A strong majority (86%) of Americans agree that lawmakers need to address abuses of the legal system, according a survey conducted by the American Property Casualty Insurance Association (APCIA) and Munich Re. The survey, conducted online among over 2,000 U.S. adults by The Harris Poll, also found that “88% believe there should be full transparency and disclosure of all the parties who have a financial stake in a civil lawsuit.”
In addition, 65% of Americans are not aware “of the negative impact plaintiff lawyers’ tactics—including predatory advertising and the use of third-party litigation funding—have on their household costs via the ‘tort tax,’ [$3,621 per American household annually] whether or not the household is involved in civil litigation,” according to APCIA and Munich Re.
Other Key Findings
Additional findings of the survey found that, of the participants, 59% do not know that third parties, like hedge funds or foreign entities, that have no relationship to the plaintiff, often secretly finance litigation in exchange for a share of the jury award or settlement as a return on their investment; and 47% are not aware the plaintiff lawyer in a civil lawsuit is likely to receive most of the jury award or settlement.
“Legal system abuse has been a persistent problem for decades. It is a top factor influencing the high cost of insurance for consumers,” Jim Whittle, APCIA’s vice president of policy, research, and international, tells CLM. “The abusive practices, including attorney advertising, reptile tactics, phantom damages, and third-party litigation funding, impact insurance affordability and availability, and has also forced costs and prices even higher across society at the same time. APCIA is working to eliminate these abusive plaintiffs’ bar practices. It is evident from the survey that these concerns resonate with consumers, as a strong majority of Americans agree state and federal lawmakers need to address the abuses of the legal system. APCIA will continue to work with consumers and the business community to drive reforms to restore balance in the judicial system.”
Ashley Fetko, senior counsel & communications director, and Sitar Bhatt, managing partner, Tyson & Mendes LLP, commented to CLM about the survey, stating. “This survey reveals the growing frustration felt by Americans who are stuck footing higher bills and paying ever-increasing insurance premiums due to predatory tactics employed by the plaintiffs’ bar. It is no secret that social inflation is taking its toll across the country, and the sad reality is most people do not know the true cause at the heart of their emptying bank accounts: Nuclear Verdicts and the plaintiffs’ lawyers who manipulate jurors into awarding them.”
They add, “While reforms would go far to address the inequities that exist in our legal system and would work to counteract the often illegal tactics employed by plaintiffs’ counsel (often at the expense of their own clients, who frequently see a fraction of verdict awarded while their counsel walks away with most of it), the insurance defense industry must adapt and change our approach in the courtroom to protect our clients’ interests, everyday Americans’ pocketbooks, our country’s economy, and our judicial system’s integrity.”