Forbes recently hyped the American Tort Reform Association's (ATRA) annual "Judicial Hellholes" report, but failed to mention that the report's attempt at methodology is anecdotal and highly suspect.
This is not the first time members of the right-wing media have cheered ATRA's Judicial Hellholes report, which aims to point out the jurisdictions that are the "worst" when it comes to allowing lawsuits to proceed. Last year, a Wall Street Journal editorial board writer called the report the "Oscars" of "abusive class actions."
In his December 16 article, Forbes writer Daniel Fisher called the report "an entertaining read" and minimized legitimate criticisms of ATRA's "hellhole" selection process:
News flash: Madison, County, Ill. is no longer the nation's worst place for corporations to find themselves in court.
California took top honors in the American Tort Reform's annual "Judicial Hellholes" list, an unashamedly pro-defendant look at the nation's judicial system. The Golden State won for the welcoming stance its courts take toward consumer class actions -- particularly against food companies -- and rampant lawsuits targeting small businesses over disability-access rules.
A dozen or so law firms, many of them veterans of the tobacco litigation jackpot, have filed 75 class actions against food companies in California and similar cases are running almost one a week, ATRA reports. Many involve the same plaintiffs and take advantage of the state's stringent laws to target companies like Chobani and Trader Joe's with claims that they mislabeled products -- for example, using the term "evaporated cane juice" instead of "sugar."
Critics may say, with justification, that ATRA is financed by businesses with a strong profit motive to cut down on such litigation. But these lawsuits aren't without cost: ATRA says California consumers paid at least part of the cost of $33.5 billion in settlements in 2013 alone. And, as I have reported elsewhere, studies cast strong doubt on the idea that consumers get anything of value out of class actions supposedly brought in their name.
Unlike the Journal's positive take on the "Judicial Hellholes" report from last year, Fisher at least points out some of its flaws -- namely that it's underwritten by corporations that don't want to pay to defend themselves in court. But Fisher seems far more concerned with the amount of money these companies spend on litigation than he is with the very real harm corporate wrongdoers cause. According to the Center for Justice & Democracy, many of ATRA's members are Fortune 500 companies, including "representatives of the tobacco, insurance, chemical, auto, and pharmaceutical companies" -- all industries with a history of questionable business practices.
Fisher also declines to mention that the report's "judicial hellhole" selection methodology is entirely subjective. The report states that hellholes are a compilation of "the most significant court rulings and legislative rulings" in jurisdictions "where judges in civil cases systematically apply laws and court procedures in an unfair and unbalanced manner." ATRA admits in the report that it "reflects feedback gathered from ATRA members," rather from statistical evidence - meaning that the very companies that underwrite the report have a hand in determining which cases are "the most significant." In the past, ATRA has admitted that previous hellhole reports "never claimed to be an empirical study."
The report goes on to complain about judges who contribute to "frivolous" lawsuits by allowing cases based on novel legal theories to proceed:
While most judges honor their commitment to be unbiased arbiters in the pursuit of truth and justice, Judicial Hellholes judges do not. Instead, these few jurists may favor local plaintiffs' lawyers and their clients over defendant corporations. Some, in remarkable moments of candor, have admitted their biases. More often, judges may, with the best of intentions, make rulings for the sake of expediency or efficiency that have the effect of depriving a party of its right to a proper defense.
What Judicial Hellholes have in common is that they systematically fail to adhere to core judicial tenets or principles of the law. They have strayed from the mission of providing legitimate victims a forum in which to seek just compensation from those whose wrongful acts caused their injuries.
Weaknesses in evidence are routinely overcome by pretrial and procedural rulings. Judges approve novel legal theories so that even plaintiffs without injuries can win awards for "damages."
Judges allow suits not supported by existing law to go forward. Instead of dismissing these suits, Hellholes judges adopt new and retroactive legal theories, which often have inappropriate national ramifications.
Under this logic, many of the most important civil rights cases in history should never have been filed since they were based on a "novel legal theory" -- like Brown v. Board of Education or Roe v. Wade. These cases likely would have been deemed contributors to "judicial hellholes," had ATRA's list existed at the time.