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Are Frivolous Lawsuits Driving Out Businesses?

Posted by in News | October 19, 2013
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“Cost and frequency of lawsuits/threatened lawsuits” was ranked 71st out of 75 business concerns according to the August 2012 National Federation of Independent Businesses publication Small Business Problems and Priorities (8th ed.). How to use Twitter was ranked as a more pressing concern for small businesses (the 70th ranking concern was “using social media to promote business”). Based on the reporting to their own organization, facing lawsuits is not a huge problem for small businesses. NFIB categorized lawsuits as one of the “10 least severe problems for small-business owners of the 75 business problems assessed…”

So where is all the outrage against lawsuits coming from? Many “citizens against lawsuit abuse” groups are actually funded by large corporations even though they claim to be grassroots movements. See http://centerjd.org/content/fact-sheet-citizens-against-lawsuit-abuse-groups. The US Chamber of Commerce, a nonprofit run by giant corporations that seeks to fight “lawsuit abuse” against its members, sues the federal government about 150 per year by itself. But lawsuits by people seeking justice on the courts? They are disappearing. In Multnomah County, Oregon, the judges actually set up a committee called the “Vanishing Civil Jury Trial Committee.” According to the Oregon State Bar­, some counties in Oregon go years without having a single civil jury trial.

The right to seek justice in the courtroom before a jury is a right enshrined in the 7th Amendment to the US Constitution. To quote the Oregon State Bar: “If trial by jury in civil cases is — as James Madison said in 1789 — ‘as essential to secure the liberty of the people’ as any right of nature, our liberty is in peril.” If there is a problem, it’s not that there are too many civil juries, it’s that there are too few.

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