Although the state of California’s ranking has dropped in the 21st Annual American Tort Reform Foundation (ATRF)’s Judicial Hellhole ranking, it is not a result of improvement but rather because other states have inched up the lawsuit abuse list, according to the Washington D.C. tort watchdog.
“The significance in the magnitude of the issues is quite challenging and, in effect, the lack of improvement is what keeps them there,” said Tiger Joyce, president of the American Tort Reform Association (ATRA).
In 2021, California landed the top spot with John Dunham and Associates finding that Californians were paying a $574 tort tax and facing 206,474 lost jobs due to the impact of lawsuit abuse. This year, the Golden State landed in 3rd place after Georgia and The Supreme Court of Pennsylvania.
Joyce
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“These are judgment calls that we have to make, and we look at a variety of factors,” Joyce told the Southern California Record. “With respect to Georgia, the number one driving factor was the Ford decision. In Pennsylvania, the Pennsylvania Supreme Court dismantled an existing standard on jurisdiction for where to bring medical liability cases.”
This year, a Perryman study found that Californians are paying a $1,900 tort tax.
“The money companies spend on compliance and litigation unnecessarily drives up the cost of goods for all California consumers,” Joyce said.
California businesses have settled 642 claims to date, due to Prop 65 lawsuits, and paid out $13.9 million with plaintiffs’ lawyers receiving 88.2% of that total, or $12.2 million.
The Ninth Circuit recently dismissed a challenge to a preliminary injunction that would have banned new Proposition 65 warning requirement lawsuits.
“My understanding is that that's not taking place as far as other decisions,” Joyce said. “Prop-65 has become so expansive that its warnings are practically meaningless to consumers, now."
The report further determined that California is plagued with serial plaintiffs and their lawyers who file boilerplate, no-injury lawsuits that nitpick technicalities and abuse the legal system.
“Unfortunately, while trial lawyers often collect millions, their clients may receive mere pennies," Joyce said.
Those duplicate template claims include accessibility lawsuits, which is yet another litigation arena in which ATRF reports serial plaintiffs are filing no-injury lawsuits.
The report also noted that California is home to more than half of the nation’s accessibility lawsuits.
“Opportunistic and predatory trial lawyers target mom-and-pop shops with few financial resources and specifically small-business owners who speak English as a second language,” Joyce added. “While the trial bar has plenty of alarming tactics, preying on immigrant-owned businesses who may not fully know the ins and outs of the U.S. legal system is especially egregious.”