Statement on West Virginia Legal Environment

Charleston, West Virginia
Monday, February 3, 2003

Thank you, Steve (Roberts), for that kind introduction.

Steve is a good friend and colleague, and the U.S. Chamber is pleased to be a partner and guest of his fine organization.

We're here today to call special attention to one of the most important issues facing West Virginia this decade – the need for real and meaningful legal reform.

West Virginia ranks second to last in a Harris poll we commissioned ranking all 50 state liability systems. This state's poor liability environment is stifling economic development, preventing job growth, and imposing burdensome costs on its own residents.

Some might ask, "Why is the U.S. Chamber sticking its nose in West Virginia's business?"

The answer is simple. While this is a local problem, it has national, and even international consequences. Companies all over the country and some from abroad are named as defendants in cases moved here by class action trial lawyers. Why do they come to West Virginia? Because they know the system here is unfairly tipped in their favor.

Consider the case of Mobil Corp. et al v. Adkins. In a remarkable act of arbitrariness, the West Virginia Supreme Court of Appeals decided to consolidate into one trial the asbestos claims of some 8,000 plaintiffs (no one knows exactly how many) against 250 corporations. Some of those are international companies who got sucked into this mass aggregation — DaimlerChrysler, ABB, Bayer, Royal Dutch/Shell and Ericsson, to name a few. Rather than endure a protracted and expensive trial, the companies had little choice but to rush into a settlement to avoid the potential of even greater financial damage.

I believe the asbestos litigation crisis is one of the greatest threats to the American economy today. Over 60 companies have filed for bankruptcy because of asbestos claims, putting 60,000 employees out of work. Unfortunately, West Virginia's legal system has the dubious distinction of having a hand in this national asbestos crisis.

Two weeks ago, the U.S. Chamber's Institute for Legal Reform released a new study that shows how asbestos lawsuits not only adversely affect the companies being sued, but also cause secondary harm to other businesses, governments, communities and individuals. This is unacceptable.

West Virginia's notoriously liberal mass consolidation rule is the epitome of unfairness. So is the state's liberal venue rule, where cases with little or no connection to West Virginia are tried here. And we have little affection for West Virginia's mandatory settlement or liberal discovery rules. The legal system is flawed and in desperate need of repair, and that's why we're shining a spotlight on these injustices.

As the nation's largest business federation, the U.S. Chamber of Commerce takes seriously its responsibility to protect and defend businesses, shareholders, workers, and customers in West Virginia and throughout America.

Unless the leaders of West Virginia take decisive action for legal reform, matters will only get worse. And the victims are not just corporate giants in some far away place — the ultimate victims are the people of West Virginia — men, women and children who deserve better.

They are the ones who will suffer while a handful of plaintiffs' class action trial lawyers become millionaires at their expense.

Tomorrow, the U.S. Chamber and the West Virginia Chamber will run full-page ads throughout the state calling on citizens to take action to help themselves.

First and foremost, we are urging West Virginians to tell their state senators and delegates to pass real and meaningful legal reform now. There is no time to waste.

We also are asking West Virginia voters to learn all they can about the records of judges running in next year's elections. We need courts that will interpret fairly legal reforms passed by the legislature.

Having a judiciary that will enforce the rule of law with integrity and impartiality is essential to achieving a fair and balanced legal system.

Progress has been made. We applaud the West Virginia House of Delegates for passing a medical liability reform bill last month.

West Virginians have been victims of a medical liability crisis that has forced doctors to scale back or even leave their practices.

In interviews conducted by Harris Interactive and commissioned by the U.S. Chamber, 289 doctors in this state told us that legal reform was critical to solving the medical liability crisis.

We urge the Senate to pass and Governor Wise to sign this med mal reform bill soon. Once that is completed, we call on lawmakers to finish the job by showing the same kind of courage and wisdom in passing broad and meaningful legal reform now.

This is the second time in the U.S. Chamber's 90-year history that we have taken the steps I have outlined here today.

Last May, we publicly issued a message to the people of Mississippi about the harm being done to them and the companies they work for by their state's deeply flawed legal system.

We highlighted Mississippi first because it came in last in our Harris poll ranking state liability systems. And when we finish with West Virginia—the second worst performer—we'll focus our attention on other states with unfair legal systems.

To be honest, our public announcement in Mississippi was not well received at first. But it didn't take long for that state's media and political leaders to realize and appreciate the urgency and truth of our message.

Although it took a special session to do it, the Mississippi Legislature – to its credit – passed medical liability reform on October 8 and broader legal reform on November 25.

Just days later, The Wall Street Journal in an editorial said that, "If reform can happen there, it can happen anywhere."

Reform can happen anywhere, and it must happen in West Virginia if the state wants to restore fairness to its legal system, stimulate economic development, create more jobs, and ensure a brighter future for its citizens.

Ladies and gentlemen, we take no pleasure in shining a spotlight on a state's unfair litigation environment. I wish West Virginia didn't have this crisis that hurts its reputation. But the reality is we cannot – and we will not – remain silent about West Virginia's abusive legal system.

Our hope is that by bringing greater national attention to this problem, the leaders of West Virginia will change its policies so that businesses large and small from around the world will be attracted to this state that has so much to offer.

And we also hope that our presence here will help a growing number of Americans and lawmakers from all ideologies to recognize that a society that resorts to lawsuits as a first reaction to every problem, issue, misfortune or perceived injustice is one that will one day exhaust its productive capital, its capacity to innovate and even its ethic of personal responsibility and hard work.

Thank you.