TorteDeForm

Cyrus Dugger

Overlooked in the Tort “Reform” Debate: Abusive Litigation by Defendants

Here is an excellent article critiquing the unitary focus of tort “reformers” on plaintiff side litigation tactics. The article points out that defense litigation tactics can have an enormously detrimental effect on the civil justice system's ability to efficiently decide claims.

Here’s the introduction.

It is common these days to hear conservative politicians and corporate representatives charging that plaintiffs' lawyers--especially plaintiffs' tort lawyers--are abusing the courts by effectively extorting exorbitant awards from the defendants they target. On this view, the problem is most pronounced in state court, where local trial lawyers and their clients cast themselves as David to out-of-state defendants' Goliath.

"Tort reform," we are told, is the answer--especially reform that will enable defendants to move more cases out of the state courts and into the defendant-friendly federal judiciary.

Omitted from this account is any thoughtful attention to the litigation practices of tort defendants and their counsel. But manipulative, abusive litigation is a two-way street, and tort reformers should be equally concerned about abuses on the defense side.

(link to full article)

Here’s also a quick overview of some of the findings mentioned in the article.

Here's a summary of what we've found so far:

First, over the last decade, tort filings in state court are down. Across 17 states between 1993 and 2002, the total number of tort filings decreased 5%; across 35 states during that same period, tort filings decreased 4%.

Second, despite the shrinking pool of state-court filings, diversity-based tort removals from state to federal court have not commensurately declined over the last decade. One would think fewer cases means fewer removals. Instead, defendants are removing nearly the same number of diversity tort cases despite shrinking state court tort dockets.

Third, cases removed from state to federal court account for an increasing proportion of the federal courts' docket. Indeed, the most recent data suggest that about 30% of diversity cases now come to federal court via removal, as opposed to being filed in federal court originally. That's about a one-third increase in the last decade.
Finally, and most importantly, remand rates are increasing over time. (A court "remands" a case when it sends it back to the state court in which it was initially filed.) In recent years, more than 20% of diversity tort cases removed to federal court were remanded to state court. That's a substantial increase over the remand rate in the early 1990s.

This last point is critical. It establishes that just as more and more of the federal courts' docket is taken up with cases removed from state court, more and more of those removals are wrongful.

How should tort reformers respond? A number of options may be worth considering.
First, Congress could provide for mandatory fee-shifting in the case of erroneous removal. That is, it could require defendants to pay the fees and costs that plaintiffs incur when they successfully contest an erroneous removal. The federal removal statute already permits such fee-shifting as a matter of discretion, but it might be worth making the provision mandatory, or at least formalizing a presumption in favor of fee-shifting. There is some appeal to this idea: if a defendant removes a case only to see it ultimately sent back to state court where it began, shouldn't the defendant pay for the detour?

Keep reading article.

If you or your organization is interested in learning more about or working on these types of civil justice issues, please feel free to contact me at cdugger@drummajorinstitute.org.

Cyrus Dugger: Author Bio | Other Posts
Posted at 12:00 PM, Oct 10, 2006 in Book & Article Reviews | Civil Justice | General Debunking Resources
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Comments

Hypocrisy watch: Look out for anyone who supports a "loser pays" model but who opposes mandatory fee-shifting in case of removal.

Posted by: Justinian Lane | October 10, 2006 11:55 AM

I don't oppose fee-shifting in the case of removal: I question one-way fee-shifting. If plaintiffs are required to pay attorneys' fees for a losing remand motion, then there would be equity.

Fee-shifting would not be a deterrent to removal, except at very rare cases on the margin, but that's a different question.

Morrison's conclusions are a non sequitur from his data for reasons I explore at Point of Law.

Posted by: Ted | October 11, 2006 5:12 PM