Lawsuit abuse impacts all Oregonians. From doctors and patients to consumers, schools, governments and businesses of every size, lawsuit abuse places an undue burden on all of us.
In 2016, legal costs and compensation paid in the U.S. tort system totaled $429 billion, equivalent to 2.3% of U.S. GDP. In Oregon, tort costs were equal to $3,105 per household.
Lawsuit abuse also disproportionately impacts small businesses, many of which survive on small margins. Studies have shown that litigation costs small businesses across the country over $105 billion each year, and that one in three small business owners have been sued or threatened with a lawsuit, which often force those small businesses to close for good.
Oregon ranked number 25 in the 2019 Lawsuit Climate Survey, conducted on behalf of the U.S. Chamber Institute for Legal Reform, which analyzes how fair and reasonable individual states’ liability systems are perceived to be by U.S. businesses. Between 2017 and 2019, Oregon fell in six of the survey’s 10 key element categories, including the “Having and Enforcing Meaningful Venue Requirements” category.
Liability protection is a vital component of allowing our businesses, schools and medical providers to operate fairly, efficiently and without placing undue burden on consumers or community members. These entities need consistent and fair treatment by our legal system, which is what ORLRC advocates for every day.
COVID-19 Liability Protection
The COVID-19 crisis has highlighted the need for liability protection now more than ever. Businesses, governments and organizations who abide by the rules and regulations outlined by the state should not be threatened by frivolous lawsuits unless they have demonstrated negligence.
In July 2020, the Oregon Supreme Court ruled in the Busch vs. McGinnis Waste Systems, Inc. case that the previously established $500k cap on non-economic damages is unconstitutional. The non-economic damages cap had ensured fair compensation while bringing predictability and stability to Oregon’s liability system, improving access to medical care and other services and creating an environment that made Oregon attractive to employers.