U.S. Chamber Report Highlights High Costs of Legal System on PA Taxpayers
Source: PA Chamber of Business and Industry
A new U.S. Chamber of Commerce Institute for Legal Reform study (Tort Costs in America) shows the extreme cost of the civil litigation system and its impact on taxpayers. The study found that nationally, tort costs totaled $529 billion. This equates to 2.1 percent of the national gross domestic product and $3,621 per household.
When comparing total tort costs by state, Pennsylvania has the 7th highest at almost $19.5 billion. This represents 2.14 percent of Pennsylvania’s gross domestic product and $3,752 per household. These costs are passed on to taxpayers via higher prices of goods, services, and insurance.
Job creators are deterred from locating and expanding in Pennsylvania due to our high litigation costs, so-called “nuclear verdicts” (commonly understood as referring to jury awards exceeding $10 million), and the reluctance of the legislature and courts to enact reforms creating a more reasonable and responsible litigation climate.
Notably, the report points out that despite the high national costs, only 53 cents of every dollar goes to plaintiffs, with the remaining going toward litigation costs, attorneys, and other expenses.