Corporate Hypocrates

The following corporations have funded or are members of either national or state organizations that advocate "tort reform." Tort reforms are always aimed at curbing litigation by sick and injured consumers against corporations, hospitals and other wrongdoers. Such "reforms" rarely affect "business-to-business" litigation, leaving corporations with unfettered use of the courts to obtain compensation for their commercial losses from trademark infringements, breach of contract, patent infringements, unfair completion or a host of other commercial claims. Sometimes the targets of their lawsuits are much smaller businesses or even consumers. The following are a few examples:

Enterprise Rent-A-Car
In 1998, Enterprise Rent-A-Car began litigation against Rent-A-Wreck -- a company 25 times smaller than Enterprise -- over Enterprise's trademarked phrase, "We'll Pick You Up." Rent-A-Wreck had used radio ads that contained the phrase "And of course, they'll pick you up." Later, after a purported settlement between the companies, Enterprise tried to stop Rent-A-Wreck from obtaining a trademark for the phrase, "We'll Give You A Lift." In 2000, Enterprise sued Rent-A-Wreck for civil contempt for using "We'll Give You a Lift." The contempt motion was dismissed.

Exxon Corporation
Major corporations like Exxon support laws to limit the ability of average consumers to sue their insurance companies when those companies unfairly deny claims. But when Lloyds of London refused to pay Exxon $250 million for losses it suffered as a cargo owner resulting from the Valdez oil spill in Alaska, Exxon did what all consumers should have the right to do. Exxon sued its insurance company. In this case, Exxon won.
Exxon has used the courts for other purposes well. For example, in August 1998, Exxon sued Mobil Oil Corp. for patent infringement involving a catalyst that makes better plastics. A jury awarded Exxon $171 million and a judge issued an order prohibiting Mobil from infringing on Exxon's patent.

Johnson & Johnson
Johnson & Johnson, makers of Mylanta in partnership with Merck, sued Smithkline Beecham Corporation for false advertising regarding the nutritional benefit of Tums over Mylanta. The court dismissed Johnson & Johnson's complaint. The lower court's decision was upheld on appeal.

In 1995, Johnson & Johnson/Merck filed another false advertising suit against SmithKline over claims that Tums and Tagamet HB were superior to Pepcid AC. The court issued a preliminary injunction, ordering SmithKline to suspend the ads. In 1999, Johnson & Johnson sued Bausch & Lomb for making claims about the superiority of its extended wear contact lenses.

Conclusion

In 1975, Indiana lobbyist Frank Cornelius, whose clients included the Insurance Institute of Indiana, helped secure passage of a $500,000 cap on medical malpractice awards and elimination of all damages for pain and suffering in Indiana. As he wrote in the New York Times on October 7, 1994, he now "rue[s] that accomplishment." Beginning in 1989, Frank Cornelius experienced a series of medical catastrophes that resulted in his wheelchair confinement, respirator-assisted breathing and constant physical pain.

When he turned to the Indiana courts to provide a remedy, to compensate him for his massive injuries and hold the negligent health care providers accountable, the law was no longer there for him. The Indiana legislature had taken his rights away. Though his medical expenses and lost wages amounted to over $5 million, his claims against both the hospital and physical therapist at fault settled for a mere $500,000 -- the limit on damages for a single incident of malpractice.

In some ways, the hypocrites of "tort reform" are an amusing list. But tragedy for them lurks just around the corner, just like it did for Frank Cornelius.

Editor's Note: This piece was excerpted from the report "Not in My Backyard -- The Hypocrites of "Tort Reform" by the Center for Justice & Democracy.

Published: May 08 2001

Back to News and Developments >