Tort Reform

Pejman Yousefzadeh makes the case for tort reform, noting that a good first step would be to require lawsuits to “plead with particularity.”

This means that pleadings must be specific as to the fraud committed, the damage caused by the fraud, and the evidence that back up the plaintiffs’ claims. Plaintiffs can no longer institute vague and general allegations of securities fraud, confident in the knowledge that they would likely receive quick and instant offers of settlement from their target defendants. Instead, plaintiffs have had to belly up to the bar and offer specific allegations. Otherwise, their cases are dismissed.

For years, a lax judicial system has allowed unscrupulous plaintiffs to engage in officially sanctioned blackmail by suing corporate defendants on weak grounds, knowing that the defendants will eventually bow to public and economic pressures, and reward plaintiffs with a settlement they do not deserve. It is high time to end this sorry state of affairs. Sensible and intelligent tort reform can do exactly that, and can bring sanity to our business and legal relationships.

I’m all for tort reform, especially in the case of the many groundless medical malpractice suits that are driving up costs for all of us. The requirement to “plead with particularity” is a good and proper requirement. My hope is that this requirement will be imposed upon not just those who are suing corporations but also on corporations who are suing individuals and smaller companies. I and many of my colleagues have been at the receiving end of intellectual property lawsuits that are nothing more than groundless fishing expeditions meant to drive us out of business by fighting us with a long, drawn out legal process instead of with engineers and superior products. I want tort reform to cut both ways. Both companies and consumers are much too lawsuit happy. Frivolous class action lawsuits need to be nipped in the bud but so too do SLAPP lawsuits and groundless cease-and-desist silliness. Hopefully, a balance can be struck.