Fixing Florida’s Broken Lawsuit Climate
By: Mark Wilson
In many ways, Florida is on a roll. Since 2010, we’ve seen more than $7 billion in reduced taxes, and more than 80 percent of businesses no longer pay a corporate income tax. On the talent development front, achievement gaps are closing, high school graduation rates are at an 11-year high, and third grade reading scores are improving.
Yet, the nation saw Florida’s weak point recently when the American Tort Reform Association (ATRA) – for the first time in its history – named Florida as the nation’s worst “Judicial Hellhole.” The impact on Floridians who are trying to make ends meet is undeniable, and the time for action is now.
There have been six Wall Street Journal articles this year alone highlighting Florida’s lawsuit abuse problem. Read their latest report Florida’s Legal Tourism, Wall Street Journal.
In addition to the worst ATRA ranking (even worse than California,) the national Institute for Legal Reform named Florida the fifth worst legal climate in America. This abuse is driving up the cost of living on Floridians and translates into an approximate $3,400 ‘tax’ for Florida families each year. In fact, I encourage you to see how this ‘tax’ impacts families by watching this short employer-to-employee video called “Meet Mary“.
One of the most egregious examples of abuse right now is the increasing cost of property and auto insurance rates resulting from a cottage industry of trial lawyers that file Assignment of Benefits (AOB) lawsuits.
As Allen McGlynn, Florida Chamber Board Chair for the Tallahassee Region recently explained on our latest Series on Free Enterprise podcast, AOB lawsuits were almost non-existent 15 years ago, but have now spread across Florida. In 2006, there were 405 AOB lawsuits in Florida and by 2016 that number had risen to over 28,000.
Building on efforts to educate Floridians and lawmakers about these abuses, the Florida Chamber and our partners at the U.S. Chamber of Commerce Institute for Legal Reform have just launched a new consumer alert warning Floridians about the AOB lawsuit abuse scam and how it’s raising home and auto insurance rates.
Yet the trial bar’s attack on job creators is much broader. At the behest of plaintiff attorneys, the Florida Supreme Court has failed to prevent junk science in our courtrooms, thrown out attorney fee caps in workers’ comp cases, eliminated attorney fee caps in medical malpractice cases, and declared other portions of Florida’s workers’ comp system unconstitutional. And that’s all within the last two years.
Now, trial lawyers that advertise on TV think businesses should pay even more. Their latest idea and top legislative priority is what’s called “prejudgment interest,” which would require interest to accrue from the date the case was filed, not from when actual damages were determined at trial. Interest would be charged on all damages and costs related to the case, including punitive damages and yes, even, attorney fees. This is a classic sue and settle “gotcha” lawsuit scheme.
Reducing the Cost of Business
Watch this short video to learn why reducing the cost of doing business – which includes fixing Florida’s broken lawsuit climate – is a priority of the Florida Chamber’s 2018 Jobs Agenda.
Senator Kathleen Passidomo Discusses Lawsuit Abuse Reform
Senator Kathleen Passidomo, is a Florida Chamber Distinguished Advocate for her past leadership on lawsuit abuse reform, yet her confidence that true reforms will take place during the 2018 Legislative Session is guarded.
“I wish I could give you some good news and say that we are on it and we’re ready to go, but I don’t see a whole lot coming out of this session for a myriad of reasons,” Passidomo said on the latest edition of the Florida Chamber’s Bottom Line.
Florida is simply better than this. And given the successes we’ve seen in education, the environment, targeted tax reform, job creation, and so much more, Florida’s “Judicial Hellhole” black eye is a factor among companies considering expanding and growing their business in the Southeast.
As I shared recently with Governor Scott, Senate President Negron and Speaker Corcoran, the Florida Chamber stands ready to help. Whether it’s helping to resolve Florida’s workers’ comp problem, ever-growing AOB lawsuits, working to create a fair liability environment to attract and keep medical professionals, leveling the playing field in bad faith lawsuits or ensuring juries receive more accurate information when awarding damages in liability cases, we are committed to helping make Florida more competitive.
Year after year, the Florida Chamber has been at the forefront of solving issues that impact the competitiveness and future of Florida’s business climate. Our focus remains steadfast in our efforts to be the driving force uniting Florida’s business community, creating economic opportunity and growing jobs.
The Conversation Continues at Capitol Days in January
Register today for this two-day event which will include a focus on lawsuit abuse reform as well as the 2018 Jobs Agenda. In addition to an all-star lineup of speakers, the agenda will include conversations with members of the Florida Legislature and Florida Cabinet.