Third-party financing. Contingency-fee counsel. Forum shopping. Fraudulent joinder.
These were just a few of the topics addressed during a House subcommittee hearing Wednesday afternoon.
The hearing, convened by the Subcommittee on the Constitution and Civil Justice and titled “Examination of Litigation Abuses,” dealt with the country’s tort system and what some contend is the need to even the playing field for all parties involved.
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Another witness, however, testified that the situation isn’t as dire as tort reform advocates and groups representing business interests make it out to be.
Joanne Doroshow, executive director of the Center for Justice & Democracy at New York Law School, said that torts today really only represent about 6 percent of all civil cases.
Doroshow said that while calling consumers’ lawyers insensitive to the importance of keeping companies “litigation-free,” corporate lawyers often “run to court at the smallest provocation.”
The United States Chamber of Commerce, for example, sues the U.S. government on average three times per week, Doroshow claims. Legal Newsline is owned by the U.S. Chamber’s Institute for Legal Reform.
In her testimony to the panel, Doroshow stated that while the rights of individuals “continue to be limited, major corporations enjoy unfettered access to the courts to recoup their commercial losses resulting from a host of troubles.”
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One of the subcommittee’s members, Jerrold Nadler, a Democratic congressman from New York State, expressed skepticism about the allegedly problematic nature of contingency fee agreements.
The representative said if a state attorney general wins a case, that inherently means the lawsuit was not frivolous, hence the issue is moot in his mind.
Doroshow, the second witness to testify, noted that the contingency fees are not paid by the taxpayers, but rather by the companies who engaged in wrongdoing.
Doroshow further asserted that because the contingency fee issue is a state issue, “the federal government should stay out of this.”
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