<p>In the latest <a href="http://www.thepittsburghchannel.com/news/2435313/detail.html">cheerleader lawsuit</a>, a senior in Pennsylvania, is suing her high school because she was dropped from the squad. Last year, after being caught with alcohol and tobacco, a cheerleader <a href="http://www.twincities.com/mld/pioneerpress/news/local/3819804.htm">sued a Minnesota high school</A> that demoted her from captain for her actions. She did not dispute the charges, she simply felt the school dealt with her too harshly. These lawsuits, like thousands of others that needlessly clog the courtrooms of America, demonstrate the extent to which the legal system has lost its mooring.</p>
<p> America has become the most litigious nation in the world, by virtually any measure. According to the <a href="http://www.ncsconline.org/WC/Publications/Res_CtComm_CJRIPub.pdf"> National Center for State Courts, 15 million</a> civil cases are filed annually in the United States. The American civil justice system is the most expensive in the world, with costs running more than <a href="http://www.whitehouse.gov/cea/tortliabilitysystem_apr02.pdf">twice that of other industrialized nations</a>. Yet despite the high costs of the system, it provides a poor return on the dollar—only 20 cents of each dollar goes to compensation for economic damages.</p>
<p> Sadly, these statistics are little to brag about. By conservative estimates, the direct costs of the mushrooming legal profession are roughly <a href="http://www.whitehouse.gov/cea/tortliabilitysystem_apr02.pdf">$180 billion annually</a> or almost 1.8 percent of GDP. These measures refer only to the direct costs of the legal system, and do not include other consumer costs, such as higher prices for the goods and services they consume, as well as the reduced availability of goods and services that are taken off the market for fear of lawsuits.</p>
<p> Medical care is a perfect example of this. Research into AIDS vaccines by some companies was delayed or abandoned altogether due <a href="http://www.atrafoundation.org/tort_facts.html">to liability concerns</a>. In addition, patients in some areas are having difficulty finding doctors in some fields, because those specialties increase <a href="http://aspe.hhs.gov/daltcp/reports/litrefm.pdf">the threat of lawsuits</a>. In other cases, entire industries were shut down due to excessive litigation. Once a world leader in the production of small aircraft, America all but stopped producing them in the face of mounting litigation. Production fell by <a href="http://www.atrafoundation.org/tort_facts.html">more than 95 percent</a> between the 1970s and the 1990s. It was only after Congress passed reform measures to reduce the threat of frivolous lawsuits that workers returned to the production line. </p>
<p> Unfortunately, the boom in litigation feeds upon itself. The legal profession, which has attracted more than its share of America’s brightest, has turned into an entrepreneurial bonanza for ambitious and clever trial lawyers. Much of their work is based on the redistribution of wealth rather than the creation of wealth. Billions have been made in the courtroom by suing companies. This does not add to the nation’s output or increase GDP, it simply shifts wealth from one group to another—with lawyers taking at least of third of it in the process.</p>
<p> In recent years, the excesses of the courts have become more visible. The “litigation crisis,” million dollar verdicts, and massive class action suits are all symptoms of the changes that have occurred in the courtroom since the 1960s. The law of contract and individual responsibility have been minimized in favor of creating a social safety net aimed at compensating victims with little regard to fault. Individual assumption of risk—such as driving with a hot cup of coffee or eating too many fatty foods—is often downplayed in favor of pricey lawsuits against manufacturers. This shift in attitude has been accompanied by procedural changes that have facilitated increased litigation and increasing damage awards.</p>
<p> As the costs of these changes have become evident, reform efforts have emerged at the federal and state level. Because much of the legal system is controlled at the state level, several states have adopted successful legal reforms. Others are in the process. Texas, for example, is considering legal reforms similar to those adopted earlier by California, which faced a mounting liability crisis that was driving doctors out of business. At the federal level, the Senate has the opportunity to reform class action lawsuits this fall. Legal reforms are a necessary step toward improving America’s courtrooms, which should be reserved for addressing real grievances of real victims. Bruised egos and ruffled pom-poms have no place in the courtroom, nor do opportunistic lawsuits that enrich those feeding off the process while providing no real benefits to consumers or society.