The American Tort Reform Foundation (ATRF) publishes an annual “Judicial Hellholes” report detailing jurisdictions it deems least favorable for civil-lawsuit defendants.
The foundation’s worst jurisdictions for 2012-2013 are:
- California – Courts there continue to see class-action litigation abuses, primarily involving consumer lawsuits involving false advertising and unfair business practices; a surge in asbestos-related filings; and continued disability access-related litigation, where plaintiffs allege technical rules violations and then seek modest settlements that are cheaper to settle than to defend.
- West Virginia – The state’s Supreme Court of Appeals has an inconsistent record regarding civil lawsuits. Further, concerns remain about the state’s lack of an intermediate appellate court, maintenance of excessive awards, seeming tolerance of fraudulent asbestos suits, and the state’s history of employing lawyers to handle lawsuits on its behalf on a contingency-fee basis,
- Madison County, Illinois – This county has 0.0008% of the U.S. population, but its courts handle 25% of the nation’s asbestos cases, with many excessive verdicts in favor of plaintiffs.
- New York City and Albany, New York – Plaintiffs’ lawyers are a political juggernaut in the Empire State, remaining steadfast in their fight against tort reform. New York City’s tort liability for the most recent fiscal year exceeded $500 million.
- Baltimore, Maryland – Peter Angelos, whose fortune as a plaintiffs’ lawyer allowed him to buy the Baltimore Orioles, is trying to consolidate 13,000 individual lawsuits into one class action. Perhaps more concerning is that the state Court of Appeals — its highest court — is reviewing a decision that could overturn Maryland’s long-held contributory-negligence standard.
On the other hand, there were states — including Alabama, Arizona, Colorado, Iowa, Mississippi, Ohio, Rhode Island and Tennessee — that made positive reforms, according to the ATRF, including limits on trespasser liability and contingency fees paid to private attorneys handling state claims. There also were positive court decisions:
- California’s Supreme Court limited liability for manufacturers that have asbestos products added to their goods.
- Illinois’ Supreme Court held that landowners are not liable to trespassers who ignore obvious dangers.
- Pennsylvania’s Supreme Court reinstated a lower court’s rejection of unsupported testimony that exposure to any amount of asbestos fibers can be a significant contributor to asbestos-related disease.
Risk management revolves around awareness of these types of issues. Insurance companies rate states based on levels of litigiousness. Carriers reward companies in documented pro-business states with lower insurance rates; conversely, states that score highly on this type of lists often have among the highest rates. It may make sense for those with active or potential business in these areas to consult with their contracts attorneys about building better protections into contracts.