Lawsuit Reform

Missouri Governor Jay Nixon Vetoes Lawsuit Reform Proposals

Missouri Governor Jay Nixon last week vetoed two reforms that would have helped the state get a handle on its frivolous lawsuit problem.

Missouri’s lawsuit system performs in the bottom third of all state legal systems, 42nd out of the 50 states, according to the US Chamber’s Lawsuit Climate Survey. It is well behind its neighbors in providing fair and predictable justice that safeguards individual liberty and buttresses economic opportunity, in large part because its state laws incentivize unwieldy justice. State Lawsuit tracks poor performance in more than half of its lawsuit reform indicators. For this reason, it has shown up on the annual Judicial Hellholes™ List for nearly a decade.

The Missouri legislature, led by Senators Mike Parson and Ed Emery, passed two reasonable lawsuit reforms that Nixon vetoed.

SB 591 would have created stronger and more meaningful standards for expert witness evaluation before trial to keep junk science out of the courtroom. Missouri is one of fewer than a third of states that follows the near-obsolete Frye standard for admitting experts, which in practice allows junk science to be presented in court and risks frivolous verdicts. SB 591 would have normalized Missouri’s expert witness standards and brought them in line with the recommendations of federal and state court judges the country over.

SB 847 would have helped normalize lawsuit awards in Missouri by requiring medical damages to reflect actual out-of-pocket costs, rather than inflated billed rates. Missouri juries can currently award phantom damages that reflect costs no party ever had to bear. These phantom damages are portions of awards for medical expenses –the difference between the list price on a bill and the amount actually accepted as full payment – that no one will ever pay or receive for care. SB 847 would have ensured plaintiffs were made whole while keeping inflated awards from making a costly legal system more expensive.

To encourage job creation, promote market innovation and let Missouri’s economy flourish, the legal system must function fairly and predictably, refraining from punishing good actors and incentivizing frivolous lawsuits. The Missouri legislature may yet take up these reforms in a veto override session and provide some relief to victims of Missouri’s litigious system.

In Depth: Lawsuit Reform

State legal systems and the liability they exert on businesses and individuals are a disincentive to bad behavior and allow fair players to succeed in the marketplace. When lawsuits inappropriately punish good actors, resources are sucked out of the business economy, away from research & development and job creation. Lawsuit…

+ Lawsuit Reform In Depth