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September 2010

Commentary

Lawsuit Abuse Obstructs Job Creation

Publication Date: 
January 2010

By Tom Donohue, President and CEO, U.S. Chamber of Commerce
January 19, 2010

Leave it to the plaintiffs' trial lawyers to add insult to injury. While American businesses and families spent 2009 coping with the effects of a severe recession, the plaintiffs' bar was hard at work bringing a whole new round of outrageous lawsuits on behalf of clients hoping to get rich quick by winning the litigation lottery. To chronicle some of the most egregious lawsuits, the U.S. Chamber Institute for Legal Reform (ILR) introduced its First Annual Most Ridiculous Lawsuit of the Year Poll.

Nominees were drawn from the monthly Most Ridiculous Lawsuit poll winners featured on FacesofLawsuitAbuse.org, a public awareness Web site that aims to show how abusive lawsuits affect small businesses and average families in very real ways. Throughout the year, more than 50,000 people voted for their favorite ridiculous lawsuit.

Here are the top five most ridiculous lawsuits of 2009:

5. Neighbor sues woman for smoking in her own home.

4. Double murderer sues to claim his victims' classic Chevy pickup.

3. Holocaust denier sues Auschwitz survivor, alleging memoir contains "fantastical tales."

2. Tourist sues hotel, claiming swimming pool got daughter pregnant.

1. Illegal immigrants sue rancher who stopped them on his property at gunpoint and turned them over to the Border Patrol.

Frivolous lawsuits like these, sadly, are all too common. With unemployment stubbornly remaining above 10%, putting Americans back to work must be our top national priority. But the litigation climate threatens to dampen job creation and economic growth just when we need it most.

Instead of investing in new equipment, opening new stores, or hiring additional employees, many small business owners are being forced to spend their hard-earned dollars beating back ridiculous lawsuits. This weakens our culture of entrepreneurship, stymies economic development and job creation, and clogs our already overburdened judicial system. To make matters worse, plaintiffs' lawyers are working tirelessly to convince Congress to give them even more ways to sue.

The American people deserve better. They deserve a judicial system that delivers swift justice to those who have caused injury and relief for victims. But when judges are forced to hear cases like those mentioned here, the system breaks down for everyone.

It's time for Congress and the state legislatures to just say "no" to more lawsuits, so that the job creators can get Americans back to work instead of worrying about the next outrageous lawsuit. Let's make 2010 the year we create more jobs, not more lawsuits.

Comments

Shawn 1/19/2010 4:20:01 PM

There needs to be some kind of penalty that keeps people from filing bogus lawsuits. First of all for attorneys who file these suits, and second to the person who wants to file it. They should be responsible for all attorney fees incurred by the defendant who has to spend all of their own money to defend themselves. As well as some kind of fee that is paid to the defendant for their time and stress of going through a lawsuit.

All of this would help keep BS lawsuits out of our courts and help speed up legitimate court cases. If you knew your case wasn't legitimate would you take the risk of having to pay the defendants fees and a penalty on top of that? (Belle Plaine, Minnesota)




Bernice Kaiser 1/19/2010 4:21:47 PM

These frivolous lawsuits makes every staffing manager think twice before giving advice. We need to take care as we conduct business to make sure that we know all legal ramifications regarding suggestions, advice and responses to any questions. It does not feel comfortable having a generalized conversation in a business setting without very carefully picking your words!!! (Chelmsford, MA)




Bill Bolander 1/19/2010 4:33:50 PM

What makes things worse, is many times these suits are settled without going to trial, because of the costs involved. (Indianapolis, Indiana)




WANDA HAMILTON 1/19/2010 4:34:10 PM

IN ALL LAWSUITS, THE PROSECUTION SHOULD HAVE TO PAY THE COST INCURRED BY THE DEFENDANT INCLUDING THE DEFENDANTS TIME AND ANXIETY. THIS WOULD PUT A STOP TO THESE FRIVOLOUS SUITS. (NORMAN PARK, GA)




Gary Ruddell 1/19/2010 4:34:15 PM

Adopting an European legal benchmark--the loser in a lawsuit pays the party that prevails reasonable legal costs (and damages if awarded). Taking this concept a step further would be to penalize the fivilous attorney for court and legal costs. Both of these would eliminate many frivolous lawsuits. (Grantsville, Maryland)




Jonathan Goad 1/19/2010 4:49:02 PM

You are exactly right Gary. This seems like such a simple solution. Penalizing the lawyer who accepted the lawsuit in the first place would go a long way. The trial lawyers lobby is destroying this country. If the American people would stop electing Lawyers to political office, we could finally end this nonsense. (Raleigh, NC)




Vijay Shankar 1/19/2010 4:44:47 PM

How can we get this taken care of - enact in law so these crooks including lawyers do not scam hardworking people. (Portland, Oregon)




Shannon 1/19/2010 4:45:51 PM

This is so terrible. It is happening all over. My husband just got terminated for a reasons that are also unjust. We full heartedly believe that those with BS lawsuits should have to pay along with those prosecuting. The corruption that is going on in our workforce makes a person wonder if there are any good employers left. Thankfully, I the other half, have the best bosses in the world. But it's crazy out there! (Osage, Iowa)




Rob 1/19/2010 4:47:42 PM

Just have the plaintiff be required to put up 50% of what they would like in a judgement. Cash, non-refunable, winner take all. (Coldwater, MI)




Rich 1/19/2010 4:55:45 PM

I am starting a new home inspection and radon measuring business, and the insurance costs just to get started are very high. And I don't really blame the insurance underwriters either. They have to protect themselves from the greedy lawyers and their clients. (Martinsburg, WV)




John Stravers 1/19/2010 4:57:00 PM

Shakespeare was right on the money when he wrote: "The first thing we do, let's kill all the lawyers". (Phoenix, AZ)




Chester Strader 1/19/2010 4:57:18 PM

There are certainly legitimate concerns about stopping frivilous law suits from being filed. There are already sanctions on the books in almost every state to be levied against lawyers being found to propound those suits, the real problem is to get a court to actually enforce these existing sanctions. I am sure that one of the biggest fears is the application of the sanctions punitively when the cases have real merit and the facts brought out at trial favor a finding one way or another. The earlier suggestion that costs be cast against the loser in a lawsuit also makes sense, however given the findings in some cases it may just add insult to injury. If we just make the threshhold of Summary Judgment real and eliminate those suits where there is not a legitimate legal question or allegation get thrown out before the legal fees have escalated we would go a long ways to eliminating law suit abuse (Ocala, Florida)




Teek 1/19/2010 5:11:50 PM

The trial lawyers are too big doners, so u will never see reforms. If the clients have to pay the other party expenses it will cut these law suites in half. There should be limitations on amounts some one can sue and get.Stupidity and negliance is ur fault. (Bloomingburg, NY)




Nick P 1/19/2010 5:17:49 PM

We had a suit this year regarding OT allegations by a salaried employee after his vacation date request was turned down for legitimate business reasons. By the most liberal standards he "might" have been due $126. over three years. He would up getting a whopping $600. as an out of Court settlment as the TV lawyers legal fees were already over $10,000 and threatening $40,000 if it went to Court, even if we prevailed. The Court did nothing but sign off on it. The result? We have demoted all Mgrs. to hourly. The sue happy employee who thought he was going to get over $10K has been unemployed for a year. Nothing will happen until we start putting business people instead of lawyers in Office, and lib Judges on the Bench. (Ormond Beach, FL)




Glenn McGovern 1/19/2010 5:17:52 PM

I would like to see actual copies of these suits with full citations, not just a one sentence summary with no reference at all. (Metairie, La.)




marty Taylor 1/19/2010 5:18:09 PM

After 30 years in business, the two things that scare me most are a letter from the government or an attorney. What does that tell you about the state of business when your biggest worries are things unrelated to your core business..... (Colorado Springs, CO)




Sharon 1/19/2010 5:34:03 PM

Maybe the judges need to be more responsible and throw these lawsuits out of court! (Yuba City, CA)




Renee 1/19/2010 5:51:06 PM

I agree with the statement about the judges. These lawsuits need to be recognized as an abuse of the legal system and the plaintiffs as well as the lawyers and judges need to be held accountable. I wonder if there are any guidelines by which a 'frivolous' lawsuit can be defined. If so any lawyer or judge who tries suits that fit this criteria too often should face serious consequences.
(Not only does this hurt small businesses and the job market, tax dollars are wasted every time one of these is granted time in court.) (Fresno , California)




Gene L. 2/18/2010 8:56:27 PM

Unfortunately, too many judges have come from the trial bar, and as a result they are also addicted to imposing their will and their judgement on others. Out of court settlements are also too often driven by the pressure of the insurance companies who want to cut THEIR losses, with no regard for the individual(s), or business(es) being screwed,... errrrrrrrr,... sued. (Milford, OH)




Jack 1/19/2010 6:12:43 PM

Legal reform should be a top priority for our government as it works to encourage small business in our increasingly challenging economy. My small company is on the brink of bankruptcy due to a meritless wage and overtime suit from an employee who was highly salaried and well treated. Due to the legislative climate in my state, plaintiff's attorneys are actually encouraged to practice what amounts to legal extortion. In our case, the cost to go to trial was prohibitive and we were forced to settle for a sum far greater than we could afford. The plaintiff refused to participate in a good faith negotiation during our mediation and, of course, the attorney received the majority of the settlement. It's quite ironic that many European countries maligned for their "socialist" bias have just and equitable laws far better than ours that discourage these predators. Shame on our lawmakers who promote and enact laws promulgating this duplicitous activity, as well as the citizens who complain about joblessness and economic woes – the two are ABSOLUTELY connected. As for me, I'm shutting down my company so I'm no longer a target. (Los Angeles, CA)




Gene L. 2/18/2010 8:57:44 PM

Under THIS administration, with THIS Congressional mindset? You've got to be joking... (Milford, OH)




Jeff 1/19/2010 6:18:56 PM

50% of liability insurance premiums end up in the legal profession. This is true whether it is personal auto, business auto or any other liability insurance. The first thing I do before deciding who to vote on is line up the candidates and elimanate for consideration any attorneys. We definately need to adopt the English rule where the loser pays and the plaintiffs attorney should be jointly liable if the case is taken on a contingent fee arrangement. Judges should not come from the legal profession. It seems they are more interested in protecting the profession than administering justice. Politicians at the State or Federal level should have to agree to not ever pracice law after taking office (they should not be allowed to become lobbyists but that is a different topic). Our legal system not only allows legalized extortion, it promotes it. (Oklahoma City, OK)




ron 1/19/2010 6:19:54 PM

Attorneys should not be allowed to advertise on T.V. many people sitting home, many capable of working, just hire these Lawyers for free with nothing to loose. Many small business owners have these frivolous suits thrown at them and just settle out of court to avoid the very large lawyer fees. You put your hand on the Bible and swear not to lie in court but isnt one side lying in every case, doesnt the words perjury or illegal mean anything anymore ! (Hopatcong, N J)




Kim Jahnson 1/19/2010 6:22:38 PM

These types of lawsuits should be thrown out & not waste more peoples time. In regards to illegal immigrants, no proof you belong here legally, you have no rights at all-end of story, chain them up & drive back to where they came from & the lawyer defending them needs to pay for any costs resulting from bad decision making, I bet this would decrease some numbers. (Oconomowoc, WI)




DLR 1/19/2010 7:58:09 PM

Kim,
I agree 100%. If someone is not here legally they should not have the right to sue. Most of these guys know the system and easily abuse it. (La Habra, Ca.)




Guest 1/19/2010 6:24:54 PM

What do these have to do with business?

5. Neighbor sues woman for smoking in her own home.
4. Double murderer sues to claim his victims' classic Chevy pickup.
3. Holocaust denier sues Auschwitz survivor, alleging memoir contains "fantastical tales."
(Tampa, Florida)




BOB 1/19/2010 7:23:42 PM

Can't get a grip on #5. As for #4, maybe the truck was parked in a commercial building, or at the crime scene and the owner of the property was made party to the suit. #5, my guess is that the memoirs were published and everyone associated with the publication of the book was named. No details were offered in this list nor were there any details on the final disposition of the cases. Who knows, but I wouldn't be surprised to discover that the same crowd that is squaking about these "frivolous" lawsuits, will be quick to align with and support the efforts of those states who are ready to take the federal government to court (lawsuit) to derail health care reform. Am I the only one who sees irony here? (Stuarts Draft, Va)




Elisa 1/19/2010 7:28:24 PM

A loser-pay system would fix this. (Kingsport, Tn)




AZAudio 1/19/2010 8:16:39 PM

I agree, the loser-pay system is a sure answer. (Aurora, IL)




jfalth 1/19/2010 8:15:29 PM

upon filing a suit on behalf of their client, most lawyer’s would argue that there is no such thing as a ‘frivolous’ lawsuit.

for lawyer's, it would only become 'frivolous' after they loose, and after they are forced to pay a 'looser's' fee, court and other sundry costs. (Marquette, Mi)




Tim 1/19/2010 8:40:22 PM

Lawyers, Bankers, Politicians, Insurance People, Brokers...and more are all in bed together to take whatever money they can from whoever seems to have any, justice does not seem to have much to do with any of it...Judges, being past lawyers do not help the situation, although not all of them are totally incompetent....

Truth needs to become the total factor again here in the United States of America. (Gainesville, Florida)




Phil Lowe 1/20/2010 11:43:08 AM

Frivolous lawsuits are yet another sympton of the disease called "entitlement" that is becoming more widespread and accepted by everyday Americans. Sadly, so called "Progressives" view our country's economy as a "zero-sum" system rather than "the land of opportunity" where talent and ideas can create jobs and yes even wealth! So the frivolous lawsuits are another method of obtaining wealth from others to benefit those who perceive their economic condition as disadvantaged because others have resources and they do not. The merits and legitimacy of their claims aren't important. The end result of wealth re-distribution is! (Albuquerque, NM)




At the Beach 1/20/2010 12:40:02 PM

Certainly, it appears that the cases you mentioned are ridiculous. It is not difficult to find several such cases in any given year. However, if you want to show at least a semblance of intellectual honesty, you should also give examples of how the court system righted some wrong in which a severly injured person had their insurance claim wrongly denied, or how some large corporation violated the law repeatedly and covered it up, all in order to increase their bottom line. There are many more cases such as that, than the other. Likewise, you should point out that the entire debate about "frivoulous lawsuits" is largely driven by the insurance industry which wants to continue collecting large premiums from the Chamber of Commerce members, but pay nothing when there is a claim. (Myrtle Beach, South Carolina)




Perry Levin 1/20/2010 4:17:33 PM

Mr. Donohue, maybe you would like to reconsider your complaint about trial lawyers in general for the actions of a few. And maybe it would be better to limit examples to business-related lawsuits. If this is your whole case I find it very frivolous. (Rockville, MD)




Anne Zachry 1/21/2010 4:31:19 AM

Here, here! This article completely throws the baby out with the bathwater. (Camarillo, CA)




Kurt Ditmer 1/21/2010 11:36:06 AM

It sure is apparent which responders are attorneys and which are business people! I say that for starters, there should be no new bills introduced or laws passed that can't be fit on three 8-1/2" x 11" pages in standard font and written using terminology that can be understood by someone with a standard 12th grade education. It currently takes teams of lawyers and judges to try to interpret most of our laws...all ultimately at the cost of our citizens. Even our lawmakers have stated that they have to rely on others to interpret the health care bill because they don't have time to read 2000 pages of "legalese" text...and most of the politicians are lawyers! Lawyers and judges are good people too...I just feel that there's plenty of legitimate work for them to do without having to get bogged down in frivolous nonsense. (Castro Valley, CA)




Lucius Hawes 1/21/2010 12:51:23 PM

The tort system is a terrible contraption. It was invented in England by the King’s exchequer to shift the cost of poverty, injury, etc, off the King’s money and onto the King’s citizen’s pocketbooks. The basic idea is to blame the oxcart owner or driver when someone’s foot gets run over by an oxcart, and then make the owner and/or the driver pay the cost of the loss. To make it work, the King’s government set up a system of courts to arbitrate the disputes and enforce the transfers of “wealth”. The cost to set up and run the courts was a really cheap buy for the King, and it “solved” two problems: (1) it shifted the burden of social tragedy off the King’s wealth; and (2) it provided, for the time, a more civilized method of resolving disputes than blood feuds, revenge killings, etc. Even so, it was a medieval response to a social problem, designed long before modern concepts of democracy emerged. The tort system needs to be scrapped. It’s erratic, unpredictable, and often does not solve the underlying problem. The underlying problem is that an injured person needs medical care, wage loss replacement, etc. Sometimes, the person “at fault” lacks financial resources to pay what the system says he/she owes. Sometimes, a jury does not agree that the targeted “wrongdoer” was at fault. Sometimes, the tragedy was the injured person’s fault, so the tort system can’t help that person at all, even though his/her loss is just a terrible as the next person’s. Then there is the insurance monster that has glommed onto the system. In some states, all citizens are forced to buy auto insurance, and can be fined or sent to jail if they fail to do so. And employers have to buy workers compensation insurance, which is an obstacle to competition from more enlightened democracies (including England) which long ago discarded the ancient tort system that we still struggle with, in favor of some form of universal response that recognizes that the government is the best entity to provide for the general welfare. All the modern democracies, except the United States, have some form of universal medical and financial program for the general welfare. We have Medicare, Medicaid, Social Security, food stamps, AFDC, immense welfare programs for farmers, pensions and federal accident and health insurance for congressmen and senators, ERISA for employees of businesses that do interstate business, disability pensions and VA medical care for injured soldiers, etc. But ours is a crazy patchwork quilt that leaves out vast populations of Americans; no other modern democracy does that.

The Chamber of Commerce’s identification of the silliest and dumbest cases in the whole tort system is a cute game. The irony of the game is that the Chamber is fighting President Obama even harder than the Republicans, in an all-out effort to defeat the President’s efforts to bring our democracy in line with the modern world, and in the process, reduce the role and prominence of the trial lawyers that the Chamber is attempting to demonize.
(Hopkinsvile, KY)




vijayaillu ruralcoophomeindia 1/22/2010 4:54:21 AM

Bring an expert,support it with facts,find the motive, (Blore, India)




Gene L. 2/18/2010 9:36:43 PM

For those who can't figure it out o their own, the stories (at this writing, 40 pages of them) are at the link at the top of the page:
http://facesoflawsuitabuse.org/ and look for the tab at the top (stories)

Or, go straight to the first page of 40 (or whatever it is when you read this) at:
http://facesoflawsuitabuse.org/news/ (Milford, OH)