New study shows benefits of tort reform in California

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New study shows benefits of tort reform in California

A new government study of the benefits of crime reform shows that reforming California would save nearly $ 23 billion in savings for the state’s residents and businesses, according to Citizens Against Lawsuit Abuse (CALA). Without the reforms, frivolous legal cases and those that result in undue harm will cost citizens a “tort tax” of US $ 574 per person.

The CALA report, titled “Effects of Tort and Potential Economic Benefits of Tort in the United States,” also shows that the savings from tort flow through the state’s economy, creating more than 206,000 and more than 206,000 new jobs $ 46 billion would support increased economic activity. The California government would also benefit from increased tax revenues of more than $ 2.5 billion.

The report from John Dunham & Associates, a Florida-based public policy modeling and economic analysis firm, explains how laws reforming criminal offenses defined as an act or omission that willfully or negligently harm another person, This can lead to economic benefits, innovation, productivity and employment. Tort law reform can help protect and exonerate entrepreneurs from abusive shakedown lawsuits – and CALA believes the same reforms can exonerate companies trying to recover from the COVID-19 pandemic.

“When tort law is abused, it leads to closed businesses, lower wages, lost jobs, a decline in productivity and higher prices that are detrimental to everyone,” said Victor Gomez, Executive Director of CA CALA. “The report shows California can take advantage of a more efficient judicial system while growing the state’s economy at a time when the state needs it most.”

CALA officials believe all industries across California are experiencing excessive crime costs and that the burdens associated with those costs will result in a decline in corporate investment. Introducing crime reform would help businesses avoid spending time and money on litigation and would lead to a number of benefits, including higher productivity rates and workplace innovation.

“Instead of investing in their business by buying new equipment or hiring more people to be more productive,” Gomez said of the cost of tort, “companies are being forced to pay out huge sums of money in the face of an unjustified lawsuit.”

Last year, the governor and lawmakers had an opportunity to pass laws to provide COVID-19 liability protection for those business owners who had risen to the governor’s challenge to stay open and provide vital services to help Californians Could stay home safer. Bill AB 1035 would have brought relief if the company had followed and implemented all relevant county and state COVID-19 protocols. Unfortunately, the law was not passed and these companies are facing a new wave of potentially abusive pandemic lawsuits that could lead to class action lawsuits.

In addition to litigation, more reforms are needed to give business owners time to address technical issues arising from the Private Attorney General Act (PAGA) and Americans with Disabilities Act lawsuits that last year with more than 2,700 Cases filed in federal court increased in the first six months of 2020 alone. For example, in the week of March 12, 2020, 159 PAGA notices were distributed according to the California Building and Industry Alliance.

CALA believes that an important legal reform that can help both the state and national economies is the “upper limit” for criminal and non-economic damage. An upper limit can provide specific advice on rewards and limit the amount of money in statements.

“The purpose of crime reform is never to lose the right to sue or the plaintiff’s rights, but rather to establish a sensible, responsible civil justice system that does not burden the US economy,” said Gomez. “One of the most important and necessary reforms in terms of economic benefit is the damage cap, which can help achieve fair and reasonable outcomes for all.”

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