It is Not True That
Contingency Fee Increases Litigation
There is no litigation explosion
generally. And the litigation that accounts for caseload
increases when increases have occurred is not litigation
brought by plaintiffs using contingent fees.
Personal injury lawsuits do not "clog"
the courts. The real increase in litigation has been from
businesses suing businesses, not consumers seeking
compensation through personal injury litigation.
Businesses suing businesses in
contract disputes comprised nearly half of all federal court
cases filed between 1985 and 1991.
Milo Geyelin, "Suits by Firms
Exceed Those by Individuals," Wall Street Journal, December
3, 1993, at B1.
Not only do businesses suing businesses
comprise the majority of cases filed in court, but this
category also experiences the greatest increase in the number
of suits filed year after year.
Contract filings in federal courts
increased by 232 percent between 1960 and 1988, and by 1988
were the largest category of civil cases in the federal
courts.
Marc Galanter and Joel Rogers,
Institute for Legal Studies, University of
Wisconsin, "A
Transformation of American Business Disputing? Some
Preliminary Observations," working paper #DPRP 10-3 (April
1991).
In state courts, contract disputes
accounted for 14 percent of all cases filed in 1991, second
only to domestic relations cases, which accounted for 33
percent of the cases filed.
"Composition of Civil Caseload
Filings: General Jurisdiction Trial Courts," National Center
for State Courts (1993), The Conference of Chief Justices
Statement on S. 687, The Product Liability Fairness Act of
1993, Submitted to the United States Senate Committee on
Commerce, Science, and Transportation Consumer Subcommittee,
September 23, 1993, at 5.
While contract cases utilize hourly
billing, most tort cases utilize the contingent fee. According
to statistics, there certainly is not an explosion of
personal injury cases in state courts.
According to the National Center for
State Courts, in 1992 only 9 percent of the new cases filed
in state courts were tort cases of any kind.1
1Based on data from 27 states
representing 61% of total U.S. population.
"Composition of Civil Caseload
Filings: General Jurisdiction Trial Courts," National Center
for State Courts (1993), The Conference of Chief Justices
Statement on S. 687, The Product Liability Fairness Act of
1993, Submitted to the United States Senate Committee on the
Judiciary Courts and Administrative Practice Subcommittee,
March 15, 1994, at 5.
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