SPRINGFIELD – Illinois loses an estimated $4.5 billion every year in direct costs along with $7.7 billion in output due to excessive lawsuits – an industry that heavily contributes to keep Democrats in power at the state capitol. (As of October 1, 2018, the Illinois Trial Lawyers Association PAC donated $299,000 to Democrat legislative candidates in the past three months.)
That's what the Illinois Civil Justice League (ICJL) reports Monday, based on the 2018 Economic Benefits of Tort Reform, an assessment measuring the impact of excessive civil court costs on Illinois’ economy.
The study, conducted by The Perryman Group for Citizens Against Lawsuit Abuse (CALA), found that Illinois is losing jobs and revenue because of the state’s civil justice system. The assessment includes extensive survey data, industry information and a variety of corroborative source material. The Perryman Group analyzed outcomes in the state of Illinois using Ohio as a control state, which has engaged in notable tort reform in the recent past.
The total current impact of excessive tort costs on the Illinois economy amounts to estimated losses of $4.5 billion in annual direct costs and $7.7 billion in output (gross product) annually. About 81,685 jobs are lost when dynamic effects are considered.
All major industry groups are negatively impacted, with total manufacturing, business services, transportation and utilities and financial activities industries showing the greatest losses. The yearly fiscal losses (as of 2018) are estimated at $397.2 million in state revenues and $335.4 million to local governments. These effects are based on the current size of the state’s population and economy and can be expected to rise over time in the absence of meaningful civil justice reforms.
“Reforms to our civil justice system in Illinois must be a priority. Unwarranted lawsuits and enormous plaintiff awards impact all sectors of our state economy and hurt our families, as costs are ultimately passed down to our shoulders in the form of higher prices for goods and services,” said President of Illinois Civil Justice League, John Pastuovic.
Civil justice reforms that have resulted in the greatest reduction in losses are those aimed at reducing frivolous lawsuits, capping appeal bonds, setting negligence standards and limiting non-economic damages. These reforms have been shown to enhance innovation and increase productivity, as well as to improve judicial efficiency and economic performance.
According to the assessment, when working properly, the judicial system provides a critical institutional framework that provides a fair and equitable forum for resolving disputes, compensates plaintiffs who have been legitimately harmed and deters undesirable behavior.
Obtain the report HERE: Download Benefits of Tort Refom in Illinos Report 2018 (1)
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