The American Tort Reform Foundation (ATRA) ranks Louisiana No. 5 on its "Judicial Hellhole" list.
In a press release issued Tuesday, ATRA said Louisiana earned this spot due to a number of factors, including what it called rampant lawsuit abuse as well as targeting of local energy companies.
One of the largest factors in the judicial hellhole, ATRA said, ranking concerns the barrage of lawsuits brought against energy companies. Gov. John Bel Edwards, a Democrat who was a trial lawyer, has hired donors and trial lawyer connections to represent the state against energy companies in more than 40 lawsuits. Edwards says the companies are legally obligated for billions of dollars to restore the coastline of Louisiana, which he claims has been damaged by the companies' operations.
Tiger Joyce, president of ATRA, said in the release that the evidence is sorely lacking for these lawsuits and the only impact they are having is injuring the job market for locals.
ATRA also said Louisiana has become highly susceptible to lawsuits regarding violations of the Americans with Disability Act. The pattern has been for a small group of "serial plaintiffs" to find flaws in the ADA compliancy requirements and then file claims without any warnings or opportunities for the business owners to remedy the flaws without the threat of a legal battle, the organization claims, adding that this tactic is most regularly used against small businesses.
"These are folks who don't have access to full-fledged corporate legal teams. They are good people who want to serve their customers, but instead, trial lawyers are taking them to court and putting small business owners through the ringer," Joyce said.
Additonally, ATRA said, in June, Louisiana was ranked in the top 10 for frivolous lawsuits, and the state currently has the second-highest auto insurance rates in the nation.
The ATRA report said that the high insurance costs limit those who can afford to drive insured, with 55 percent of Louisiana residents driving uninsured or at least underinsured. This lack of insurance leads to higher payouts when even small accidents take place.
"Louisiana finds itself in a bad cycle of trial lawyers driving up insurance costs, [and] the driver then being unable to afford the necessary auto insurance and then going to court to seek payouts," Joyce said.
ATRA lamented that the Louisiana legislature did not jump on the opportunity to pass legislation that would have limited some lawsuit abuses, such as one allowing a court to consider if a person was not wearing a seatbelt when an incident took place; currently, the state prohibits juries from taking this evidence into account when deciding damage awards.
The total estimated toll due to the excessive tort costs in Louisiana is over 15,000 jobs and $1.1 billion direct costs each year, the organization says.