The Center Square: New York ranked among worst in lawsuit abuses

By: Steve Bittenbender

The American Tort Reform Foundation has ranked New York as the nation’s fourth-worst “judicial hellhole” for 2022-23, and while better than last year’s number two ranking, the group didn’t lavish praise on the state’s court system.

“New York’s fall in the rankings is in no way a reflection of positive change in the Empire State, but rather due to the immense challenges facing other jurisdictions,” the report stated. “Lawsuit abuse continues to plague New York and bog down the state’s economic growth. Meritless food class actions, American with Disabilities Act lawsuit trolling, third-party litigation financing, and nuclear verdicts only worsened in New York in 2022.”

According to the report, New York residents pay more than $1,875 annually in a “tort tax,” which The Perryman Group described as the amount of economic activity impacted by abusive lawsuits and other dubious practices.

According to the report, tort reforms could bolster the state’s gross domestic product by more than $36 billion.

However, New York lawmakers have expressed more interest in allowing more people to take legal action. Earlier this year, the state legislature passed a bill to expand New York’s wrongful death law, and allow people to seek damages for noneconomic reasons. That bill has been opposed by business and local government groups, which have called on Gov. Kathy Hochul to veto it before the end of the year.

The report noted that New York City paid $794.4 million in public funds for judgments and settlements during the 2022 fiscal year. That represented a 37.9% increase from the previous year, and was the highest annual total reported dating back to 1998.

New York is also seeing an increase in “nuclear verdicts,” defined as judgments of at least $10 million. In November 2021, a New York appeals court upheld a ruling in a pain-and-suffering case against the New York City Department of Education over a botched high school lab experiment. While the appeals court ultimately reduced the award from $59 million to $29 million, it still was the highest award approved by the court.

New York also continues to lead the nation in the number of food and beverage related class-action lawsuits. Of the 325 filed in the U.S. in 2021, 117 were filed in the Empire State. Those cases have skyrocketed in New York, as the class-action filings have more than tripled over the past five years.

In April, a federal judge approved $2.7 million in legal fees for lawyers representing a class-action case against Godiva Chocolatier in which plaintiffs accused the candy maker of misleading consumers that their products were made in Belgium. Those plaintiffs received $7.5 million in the legal settlement.

Georgia replaced California as the year's top, or worst, judicial hellhole. That’s due largely to a $1.7 billion verdict a jury returned against Ford Motor Company in a case over roofs on the automaker’s heavy-duty trucks.