Like so much “common wisdom” of our culture, the view that our court system is flooded with lawsuits filed by “trial lawyers” has no factual support. The Wall Street Journal (WSJ) reported this week on statistics provided by the National Center for State Courts, showing a dramatic decrease in personal injury lawsuits. In 1993, about 10 in every 10,000 Americans filed a tort claim but in 2015, the average had dropped to fewer than 2 in every 1,000 people.
WSJ notes that industry groups, particularly the U.S. Chamber of Commerce, have promoted the perception of lawsuit abuse have effectively demonized plaintiffs and personal injury lawyers. But many judges see a different reality, observing many individuals who are effectively barred from seeking redress due to high litigation costs, monetary caps on damages and extended delays in resolution of claims. These barriers are typically created by state laws passed as “tort reform.”
What the trend illustrates is that the cost-benefit analysis for many tort cases is strongly rigged against plaintiffs. With caps on the damages and escalating litigation expenses, injured victims with moderate claims cannot hope to recover sufficient compensation to justify the risk of litigation.
While the number of tort cases have decreased, only 4% of civil filings, contract cases have sky-rocketed. Cases involving contracts, including business-to-business lawsuits, debt-collection, foreclosure and eviction, have grown from 18% in in 1993 to 51% of the civil filings in 2015.