Monday, 19 December 2011

Texas Tort Reform

From the Economist

In June the governor of Texas signed a “loser pays” tort law, intended to discourage slight or frivolous lawsuits by making losers pay the winners’ legal costs. Conservatives are eager to support it. The right has maintained for decades that America’s legal culture smothers small businesses, doctors and innovators.

Too bad, then, that the Texas law is timid. “Loser pays” is the norm in many countries, including England, Canada and Germany. But there, “loser pays” is the rule in most torts. The Texas bill awards legal costs only for suits “that have no basis in law or in fact” and are dismissed before any evidence is gathered. Most competent lawyers can write a complaint that clears this bar. Even the Texas trial-lawyers’ association eventually endorsed Mr Perry’s law.

So, England and Wales adopt American style damages based agreements and America adopts English (I am pretty sure it's the same rule in Scotland but haven't checked for about 15 years) style 'loser pays' litigation funding. Litigation boom anyone?
I don't know what the position is with 3rd party litigation funding or insurance against losing a case in the US but surely this gives potential for that market to grow. Might bump the lads at Allianz and see what they think.


  1. Oh, are you up and blogging again? Welcome back.

  2. so busy

    this is just a half arsed "i saw this!"