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The Similar Cost and Other Advantages of an Early Offers Reform for Product Liability Claims for Personal Injury Compared to General Liability Claims Therefor

63 Pages Posted: 18 Sep 2009 Last revised: 19 Oct 2009

Jeffrey O'Connell

University of Virginia School of Law

Patricia Born

Florida State University - College of Business; Florida State University - College of Law; California State University, Northridge - Department of Finance, Real Estate, & Insurance

Date Written: September 16, 2009

Abstract

An “early offers” program in which product liability lawsuits could be quickly settled would improve a tort system that is often slow, expensive and unfair.

Under the authors’ early offer reform, a defendant facing a personal injury claim is given the option within 180 days after a claim is filed of offering to guarantee periodic payments for a claimant’s medical expenses and wage loss beyond any other applicable coverage, plus 10 percent for attorneys’ fees. There would be no compensation for pain and suffering. The claimant in return agrees to foreclose further pursuit of a normal tort claim for both economic and non-economic losses.

Offers could be turned down by claimants, but only in cases where the defendant’s injurious acts were the result of gross misconduct provable beyond a reasonable doubt.

The early offers plan would reduce the time it takes to pay losses by at least two years, and also greatly reduce the costs of such claims. Claims for product liability, would be cut by an average of approximately $129,105 per claim and by $563,000 per claim for severe injuries. The early offers plan is projected to save an average of approximately $33,000 in legal expenses in all such cases and about $207,000 in cases of severe injury.

The savings come mainly from eliminating pain and suffering damages and reducing legal fees.

Suggested Citation

O'Connell, Jeffrey and Born, Patricia, The Similar Cost and Other Advantages of an Early Offers Reform for Product Liability Claims for Personal Injury Compared to General Liability Claims Therefor (September 16, 2009). Virginia Public Law and Legal Theory Research Paper No. 2009-11; FSU College of Law, Law, Business & Economics Paper No. 09-27. Available at SSRN: https://ssrn.com/abstract=1474426 or http://dx.doi.org/10.2139/ssrn.1474426

Jeffrey O'Connell (Contact Author)

University of Virginia School of Law ( email )

580 Massie Road
Charlottesville, VA 22903
United States
804-924-7809 (Phone)
804-924-7536 (Fax)

Patricia H. Born

Florida State University - College of Business ( email )

250 Rovetta Business Building
Tallahassee, FL 32306-1110
United States

Florida State University - College of Law

425 W. Jefferson Street
Tallahassee, FL 32306
United States

California State University, Northridge - Department of Finance, Real Estate, & Insurance ( email )

Northridge, CA 91330-8379
United States

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