There is this notion that Americans are the most litigious people in the world. However, a recent report by the Wall Street Journal is about to prove that that is not the case…anymore. In 2015, only two out of 1,000 people who are alleged victims of different kinds of civil wrongs, including faulty products or medical malpractice, have filed tort lawsuits in 2015. That figure is way below 1993 levels when 10 in 1,000 Americans sued for damages.
The WSJ report analyzed data from the National Center for State Courts, and the numbers are clear: Americans are filing fewer cases, but what is behind this dramatic dive?
What is a Tort?
A tort is a wrongful act, one that causes harm or injury to another and cause courts to impose liability.
Tort law aims to give the injured party relief for harm caused by others. It also seeks hold the responsible party accountable for the offense they committed and hopes to prevent others from committing acts that could prove harmful.
The afflicted party (plaintiff) usually seeks damages in the form of monetary compensation. Other remedies are also available including injunction and restitution.
There are three general categories that torts fall into:
- intentional torts – for example, when someone intentionally hits another person
- negligent torts – for example, when someone causes an accident by not following traffic rules
- strict liability torts – for example, selling and making defective products
Reasons for the Decline of Tort Lawsuits
It’s difficult to pinpoint the decline in the litigation industry down to just one factor. There are so many contributing causes for the drop in tort lawsuits, but here are some of the major reasons:
In most cases, personal injury attorneys don’t require clients to pay an upfront fee. Attorneys get paid a percentage of the money the client receives from the settlement or trial verdict. This is called a contingency fee agreement.
The fee an attorney receives depends on the cap set by the state. For example, lawyers in Michigan cannot get more than one-third of the total amount received by the client.
However, those are not the only costs a claimant will have to pay; there are ancillary fees involved as well including fees for the following: court filings, police reports, medical records (obtaining and preparing), expert witnesses, and copies of deposition transcripts.
It is possible that a lot of Americans find the costs associated with filing lawsuits too much.
- Tort Reform
For years, a number of tort reforms seem to favor individuals and businesses from frivolous and fraudulent claims. In March, House Republicans advanced bills long supported by corporations and doctors, including putting a cap on medical malpractice awards. The changes limit the ability of some Americans to seek legal remedies from powerful institutions.
- New Ways to Resolve Problems
More alternative dispute resolution options are becoming more accessible to people, including arbitration and pre-litigation mediation. With these, a number of complaints can be remedied without ever seeing a lawsuit being filed.
Plus, better safety technology has resulted in fewer road accidents. A number of states have also introduced new damages caps which make attorneys far less likely to take on risky cases.