Trial lawyers often employ strategies that exploit the legal system, making it easier for them to secure large payouts at the expense of fairness. This abuse not only clogs the courts but also harms consumers by driving up costs and creating an environment of uncertainty. Let’s dive into some of the ways this happens.
One of the most problematic drivers is third-party litigation funding. This practice is supposed to help victims who can’t afford the high costs of litigation by providing them with the necessary funds to pursue their cases. However, the reality is often quite different. In many instances, lawyers and investors end up taking the lion’s share of any settlement or award. Furthermore, funders also can actually control the plaintiff’s case. Take Burford Capital’s controversial dispute with Sysco Corp., for example. Burford, arguably the world’s biggest litigation finance firm, was funding Sysco’s litigation against beef, pork, and chicken producers, and it used its funding agreement to take control of the litigation, prioritizing its financial interests over those of the actual plaintiffs. This case highlights how third-party funding can often do more harm than good.
Another major culprit is misleading advertising by trial lawyers. These ads often paint a distorted picture of the civil justice system, making it seem like multi-million, or even billion-dollar verdicts are the norm. Sometimes, these ads issue government logos or words like RECALL or HEALTH ALERT to scare people and recruit them to sign up for lawsuits. The more people who sign up for a lawsuit, the bigger the potential payday for the trial lawyers. Fortunately, some states are catching on and have started to pass or are working on reforms to curb these deceptive practices. States like Florida, Kansas, and Texas have enacted legislation to combat misleading lawsuit ads, aiming to protect the public from being deceived.
Plaintiffs’ lawyers also employ various tactics in the courtroom designed to manipulate juror behavior and inflate damages. One such tactic is the “reptile theory,” which aims to instill a sense of danger in jurors’ minds, diverting their attention from the actual evidence. This approach makes jurors feel like they need to “send a message” to protect their community, leading to inflated verdicts. Another tactic is jury anchoring, where lawyers suggest a specific, exorbitant amount for damages or apply a method for calculating damages that leads to a nuclear verdict. These tactics, combined with persistent lawsuit advertising, mislead the public into believing that multi-million-dollar verdicts are normal, contributing to the increasing frequency and amount of nuclear verdicts.
In conclusion, lawsuit abuse has far-reaching consequences that go beyond the courtroom. It contributes to the rising costs of goods and services as businesses pass on the costs of litigation to consumers. This not only affects the economy but also undermines the fairness and predictability of the legal system. It’s vital that states across the country address these issues to ensure a more balanced and just legal system for everyone.