S.B. 863, limit on non-economic damages in lawsuits, clears first hurdle

By Patrick B. McGuigan

Published 24-Feb-2011

Senate Bill 863, placing a “hard cap” on non-economic damages in tort litigation, passed the state Senate this week. A blizzard of contrasting interpretations emerged over the significance of the 29-18 Senate vote on “third reading,” coming after close division in a procedural vote.
The bill has been tagged by Senate President Pro Tem Brian Bingman and Governor Mary Fallin as a central element in the Republican pro-business, pro-growth agenda.
The State Chamber is in conflict with some conservative groups over the measure’s provisions limiting non-economic damages. Three Republicans opposed the measure on the merits.
In a statement sent to CapitolBeatOK after Wednesday’s vote. Sen. Bingman said: “This is critical to our efforts to boost Oklahoma’s economic recovery through laws that encourage businesses to locate and stay in our state, creating more jobs.”
The Sapulpa Republican continued: “Lawsuit reform is about providing the jury with better information and allowing them to make more informed decisions, this bill will accomplish that and improve the system for us all.”
Sen. Anthony Sykes of Moore, chairman of the Senate Judiciary Committee, is principal author of Senate Bill 863. He processed S.B. 863 and other lawsuit reform measures earlier this month in a judiciary hearing.
Sykes believes “this reform will preserve the right to a fair trial by strengthening the ability of jurors to evaluate each case while also reducing the likelihood of a frivolous lawsuit.”
The bill narrowly cleared the motion to advance, which had the practical effect of preventing consideration of further amendments this week. That motion passed 24-23.
All 16 Democrats in the Senate were joined by seven Republicans (with one excused) in opposing the motion to advance. Senator Andrew Rice of Oklahoma City had expressed previous “concern” about the lawsuit reform provisions in S.B. 863 and other bills.  
The seven Republicans voting no on the motion to advance were Patrick Anderson of Enid, Harry Coates of Seminole, Brian Crain of Tulsa, Jim Halligan of Stillwater, Jim Reynolds of Oklahoma City, Steve Russell of Oklahoma City, and Ralph Shortey of Oklahoma City.
When it came to passage on the merits, 28 of the chamber’s Republicans were in support, with a single Democrat joining them.
Among Republicans only Anderson, Coates and Russell opposed the bill on the merits. One Democrat who had opposed the motion to advance, Susan Paddack of Ada, switched to support passage. With Cliff Aldridge of Midwest City excused from both votes, the measure prevailed, albeit with title stricken (meaning it is subject to possible changes later in the process). 
S.B. 863 would put in place a “hard cap” on non-economic damages of $250,000. Sen. Sykes and other advocates contend the bill’s language allows courts and juries to disregard the cap in some cases. The measure does not limit economic damages in lawsuits.
In a release touting the bill after it cleared the Senate, the state Chamber stressed the measure “does not impact damages such as lost wages, medical expenses and future loss of expected wages. The bill also lays out exceptions to the cap cases of gross negligence, intentional actions, or malicious conduct.”
In his comments, sent to CapitolBeatOK, State Chamber President Fred Morgan asserted: “If we want to grow our state’s economy, it is critical that we put in place a legal system that is consistent and fair for both plaintiffs and defendants.
“The hidden costs of defensive medicine inhibit access to quality and affordable health care and drive doctors out of our state. Oklahoma businesses are also impacted by the costs in preventing and defending meritless lawsuits, which are often passed onto consumers and severely inhibit innovation and initiative in the private sector. These bills are an important step in the right direction.”
There are four remaining bills touching lawsuit reforms which the Chamber backs strongly. Those bill numbers, and the group’s thumbnail of provisions, follow:
  • Senate Bill 862 — Ensures that defendants are responsible for their actual fault and only their fault. 
  • Senate Bill 864 — Allows the jury to hear if the plaintiff receives compensation for the injuries from a source wholly independent of the defendant. Examples of such compensation include Medicaid, Medicare, Social Security, etc. Such fact shall be admitted into evidence and the amount shall be deducted from the amount of damages. 
  • Senate Bill 865 — Requires the judge to tell the jury that no part of an award for damages for personal injury or wrongful death is subject to federal or state income tax. 
  • Senate Bill 866 — When an award for “future damages” is made which exceeds $100,000, the court, upon the request of either party, shall order that medical, health care, or custodial services awarded to be paid in periodic payments rather than by a lump-sum payment. This will allow for the plaintiff to have money in the future for medical care.
 Todd Goodman, chairman of the Oklahoma Democratic party, spanked the upper chamber for approving S.B. 863. In a statement sent to CapitolBeatOK, he said:
“This should not be a partisan issue. Republicans put on the front that this legislation is pro-business, but at what cost? This detrimentally affects those who are physically injured long term. I want to reiterate what Sen. [Charlie] Laster [of Shawnee] asked on the floor [in Wednesday’s debate]: ‘Do you believe that an innocent person who is injured by a non-criminal act and is rendered quadriplegic or paraplegic should have their damages limited by politicians?’ I certainly do not, and this is certainly not smaller government. It’s legislation that again protects the big businesses that don’t need protecting.
“I agree with Sen. [Sean] Burrage [of Clarmore] that a jury of peers should decide what damages are appropriate, not those who are getting their back pockets padded.  The bill is nothing more than corporate immunity. Businesses can now factor in the cost of losing a child. This is a continuation the Republican assault on honest, hardworking Oklahomans, and hopefully voters will hold their representatives accountable.”
Criticism of the measure also came from some on the conservative end of the spectrum. David Tackett, executive director of Oklahomans for Liberty, celebrated the fact that the bill’s handlers had agreed to “strip title” from S.B. 863. In reflections sent to CapitolBeatOK, Tackett said that was the only way leaders could “ensure that their rank-and-file members would vote for its passage.” He argued the measure is infirm under the U.S. Constitution, and 7th Amendment guarantees of rights to sue in civil court.
Tackett asserted, “In the end, the Senate Leadership couldn’t sell this tort reform package as is and this maneuver is basically a ‘4th down punt’ in order to buy them more time.” Tackett’s group is a 501(c)(4) lobbying group focused on what it deems “constitutional conservative principles.”