed a total of $25,000 to George W. Bush’s gubernatorial campaigns. The article doesn’t say where the other $3,975,000 of the cited $4,000,000 came from. Nor does it relate how much money Mr. Bush’s opponents received in campaign contributions from personal-injury plaintiffs’ lawyers.

TEXAS MONTHLY responds: Swartz used figures complied by Texans for Public Justice (TPJ), an Austin-based nonprofit that is a leading source of information about campaign contributions. TPJ calculates that TLR and individuals on its board of governors contributed $1,324,570 to Bush’s 1994 campaign and $2,247,818 to his 1998 campaign, for a total of more than $3.5 million. The Texas Civil Justice League and affiliated businesses and individuals contributed a total, in the two races, of $583,155, for an overall total from TLR and similar groups of more than $4.1 million. TLR is correct that its PAC contributed only $25,000. However, individual contributions were considerably larger. For example, TLR co-founder Dick Weekley and his relatives donated more than $60,000.

5. The article misrepresents contingency fee and jury reforms advocated by TLR.

On page 256, Ms. Swartz writes: “There are other areas of the law that TLR would like to see ‘reformed.’ Along with prohibiting contingency fees for lawyers hired by government agencies, TLR wants to restrict who can serve on juries [emphasis added].” Both of these assertions are false and completely misrepresent the efforts of TLR in this regard.

First, TLR has never advocated, and does not advocate, “prohibiting” contingency fees for lawyers hired by government agencies. Our work on government officers hiring outside lawyers on contingent fees flows from the outrageous activities of former attorney general Dan Morales in awarding $3.3 billion to five lawyers as part of the tobacco settlement. A sorely needed TLR-inspired reform, which was sponsored by then-representative Rob Junell (Democrat, San Angelo) and enacted into law in 1999, places reasonable checks and balances on a state officer in making contingency fee arrangements with lawyers. Among other reforms, lawyers hired by the state under these arrangements will receive the lesser of the agreed-upon contingency fee or a “lodestar” computed fee that may result in a fee award of up to $4,000 per hour. These reforms most certainly do not “prohibit contingency fees,” as incorrectly alleged by Ms. Swartz. Instead, the statute codifies for use with state contingency fee arrangements the venerable “lodestar” method of determining reasonable legal fees, which has long been utilized by state and federal courts.

Second, with respect to jury reforms, TLR endeavors to make the entire jury experience more fair, efficient, and useful. That is why TLR supported the juror-pay bill in the 2005 legislative session, which raised juror pay to $40 per day. Additionally, TLR thinks it is regrettable that, for example, only 25 percent of the people summoned to jury service in Harris County actually show up. TLR believes that reforms designed to increase such percentages, along with other ideas to improve jury service being explored by judges, lawyers, and academics, such as allowing jurors to ask questions during the trial, certainly merit further consideration. None of these ideas, however, can accurately be portrayed as “restrict[ing] who can serve.”

TEXAS MONTHLY responds: It is surprising to see TLR attempt to disassociate itself from this phrase—“along with prohibiting contingency fees for lawyers hired by government bodies”—because it appears in the magazine exactly as dictated to a TEXAS MONTHLY fact checker by TLR spokesman Ken Hoagland. In practice, contingency fees for lawyers representing government agencies have been legislated out of existence by allowing them only if they are lower than an alternative judge-approved “lodestar” fee. Contingency fees remain an option—for any lawyer who wishes to be paid less rather than more.

It is equally surprising to see TLR deny that it seeks to restrict who can serve on juries. TLR’s own press kit calls for “upgrading the qualifications required to serve on juries.” It is not possible to upgrade qualifications without excluding those who currently meet qualifications but would not meet the upgraded qualifications.

6. The article incorrectly implies that Justice Priscilla Owen’s dissenting opinion in Dueñez evidences that she is beholden to TLR.

On page 256, in discussing the Dueñez opinion, Ms. Swartz writes, “Justice Priscilla Owen, whom TLR had helped elect, had conceded in her dissent that ‘a provider of alcohol should be vicariously liable for a patron’s intoxication.’ But she went on to say that she did not believe the Legislature meant what it said when it passed a law stating that a provider of alcohol was 100 percent liable for damages caused by an intoxicated patron who had been allowed to buy alcohol when he was clearly already drunk.” (emphasis added).

By this passage, Ms. Swartz clearly expects the reader to believe that Justice Priscilla Owen (who now sits on the United States Court of Appeals for the Fifth Circuit and who has received the American Bar Association’s highest qualification rating in her confirmation process) is beholden to TLR because of its support in her past election campaigns, and as a result, she conformed her dissenting opinion in Dueñez to satisfy TLR’s position on that case. However, Justice Owen’s dissenting opinion, which was joined by three other justices, was written and published long before TLR filed its amicus curiae brief in Dueñez. Earlier in the article, Ms. Swartz concedes as much when she speculates that one of the reasons the Texas Supreme Court granted a rehearing of its previously issued decision (to which Justice Owens and three others dissented) is that very same amicus curiae brief filed by TLR. ( See article, pages 254–256). Thus, it is obvious, presumably even to Ms. Swartz, that at the time Justice Owen was writing her dissenting opinion, she was unaware not only that TLR would later prepare and file an amicus curiae brief urging a rehearing but also that TLR would even take a position with respect to the Dueñez opinion. Additionally, the article fails to disclose that, in addition to Justice Owen, all five of the Justices who decided the majority opinion in Dueñez (which was dissented to by Justice Owens and three others) have been—and are—also supported by TLR. Curiously, Ms. Swartz did not see fit to mention that “TLR had helped elect” those five justices who rendered a decision that TLR later sought to have re-heard.

TEXAS MONTHLY responds: Once again, TLR has attributed words and motives to Swartz without justification. Describing Judge Owen, who is singled out as the author of the dissenting opinion, as someone “whom TLR had helped to elect” is not equivalent to suggesting Owen is beholden to TLR. It is information that Swartz has every right and reason to provide to our readers without having motives imputed to her. Owen is known to be a conservative judge with a pro-business record, which makes her exactly the kind of judicial candidate TLR would support—because of her philosophy, not because of her malleability.

Conclusion

TLR takes serious issue with both the legal and factual accuracy of Mimi Swartz’s recent article on civil justice reform in Texas. We believe that TEXAS MONTHLY should investigate the matters raised in this memorandum and our contemporaneous letter to the editor, and it should issue a complete correction of the erroneous and misleading statements. We would welcome the opportunity to discuss any of these items with you at your convenience.

TEXAS MONTHLY responds: With a couple of exceptions, for which we have apologized, the criticisms of Texans for Lawsuit Reform of Mimi Swartz’s article are largely without merit. Sadly, TLR chose to direct most of its criticism toward minor matters, such as whether Swartz had described points of law to TLR’s satisfaction, and to respond with bombast and indignation, rather than to engage in a discussion on the merits concerning the main point of Swartz’s story: Tort reform, which was necessary to bring fairness and balance back to the legal system, has overreached to the point where it has now effectively closed the courthouse to many people who have suffered injuries in many areas of litigation.

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