In ‘How to become a millionaire,’ ToI’s November 14 SWAMINOMICS column SWAMINATHAN S ANKLESARIA AIYAR said:

“A month ago, the US pharma giant Merck withdrew its best-selling drug rofecoxib (sold under the brand name Vioxx) after tests proved that it doubled the chances of heart attacks, and perhaps strokes. Many US buyers of the drug plan to become millionaires by suing Merck. Can Indians do the same?

In the US, lawyers mount class action suits on behalf of many sufferers, charging no fees but taking a share of any compensation awarded. Such suits against tobacco companies have won huge compensation for lawyers and smokers alike. Smokers have received millions, lawyers billions.”

The Bhopal victims of the Union Carbide are a case in constrast. The day after the disaster, plane load of US lawyers landed in Bhopal to sign up victims to file cases on their behalf in US courts. But the government of India passed an act and appointed itself as the sole representative of all victims of Union Carbide. Then the US court sent the case back to India since it was claimed that the Indian judiciary is competent to try such cases. It became an issue of national pride and not what bests for the victims. The Indian courts as they are, took years to decide. Union Carbide finally paid $490 for damages. Almost after 15 years, the victims received some compensation. And here comes the clincher–part of that money was not paid out and earned interest with RBI, the amount has grown to become equal to the whole initial payment made to the victims. Someone had to file a PIL to get the govt to pay out this money! Wonders of Indian socialism, all in the name of the poor and the helpless.

The issue of torts in India is not so much of victims becoming millionaires but of geting some compensation for the harm as quickly as possible. In the US, the lawyers are hated for overdoing the torts, in India for not doing them at all.

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The opinions expressed in this essay are those of the authors. They do not purport to reflect the opinions or views of CCS.

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Parth Shah

Parth J Shah is founder president of Centre for Civil Society, a think tank that promotes choice and accountability across public and private sectors. He is co-founder and Director of Indian School of Public Policy. Parth’s research and advocacy work focuses on the themes of economic freedom, choice and competition in education, property rights approach to the environment and new public governance. He recently edited Liberalism in India.