Class Action Lawsuits and Lawyers

413). 16. See the Fairness in Asbestos Injury Resolution Act of 2003 (S. 1125).
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Attorneys and Legal Information

However, Daniel Kessler and Mark McClellan have shown that passage of state laws limiting liability for doctors led to lower spending for certain heart procedures. See Kessler and McClellan, "Do Doctors Practice Defensive Medicine?" Quarterly Journal of Economics, vol.
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Attorneys and Legal Information

Underinvestment in prevention can even arise from perverse incentives that associate increased care with higher liability costs--as in the case of a company that refrains from researching ways to make its products safer lest it create a paper trail of safety-related data that could be used against it in court.(12) Whatever the cause, underinvestment in prevention has the same effect on efficiency as overinvestment: the net savings from precaution are lower than they would be in the ideal case (here, because some worthwhile opportunities are neglected), and thus they are less likely to outweigh the other costs of the liability system.
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