Lawsuit Abuse Impact

America has the world’s costliest legal system. As a percentage of our economy, U.S. legal liability costs are double those of the UK, three times higher than those in France and five times higher than those in Japan. Our nation’s litigation addiction hurts families, businesses, communities, and America's ability to compete for jobs and investment in a global economy.

Just as important, lawsuit abuse harms workers and communities across the United States. Consider: Litigation costs small businesses in America over $100 billion per year.  One in three small business owners report that they have been sued or threatened with a lawsuit – and if sued, more than two-thirds say they would likely have to pass legal costs on to consumers, reduce employee benefits and hold off on hiring new employees. Read More...

In other words, the ultimate victims of lawsuit abuse are consumers (in the form of higher prices) and workers (in the form of lost jobs and benefits).

Consider one example of how lawsuit abuse destroyed a business, killed jobs and decimated a community.

For nearly fifty years, gasoline can manufacturer Blitz USA was a pillar of the small town of Miami, Oklahoma.  They produced 75% of all portable gas cans sold in the United States, and more than 100 families depended on Blitz for their livelihoods. 

But then a small group of plaintiffs’ lawyers put Blitz USA out of business.  These trial lawyers concocted a legal theory that sought to blame Blitz for the handful of injuries caused by misuse of gas cans.  The resulting lawsuits forced the company to close its doors.  Over a hundred workers lost their jobs and benefits, and the town of Miami lost one of its most important employers – while the lawyers made millions. The factory has since reopened under foreign ownership but with fewer jobs.

It’s not just businesses that suffer from frivolous litigation. In Huntington, West Virginia, the local school district removed swings from elementary school playgrounds following a lawsuit.  In Rancho Cordova, California, a local community center was forced to close because of an abusive lawsuit. In 2017, New York City had to spend $722 million on civil litigation costs – which comes to approximately $85 for every resident of the city.

From workers on a gas can assembly line to kids in a West Virginia playground, the victims of lawsuit abuse are all around us. Little wonder, then, that nine out of ten American voters believe there are too many meritless lawsuits. Policymakers should take note and enact commonsense reforms to improve America’s lawsuit climate.

Suggested Resources

Research
  • Torts of the Future II: Addressing the Liability and Regulatory Implications of Emerging Technologies

    Torts of the Future II: Addressing the Liability and Regulatory Implications of Emerging Technologies

    April 18, 2018

    The second edition of ILR's Torts of the Future research examines evolutions in regulatory and liability trends for emerging technologies including artificial intelligence, virtual reality, wearable devices, and 3D printing. The research also presents a number of updated guiding principles to inform courts, legislators, and policymakers as they seek to address privacy and safety concerns without derailing or delaying innovation. Read More

  • 2017 Lawsuit Climate Survey: Ranking the States

    2017 Lawsuit Climate Survey: Ranking the States

    September 12, 2017

    The 2017 Lawsuit Climate Survey: Ranking the States was conducted for the U.S. Chamber Institute for Legal Reform by Harris Poll to explore how fair and reasonable the states' liability systems are perceived to be by U.S. businesses. Read More

All Results for Lawsuit Abuse Impact

  1. In the News Today - Februrary 13, 2019

    February 13, 2019 | News

    "Cooperation, Not Lawsuits, Right Way Forward for Florida on Climate"... Read More

  2. In the News Today - February 11, 2019

    February 11, 2019 | News

    "Driverless Car Bill Stalls In Congress, So States Gear Up"... Read More

  3. ILR's Harold Kim: Businesses Don't Think They'll Get a "Fair Shake" in Louisiana Courts

    January 25, 2019 | News

    Harold Kim, the chief operating officer of the U.S. Chamber Institute for Legal Reform (ILR), said businesses and their attorneys fear they won't get a "fair shake" in Louisiana courts.... Read More

  4. In the News Today - January 23, 2019

    January 23, 2019 | News

    Arkansas Pension Fund At Center of State Street Debacle to Review Law Firms... Read More

  5. In the News Today - January 22, 2019

    January 22, 2019 | News

    Coffee Warning Label Suit Like "Something You'd See in a Comedy Skit... Read More

  6. A New Day for the Florida Supreme Court

    January 09, 2019 | Blogs

    It won't be long before Major League Baseball's spring training is in the air, and teams flock to Florida to begin tuning up for the regular season...... Read More

  7. In the News Today - December 26, 2018

    December 26, 2018 | News

    "That Feeling When You Didn't Want the Cheese":... Read More

  8. "Nearly Half of the World's 'Most Ridiculous' Lawsuits Were Filed in NY"

    December 21, 2018 | News

    Citing the U.S. Chamber Institute for Legal Reform's (ILR) "Top 10 Most Ridiculous Lawsuits of 2018" list, the New York Post talked about its state's "dubious distinction of landing four of the top 10 spots" on the list. ... Read More

  9. In the News Today - December 20, 2018

    December 20, 2018 | News

    Washington Examiner: ILR's Most Ridiculous Lawsuits of 2018 List "a Doozy"; "They like a Quarter Pounder without cheese – so they're suing McDonald's for $5 million"... Read More

  10. In the News Today - December 12, 2018

    December 19, 2018 | News

    "Lawsuits Against Cheese and Ginger Ale Highlight List of Ridiculous Court Cases... Read More