California once again topped the annual “Judicial Hellholes” list.
The 2018-2019 “Judicial Hellholes,” published by defense bar organization the American Tort Reform Association, ranked the nation’s top nine venues with the “most unfair” legal systems. California has topped the list at least three prior times, but last year’s report bumped it to No. 2 in favor of Florida, whose highest court came out with a bevy of medical malpractice decisions for plaintiffs. This year, Florida ranked No. 2.
California’s top ranking comes after the state’s highest court became the first in the nation to hold manufacturers of brand-name pharmaceuticals liable in cases involving their generic equivalents.
“That was such an outlier,” said Sherman “Tiger” Joyce, ATRA’s president. “There was a sense that what was going on in California collectively was enough to rule it beyond Florida, and there was not the level of negative activity in Florida.”
New York City’s courts jumped to No. 3, while the Philadelphia Court of Common Pleas and New Jersey’s legislature, though not its courts, also made the list.
Some overriding concerns in the report involved: the prevalence of “junk science” at trials; class actions, particularly involving food packaging, which the defense bar insists have no injuries; and “activist” attorneys general who have brought cases over opioids and climate change.
Peter Knudsen, a spokesman for the American Association for Justice, the nation’s largest plaintiffs bar, said of the report: “ATRA’s definition of a ‘hellhole’ is a courtroom where a plaintiff brings a case in front of a jury to hold an unscrupulous corporation accountable. The real hellhole is a world in which an unsuspecting consumer is harmed, abused or defrauded by an unscrupulous corporation but has no recourse and no chance to prevent future wrongdoing.”
California has been No. 1 in prior years, often cited for its unique laws, like this year’s data privacy statute. But the California Supreme Court’s Dec. 21 decision last year in T.H. v. Novartis Pharmaceuticals propelled it to the top of the list again. The ruling was the first to impose liability on brand-name drugmakers for the actions of generic pharmaceutical manufacturers, which the U.S. Supreme Court found in 2011 were protected from tort actions by federal pre-emption under Pliva v. Mensing.
At least 35 other state and federal courts have rejected the theory, the report says, but since the California ruling, the Massachusetts Supreme Court has adopted innovatory liability.
“The reason the decision matters is for the first time consumers of generic drugs have a remedy when they’re injured by a mislabeled drug,” said Leslie Brueckner, senior attorney at Public Justice who represented the plaintiff. “That’s what this decision did. And because 90 percent of the drugs in America that are consumed are generic, it’s a huge deal in holding the pharmaceutical industry liable for dangerously labeled drugs.”
J.G. Preston, a spokesman for the Consumer Attorneys of California, called ATRA’s list the group’s “annual attempt to generate irresponsible news coverage in a callous attempt to undercut the legal rights of American consumers so that big businesses and corporate CEOs can further fatten their wallets.”
“If our state is No. 1 on the list, the reality is that we’re there because California takes seriously the idea of holding wrongdoers accountable when they cheat, injure or otherwise harm consumers,” Preston said.
Preston added that it was “ironic” that would criticize the California Consumer Privacy Act in the wake of another massive corporate data breach, this time affecting customers of Marriott hotels. Last year, he said, hackers had attacked about 1,300 companies and stole more than 174 million consumer records.
“The bottom line is that American corporations have too often proven careless with consumer data, let alone their privacy,” Preston said. “Without the civil justice system to hold corporations accountable after they fail to take necessary data precautions, when will they get serious about protecting consumers?”
Here are a few more highlights from “Judicial Hellholes” report:
- The Twin Cities area of Minnesota joined the list for the first time, at No. 9, because of an $850 million settlement in a groundwater contamination case. The settlement, between Minnesota Attorney General Lori Swanson and against 3M, gave $125 million in contingency fees to outside law firms. The Minnesota Supreme Court also rejected the Daubert standard.
- St. Louis continued to be on the list, at No. 4, down one ranking from last year, due to the legislature’s failure to enact tort reform. The report also noted a $4.7 billion verdict against Johnson & Johnson over its baby powder.
- The report put the Georgia Supreme Court on the “watch list” after it upheld a $40 million verdict in Chrysler Group LLC v. Walden this year.
- The Delaware Supreme Court got a “dishonorable mention” for its “take-home” asbestos ruling, and Texas trial courts for their large verdicts, such as a $706.2 million trade secret verdict against a Quicken Loans affiliate.
- The report gave kudos—called “Points of Light”—to the U.S. Supreme Court for its decision this year upholding class action waivers in employment contracts, and to the U.S. Court of Appeals for the Fifth Circuit for its reversal of a $502 million verdict over hip implants.