|The Mission of the Manhattan Institute is
foster greater economic choice and
The Associated Press
As lawyers file more class-action lawsuits in state courts, Illinois county gets more than its share
By Dennis Conrad, Associated Press Writer
Lawyers increasingly are choosing state courts over federal when filing class-action lawsuits, believing those venues provide the better chance for a big payoff.
That's why the U.S. Chamber of Commerce is pushing legislation to send to federal courts any suit seeking damages in excess of $2 million. That's also why the Madison County courthouse in Edwardsville, Ill., sees more class-action suits than any jurisdictions except Los Angeles County and Cook County, which includes Chicago, according to an analysis by the Manhattan Institute, a conservative think tank.
The county that rests across the Mississippi River from St. Louis has seen a surge in class-action filings: from two in 1998, to 43 last year and a 2002 pace that would produce 78, the Manhattan Institute said. "Madison County is the poster child of abuse of class-action venue shopping," said James Wootton, president of the Washington-based Chamber of Commerce's Institute for Legal Reform.
Paul Weiss, an attorney with the Chicago-based law firm Freed & Weiss, estimates he has 100 class-action lawsuits pending nationwide. More than 30 are in Madison County.
When asked why, he said, "I'd have to say it's the results: great recoveries for the class."
Class-action lawsuits bring together many people - sometimes millions - who claim they have been similarly injured by a company or product. Settlements vary greatly, with some reaching billions of dollars. Lawyers typically take a percentage of the settlement.
Critics like Wootton say attorneys are more interested in searching for sympathetic local judges and juries than in looking for evidence to support a claim of wrongdoing. Attorneys like Weiss say they're simply looking for the best place to right a corporate wrong.
Recently, a state court jury in Miami ordered three cigarette makers to pay $37.5 million in damages to a man who lost his tongue to cancer. It was an outgrowth of a $145 billion punitive damage award issued in a class-action suit covering all sick Florida smokers.
In Madison County, Ameritech reached a settlement in 2000 with an estimated potential value of $350 million in services and cash in a case stemming from the phone company's charges to maintain wires in customers' homes. The lawyers who brought the suit got more than $14 million in fees.
William Schroeder, a law professor at Southern Illinois University in Carbondale, said Madison County's "pro-plaintiffs environment" has much to do with the area's working-class residents, their history of struggling with lost factory jobs and resulting anger with corporations.
"Lawyers are going to attempt to bring their lawsuits in an environment where they are most likely to prevail," he said. "Once they start succeeding, they make money; and once you make a lot of money, you can start to influence or exercise influence in the judicial selection process, so you wind up with judges who may be pro-plaintiff."
Rex Carr, one of the attorneys in the Ameritech case, acknowledges class-action lawsuits can be highly profitable but said they also benefit consumers. The bottom line in the Ameritech case is the company had to stop unfairly charging customers, he said.
Lawyers say places like Madison County are getting more class-action cases because state rules often make it easier for such lawsuits to be certified. In addition, the attorneys say, since state judges typically are elected, they may be more sensitive to how a case will play with voters. Federal judges have lifetime appointments.
Business groups say lawsuits make doing business more costly. Companies sometimes make up the millions they spend in their defense with increased prices or job cuts.
With overwhelming Republican support, the House voted 233-190 this year to send to the Democratic-led Senate a federal courts bill like the one pressed by the Chamber of Commerce.
"The problem is there is hardly a Democrat in the Senate who will support it," said Sen. Orrin Hatch of Utah, senior Republican on the Senate Judiciary Committee.
Under current rules, a federal court may exercise jurisdiction only if all defendants in the suit are residents of different states from all named plaintiffs. Each individual claim also must be at least $75,000 for a federal court to handle it as a class action.
Home | About MI | Scholars | Publications | Books | Links | Contact MI|
City Journal | CAU | CCI | CEPE | CLP | CMP | CRD | ECNY
|Thank you for visiting us. |
To receive a General Information Packet, please email email@example.com
and include your name and address in your e-mail message.
|Copyright © 2009 Manhattan Institute for Policy Research, Inc. All rights reserved.|
52 Vanderbilt Avenue, New York, N.Y. 10017
phone (212) 599-7000 / fax (212) 599-3494