A decade ago, a landmark Texas tort reform bill was enacted following months of debate, including the testimony of more than 400 Texans. After a bruising legislative battle against forces backed by personal injury trial lawyers, legislative leaders commented that “history would decide” whether this comprehensive civil justice reform effort would prove to be good for Texas.
Ten years later, the results are in. House Bill 4 has been a key driver of the Texas economy making the Lone Star State the No. 1 job creator in the nation. HB 4 included a number of common-sense laws that changed the litigation landscape in Texas. For example, lawyers can no longer extort legal fee-driven — but otherwise meritless — settlements from defendants in class-action cases.
Because of the reforms passed in 2003, Texas law has provided that if a lawyer settles a class action by accepting free coupons for the plaintiffs, as they frequently do, then the lawyer must be paid in coupons as well. Under HB 4, a plaintiff can no longer sue a “deep-pocket” defendant while ignoring the truly responsible — but financially insolvent — party.
After the 2003 reforms, Texas law allows juries to allocate fault among all parties who contributed to the plaintiff's injury, whether the plaintiff sued all of them or not. Simply having deep pockets is no longer a good enough reason to be held entirely liable for a multimillion-dollar judgment in Texas when the defendant is found only partially at fault for the plaintiff's injuries.
Thanks to tort reforms passed in 2003, a retailer in Texas can't be held liable for defects in the design or manufacturing of a product if the retailer simply sold the product without altering the design or the product itself. And a manufacturer can't be held liable for a product that's manufactured in compliance with government standards governing the product's design, unless the manufacturer misled the government to obtain an insufficient standard.
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