New Orleans area residents pay $2.2 billion annually in excessive civil court costs, resulting in a “tort tax” of $2,763 per person and job losses of nearly 35,000, according to a new study from Louisiana Lawsuit Abuse Watch (LLAW).
In another Louisiana Metropolitan Statistical Area (MSA), Baton Rouge, excessive civil court costs eat up $626 million each year in personal income, LLAW reported. That amounts to a “tort tax” of $1,152 per person and siphons off 9,709 jobs annually, the study released March 10 says.
“Unfounded lawsuits and exorbitant plaintiff awards impact everyone, as these associated costs are passed down to families and businesses through higher prices for goods and services,” LLAW Executive Director Lana Venable said in a prepared statement. “These impacts are resonating now, more than ever, as residents continue to recover from the devastating effects of recent hurricanes and COVID-19 and the global economy is becoming more uncertain.”
The numbers were derived from a study by the Texas-based Perryman Group and other economic data. Overall, Louisiana’s gross product losses stemming from excessive civil court costs is nearly $4.7 billion, according to LLAW.
Venable said that tort-reform groups are now looking to state lawmakers to advance reforms that would address problems brought up in the study.
“In concert with the Louisiana Coalition for Common Sense, Louisiana Lawsuit Abuse Watch is currently reviewing legislation,” she told the Louisiana Record in an email. “Bills addressing legal advertising by Sen. (Barrow) Peacock (SB 378 and SB 383) and collateral source by Sen. (Kirk) Talbot (SB 120) are of key interest, as the proposed reforms in these bills would have a positive impact on our civil justice climate.”
Senate Bill 378 would prevent advertisements that falsely suggest they are offering professional, medical or official government advice about any medication or medical device.
The Talbot bill would reform the state’s collateral-source doctrine so that courts can recognize medical-care discounts provided to plaintiffs rather than being obligated to accept the full “sticker-price” amount from a medical provider. This would help to bring down damages awards in personal injury cases, supporters argue.
The executive director of the Louisiana Coalition for Common Sense also expressed concern about the excessive civil litigation costs in the state’s two largest metro areas.
“As a result of continuing local involvement in coastal lawsuits and Louisiana citizens being constantly hounded by lawyers’ advertising, the culture of excessive lawsuits continues to be a drain on Louisiana’s residents and economy,” the coalition’s executive director, Karen Eddlemon, said in a prepared statement. “Louisiana can do better for its citizens.”