(FORTUNE Magazine) – ITS INITIALS are ATLA, which makes the Association of Trial Lawyers of America sound a little like the celebrated Hun who tormented the civilized world some centuries back. And that's the way opponents regard one of Washington's most formidable lobbies. It is unflinching, unyielding, and so far unbeaten. What the National Rifle Association is to guns, ATLA is to lawsuits. It helps make sure there are plenty of them. But flush times for legal eagles usually mean trouble for corporate America. You may recall, for example, the terrible crash two years ago of a DC-10 in Sioux City, Iowa, in which 112 people died and 46 were seriously injured. A flawed titanium disk in an engine broke apart. The engine exploded, and the debris slashed the plane's hydraulic system. One of ATLA's most successful members, Philip H. Corboy of Chicago, represents 45 of the victims. He is suing not just United Airlines, which owned the plane, but also McDonnell Douglas, which built it; General Electric, which made the engine; Alcoa, which supplied GE the titanium ingot; and Timet and RMI, which refined the titanium. If the ground were incorporated, you can bet Corboy would sue Mother Nature as well. The cost of the tort system, as attorneys call the rules governing product liability, medical malpractice, and other personal injuries, is staggering. The total now comes to more than $180 billion a year, a sum that includes out- of-court settlements, attorney and expert witness fees, and jury awards. That's up from $46 billion ten years ago. In addition, companies pay more than $21 billion a year in insurance premiums to cover product liability, triple what they shelled out in the late 1970s. For more than a decade, U.S. business has petitioned Congress annually to do something to stem the flood of multimillion-dollar verdicts. Every year, ATLA and its allies -- mainly consumer groups led by Ralph Nader and his lieutenants -- have crushed any attempt at tort reform. This year, however, the business lobby is deploying an argument that's getting increasing attention on Capitol Hill: America's product-liability laws, by raising costs and stifling innovation, seriously hamper U.S. manufacturers in their battles with foreign competitors. That view is shared * by the Bush Administration, which is unveiling its own tort reform program this month. One likely suggestion is that the U.S. adopt the so-called English rule: If you bring suit and lose, you pay the defendant's court costs. Leading the charge against ATLA is the Product Liability Coordinating Committee, whose several thousand members range from tiny retailers to major corporations like Du Pont, FMC, Ford Motor, and TRW. Recently the group hired its first full-time director, William D. Fay, who trained in lobby warfare as the representative of smokestack companies during the struggle over the Clean Air Act of 1990. Says Victor Schwartz, the committee's counsel: ''In the past the trial lawyers' opponents have been summer soldiers who got tired and gave up after a while. We're serious about this fight.'' THOUGH FRIENDS and foes alike refer to ATLA's 60,000 members as ''the trial lawyers,'' they are actually just one-half of the courtroom -- the accusers. By and large they belong to firms with ten lawyers or fewer. Their clients generally are not companies but individuals, whom they represent in all kinds of actions, including personal injury suits. Opposing them are defendants' attorneys, who speak for manufacturers, hospitals, insurance companies, and the like. (When one big company sues another, the attacker's spokesman might take umbrage at being called a ''trial lawyer.'' He or she is a ''plaintiff's attorney.'') In many respects trial lawyers are an appealing bunch -- hard working, passionate, theatrical, often self-made. Defendants' attorneys are more likely to have graduated from Harvard or Yale, wear gray wool, dress up their waiting rooms with the New Yorker or Town & Country, and charge corporate clients up to $400 an hour. Often alumni of schools like St. John's or the University of Houston, trial lawyers favor plaid jackets, and display articles like ''Biggest Jury Awards of 1988'' on their coffee tables. Prospective clients can read, for example, that a court ordered a lawn mower manufacturer to pay $22.9 million to a 5- year-old Texas boy who lost both hands. Trial lawyers don't charge by the hour. They work for contingency fees of roughly one-third of whatever their clients win in court. Critics are inclined to exaggerate trial lawyers' incomes. The median of all jury awards in 1989 was $75,000, which reflects a lot of routine traffic accidents and other cases that don't make headlines. Still, most trial lawyers earn a good living, and a few dozen make $5 million or more. Chicago's Corboy, who graduated at the top of his class from Loyola University Law School in 1949, is the archetypal success. His style is Jimmy Cagney's: bluff charm, a burst of impatience, bonhomie, a flash of anger, twinkling smile. His firm, Corboy & Demetrio, won $63 million for its clients last year, $7 million of which Corboy took home. But tell him that sounds a bit much, and you're likely to get a grapefruit right in the kisser. ''Is that an outrageous amount?'' he asks, face reddening. ''If I were second-rate it might be. How much does Lee Iacocca make? Great lawyers are entitled to as much money as CEOs.'' To their detractors, trial lawyers are disaster mongers who appear at the scenes of plane crashes, fires, and chemical plant explosions to sign up customers. And the huge fees they earn help finance ever more outrageous lawsuits. But to their friends, trial lawyers are champions of the underdog. ''They are fighters and risk takers who feel so strongly about the people they represent they would do it even without pay,'' says Alan Parker, deputy executive director of ATLA. That doesn't happen often. On average, trial lawyers win two of three jury verdicts. Do loads of lawsuits make the country safer? Yes, insists Tom Henderson, ATLA's executive director: ''Without lawsuits resulting from tragic accidents, cars would have no rear seat belts and trucks wouldn't sound warning beepers when they back up.'' Maybe, but a recent Brookings Institution book on the subject, The Liability Maze, argues that the benefits of the tort system are vastly overstated. Editors Peter W. Huber and Robert E. Litan maintain that safety in America improved steadily in the first half of the century when it was more difficult for the injured to collect damages. In addition, safety trends in European countries, which rely more on government regulation than on liability to set standards, have generally paralleled those in the U.S. WHY IS the American way of liability law so chokingly expensive? Although the fashionable wisdom is that Americans sue at the drop of a gavel, a study published by the Rand Corp. a few months ago concludes that the vast majority of people are reluctant to take legal action, even when evidence is clear that the manufacturer goofed. ''People blame themselves when the ladder tips over,'' says Linda Lipsen, legislative counsel of Consumers Union. Only 9% of the injured interviewed by Rand considered going to a lawyer, and only 1% actually sued. Where the U.S. system has gone nutty is in the way juries treat that 1% -- like lottery winners. Says professor Lester Brickman of New York's Cardozo law school: ''Some juries think it is their duty to transfer wealth from corporations to those lucky enough to appear before them.'' Consider Harris Corp., a manufacturer mostly of semiconductors and office equipment, which is haunted by century-old cast-iron monsters. Around 1890 a company that Harris purchased much later made presses for embossing book covers. Stripped, electrified, and jerry-rigged, some of those machines have cheated the junkman for generations. A few years ago the fingers of a young printer were crushed in the jaws of one, and a court in Philadelphia ordered Harris -- remote kin though it is to the makers -- to pay him $700,000. What makes Harris and its insurers edgy is that there is no telling how many other ancient embossers are strewn across the industrial landscape waiting to maim and cripple. Compensation for ''pain and suffering'' beyond and above lost wages, medical costs, and other real expenses accounts for about half the awards with which juries penalize defendants. A New York jury in 1988 handed a mother $25 million for the anguish of watching her two children crushed to death by a truck. After the defendants appealed, she had to settle for $3.5 million. Legal scholars puzzle over whether damages other than economic losses should be compensated at all. The grieving mother almost certainly needs psychiatric care, and the settlement ought to buy her the best. Should she get an additional sum, enough to buy a new home, for example? There's a rational case for limited compassion. One part of her life has been closed. Make those responsible open another aspect of life for her. Juries, however, are tempted to try to change the lives of victims completely rather than partially -- and the fates of defendants as well. Rather than face a jury, Sears Roebuck and half a dozen suppliers recently gave $4.8 million to Shane and Becky Sharpe of Corpus Christi, Texas. The couple left the propane tank that fueled their barbecue grill indoors -- despite half a dozen warnings in the product literature to keep it outdoors. The fumes that often escape from such tanks collected in the house and were ignited by the pilot light on the furnace; the explosion burned Shane badly. The Sharpes' lawyers maintained that the warnings should have been written in larger letters. The product liability legislation now in Congress -- one bill introduced by Wisconsin Republican Robert W. Kasten in the Senate and a similar one sponsored by Georgia Democrat J. Roy Rowland in the House -- would still leave manufacturers and retailers vulnerable to lawsuits if they were negligent. And it would not eliminate compensation for pain and suffering. But a manufacturer's liability would be greatly reduced if victims were using products in ways other than the maker intended. This might have lowered Sears' responsibility in the barbecue case. Victims would also have no legal recourse if they got hurt because they were drunk or on drugs. Capital goods makers would not have to answer for their products' safety after 25 years, which would let companies like Harris breathe easier. Reformers managed to breach ATLA's defenses last year, when the Senate Commerce Committee approved a version of such legislation -- the first time that has happened in the ten years of pushing. But ATLA is not about to cede more ground. ''There is no need for federal tort reform,'' declares executive director Parker. Period. When ATLA digs in, Congress takes careful note of where the ramparts are. What makes this lobby so powerful? As Mark S. Mellman, a Washington strategist who helps run lobbying campaigns, explains it, ''Some groups have brawn, like the NRA, and some have brains, like the environmentalists. The trial lawyers have both.'' Raising money seems effortless. ATLA's political action committee gave $1.5 million to candidates in the 1989 to 1990 election cycle, ranking it ninth on the list of big spenders. (No. 1 is the National Association of Realtors, with $3 million.) Still, PACs can't contribute more than $10,000 a race to any candidate, which restricts their influence. Far more significant are the sums that individual trial lawyers pony up for local as well as national campaigns. One Florida attorney gave $600,000 to an advertising campaign to defeat a state referendum that would have capped medical malpractice awards. TRIAL LAWYERS, moreover, are professional advocates who take easily to pressing their case in a Senator's office. ''They do before legislators what they do for a living,'' says David Snyder, senior counsel for the American Insurance Association. They fully appreciate how dependent that living is on sympathetic lawmakers. This time around the decisive struggle is likely to take place in the ^ Senate, where legislation was introduced earlier than in the House. Not only the Commerce committee but also Judiciary must scrutinize the Kasten bill, and there ATLA has an influential friend in Howard Metzenbaum. The Ohio Democrat received $123,000 in small contributions of $1,000 or so in 1989 from several dozen law firms from Albany, New York, to Houston specializing in personal injury work. Metzenbaum, a tireless goad of big business, insists he votes with trial lawyers for ideological, not financial, reasons. In any event, he draws the line where ATLA does: no federal tort reform. Can the trial lawyers be beaten? The reformers are not likely to win this year, despite their competitiveness case. But a few sessions ago the NRA seemed invulnerable as well. This year the gun lobby could lose an important battle. Congress might approve the Brady bill, which would require hand-gun buyers to wait seven days before picking up their weapons. Eventually even the mightiest armies stumble. ATLA's time may yet come.

CHART: NOT AVAILABLE CREDIT: SOURCE: JURY VERDICT RESEARCH INC. CAPTION: THE FIVE LARGEST JURY AWARDS IN 1990*

CHART: NOT AVAILABLE CREDIT: FORTUNE TABLE CAPTION: THE TEN TOUGHEST LOBBIES Capitol Hill aides say these have the most clout.