House approves changes to laws on lawsuits

  • Article by: JIM RAGSDALE , Star Tribune
  • Updated: February 1, 2012 - 10:54 PM

Republicans say tort law changes will make businesses more competitive. DFLers say they'll burden plaintiffs.

Republicans in the Minnesota House pushed through a package of bills Wednesday to limit the costs of lawsuits, which they view as a necessity to make the state competitive but which opponents see as a barrier to justice.

After a sometimes-emotional 6 1/2-hour debate, Republicans used their 10-vote House majority to pass tort reform bills favored by a coalition of business groups and opposed by the state's trial attorneys.

The measures, which passed largely on party-line votes, include:

• Reducing Minnesota's statute of limitations, the time limit for filing suit, from six years after the incident to four years.

• Allowing an early appeal to question the class-action status of large suits, in an attempt to weed out frivolous actions.

• Limits on attorney fees in certain cases, such as wrongful termination or sexual harassment, where state law requires the fees be paid as part of the lawsuit.

• Reducing the interest rate on judgments that remain unpaid while a case proceeds. The current 10 percent rate would be reduced to a market-based rate no lower than 4 percent.

The changes have been sought by a coalition of businesses and chambers of commerce known as Minnesotans for Lawsuit Reform.

Robert Johnson, president of the Insurance Federation of Minnesota and chairman of the reform group, said the bills were drafted by Minnesota employers. Supporters include contractors, builders, insurers, food processors, auto dealers, bankers, grocers, resort and restaurant owners, and the Minnesota Chamber of Commerce.

"They are targeted to specific issues we believe are unfair and inequitable,'' Johnson said of the changes. He said the changes do not restrict access to the courts and put Minnesota's laws in line with those of most other states.

"The Insurance Federation are the only people that benefit from these bills,'' responded Joel Carlson, lobbyist for the trial lawyers' organization, the Minnesota Association for Justice. "They pay less on judgments, they lower the statute of limitations and they shift the costs of wrongdoing to the injured parties by changing attorney fee provisions."

The changes must go back to the Senate, which has passed the concepts in different form, then to Gov. Mark Dayton.

The floor debate

During the debate, carried largely by lawyers in the chamber, DFLers dismissed the bills as cookie-cutter copies from a national free-market group known as ALEC, the American Legislative Exchange Council. Republicans said the proposals have strong support among mainstream Minnesota businesses.

The debate over the interest rate change was particularly emotional.

The sponsor, Rep. Pat Mazorol, R-Bloomington, said the rate should merely preserve the value of the judgment while the case is in litigation. But Rep. Joe Atkins, DFL-Inver Grove Heights, and other opponents said the rate reduction would hurt plaintiffs who must incur debt at high rates while waiting for their suits to be resolved.

"I'm ashamed of this bill -- this is an obscenity," Atkins said. He raised the possibility that the Legislature was trying to protect itself from a lawsuit threatened by a former staffer, Michael Brodkorb, which supporters denied. "It brings shame, in my opinion, to this House,'' Atkins said. "It lines the pockets of corporations and insurance company executives.''

"We need lawsuit reform in the state of Minnesota to make Minnesota more competitive,'' responded House Majority Leader Matt Dean, R-Dellwood. "The business community is desperately looking toward the Legislature for a ray of hope.''

All four bills passed with mostly Republican "yes" votes. DFL legislators offered more than 25 amendments to exempt groups of plaintiffs from the changes, but none passed.

Jim Ragsdale • 651-925-5042

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