Hidden Costs of Lawsuit Abuse
The skyrocketing cost of lawsuit abuse involving trucks is driving up prices for goods paid by all consumers. It also means trucking companies—the vast majority of which are small businesses—are often one unfair, outsized verdict away from being forced to permanently shut their doors.
Explore the economic impact of lawsuit abuse across America. Click on a state or region to see specific data:
Click HERE for more statistics on the cost of lawsuit abuse.
Other negative consequences of lawsuit abuse:
- Reduced business investment and innovation
- Job losses and economic uncertainty
- Supply chain disruptions
- Increased insurance premiums for all motorists
- Overwhelmed court system
Lawsuit Abuse Takes Many Forms:
The plaintiffs’ bar is endlessly inventive when it comes to devising schemes that target the trucking industry. Here are just a few examples.
Staged Accidents
These highly dangerous schemes involve scammers recklessly and intentionally crashing their vehicles into large commercial trucks with the intention of extorting a hefty insurance payout.
Forum Shopping
The plaintiffs’ bar often “forum shops” their lawsuits by finding favorable judges and friendly jury pools to engineer the award of outsized verdicts against trucking companies that go far beyond actual harm.
Fraudulent Lawsuits
Fraudulent lawsuits are those that are filed by plaintiffs’ attorneys who have not properly investigated the facts before filing a lawsuit. Instead, they make speculative and unsubstantiated allegations, seeking to game the system to get a quick settlement.
Phantom Damages
A phantom damage is the difference between the amount that was billed for medical treatment and the amount that was actually paid for the medical treatment after accounting for insurance, rate negotiations, and other adjustments. Many states permit evidence of billed medical treatment amounts while prohibiting the admission of evidence to the jury of the amount actually paid for the medical treatment.
Allowing the juries to learn the amount actually paid for the medical treatment would curtail the ability of plaintiffs’ attorneys to rake in windfall profits based on what is essentially a fictitious number. Learn more.
Seat Belt Gag Rules
Forty-nine states require adult front-seat occupants to use seat belts. Although seat belts have been proven to prevent serious injuries and fatalities, many states prohibit juries from learning whether the plaintiff was wearing a seatbelt at the time of a collision, which is at issue in the lawsuit. This is known as a seat belt gag rule.
If there is a collision where a plaintiff would not have been injured or would not have been as seriously injured if he or she had been wearing a seatbelt, the court deserves to know that information. Learn more.
Third-Party Litigation Financing
Also known as “lawsuit lending,” this funding arrangement typically involves investment firms with billion-dollar portfolios fronting the cost of litigation with an agreement that the plaintiff will repay the lender with interest on a verdict or settlement. The funders have a financial interest in the outcome of the litigation.
This practice incentives plaintiffs to pursue outsized verdicts to repay their loan and makes it harder to reach reasonable settlements because these funders are a “silent party” to the litigation being funded. All parties deserve to be informed of these funding arrangements and the funding agreements should be produced in the litigation. Learn more.