Thursday, November 8, 2007

Not Really News: Wall Street Journal Slams Trial Lawyers

The editorial in the Wall Street Journal starts like this: “We're old enough to remember when Naderite groups like Public Citizen were embarrassed by their ties to trial lawyers.” (Nov. 7, 2007, A-22). And then it goes downhill from there.

The Journal criticizes Public Citizen for its ties to trial lawyers and attempts to suggest that the stalwarts at National Association of Consumer Advocates are somehow fat-cats who are singly responsible for the demise of the American economy. It’s a screed that misses several points. Most notably this: Corporate greed, accounting abuses and lax regulation brought us Enron and the rash of inflated stock value scams.

The same big three--corporate greed, accounting abuses and lax regulation--are back for another round. This time it’s the burgeoning mortgage lending crisis. Against this backdrop, the Journal tosses out desperate charges that trial lawyers are responsible for economic meltdown. That’s very sad, as Enron didn’t hire any consumer lawyers to cook the books. Neither did the accounting firms. And the FTC and other regulatory agencies don’t seem to consult with trial lawyers, either. The growing mortgage crisis appears to be another sad case. Some lenders may have engaged in scams that involved wide-spread inflation of real estate values, so that consumers got bigger and more profitable mortgages.

The reality is that trial lawyers provide the main method of smoothing the kinks out of an economy. Open courts and the jury trial system provide the means through which ordinary consumers can call wrongdoers to account. It is the place where bad behavior faces scrutiny and the means through which greed gets checked. In that respect, the process actually protects the economy. Without the means to call wrongdoers to account, consumers would be left with very few options.

My schedule didn’t allow me to attend this year’s conference of the National Association of Consumer Advocates. So sad because it’s always nice to show up for consumers.

David F. Sugerman
Paul & Sugerman, PC

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