Gov. Ron DeSantis is firmly behind a renewed Chamber of Commerce campaign against lawyers who sue companies on behalf of consumers and said the need for a more business-friendly court system is guiding his appointments to the Florida judiciary.
Businesses he has attempted to lure to Florida were aware of the state’s low taxes and otherwise friendly business climate but sometimes balked at the legal climate, the governor said Wednesday during a news conference in the Capitol.
“There was a lack of trust and confidence in Florida’s judiciary. There was a sense that the Legislature could enact reforms but the chance of that getting rewritten or unwound in the courts, more based on policy reasons than legal reasons, was way too high,” DeSantis said.
The business community has campaigned for decades seeking changes to the tort system – that is, the ability of average citizens and business people to sue people or companies that do them harm. Tort cases can involve personal injury, wrongful death, contract, insurance, business, and many other types of disputes.
The complaint is that trial lawyers manipulate the courts to extort large settlements from corporations, although trial lawyers say they’re fighting to help consumers and taxpayers who have been wronged.
Sparking grousing from the trial bar, DeSantis said his early appointments to the Florida Supreme Court and other levels of the judiciary mean “folks that are looking at Florida, if they see reforms being done politically through the legislative and executive branches, they can be pretty sure that’s going to be applied as written and you’re not going to see any type of political gymnastics being done via the judiciary,” the governor, a Harvard-trained lawyer, said.
The U.S. and Florida chambers organized the news conference to release a national survey suggesting widespread suspicion within America’s corporate elite of the state’s legal climate. Also present were key members of the state Legislature.
The Harris Poll asked 1,300 corporate general counsel and senior executives about their opinions of the legal climate in various states. Florida ranked No. 46 overall, reflecting the C-suite’s perceptions of factors including overall treatment of tort and contract litigation, trial judges’ impartiality and competence, juries’ fairness, and the quality of a state’s appeals courts.
Only Illinois, Louisiana, California, and Mississippi ranked lower.
Not a great number from the Chamber’s perspective, said Harold Kim, chief operating officer of the U.S. Chamber’s Institute for Legal Reform. Still, he said, the state “has stopped the downward spiral” because of legislation including limits on litigation against insurance companies enacted last year – and DeSantis’ appointment of sympathetic judges in venues including the state high court.
Trial lawyer group disputes survey findings
The Florida Justice Association, which represents attorneys who sue on behalf of consumers, issued a document questioning the survey’s methodology and noted that participation was limited to “corporate lawyers from multimillion-dollar corporations who spend their days trying to ensure that consumer or employees can’t hold these corporations accountable for wrongdoing and gross negligence.”
Association President Leslie Mitchell Kroeger said in a written statement: “The Florida Justice Association agrees that it is critical to have a strong, robust system of justice where people can vindicate their rights. Access to our courts and trial by jury are cornerstone rights established in both the Florida and U.S. Constitutions. We look forward to working with Gov. DeSantis and the Florida Legislature during the 2020 session to protect people’s access to justice and develop unbiased, well-researched policy solutions by Florida, for Florida.”
The survey reflects perceptions, not empirical analysis, Kim conceded. Still,”89 percent of the respondents of this poll said that a state’s legal climate really matters when it comes to making important business decisions – where to relocate, where to expand, basically where to create jobs,” he said.
“When companies see hostile territory, they’re going to, naturally, move to friendlier ground,” he said.
Florida’s share of “the national lawsuit burden” was $34 billion in 2016, 3.6 percent of the state’ gross domestic product or $4,400 per household, Kim added.
“When I think of who the real warriors are on legal reform, it’s Gov. DeSantis, it’s the members of the Florida Legislature who are willing to put local businesses and citizens ahead of special interests,” said Mark Wilson, president and CEO of the Florida Chamber of Commerce.
DeSantis said he supports people’s right to seek redress in court.
“But I also think there’s so many cases that get brought, it seems, where even if the person who gets sued is 100 percent innocent, they look at it and say, ‘OK, well, to be able to defend this it’s going to cost a couple of hundred thousand dollars, so I’m better off as a business decision just cutting a check and having them go away,’” the governor said.
“That, to me, is more of a lawyer-driven culture than it is based on people who actually suffer harm. If we can make it so that it’s based on the clients rather than the attorney, I think that would be better.”
Laws that make it harder – or easier – to sue on behalf of consumers
DeSantis cited assignment of benefits reform approved by the Legislature last year– legislation that makes it harder for contractors and their attorneys to sue on behalf of customers on grounds their insurance companies are low- or slow-balling claims.
Insurers and the business community argued these lawsuits were driving up premiums. Plaintiffs’ attorneys and contractors retorted that much of this litigation would go away if insurers treated their customers fairly.
Florida’s Office of Insurance Regulation recently approved premium levels for Citizens Property Insurance Corp. – Florida’s insurer of last resort – that reflect a lower rate of increase than the insurer sought before the legislation took effect.
Key Florida Supreme Court rulings, including Castellanos v. Next Door Co., highlight the difficulty in balancing the competing interests. In that 2016 case, the court’s old liberal majority struck down limits on attorney fees in workers’ compensation benefits challenge that were intended to contain litigation costs. And, indeed, the ruling was blamed for significant increases in workers’ comp premiums.
But the justices noted that the claimant’s attorney spent more than 107 hours to wrest benefits from the insurer – for which, under the attorney fee limits, he was entitled only to $1.53 per hour. That, the court said, was an unconstitutional infringement upon the right to seek redress in court.
Even under Republican governors and GOP majorities in the state House and Senate, the business community has struggled to enact its priorities in Florida. Wilson, of the Florida Chamber, noted that the Republican Party, too, contains trial lawyers who oppose limits on litigation.
“It’s hard to get these issues passed. When you’re 46th in the country, there’s about 25 things that need to be done. If you’re fifth in the country, there’s only one or two things. Uniting the business community around those three to five things that can be done is a real challenge – and that’s what our top job is going to be,” he said.
The Florida Chamber hasn’t yet polled its members about their top priorities for 2020 – that’ll happen in the coming weeks, spokeswoman Edie Ousley said. Wilson, meanwhile, suggested priorities would include matters the Chamber has pressed for in the past – continued reform of workers’ compensation and applying last year’s assignment of benefits limits to the auto glass industry.
But he declined to delve into the details.
“We have a very well-funded opponent called the personal injury trial lawyers. They would like nothing more than for me to tell you what our game plan is. I’m just not going to talk about strategy, I’m not going to talk about the resources that would go behind the campaign.”
As for DeSantis, “he moved very quickly to restore the rule of law with his initial appointments to the state Supreme Court, and he has advanced an agenda that is pro-business, pro-growth,” Kim said.
Correction: In an earlier version of this story, a quote should have been attributed to Gov. DeSantis. The Phoenix has corrected the error.