Explosion, Fire, Forest, NatureBy Gerald L. Maatman, Jr.

 Seyfarth Synopsis: On an annual basis the American Tort Reform Association (“ATRA”) publishes its “Judicial Hellholes Report.” The Report focuses on litigation issues in state court systems and challenges for corporate defendants in the fair and unbiased administration of justice. The ATRA recently published its 2021-2022 Report and California is identified as the most disadvantageous jurisdiction in the country for corporate defendants – a copy is here and the executive summary is here.

The Judicial Hellholes Report is an important read for corporate counsel facing class action litigation because it identifies jurisdictions that are generally unfavorable to defendants. The Report defines a “judicial hellhole” as a jurisdiction where judges in civil cases systematically apply laws and procedures in an unfair and unbalanced manner, generally to the disadvantage of defendants. The Report is a “must read” for anyone litigating class actions and making decisions about venue strategy.

The 2021 Hellholes

In its recently released annual report, the ATRA identified 8 jurisdictions on its 2021 hellholes list – which, in order, include: (1) California (with the plaintiffs’ bar taking advantage of unique California laws like the Private Attorney General Act); (2) New York City (particularly regarding Americans With Disabilities Act accessibility claims and an activist attorney general battling climate change with energy companies), (3) Georgia; (4) Philadelphia, which fell from the number 1 spot last year (especially in the Philadelphia Court of Common Pleas and the Supreme Court of Pennsylvania), (5) Illinois (especially Cook, St. Clair, and Madison counties and regarding asbestos litigation and Illinois Biometric Information Privacy Act class actions), (6) Louisiana (including deceptive lawsuit advertising practices and coastal litigation), (7) St. Louis, Missouri, and (8) South Carolina (particularly in asbestos litigation).

According to the ATRA’s analysis, these venues are less than optimal for corporate defendants and often attract plaintiffs’ attorneys, particularly for the filing of class action lawsuits. Therefore, corporate counsel should take particular care if they encounter a class action lawsuit filed in one of these venues.

The 2022 “Watch List”

The ATRA also included 5 jurisdictions on its “watch list,” including Florida (the ATRA noted that Florida has been making strides to improve its liability climate, however, the trial bar is still able to capitalize on liberal judges and rulings in this jurisdiction), Colorado, Texas (a newcomer to the list, added because of its prohibition on introducing evidence about different products and dissimilar accidents), Maryland (due to unstable medical malpractice climate and backlog of asbestos lawsuits), and Minnesota (dropping from the Hellholes list for the first time in three years, mostly due to COVID-19 inactivity rather than any reforms).

In addition, the ATRA recognized that several Courts made significant positive improvements this year, and 20 states created laws protecting against meritless claims brought in connection with the COVID-19 pandemic.

Implications For Employers

The Judicial Hellholes Report dovetails with the experience of employers in high-stakes workplace class actions, as California, New York, Georgia, Pennsylvania, Illinois, Louisiana, Missouri, and South Carolina are among the leading states where Plaintiffs’ lawyers file employment discrimination and wage & hour class actions. Many of these jurisdictions are also becoming a hotbed for privacy and accessibility-related lawsuits. These jurisdictions are linked by class certification standards that are more plaintiff-friendly and by generous damages recovery possibilities under state laws.