Survey Finds State Lawsuit Climate Important Factor for Company Growth Plans

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A new survey finds 75 percent of attorneys at U.S. companies say a state’s lawsuit environment is likely to impact important business decisions at their company, including where to locate or expand.

That is an 18 percent increase from eight years ago, according to a new survey released by the U.S. Chamber Institute for Legal Reform (ILR).

According to the 2015 Lawsuit Climate Survey: Ranking the States, senior attorneys at major companies say that several large states, such as California and Illinois, have some of the worst legal climates in the country for businesses, with rankings of 47 and 48, respectively. Delaware ranked at the top.

LEGAL CLIMATE OVERALL RANKINGS BY STATE

1. Delaware
2. Vermont
3. Nebraska
4. Iowa
5. New Hampshire
6. Idaho
7. North Carolina
8. Wyoming
9. South Dakota
10. Utah

11. Virginia
12. Alaska
13. Minnesota
14. Maine
15. North Dakota
16. Colorado
17. Massachusetts
18. Indiana
19. Kansas
20. Wisconsin

21. New York
22. Connecticut
23. Tennessee
24. Michigan
25. Arizona
26. Rhode Island
27. Ohio
28. Maryland
29. Washington
30. Hawaii

31. Georgia
32. Oregon
33. Oklahoma
34. Montana
35. Nevada
36. South Carolina
37. Pennsylvania
38. New Jersey
39. Kentucky
40. Texas

41. Arkansas
42. Missouri
43. Mississippi
44. Florida
45. New Mexico
46. Alabama
47. California
48. Illinois
49. Louisiana
50. West Virginia

Illinois’ legal environment has worsened in recent years, hitting an all-time low in this year’s survey as the third-worst state nationally. More than a third of the survey respondents identified either Chicago/Cook County, or Madison County, Illinois as the city or county court with the “least fair and reasonable litigation environment for both defendants and plaintiffs” nationwide.

Survey participants also singled out East Texas, Los Angeles, California, and New Orleans/Orleans Parish, Louisiana, as some of the least fair jurisdictions nationally.

“More business leaders than ever have identified a state’s lawsuit climate as a significant factor in determining their growth and expansion plans,” said Lisa A. Rickard, president of ILR. “States ought to take notice that a good lawsuit climate is vital to their continued job growth.”

According to the survey, the top issues in need of improvement included limiting costly discovery and punitive damages as well as ridding courts of unnecessary lawsuits.

Most Important Issues for Improving the Litigation Environment

Eliminating unnecessary lawsuits	32%
Placing reasonable limits on discovery	15%
Limiting punitive or other types of damages	11%
Increasing the effectiveness of judicial case management	11%
Ensuring timely court decisions	9%
Assuring that liability is properly allocated among defendants	9%
Addressing e-discovery	6%

In tandem with the survey, ILR released 101 Ways to Improve State Legal Systems, listing key legal reforms that states can adopt to improve their lawsuit climates. ILR also launched a national media campaign to raise awareness about the importance of a fair and balanced lawsuit system.

Harris Poll, a global polling firm, conducted the 2015 Lawsuit Climate Survey through telephone and online interviews between March 9 and June 24, 2015. The respondents were more than 1,200 general counsels and senior attorneys or leaders in companies with annual revenues of at least $100 million.

See the entire 50-state list and read a full copy of the 2015 Lawsuit Climate Survey online at: http://www.instituteforlegalreform.com/.

Source: U.S. Chamber Institute for Legal Reform

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