Liability Law Initiative to Be on June Ballot

An initiative designed to overhaul California’s “deep pockets” liability law, which has been blamed for soaring liability insurance rates, has qualified for the June 3 election ballot, Secretary of State March Fong Eu said Friday.

The initiative’s supporters, which include cities, counties, insurance companies, chambers of commerce and the California Medical Assn., collected 462,071 valid signatures, far in excess of the 393,000 needed to place a measure on the ballot, Eu said.

If approved by voters, the initiative would drastically alter the state’s existing liability doctrine, in which one party can be held liable for all damages resulting from a personal injury, even if that party is barely at fault.

The initiative would not change existing law for actual damages, like medical costs. But defendants named in injury suits would have to pay only their share of non-economic damages, such as pain and suffering.

Supporters of the initiative argue that the existing system has forced insurance rates up and caused many government agencies to go without coverage. They also contend that it encourages local government and big business to be targeted for large suits simply because they are believed to have “deep pockets” of wealth.

Critics of the measure, principally trial lawyers, maintain that the existing system is the only way to assure that injured parties are compensated in situations where one or more of the defendants is found to have no assets. They also argue that the initiative is an attempt on the part of insurance companies to recoup recent losses.