A bedrock principle underlying the American tort reform movement is the understanding that litigation drains resources from a business—time, money, manpower, and attention. According to the American Tort Reform Association, the cost of the U.S. tort system runs nearly $250 billion annually, or nearly a thousand dollars for every American. Getting a handle on needless litigation has been a top-tier issue for the nation’s small business advocates, as small businesses are the least equipped to handle such lawsuits. Generally, such lawsuits are of the frivolous, disgruntled customer-type, like the $54 million “pants lawsuit” that was filed in DC. That lawsuit cost the Korean couple who owned the dry cleaning business at the heart of the suit thousands of dollars, and nearly their entire business.
In that case, it was an individual suing the government. But what happens when it is the government initiating the frivolous lawsuit, or creating a policy which forces someone singled out to have to challenge that policy in court? Worse, what happens when the government decides to press criminal charges against an individual or that individual’s business, when no real harm has been done to anyone?
There are two central problems when governments attack, either via litigation or legislation. The first is the comparative inequity between the state and the individual. Even the Microsofts of the world cannot compete with the resources of one of the globe’s largest economies, and proportionally, the entity attacking and the entity being attacked are on entirely different levels of the playing field. Governments have the element of time on their side, and can take that time to grind down an opponent, forcing them to yield. In lawsuits challenging violations of private property rights, for instance, cases can take a dozen or more years, wearing claimants down until they either drop their case or settle for meager compensation. In the case of Wayne Hage, a Nevada rancher who was forced to sue over grazing issues, victory came after 18 years of litigation, after both he and his wife had passed away.
Like other citizens whose constitutionally-protected rights have been cavalierly violated by the government set up to protect them, Hage was forced to sue to defend what was his. Similarly, the Electronic Software Association has had to sue nearly a dozen times to defend the 1st Amendment rights of its members. In each instance, the ESA has been successful in defending its rights—but has had to spend millions of dollars in order to do so. Dollars that ultimately have had to come from its members, many of whom are the small businesses that are the engine of the economy.