“Judicial Hellholes”—Where not to be sued
WHY IT MATTERS:
These states have the most adverse laws and judicial rulings for defendants which, when sued there, can determine your financial fate.
WHAT IS THE LIST:
Annually the American Tort Reform Assn. (“ATRA”) produces a list of “places where judges in civil cases systemically apply laws and court procedures in an unfair and unbalanced manner, generally to the disadvantage of defendants.” (highlight by ATRA in original)
WHO MADE THE LIST:
ATRA ranked the “Hellholes” as follows:
8. St. Louis, MO
7. Louisiana
6. Lansing, MI
5. South Carolina Asbestos Litigation
4. New York City
3. California
2. Cook County, IL
AND….A TIE AT THE TOP
1. Georgia and
1. The Supreme Court of PA and Philadelphia Court of Common Pleas
The Trucking Impact
ATRA addresses this across all forms of litigation—medical malpractice, food, premises liability, asbestos,…The following are key impacts on our industry:
“Litigation Tourism”
It’s bad enough that your fate varies depending on where you’re sued. Worse—Courts are making it easy for plaintiffs to sue you wherever they want based upon your most tenuous connection to those jurisdictions. ATRA cited GA, PA, and MO for being “litigation destinations.”
Not just where the accident happened. Not just where you’re located or incorporated.
Last year, two court decisions made the 7-10 split of judicial logic that results in your exposure to suit in the most plaintiff friendly of venues. The plaintiffs’ version of the old TV show, “Bowling for Dollars”.
The Supreme Court took out the 7 pin when it said that you can be sued in any state in which you are registered. Surprising and disappointing as its most recent decisions before this limited suit to where the accident occurred or where your primary location or state of incorporation. Legitimate connections, not “litigation tourism.”
However, this recent Supreme Court case involved the Pennsylvania law that requires corporate registration. That law provided that if you complied with the required registration, you agreed to be sued in PA. Thus, where you are registered to do business can expose you to suit in that jurisdiction.
The PA Supreme Court then knocked down the 10 pin as to the question of where you can be sued within PA. The answer: virtually anywhere.
It held that a company that did .005% of its business in Philadelphia could be sued there, despite the product not having been bought there and the accident not having occurred there. Even the Philadelphia Court had rejected that suit there, only to be reversed by the PA Supreme Court..
So…you can be sued in PA if you are registered here. And you can be sued in Philadelphia if you have even the most tenuous connection to it.
Judicial 7-10 split.
Nuclear Verdicts
Detonator jurisdictions “earned” “Hellhole” designations. ATRA called out Georgia, PA, Illinois, NY, and Missouri as bastions of personal injury nuclear verdicts.
More specifically, counties within those states.
Georgia—Fulton, DeKalb, and Gwinnett Counties account for 41% of the state nukes.
PA—Philadelphia. Period.
llinois—Cook accounts for 2/3 of that state’s explosions.
New York—New York. Courts so plaintiff nice they named it twice.
Missouri—St. Louis.
This nuclear exposure in specific jurisdictions makes the “litigation tourism” even more damning.
“Anchoring”:
ATRA cites GA, NY, and MO for the impact of “anchoring” on verdicts. “Anchoring” is a practice permitting plaintiff attorneys to “suggest” to the jury a verdict amount number. A BIG number.
Impactful? Think about it—eight to twelve people are brought from their homes and jobs and put into a jury box. Most for the first time. And they must decide an amount of the verdict.
They can start with “special damages”. Those with specific amounts. Medical bills. Lost wages. Both past and future.
But an amount for pain and suffering? How do they come up with that? That’s where the impact and influence of “anchoring” can be devastating.
“Phantom Damages”
I just told you about jurors having an easy time with numbers such as medical bills. Makes sense, right? It’s the amount that the plaintiff is out because they paid that amount, right?
Wrong, if “phantom damages” are permitted. “Phantom Damages” are the amounts billed by the medical provider rather than what was actually paid and accepted for the service.
Medical bills are like the sticker price on cars. No one pays the full amount. Yet some courts permit plaintiffs to present to juries the “billed” amount and hide from them the amount actually paid. The overstatement results in a plaintiff windfall. “Phantom Damages.”
ATRA called out GA and Missouri for these practices.
Litigation Financing:
What can be wrong with a loan to someone injured in an accident? Help someone get through tough times?
The problem is when the interest is not limited and compounds like a “pay day loan.”: Georgia and New York are cited by ATRA for these practices being prevalent. It notes a New York case in which a lender charged 124% interest.
But aren’t there limitations on the rate of interest that can be charged? ATRA indicates that the NY Bar Association said the loans are considered “non-recourse”, meaning the borrower’s obligation is not absolute, thus removing the loans from interest rate limits.
=Read ATRA’s full publication at About - Judicial Hellholes
BOTTOM LINE:
Know the “Hellholes” and act to avoid them.