Achieving a longtime goal of Tennessee’s businesses, Gov. Bill Haslam signed legislation Thursday to cap jury awards on lawsuits for injuries and deaths caused by negligence or wrongful actions.
To the cheers of Republican legislators in a ceremony at the Capitol, Haslam said his tort reform law — one of the signature bills of his first legislative session — will help entice new businesses to locate in to Tennessee.
“Business recruitment is incredibly competitive, and Tennessee is not only competing against other states but against foreign countries as we go and market ourselves as the best place for business,” Haslam said. “This tort reform legislation will help us attract and retain jobs by offering businesses more predictability and a way to quantify risk.”
The law won’t limit compensatory damages in lawsuits, including medical expenses and loss of pay or earning capacity. But it would place a $750,000 cap on so-called noneconomic damages — such as physical and emotional pain and suffering, mental anguish, emotional distress, loss of companionship, humiliation and loss of enjoyment of life.
After negotiations with both sides in the legislative fight, the administration agreed to amend the bill to raise the cap to $1 million for certain catastrophic cases — spinal cord injuries, amputations, severe burns and the death of a parent leaving young children.
The proposal would limit punitive damages, which are intended to punish wrongdoers, to twice the amount of compensatory damages or $500,000, whichever is greater.
Democrats fought tort reform during this year’s session, and they expressed skepticism that it would lead to new jobs. They pushed their own package of jobs bills, including one giving a sales tax holiday for businesses, but Haslam and the Republicans refused to consider them.
“I’m looking for Tennesseans any way that we can get them and, if they come as a result of this, that’s grand,” House Democratic leader Craig Fitzhugh said. “There were many bills in the session that would have had a more direct effect on jobs, but unfortunately, they didn’t pass.”