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Republicans Go After Lawsuit Abuse

Legislation “restores accountability to our legal system” and will force attorneys to “think twice before filing frivolous lawsuits.”

by
Bill Straub

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September 24, 2013 - 12:03 am
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WASHINGTON – Congressional Republicans are taking steps to punish lawyers who file what they characterize as “frivolous” lawsuits, maintaining the practice wastes billions of dollars and forces individuals and businesses to unnecessarily spend thousands of dollars on litigation.

The House Judiciary Committee in a 17-10 vote along party lines passed and sent to the floor the Lawsuit Abuse Reduction Act, sponsored by Rep. Lamar Smith (R-Texas), which among other things imposes mandatory sanctions on lawyers who file meritless suits in federal court.

Generally speaking, a frivolous lawsuit is defined as one that clearly is intended to merely harass, delay or embarrass the opposition. The presiding judge, usually upon the motion of the opposing party, determines whether a court action meets that standard.

“Lawsuit abuse is common in America because the lawyers who bring these frivolous cases have everything to gain and nothing to lose,” Smith said. “Lawyers can file meritless lawsuits, and defendants are faced with the choice of years of litigation, high court costs and attorneys’ fees or a settlement out of court. This is legalized extortion.”

The legislation, Smith said, “restores accountability to our legal system” and will force attorneys to “think twice before filing frivolous lawsuits.” Nuisance lawsuits, he said, costs jobs and damage the economy because money that could be spent on adding employees or investing in new businesses is instead directed toward legal fees.

Smith’s legislation would require federal judges to impose monetary sanctions against lawyers who file frivolous lawsuits, directing that the money be dedicated toward the defendant’s attorney fees and costs. The court, if it deems necessary, could impose sanctions beyond what the rule calls for and would eliminate the so-called “safe harbor” provision, which establishes a 21-day period for parties to avoid sanctions by withdrawing claims.

The Lawsuit Abuse Reduction Act revolves around Rule 11 of the Federal Rules of Civil Procedure. In 1983, Congress amended Rule 11 to require monetary sanctions to “discourage dilatory or abusive tactics and to streamline the litigation process by lessening the amount of frivolous matters brought before the federal courts.”

In 1993 the Conference of Senior Circuit Judges, the principal policy-making body concerned with the administration of the U.S. Courts, moved to make Rule 11 more lenient than the 1983 version by providing presiding judges with the discretion to determine what sanctions, if any, should be imposed. The changes were adopted after a flood of litigation revolving around Rule 11 claims inundated the legal system, eating up court resources and time.

The 1993 changes included adoption of the safe harbor provision. Tort reform activists have since pressed for a stricter rule.

Smith’s measure has drawn sharp criticism. In a letter to Rep. Bob Goodlatte (R-Va.), chairman of the House Judiciary Committee, Thomas M. Susman, director of the Governmental Affairs Office for the American Bar Association, noted that the proposal circumvents congressional procedures for amending the Federal Rules of Civil Procedure. He further argued that there exists no evidence that the existing Rule 11 is inadequate, adding that the changes would impede the administration of justice by encouraging additional litigation and increasing court costs and delays.

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All Comments   (21)
All Comments   (21)
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The Republicans had a chance to do something about tort reform back when they had majorities in both houses and GWB in the White House, and they didn't even make a serious try at it. Better late than never, but this is just positioning- the Dems will never let their second biggest contributors (plaintiffs' bottom feeders, ah,... lawyers) down, and they still have that little dictator, Harry Reid, in the Senate to watch over the bottom feeders and other assorted cronies.
1 year ago
1 year ago Link To Comment
Perhaps they need to extend the provisions to civil actions brought by attorneys employed by the U.S. Government, with penalty provisions paid personally?
1 year ago
1 year ago Link To Comment
The correct answer, of course, is Loser Pays.

But given the power of the Lawsuit lobby, that is something that will never happen.
1 year ago
1 year ago Link To Comment
The lawsuits I most want to be denied are the ones claiming racism against companies who do not use Affirmative Action to hire it's employees. Companies should be allowed to hire the most qualified instead of basing it on skin color.
1 year ago
1 year ago Link To Comment
How about prosecutorial abuse against political enemies who could not be dislodged in elections: e,g, Tom Delay, Ted Stevens?
1 year ago
1 year ago Link To Comment
The right fix is to give the power to Juries, not judges.

Currently a jury in a civil suit only determines whether to award, or not to award. Allow them to determine "not only are we not awarding, but your case is so asinine that we are penalizing."
1 year ago
1 year ago Link To Comment

Trouble is, Swami, the jury verdict is at the end of the train,and all the litigation costs have to be borne before you get there.

As a rule, deep pockets don't like to play roulette with jury verdicts and are likely to settle before one comes in, meaning they have no remedy if the suit is frivolous. And by the way, even frivolous or non-meritorious suits do get favorable jury verdicts. If the judge lets in the wrong evidence or gives the wrong instruction, you can be hit with a judgement that shouldn't have happened. Happens every day.

The favorite tactic of the plaintiffs' bar is to attempt to get such a huge judgement at trial that the defendant cannot bond the judgement and so cannot appeal and must settle. So even an egregious error by the trial court never finds a remedy and somebody's pocket is picked clean. Happens every day.
1 year ago
1 year ago Link To Comment
This legislation is wrong on many levels. Just because someone loses a suit doesn't mean it's "frivolous," any more than every criminal prosecution that results in a "not guilty" verdict is frivolous.

The main problem with the act, and with imposition of sanctions generally, is that no one can agree on the definition of "frivolous." Liberals may view a suit to stop ObamaCare as frivolous, and there are a lot of liberal judges, so don't think this is only going to stop suits you don't approve of.

Second, there are already incentives discouraging cases that aren't well founded. In addition to Rule 11, mentioned in the article, lawyers generally invest their time and money in a case, which they won't get back unless they win.

Third, there is no way to determine that "lawsuit abuse" is on the rise so as to require special legislation to curb it.
1 year ago
1 year ago Link To Comment
“Even if frivolous lawsuits have increased in recent years – a proposition for which we do not find empirical support –there is no evidence that the proposed changes to Rule 11 would deter the filing of non-meritorious lawsuits,” Susman wrote.

And what evidence there is, would most likely be skewed since far too many insurance companies "do the math" of defending a frivolous claims and just cut a check to save themselves the time and hassle. With complete disregard for the lack of culpability of their client or their client's reputation. Once a settlement has been paid, you are considered guilty of whatever claim the plaintiff has made.
1 year ago
1 year ago Link To Comment
How about a three strikes and you're out law. The first time a lawyer files one of these suits he gets a warning or fine, the second a sanction, the third he loses his license and is disbarred. The same could hold true for the supposed law firms that specialize in these types of suits. Three times and the whole firm loses their license. Of course anyone that is a victim of this type of suit may turn around and sue the lawyer or law firm that filed the suit in the first place.
1 year ago
1 year ago Link To Comment
It will never happen, but I would love to see Congress use its constitutional authority to completely re-organize the federal court system. Wouldn't it be wonderful to dissolve the 9th Circuit and re-assign its jurisdiction to a more conservative court?
1 year ago
1 year ago Link To Comment
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