FYI even under the current system where the statute or a contract provides the the winner gets their fees paid by the loser (generally called prevailing party f

FYI even under the current system where the statute or a contract provides the the winner gets their fees paid by the loser (generally called prevailing party fees), the fees must be "proven" to be "reasonable". So a "inefficient" law firm does not simply say my fees are $x and they get paid, the Court holds a hearing in which other lawyers who are certified as experts on fees come in an testify regarding what a reasonable fee would be with the type of case, the lawyer(s) experience, the number of hours, ect... Your other point is well taken and the potential to be liable for the other sides fees is a deterrent, but that is the purpose of prevailing party fees, to encourage both sides to resolve the dispute without litigation. To some degree they also permit the little guy to get representation when otherwise they could not afford an attorney.