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Somin on federalism and tort reform

Ilya Somin @ Volokh:

In this post, I explained why federally mandated tort reform is, in most cases, both constitutionally dubious and unnecessary. The better way to restrict abusive tort suits is through interstate competition combined with constraints on states' ability to regulate conduct outside their borders.

Somin needs to be more specific: the Private Securities Litigation Reform Act was "tort reform," but it was reforming federal securities law, and there was nothing anti-federalist about that.

When it comes to product liability, it's nice for Somin/Barnett libertarians to say that the real problem is long-arm personal jurisdiction. I don't disagree (I'd go further and say Erie's abolition of federal common law has substantially contributed), but there isn't a solution to that: that ship has sailed, and there's no chance of that problem being fixed in my lifetime. Meanwhile, we have states racing not to provide friendly business environments, but racing to extract the gains from interstate commerce for their own citizens through inefficient product liability law. There's nothing inconsistent for a federalism supporter thinking that Congress should exercise its responsibility in the arena of interstate commerce when it comes to product liability or pharmaceutical warnings through aggressive preemption of state tort suits or creation of a single consistent federal law of product liability.

Medical malpractice is obviously a different animal: when Nevada threatens pharmaceutical viability through jackpot justice, it is adversely affecting interstate commerce for everyone in the nation; but when Pennsylvania or Illinois decides to favor lawyers over doctors and patients, it is only hurting its own citizens (and helping those of Texas, who get the benefit of the inflow of doctors). There seems less a role for Congress to play in medical malpractice—except to the extent that the federal government is already involved in the issue. It's easy enough for Congress to condition portions of Medicare block grants on a state establishing reasonable medical-malpractice litigation guidelines, or for Congress to prohibit certain types of lawsuits over federally-funded medical care. It doesn't need to impermissibly federalize all medical malpractice litigation to accomplish reform.

Separately: the trial-lawyers' lobby jumps on Randy Barnett's op-ed, and The Hill covers the controversy (h/t Carter Wood).

Update: Walter Olson weighs in with similar analysis.

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Rafael Mangual
Project Manager,
Legal Policy

Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.