New Report Declares Los Angeles a ‘Judicial Hellhole’

December 17, 2004

A report released by the American Tort Reform Association (ATRA) identifies Los Angeles as one of the nation’s nine “judicial hellholes,” further emphasizing the need for passage of civil justice reform legislation in 2005, according to the American Insurance Association (AIA).

Judicial hellholes are those jurisdictions across the country where the law is not applied fairly to all parties. ATRA defines judicial hellholes as places that have a disproportionately harmful impact on civil litigation. “Judicial hellholes are a nightmare for businesses and consumers, but a dream come true for trial lawyers,” said Ken Gibson, AIA vice president, western region. “The deck is stacked in their favor in these destructive jurisdictions, through favorable rulings and verdicts that encourage frivolous lawsuits and unfair financial windfalls.”

This report should serve as a wake-up call to California’s elected officials – states with jurisdictions designated as judicial hellholes often experience harmful economic side effects that are very damaging to businesses and consumers, including higher costs of goods and services, higher insurance premiums, reduced wages, loss of employment opportunities and reduced access to health care.

To that end, this year AIA supported the successful campaign for Proposition 64 to stop shakedown lawsuits and will continue to advocate against legislation which expands opportunities for litigation in 2005.

“The good news for Los Angeles is that out-of-balance tort systems can be fixed,” Gibson said. “This was the case most recently in Mississippi; after years in the national spotlight as a judicial hellhole, the legislature this year passed comprehensive civil justice reform. Mississippi is now in the headlines for all the right reasons as insurers and other businesses bring additional jobs and investment to the state. AIA will be working with our civil justice coalition partners to bring this same success to California during next year’s legislative session.”

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