In a move that comes as no surprise to those that follow tort “reform” and its thinly-disguised efforts to prevent Plaintiffs from bringing their claims, the state of Texas recently enacted further tort “reform” – moving its law closer to the loser-pays system used in much of Europe.
The new Texas law requires a plaintiff who loses a motion to dismiss its claims to compensate the other side for court costs and attorneys’ fees. The new law also requires plaintiffs who reject a settlement offer, but fail to obtain a recovery which is more than 120 percent of that offer, to compensate their opponents for attorneys’ fees and costs. This is a departure from the prior state law, which only required plaintiffs to obtain a verdict of 80 percent of a settlement offer to avoid fees. In addition, when fees were awarded, they were only calculated from the date of the rejected offer, and could not exceed the amount of the judgment – meaning that losing plaintiffs never had to pay out of pocket, but could only walk away with nothing.
The new Texas law removes those limits – meaning that a winning plaintiff who simply does not recover as much as he expected can be saddled with his opponent’s massive attorneys’ bills. The message to plaintiffs is clear: take whatever is offered you, because pursuing your case and losing could mean lifelong economic ruin.
The law also creates a profound inequality between plaintiffs and defendants. These new provisions further skew a state court system already heavily weighted in favor of defendants. Winning plaintiffs cannot, in most cases, seek recovery of their own legal fees – only the very small amount expended in court costs.
This new law is perfectly in line with the ongoing tort “reform” efforts in Texas, where big business has for years held the upper hand in enacting laws designed to prevent individual and small-business plaintiffs from bringing claims against larger corporate entities and, should that fail, to scare them away. The Chicago personal injury attorneys of Passen & Powell are relieved that our Illinois legislature has, thus far, resisted such efforts here.
We urge all those interested in maintaining justice and opposing so-called tort “reform” to remain vigilant, however. As quickly as the tide turned in Texas, Plaintiffs in Illinois could likewise find themselves facing unjust restrictions on their ability to bring claims.
For a free consultation with an experienced Chicago personal injury lawyer at Passen & Powell, call us at (312) 527-4500.