Professor Tim Lytton takes issue with the characterization of the tort system as a "litigation lottery"—a characterization made not just by me, but also by Obama appointee and Harvard Law professor Cass Sunstein in his recent book Nudge. Lytton writes:
Yet the possibility of erroneous outcomes and variable awards does not make tort litigation a lottery. Indeed, the very possibility of identifying some outcomes as erroneous fundamentally distinguishes litigation from a lottery. Winners in litigation are determined not by chance but by applying the law to the facts of a case. Of course, there is always the possibility of an erroneous outcome when a judge misapplies the law or the jury misconstrues the facts. But this is quite different from the process of random selection whereby lottery winners are selected. It makes no sense to argue that a randomly selected lottery winner should not have won. In contrast, it is certainly possible to criticize litigation outcomes as erroneous--to argue that the prevailing party should not have won--precisely because litigation, unlike a lottery, is governed by the rule of law. Suggesting that the error rate of a decision procedure makes it a lottery is a category mistake since the very possibility of identifying an erroneous outcome, by definition, makes the procedure non-random and therefore not a lottery.
But this seems to be too literal, like complaining that Shakespeare's Sonnet 20 talks of beauty that "steals men's eyes," when the eyes aren't really stolen.
The metaphor of a lottery comes because, like a lottery, in the litigation lottery, the jackpot winner is unpredictable—other than that there will be a jackpot winner at some point. No, the tort system is not as random as the televised selection of ping-pong balls by a beauty queen (though some courthouses coincidentally use ping-pong balls to select the voir dire panel)
That the justice system at all (or at least so much) randomly strikes out at innocent defendants is contrary to the rule of law or normative concepts of justice. Like parties should be treated alike. The better tort reforms out there promote that predictability and the rule of law, either through improving the accuracy of the trial (Daubert or perhaps Phil Howard's proposal for medical courts), reducing the range of results (caps on damages), or permitting contracting around the tort system in ways judges currently don't allow (allowing the waiver of certain medical malpractice claims as proposed in Rubin's Tort Reform by Contract or Sunstein/Thaler's Nudge). When tort reforms merely redistribute wealth from plaintiffs to defendants without regard to the rule of law, as in collateral source reform, it is unsurprising that they do not have empirically positive results on health and safety.