What Is Tort Reform, Anyway? A User-Friendly Guide.

A User-Friendly Guide To Tort Reform

Tort reform isn't one single idea or law.  Instead, it's a group of ideas and laws designed to change the way our civil justice system works.  While each tort reform law is different, they all are designed to either limit the circumstances under which injured people may sue, limit how much money juries may award to injured people, or both.  Many people refer to it as tort "reform" because they don't believe that the proposed laws will actually reform the system.  Others call it tort deform for the same reason.  For example, the web site Tortdeform.com is very critical of tort reform measuers.

Any discussion of tort reform is likely to contain lots of jargon and legalese.  Before one can take a side in the debate over tort reform, one needs to understand the terms and concepts in the debate.That's why Justinian Lane has put together this user-friendly guide to the various terms and concepts that are used in the tort reform debate. 

Justinian is a law student but not yet a lawyer.  So, while it should be accurate, it's not legal advice, and you shouldn't rely on it as legal advice.  If you have a legal question, find a lawyer. This site links to various web sites, some of which may belong to lawyers.  Don't take these links as a personal recommendation for those lawyers.  

For a broad look at tort reform, check out Justinian's article, "What Is Tort Reform?"

Principal Place of Business

In order to sue a corporation, you need to determine what courts have jurisdiction over that corporation.  Determining what courts have  jurisdiction over a person is easy: Wherever that person lives has jurisdiction over the person, and wherever the person happens to be has jurisdiction.  For example, if you live in California but take a trip to Las Vegas:

• You can always be sued in California, because that's where you reside.
• You can be sued in Nevada, but only if you're given a subpoena while you're actually within the state's borders. 

Determining where a corporation can be sued is a little trickier.  Assume that Acme, Inc. is incorporated in Delaware, has its corporate headquarters in New York, and all of its retail stores and manufacturing facilities in Pennsylvania:

• Acme can be sued in Delaware, because that's where it is incorporated.  A company can always be sued in its state of incorporation.
• The company can also be sued in Pennsylvania since it does most (if not all) of its business in Pennsylvania.
• Acme can also be sued in the state of its principal place of business.  The question is which state is its principal place of business?

Delaware might be, because that's where it is incorporated.  New York might be, because that's where its headquarters is.  And Pennsylvania might be because that's where everything goes on.

Courts around the country have come up with different tests to determine where a corporation's principal place of business is, but the Supreme Court hasn't yet weighed in  on the issue.