(FORTUNE Magazine) – THE LEGAL DOCTRINE of joint and several liability may seem like so much esoterica, but it has the power to force a chief executive into an excruciating choice. Under the rule, a company convicted of price fixing is liable not only for its own wrongdoing, but also for the harm caused by all the other defendants. If the most conspicuous price fixers settle early out of court, other defendants remain liable for the total damages. A company convinced of its innocence might settle because the risk of going to trial and losing is too great. ''No one can afford to bet his company on the decision of 12 laymen,'' says Thomas R. Long, general counsel of Westvaco, a New York City-based pulp and paper company. Efforts at reform through legislation have foundered in the past, partly because the business community couldn't agree on how to do it. The last major campaign to limit an individual company's liability died in Congress in 1982 because of strong opposition by many large companies. The bill had a retroactive provision that bothered companies that had previously settled price-fixing cases out of court. This time a bill sponsored by Republican Strom Thurmond, chairman of the Senate Judiciary Committee, has widespread business support. It would retain the current practice of assessing triple damages, but would hold a defendant responsible only for its own share of a price-fixing scheme. And it wouldn't be retroactive. A formidable coalition of FORTUNE 500 companies and business groups -- including Dart & Kraft, Owens- Illinois, and Westvaco -- is pushing hard for the bill. Supporters argue that the present system permits large guilty companies to settle early while leaving less culpable or even innocent companies holding the bag. Opponents respond that limiting an individual company's liability would discourage victims from suing. Lawyers who represent plaintiffs say joint and several liability is one of the most potent weapons they have. Opponents further claim that each party in a price-fixing conspiracy is equally culpable and therefore should be held accountable for all resulting damages. Charles F. Rule, U.S. deputy assistant attorney general, concedes that proposed reforms may seem fair, but he quickly adds: ''It is difficult to quantify the benefits to society from being 'fair' to antitrust felons.'' Though the Justice Department has joined state prosecutors, liberal activists, and plaintiff attorneys in opposing the Thurmond bill, it has strong bipartisan support on Thurmond's committee and stands a good chance of winning approval on the Senate floor. Business will have a tougher time making its case in the House. Corporate attorneys and their bosses will be awaiting the outcome anxiously. Says one general counsel, ''Joint and several liability seems like a lawyer's problem, but it can sure affect the bottom line in a hurry.''