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  1. #1
    Join Date
    Nov 2006
    Posts
    1

    Default Effects of Lawsuit abuse

    The Texas legal system has been the nation’s ‘pin up boy’, for year, when it comes to lawsuit abuse. The whole system is inflicted with junk lawsuits and lawsuit abuse. These lawsuits have led the doctors to leave the area in search of greener pastures, kept life saving drugs from entering the market, small businessmen to work in constant fear of losing their business.

    The overall impact of such lawsuits on the US economy can be pointed below:
    • The cost of the U.S. tort system for 2003 was $246 billion, or $845 per citizen or $3,380 for a family of four.
    • U.S. tort costs increased 35.4 percent from 2000 to 2003.
    • The Growth of U.S. tort costs have exceeded the Gross Domestic Product (GDP) by 2-3 percentage points in the past 50 years.
    • The U.S. tort system is inefficient; it returns less than 50 cents on the dollar and less than 22 cents for actual economic loss to claimants.

    A recent study lists the Texas Liability system among the worst. The survey also showed that nearly 81 percent of the respondents indicated that the litigation environment of a state can affect decisions such as where to locate or where to do business.

    The job of Texans for Lawsuit Reform (TLR) is to fight such lawsuit abuse. The Co-founder and Chairman of TLR, Mr. Dick Weekley, envision a litigation system devoid of game playing and intimidation, allowing plaintiffs to be fairly compensated and defendants to get a fair day in court.

    http://www.pacificresearch.org/press...-24-06tlr.html

  2. #2
    Join Date
    Mar 2005
    Location
    Michigan
    Posts
    28,906

    Default Re: Effects of Lawsuit abuse

    Gotta love the insurance industry's propaganda.

    As this has nothing to do with the subject of defamation, I'll move it to "debate the issues".

  3. #3

    Default Re: Effects of Lawsuit abuse

    In that vein I'll see if we can't drum up some debate. Really, the solution is simple: loser pays. The door should still be open for legitemate suits to be brought, so I don't think it should be across the board, but there should be some sort of standard to which the case is held (yes, I realize that establishing it is tricky) - if the case doesn't stack up, it is dismissed and the loser pays.

  4. #4
    Join Date
    Mar 2005
    Location
    Michigan
    Posts
    28,906

    Default Re: Effects of Lawsuit abuse

    How many insurance companies do you see presently lobbying for a "loser pays" rule? Zero? There's a reason for that, you know.

    Beyond the obvious problem that a "loser pays" rule will intimidate people of modest means into giving up valid legal claims, most plaintiffs in tort litigation are represented on a contingent fee basis and have no money to pay legal fees if they lose. (This is also a huge factor in why, despite all of the insurance industry's yammering about "frivolous litigation", it is exceptionally rare to find a plaintiff's lawyer who has filed a frivlous case - if they do that, they take a loss.) Insurance companies almost always have the funds to pay legal fees when they lose.

  5. #5

    Default Re: Effects of Lawsuit abuse

    True, but as long as the legal fees (which can be large) are less than the proposed settlement the companies have no incentive to fight an obviously bogus lawsuit. As a lawyer I might gamble losing the court costs as well as my own time on the outside chance that the company will choose to settle for far less than what I am asking but still far more than the case is worth based on its merits.

  6. #6
    Join Date
    Mar 2005
    Location
    Michigan
    Posts
    28,906

    Default Re: Effects of Lawsuit abuse

    That's incorrect. Even in relation to meritorious claims, insurance companies frequently and intentionally spend far more defending against claims than the claims are worth, and routinely drag out litigation that they know will ultimately settle or result in an adverse verdict. This gives them two obvious benefits, the first being that any lawyer who is considering filing a small claim knows it has the potential to be a money loser, and the second being that a desperate plaintiff is likely to settle for less than the case is worth if they believe it will otherwise be a year or more before they see any money.

    In terms of the mythic "bogus lawsuits", the former rationale applies - and the insurance company can seek sanctions in every state and in the federal courts (including legal fees) if they can convince the judge that the lawsuit was in fact frivolous.

    Did you have a specific "bogus lawsuit" in mind, as an example?

  7. #7
    Join Date
    Sep 2005
    Location
    California
    Posts
    20,594

    Default Re: Effects of Lawsuit abuse

    Well, cities and counties in CA get claims filed against them all the time. These claims rarely go to court in a suit because local government looks at the numbers and decides that it is cheaper to settle the claim for a low five figure amount then going to court. It is NOT uncommon to see cities and counties write a multitude of checks for $10-$20,000 each year. Cities like Los Angeles actually have these payoffs built into their budget.

    I don't know what the answer is, but the process is being abused.

    - Carl
    **********
    Retired Cal Cop Sergeant & Teacher

    Seek justice,
    Love mercy,
    Walk humbly with your God

    -- Courageous, by Casting Crowns ... http://www.youtube.com/watch?v=pkM-gDcmJeM

  8. #8
    Join Date
    Mar 2005
    Location
    Michigan
    Posts
    28,906

    Default Re: Effects of Lawsuit abuse

    Detroit used to settle (and default) on a lot of cases they could have won. Following an administration change, they got much more competent lawyers in place and involved more outside defense firms, resulting in what might be called an appropriate level of competence in defending against claims.

  9. #9
    Join Date
    Sep 2005
    Location
    California
    Posts
    20,594

    Default Re: Effects of Lawsuit abuse

    Ideally, I would love to see that. But, when you are talking pure dollars and cents, and winning would cost you say, $15,000, why not settle for $10,000?

    Sure, one theory is that you discourage such suits by fighting them, but few city councils out here look beyond that bottom line. Most cities out here subscribe to the "go away" money idea it seems. However, I am not privy to all such claims so I can't say for sure how many are rejected and disappear, but I know that it annoys me how many are paid off for convenience and not due to merit.

    - Carl
    **********
    Retired Cal Cop Sergeant & Teacher

    Seek justice,
    Love mercy,
    Walk humbly with your God

    -- Courageous, by Casting Crowns ... http://www.youtube.com/watch?v=pkM-gDcmJeM

  10. #10
    Join Date
    Mar 2005
    Location
    Michigan
    Posts
    28,906

    Default Re: Effects of Lawsuit abuse

    I doubt that's in fact the case. Most cities are insured through municipal leagues, which are very forward-looking when it comes to determining whether an early settlement (or an adverse court decision) will end up costing them money over the long term, whatever the short-term cost of defense.

    If they appear to be settling quickly for small amounts, it likely is to save money - but because they deem the case a probable loser at trial.

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