It could be worse though. In its initial filing Farmers actually said an increase of 52% could be justified, but the company was willing to settle for only 10%. What a racket!

The Texas Supreme Court has a long history of favoring corporate defendants over families and small businesses, according to a decade-long review of the Court’s decision making by Court Watch, a project of the non-profit Texas Watch Foundation.

Court Watch reviewed the 624 cases involving consumers decided by the Court between 2000 and 2010. The report, “Thumbs on the Scale: A Retrospective of the Texas Supreme Court, 2000-2010,” finds that the state’s high court for civil matters “has marched in lock-step to consistently and overwhelmingly reward corporate defendants and the government at the expense of Texas families.”

“The Texas Supreme Court is an activist, results-oriented body that over the last 10 years has developed into a safe haven for corporate defendants at the expense of individuals, families, and small business owners,” said Alex Winslow, director of Court Watch. “The statistics speak for themselves. The court’s pro-defendant ideology can not be disputed.”

The Los Angeles Times adds that although the 1996 law specifically gave customers the right to sue any firm in violation, the Supreme Court “ruled Tuesday that credit repair companies could block such lawsuits and instead force disgruntled customers into binding arbitration if they had agreed to such a provision in the fine print of their agreements.” The Times observes that the decision “is another in a string of high court rulings in recent years that have backed an arbitration clause over a customer’s right to file a lawsuit,” and notes that the trend “alarms some consumer advocates, who complained that arbitration proceedings typically favor companies and remove the strong deterrent of class-action lawsuits.”

The AP reported that the 9th Circuit had interpreted the 1996 law’s provision giving consumers a right to sue as being “a right to go to court, rather than be forced to submit to arbitration,” although two other federal appellate courts had ruled otherwise. Reuters and the Wall Street Journal /Dow Jones also reported the story.

Some major credit cards are dropping arbitration. Even as the Supreme Court was overruling a 9th Circuit decision that the Credit Repair Organizations Act barred mandatory binding arbitration, CreditCards.com reports that some of the nation’s largest credit card companies, including Chase, Bank of America and Capital One, “have announced that they are dropping the arbitration requirement from their consumer agreements or will not enforce it.” The article also noted that the Minnesota attorney-general had sued a major arbitration firm for deceptive practices, and that the American Arbitration Association had called for reforms in mandatory arbitration.

From the American Association for Justice press release.

Five months on the job as Texas’ top insurance regulator, Houston native and former insurance executive Eleanor Kitzman is under close scrutiny by consumer groups, lawmakers and insurers as she deals with the first major rate filings of her tenure.

As head of the agency that regulates the state’s multibillion-dollar insurance industry, Kitzman will make decisions that directly affect the pocketbooks of most Texans — those who buy auto, home, health or other types of insurance — as well as the business fortunes of hundreds of insurers.

Her lengthy background in the industry — including the auto insurance business she started in South Carolina — gives her a leg up in overseeing the market, but also makes some consumer groups skeptical about whether she will hold companies accountable for anti-consumer practices.

“I have a different agenda than I did when I was running my insurance business or working as an attorney for insurance companies,” Kitzman said in a recent interview. “I know how the business works, so I know what insurance companies can do.”

Kitzman insisted her background and knowledge of insurance put her in position to “better serve consumers in every way.” But, she added, “having a robust, competitive market is very good for consumers.” She added: “I can also recognize gratuitous whining [by insurers] when I see it.” But consumer advocates fear she’s already shown her tendency to favor insurers.

In her first major decision last fall, Kitzman approved a rate plan by the state’s largest insurer, State Farm, that will begin switching many of the company’s homeowner policies to a higher deductible. Policyholders will have to shoulder a greater share of their property losses — while paying slightly higher rates. The overall rate increase was only 2 percent in North Texas, but Kitzman acknowledged to a Senate committee that State Farm customers will be getting less coverage for their money because of the new deductible.

A leading consumer group, Texas Watch, accused her of giving in to the “biggest bully” in the Texas insurance market. “This was Commissioner Kitzman’s first big test, and she failed miserably,” said the group’s Alex Winslow. “Insurance companies and their lobbyists are crowing over the decision.”

Please take a few minutes on Martin Luther King, Jr. Day to refresh your memory.

Over his 10 years in office, Rick Perry has picked more Texas Supreme Court justices than any other governor, and if he wins the White House, his choices could be a clue about what kind of justices he would nominate in Washington.

While Perry has been praised even by his critics for bringing diversity to the state’s highest civil court, critics say the governor leaned heavily on conservative, business-friendly ideology and gave too little consideration to judicial qualifications.

Texas high-court judges are elected, but the governor fills vacancies when sitting justices step down, so six of the nine current justices (all are Republicans) are Perry picks. Of those, four are racial minorities, two are women, and two have no prior experience as a judge. A Perry spokeswoman said the governor appoints the most qualified people based on their experience, background and legal philosophy.

What the appointees have in common, consumer groups, environmental watchdogs and other Perry critics say, is a strong enough leaning toward corporate interests that it’s nearly impossible for individuals to win cases against large corporations.

“Over the last decade, the Texas Supreme Court has become a safe haven for big insurance companies and corporate wrongdoers and has developed a well-earned reputation as results-oriented,” said Alex Winslow, director of Texas Watch, a consumer advocacy group. “Time and again, this activist court has rendered decisions that defy logic, ignore precedent, and rewrite the law in order to reach a result that benefits a few powerful corporate interests.”

The justices say this criticism lacks merit because they are following the law as the Legislature enacted it.

“The court’s role is to interpret the laws as written by the Legislature,” said Justice Eva Guzman. “So if the Legislature has passed a law that tends to favor individuals over corporations, or vice versa, then the court interprets the law to give effect to the Legislature’s intent as expressed in the words of the statute.”

Statistics show recent court decisions tend to favor oil companies, insurance firms and other big businesses. A report by Texas Watch found that since 2000, consumers have won 22 percent of cases in the high court, while defendants have won 75 percent.

Many point to the difficulty, for instance, of bringing suit against a nursing home or hospital. While lawmakers enacted measures in 2003 to cut down on lawsuits against doctors, the court has construed those statutes to mean that almost any suit over what happens in a medical environment is a malpractice case.

That means when patients suffer things like spider bites and sexual assaults, it’s tough to win at the Supreme Court.

“This court twists and contorts basic logic to reach its conclusions,” Winslow said. “The court has broadened and expanded an already draconian law and made it even worse.”

Sherry Sylvester, a spokeswoman for Texans for Lawsuit Reform, an influential group that has pushed for lawsuit limits, said the restrictions have strengthened the Texas economy and restored public trust to the courts.

“Further, Governor Perry has appointed exemplary judges to Texas courts who are honest, competent and conservative,” Sylvester said.

Among the cases critics point to is Entergy vs. Summers, in which the court’s unanimous ruling allows businesses to escape legal and financial liability for contract employee injuries that happen on their property — even if the company’s actions are what led to injury or even death.

Land Commissioner Jerry Patterson, a conservative Republican, has gone up against the high court in several cases, notably a case where Exxon Mobil plugged the wells of property owners in such a way that the wells couldn’t be re-entered. The Supreme Court reversed a lower court decision that had ordered compensation for the family and held that the family had waited too long to bring their case, so the claim was essentially moot.

“We have an activist court on this case,” Patterson said. “Clearly this was a decision that was tailored to reach a pre-conceived outcome that just didn’t make sense.”

The justices have repeatedly pointed to the differences in their professional backgrounds as proof that the court is varied and diverse.

“There’s a notion that because we’re all Republican, we’re all like-minded and we march in ideological lockstep,” said Justice Don Willett. “That is laughably untrue.”

Willett has been regarded skeptically by some because he was never a courtroom lawyer or a lower court judge. His resume includes stints in the U.S. Justice Department, in the Texas attorney general’s office and as a legal adviser to President George W. Bush.

“You’re clearly not appointing the best legal scholar when you’re appointing someone who has never had courtroom experience,” said Paula Sweeney, attorney and past president of the Texas Trial Lawyers Association. “Some of his appointments are good, but Perry has worked from an ideological approach.”

Lucy Nashed, a Perry spokeswoman, said the governor seeks to add to the court’s depth of experience and “appoints strict constructionists who will adhere to the philosophy that judges should interpret law and not make it from the bench.”

Chief Justice Wallace Jefferson came to the court with a strong private appellate practice that included arguing successfully before the U.S. Supreme Court, although he never sat as a lower court judge. He said that although Perry has the power to appoint judges, the voters ultimately decide who remains on the bench.

“Certainly if there were real objection to the court as a whole or to individual justices, then it has to work itself out in the political process,” Jefferson said.

Others also argue that there’s benefit to bringing in lawyers with real-world experience. The current U.S. Supreme Court consists almost entirely of former appellate judges, prompting some critics to suggest that it lacks an understanding for how its decisions play out.

Willett wrote a concurring opinion in Barbara Robinson vs. Crown Cork & Seal Co. Inc., in which the court struck down a law as unconstitutional on the grounds that it was retroactive. The law would have insulated a company from an ongoing lawsuit over a man’s death from asbestos exposure. Willett wrote that judicial deference doesn’t mean deferring to the Legislature on everything, especially not constitutional violations.

“I have no idea whether the governor’s office liked that decision, but it was a tort reform bill that this court struck down as unconstitutional,” Willett said, noting Perry’s support for lawsuit restrictions. He added that the case shows the court doesn’t have any qualms about siding with a plaintiff or individual over a business.

When George W. Bush was governor, his appointments to the court also leaned toward business interests in its decisions, but statistics show that in 1998-99, the court ruled for defendants 60 percent of the time. Some court observers say that although his jurists were conservative, they were far more moderate and fair minded than the Perry court.

“Bush appointees were scholarly and very well-qualified,” said Sweeney of the trial lawyers association. “This shows that we have in the past been able to get the best and brightest on the court. By comparing those jurist credentials to what we have now, the question is self-answering.”

But when Bush got to the White House, he appointed two staunchly conservative Supreme Court justices — John Roberts and Samuel Alito. Perry critics in Texas fear that Perry would do the same.

“If Rick Perry plans to use the same low standard for judicial appointments that he has used in Texas, then the results will be devastating,” Winslow said.

Marilyn Werber Serafini also cited the PolitiFact analysis in NPR’s “Health” blog, noting that “Texas has only about 13,000 more doctors in the state and the historic trends suggest that population growth was the driving factor.” PolitiFact’s Jon Greenberg also noted other aspects of “PerryCare,” including that “‘Rick Perry believes the best way for the federal government to improve health care is to stimulate job creation so more Americans are covered by employer-sponsored health plans,’ according to his campaign website.”

Additionally, the Daily Kos highlighted a number of reports debunking Perry’s tort reform claims. A July article from the Austin American-Statesman reported that “almost half of the state’s job growth in the past two years came in the education, health care and government sectors.” More recently, an August Washington Post article noted Perry’s job growth claims but said “he is less forthcoming about the 26% of Texas residents who lack health insurance – ranking 50th among the states – compared with a national average of 17%.” And a Public Citizen report said Perry’s 2003 tort reforms haven’t tamed health costs but “Texas Medicare reimbursements have actually been rising faster than the rest of the country.”

From the American Association for Justice news release.

With no shortage of real threats to keep U.S. executives awake at night, it’s surprising that so much time and energy is wasted trying to make sure that 12 average citizens in a jury box are not allowed to hear their business grievances. This fear of the jury system has become a pervasive phobia for many in corporate America.

Take former Halliburton subsidiary KBR, which spent four years and no doubt an enormous amount of legal fees fighting tooth and nail to keep a jury from hearing Jamie Leigh Jones’ claims that she was drugged and raped by a KBR coworker while working for the defense contractor in Iraq. Like many of its business peers, the Houston-based KBR instead preferred to have the claim handled discreetly, behind closed doors, in what is widely believed to be a more business-friendly arbitration venue. In fact, the case wound up in a federal courtroom in Houston only after U.S. Senate intervention that made a sexual assault exception for the standard employee arbitration clauses for defense contractors.

Funny thing, when jurors were finally allowed to weigh the evidence earlier this month, they agreed that Jones’ claims were not supported by the evidence and testimony. Meanwhile, the public airing of the allegations in open court revealed key holes in the evidence and gaps in Jones’ account of what happened. The jury also heard compelling evidence that she had exaggerated and embellished her claims, among them that KBR locked her in a shipping container and restricted her access to a telephone after she reported the attack.

Had this case been resolved in arbitration as KBR had originally hoped, the outcome likely would have been the same. But the lack of transparency inherent in arbitration proceedings would have done nothing to resolve doubt about the allegations and the final outcome. KBR’s favorable outcome would have been additional ammunition for those inclined to think the worst of its parent company at the time, Halliburton, whose former CEO, former Vice President Dick Cheney, was one of the Iraq war’s most vocal supporters.

Of course there are plenty of examples of individual jurors behaving badly, but as the KBR case and so many others show, jurors do take their oaths seriously and there’s good reason to support the unbeholden jury system guaranteed by our Founding Fathers in the Bill of Rights.

The long and admirable fight of Jones to remove her case from arbitration and take it to a jury had a prominent role in the Hot Coffee documentary now in regular rotation on HBO. The film’s namesake case, the 1994 verdict by a New Mexico jury against McDonald’s for serving dangerously hot coffee and causing disfiguring burns to an 81-year-old woman, is another popular, if misguided, reference point for those who want to criticize our jury system.

A look at the facts shows the outcome to be another example of the system working, as opposed to a poster child for tort reform. Everyone blamed Stella Liebeck for spilling coffee on herself, but no one, until the jury, considered that the company might bear some responsibility for ignoring repeated warnings and a documented string of injuries. This notion of shared responsibility doesn’t let the individual off the hook. It just doesn’t put them on the hook alone.

Jurors make a solemn pledge, and it’s reassuring to know that that still means something today. That’s why a jury could rule against a woman who claimed KBR was responsible for her sexual assault. That’s how a jury could hold a business partially responsible for knowingly selling coffee so hot that it caused disfiguring burns.

Melsheimer is the managing principal at Fish & Richardson in Dallas.Smith is judge of the 192nd Civil District Court in Dallas County.

The irony is that this couple describes themselves as conservative Republicans who are opposed to frivolous lawsuits. My guess is that they cheerfully voted for tort reform, thinking the changes in laws would never affect them. Now that the wife’s father was allegedly killed through the nursing home’s negligence, they suddenly have a different viewpoint on tort reform.

We get calls or e-mails every week from people in this situation, and we always have to explain that in Texas there is not much reason now for nursing homes, or to a slightly lesser extent doctors or hospitals, to worry about the level of care they give. They know they are not likely to be held accountable in the judicial system for their negligent acts. Here are excerpts from the newspaper column:

Bill owns a business installing audiovisual equipment. Kelly is a teacher. The Frisco residents identify themselves as conservative Reagan Republicans. Bill still considers himself a supporter of lawsuit limits.

“But you don’t throw the baby out with the bath water,” he said. “Frivolous lawsuits are one thing, but legitimate ones need to be heard. And they’re not.”

But when they consulted with attorneys, they heard the same story over and over. Sorry, the lawyers said, but we don’t take nursing-home cases anymore.

Lawsuit changes approved by the Texas Legislature in 2003 capped noneconomic damages at $250,000. And since elderly, infirm nursing-home residents can’t show loss of earnings or other economic damages, that $250,000 becomes the most they can receive.

Mounting a medical malpractice case is expensive and time-consuming, and lawyers say they simply can’t afford to pursue a case with a maximum award of $250,000. So the threat of lawsuits against Texas nursing homes has virtually disappeared — along with their incentive for quality care.

Consumer advocate N. Alex Winslow of Texas Watch said medical malpractice restrictions are “generally awful” in Texas, but their effect on nursing-home residents is “acutely despicable.”

“We’re talking about the most vulnerable in our society — the elderly and disabled. We should be doing everything in our power to protect them,” Winslow said.

He said he knows of no study to document a decline in nursing-home quality, but he is confident that lawsuit caps have caused it. “It has to have,” he said. “Absent the possibility of being held accountable, it’s human nature to start cutting corners.”

With seating for 30 in a private dining room wired with projection equipment, Dalya’s Restaurant at Bedford Farms was well equipped to host dinners put on by pharmaceutical companies for doctors they hoped would use their products.

Owner Frans von Berkhout said doctors liked to come to his restaurant in Bedford because they knew they were in for a good meal. But in 2008, when the Legislature made such gatherings illegal as part of a broader effort to limit the relationship between physicians and marketers, Dalya’s lost about 10 percent of its business, he said.

He and other restaurant representatives appealed yesterday to a panel of lawmakers to roll back the law and allow the doctor dinners to go on, in the name of supporting small businesses.

Consumer advocates said the change would be a dangerous undoing of a law aimed at protecting patients and curbing prescription drugs costs, even as the national trend is toward stricter controls.

Some members of the Joint Committee on Community Development and Small Business said the negative impact on restaurants seemed like an unintended consequence of the 2008 law, generally referred to as the pharmaceutical gift ban, because it prohibits gifts of more than $50 to doctors.

But Senator Mark C. Montigny, a Democrat from New Bedford and an author of the original gift ban, said there was nothing unintended about the law.

“The corruption of the sacred doctor-patient relationship by the pharmaceutical industry by schmoozing at fancy restaurants is exactly the consequence that the law was intended to prevent,’’ he said.

Such dinners contribute to the “illegitimate relationship’’ between physicians and industry, he said. Advocates say such connections to marketers can make doctors feel obliged to prescribe high-cost brand name drugs, even when cheaper options may be more appropriate.

Such gifts aren’t free, said Amy Whitcomb Slemmer, executive director of the consumer group Health Care For All. “They come with strings attached.’’

The bill before the committee is one of two efforts to roll back the gift ban. In April, the House added a measure to its budget proposal, now being debated in conference committee, that would repeal the law altogether.

Advocates aid they are skeptical of the idea that the gift ban has hurt the economy. They point to talks of expanding the Boston Convention and Exhibition Center and to Department of Revenue numbers that show restaurant revenues are growing.