• Tobacco, oil, insurance fund the tort “reform” movement Friday, September 18, 2009

    Civil Justice Association of California is the main advocate of so-called tort reform in California. To get an idea of why, consider its board members:

    • American International Group, the insurance giant that survives because of a $180 billion bail-out.
    • Altria, the world’s largest cigarette maker.
    • Chevron and other oil companies.
    • Major banks, many of which have received bail-outs.
    • Insurance companies that have faced millions in fines and have been the target of suits because of their failure to pay the legitimate claims of policy holders.
    • Drug companies. While many of their products save lives, too often their miracle drugs and devices prove to be nightmares for the consumers.

    CJAC and its corporate board members have much to protect in Sacramento. That’s why they have spent more than $500 million during this decade on campaign contributions to California candidates, causes and initiatives.

    CJAC and its members were the main backers of Proposition 64, the 2004 initiative to curb class action lawsuits.

    Altria cigarette subsidiary Philip Morris USA gave $200,000 to help pass the initiative.

    AIG gave $180,000 to help finance its passage, as did other insurance and the largest subprime lenders.

    Countrywide Financial Corp., a major subprime mortgage lender, gave $205,000. Ameriquest gave $55,000. New Century Mortgage Corp. gave $10,000. Each is out of business, or swallowed up by banks that survive with taxpayer bailout money.

    These corporations and individuals have been major players in the tort reform movement nationally.

    Maurice “Hank” Greenberg, former AIG chairman, funneled almost $25 million into the U.S. Chamber of Commerce arm that orchestrates efforts to limit the right to sue. Greenberg agreed in August 2009 to pay $15 million to settle a Securities and Exchange Commission lawsuit.

    CJAC has pushed legislation to limit the right of consumers to join together to file class action lawsuits.

    These measures are part of a nationwide effort to limit class action suits.

    President George W. Bush and the Republican-controlled Congress approved legislation that sharply limited in 2005 the right to bring class action claims, over the objections of respected consumer organizations.

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Category: Tort Reform;