News
September 18, 2019

Louisiana Lawsuit Climate Ranked Nation’s 2nd Worst

FOR IMMEDIATE RELEASE

September 18, 2019

WASHINGTON, D.C.— Louisiana’s lawsuit climate ranks 49th—the second-worst in the nation—in a new national survey released today by the U.S. Chamber Institute for Legal Reform (ILR). In the survey, New Orleans/Orleans Parish’s legal climate ranks as one of the ten worst local jurisdictions in the nation.

The 2019 Lawsuit Climate Survey: Ranking the States, conducted by renowned polling firm The Harris Poll on behalf of the U.S. Chamber Institute for Legal Reform, questioned senior business executives about the fairness and reasonableness of state court systems.

The state’s low ranking has been long-standing, and it has never ranked higher than 47. This year’s poor performance is due to a number of factors, including excessive litigation driven by trial lawyers’ ubiquitous advertising and local government’s pursuit of novel lawsuits against the energy industry—the state’s top employer and economic driver.

The poor perception of Louisiana’s legal climate is critical to its economic future, because a record-high 89 percent of survey participants said a state’s lawsuit environment is likely to impact their company’s decisions about where to locate or do business.

“Louisiana has remained stuck in the mud, moving up only one spot since 2017,” said Harold Kim, chief operating officer of the U.S. Chamber Institute for Legal Reform. “With over-the-top plaintiffs’ lawyers and unfair courts, it’s not surprising that Louisianans are paying an outrageous amount to support the state’s lawsuit system, including sky-high insurance premiums.”

Drivers in the Pelican State pay an average of $2,300 for auto insurance, 50 percent higher than the national average, because of the high number of lawsuits and massive payouts. It’s gotten so bad that some insurance companies won’t write new policies in Louisiana because doing business in the state is so risky.

Since 2017, there have been 43 lawsuits filed against energy companies by six parishes and the city of New Orleans over alleged coastal erosion. What’s more, plaintiffs’ lawyers have designed these lawsuits to get massive settlements while bypassing a state law that mandates cities and parishes use any award money to fix the coast.

Other contributions to Louisiana’s low ranking include a system that allows plaintiffs’ lawyers to game the system by filing low-dollar claims and “shop” for friendly judges in a favorable venue.

The political power of the plaintiffs’ bar in the state has kept reforms from passing in the state legislature. The Senate Judiciary Committee A, comprised of mostly plaintiffs’ lawyers, has successfully blocked all reform bills for years.

“Louisiana will continue to be one of the nation’s worst lawsuit climates until the state passes real legal reforms and begins to change its bad lawsuit culture,” said Mr. Kim.

The 2019 Lawsuit Climate Survey: Ranking the States is the 12th time The Harris Poll has conducted the survey since 2002 for the U.S. Chamber Institute for Legal Reform. The final results are based on interviews with a national sample of 1,307 in-house general counsel, senior litigators or attorneys, and other senior executives who are knowledgeable about litigation matters at public and private companies with annual revenue of at least $100 million.

 


About the U.S. Chamber Institute for Legal Reform

ILR seeks to promote legal reform through legislative, political, judicial, and educational activities at the national, state, and local levels.

About the U.S. Chamber of Commerce

The U.S. Chamber of Commerce is the world’s largest business federation representing the interests of more than 3 million businesses of all sizes, sectors, and regions, as well as state and local chambers and industry associations.

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