By Virginia Harker | Chamber Business News
Cities and counties suing oil and gas manufacturers over climate change.
School districts taking an e-cigarette producer to court, claiming it is marketing to minors.
Governments suing drugmakers because of overdose deaths.
These are examples of a new generation of class action suits that are benefiting trial attorneys to the tune of hundreds of millions of dollars. But consumers and victims? Not so much.
Trial attorneys courting municipalities for cash settlements
Now local governments are increasingly teaming up with contingency fee lawyers to influence public policy issues through litigation, and businesses are paying the price whether claims are valid or not, said Lauren Sheets Jarrell, counsel for the non-profit American Tort Reform Association (ATRA).
ATRA, the U.S. Chamber of Commerce Institute for Legal Reform, the Arizona Chamber of Commerce and Industry, the National Federation of Independent Business, and other business advocacy groups are working to increase public awareness about class action abuses.
“Some of these lawsuits are looking to hold companies liable regardless of what was understood at the time that the company sold the products or in some cases even if they complied with government regulations or were approved by the government,” Sheets Jarrell said.
Companies often are forced to settle to avoid years of litigation.
“Frivolous lawsuits and the threat thereof can really burden small businesses and discourage entrepreneurs from taking risks. Whether you choose to settle or fight it, you end up spending valuable resources, time and money. But you’re likely not the first entrepreneur to be “frivolously” sued. So, do not panic. Not all threats of litigation end up in trial. Moreover, courts are well aware that the legal system can be abused and there are built-in safety measures that can be used to quickly and effectively get rid of such cases.”