On a 37-27 vote, the Colorado House of Representatives passed House Bill
1106 (sponsored by Rep. Bob Gardner, R-Colorado Springs and Sen. Ellen
Roberts, R-Durango), which would overturn a controversial split decision
issued last November by the Colorado Supreme Court.
The court's ruling, which resulted in a 4-3 split among the justices,
allows successful plaintiffs to collect phantom damages for medical care
costs — damages that they never paid and never actually owed —
undermining a 1986 statute that sought to prevent plaintiffs from
turning a profit from their injuries.
Left untouched, the court's ruling will drive up the cost of health care
by pushing up insurance costs for doctors and other health care
providers. Colorado drivers will also see the cost of mandatory
liability insurance increase if they must pay far more than the actual
cost of medical care for people injured in traffic accidents.
Four Democrats joined 33 Republicans in the House to pass HB 1106, but
the bill still faces uncertain prospects in the Senate where trial
lawyers are pressuring Democrats.
On March 10, the House State, Veterans and Military Affairs
Committee voted 5-4 to postpone indefinitely (kill) Senate Bill 68 (by
Sen. Morgan Carroll, D-Aurora, and Rep. Judy Solano, D-Brighton) — a
bill which CCJL has previously described as "a sledge hammer aimed at
Colorado business."
A dream bill for trial lawyers, SB 68 would have eliminated the "public
impact test," criteria employed by the Colorado Supreme Court to
determine whether an ordinary lawsuit can invoke the Colorado Consumer
Protect Act and thereby threatening the defendant with treble damages
and plaintiffs' attorney fees. Had SB 68 passed, virtually any lawsuit
against a Colorado business could have included a presumption that an
error, oversight or misdeed alleged by a single plaintiff had been
replicated innumerable times against the public at large.
Businesses would have found themselves not simply defending against
charges of varying merit but risking far more that compensatory damages
were they to lose. Increasing the stakes for businesses would create
tremendous leverage for plaintiffs attorneys to coerce defendants to
settle even dubious claims rather than risk that a jury would rule for
the plaintiff and order the defendant to pay treble damages and attorney
costs.
CCJL appreciates the hard work to defeat this bill by our members and
allies in the business community and by Andrew Unthank, an attorney at
Wheeler Trigg O'Donnell and a participant in CCJL's Legal Advisory
Board, for his compelling testimony against SB 68 in the House
committee.
House Bill 1106 (by Rep. Bob Gardner, R-Colorado Springs) passed the House Judiciary Committee on March 4 on a 6-5 vote. The bill seeks to restore a
statutory scheme for measuring damages for medical care that was passed
in 1986. Last November, the Colorado Supreme Court overturned the
statute in a deeply divided 4-3 decision. The Court decided that what is
initially billed by a hospital or other care provider — rather than
what is paid by an insurance company to settle the account — is the
proper measure of damages.
The author of the dissent, Justice Nancy Rice, argued that the majority
had ignored “the legislature’s clear intent, the statute’s plain
language, and sound public policy.” Agreeing with Rice, CCJL and our
allies in the business and health care community have formed a coalition
to reverse the action of the Supreme Court and restore legislative
intent.
At the Judiciary Committee hearing on the bill, trial lawyers argued —
quite contrary to Justice Rice's opinion and other court decisions —
that the Supreme Court had changed nothing by its November opinion and
the law was the same now as it has always been. Indeed, they argued
that passage of HB 1106 would overturn settled rules of common law that
have been in place for centuries.
Numerous witnesses supporting the bill differed. They argued that the
General Assembly had replaced the common law in passing tort reform
legislation in 1986 and the Supreme Court had returned to the common law
in November. HB 1106 now goes to the full House now for debate.
CCJL has previously noted the problems with Senate Bill 68
(Sen. Morgan Carroll, D-Aurora) which, as introduced, would have
allowed the Colorado's attorney general to define a "consumer
protection" crime and then prosecute it. The bill also required the
courts to interpret evidence that a business engaged in a single
"deceptive trade practice" as prima facie evidence that it also did so in a way that impacted the public as a whole.
In last week's Senate Judiciary Committee hearing, the expansion of
attorney general powers was stripped from the bill, which is now largely
an effort by Sen. Carroll and the plaintiffs bar to eliminate the
Supreme Court's "public impact test" -- the criteria by which a single
claim against a single business becomes a complaint under the Colorado
Consumer Protection Act thereby making the defendant subject to treble
damages and attorney fees.
As re-written last week in committee, Senate Bill 68 would eliminate the precedent established by the Court in Hall v. Walters
that a plaintiff can only bring a claim under CCPA if it can be shown
that the conduct in question applied not only to the plaintiff but also
that it "significantly impacts the public" in general.
Plaintiffs' attorneys like to cloak themselves in pursuit of justice for victims, but Senate Bill 107
(sponsored by Senate Majority Leader John Morse, D-Colorado Springs)
comes closer to jackpot justice by confusing compensation of victims
with punishment of drunk drivers. Worse still, the bill expands
unlimited liability to a long list of people and businesses who are
entirely innocent of driving under the influence of alcohol or drugs.
SB 107 allows for unlimited claims for non-economic damages (pain and
suffering, inconvenience, emotional stress) in "alcohol-related or
drug-related driving incidents." Such claims are currently capped at
$468,000 and adjusted for inflation. However, by exempting
such "incidents" from existing limits, the bill goes far beyond
punishing drunk drivers.
If an impaired driver happened to be driving a company vehicle, the
employer could be subject to unlimited claims simply because it has deep
pockets. Likewise, an automaker could be exposed to unlimited damage
claims if a jury can be convinced that it could have made the vehicle
safer. The list of potential defendants with "deep pockets" who might
be dragged into such cases is limited only by the creativity of
plaintiffs attorneys.
