Our editor, Walter Olson, in today’s Wall Street Journal:
A few observations:
• Phrases like “Do you realize I’m a lawyer?” uttered in the course of routine disputes with storekeepers, neighbors, school principals, etc., probably account for more of the legal profession’s aggregate unpopularity than any number of scandals in the actual representation of clients.
• David and Goliath talk notwithstanding, legal action is often a powerful dis-equalizer of the playing field, as those who know how to work the system fleece the outsiders, the novices, the distracted and the trustful.
• Pretty much every other advanced country would have afforded the Chungs better protection against a lawsuit like this. Under proper “loser-pays” rules, the Chungs would be correctly construed as having won even if Mr. Pearson proves damages of, say, $1,000, since they would have prevailed on the actual issues in dispute. D.C. does have a weak “offer of judgment” rule that might let the Chungs recover some miscellaneous court costs — but not their major expense, lawyers’ fees — if Mr. Pearson loses or wins but a token sum. So even if they win, they’re bound to lose.
• The other source of Mr. Pearson’s power — his ability to hold the threat of huge penalties over the Chungs’ heads — arises from consumer laws that encourage complainants to multiply the stated penalty for a single infraction by the whole universe of a business’s clientele, or by all the days in the calendar, with no need to prove actual injury.
This sort of mechanical damage-multiplication has been a key engine in shakedown scandals in California (where roving complainants have mass-mailed demand letters to small businesses over technical infractions); in “junk-fax” litigation demanding billions from hapless merchants in Texas, Illinois and elsewhere; and in important sectors of litigation aimed at bigger businesses, including claims against credit-card providers and purveyors of “light” cigarettes. Whole dockets’-worth of opportunistic litigation would dry up if we revised these laws so as to require a showing of actual injury. Doing so would require overcoming epic resistance from the litigation lobby.
It’s nice to see that even the organized plaintiffs bar piously deplores Mr. Pearson’s abuse of the law. It would be even nicer if they agreed to stop opposing reforms that would give the Chungs of the world a fighting chance the next time around.