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| Lawsuit Financial Corp

Today I read an article by Christine Hines, Public Citizen’s Consumer and Civil Justice Counsel that I felt was worth sharing with my readers. I have paraphrased it, slightly, for length and clarity:

A product malfunctions, causing severe injury to your eight year old son. A corporation laid-off your neighbor, without reason, after thirty years of service; age discrimination is suspected. The scenarios under which you or someone you know and care would pursue litigation are limitless; likewise, the potential tragedy, if HR 966 passes, is as limitless and has extremely serious consequences.

The House Judiciary Committee just approved the "Lawsuit Abuse Reduction Act," HR 966 AKA "LARA."

To anyone who cares about justice or about wise use of taxpayer dollars, HR 966 is yet another example of bills to add to the long list of "Clear Skies" and other “let’s-call-this-bill-the-exact-opposite-of-what-it-actually-is” bills.

If the title wasn’t bad enough, the bill, sponsored by Rep. Lamar Smith and Senator Charles Grassley (sponsor of the Senate version, S. 533), is deceptively cloaked in technical terms. What better way for Congressional lawmakers to slip this unjust legislation past ordinary citizens (the ones who will be at an even greater disadvantage if LARA moves forward as feared).

Here is the scoop: HR 966 revises a procedural rule – commonly called Rule 11. The old Rule 11, which was implemented in the 1980s, was typically used as a tactic by corporate defendants to prolong and create sidebar litigation, distracting attention away from the real claims in lawsuits and increasing the costs of already-expensive litigation.

A judicial advisory committee reviewed several empirical studies and judicial surveys and found that the rule encouraged additional and unnecessary litigation. According to the committee, the incidents of motions for sanctions and court orders were higher in civil rights cases than in some other types of cases. It was also discovered that sanctions were sought more frequently against claimants than against defendants. In other words, the old Rule 11 as written made it easy for corporate lawyers to create expensive procedural hoops, which claimants (ordinary citizens like you and me) would have to jump through. While corporations have teams of lawyers and the time and resources to stay in court indefinitely, claimants do not.

After these and other problems came to light, Rule 11 was revised in 1993 to give judges more discretion to address the issues as they see fit; these revisions alleviated the burdens on the courts. In a recent survey on the newer rule, more than 80 percent of federal trial judges said that "the rule is needed and it is just right as it now stands."

Fast-forward to 2011 and I find myself sitting in a hearing on LARA where I cannot help but wonder why the House Judiciary Committee is so dead-set on removing federal judges’ ability to exercise their judgment in deciding whether to impose punishment for unnecessary court filings and on eliminating lawyers’ ability to correct or withdraw filings with the court if they are not well grounded in fact or law.

The judiciary as well as consumer, employment and civil rights groups oppose HR 966 because it will take us back to a place where we should not care to return. But it looks like some members in Congress are determined to live in the past.

This bill threatens your safety and constitutional rights. It seeks to reform and sanction activities that need no reform or sanction; the system already has checks and balances for frivolity in litigation. There is no serious “lawsuit abuse” problem and the title of this legislation is premised on the bald faced lie that there is some sort of frivolous legal filing crisis. It is too time-consuming and too expensive to file groundless lawsuits, especially on a contingency fee basis. In fact, the opposite is true; corporate defendants engage in far more frivolous, delay, deny, defenses than any claimant engages in on the pursuit of litigation side. HR 966 is another cloaked attempt to limit the rights of victims seeking justice in our court system; it is yet another Republican backed corporate bailout at the expense of the taxpayers.

Somewhere in the pandering for corporate capital ($$$) for their political campaigns, these conservative, smaller government, politicians have lost their way. They seek to have one branch of government (legislative) provide superintending control over another branch of government (judiciary). How is that a hands-off, separation of powers, conservative viewpoint? Where are the conservative voices (7th Amendment advocate, Andy Cochran, aside) in violent opposition to this behavior and activity? The only people standing in the way of this assault on our civil justice system are a few sensible legislators.

But, you can help stop this anti-citizen legislation; contact your elected officials and tell them to vote “no” if this piece of legislation ever comes to a vote. If this legislation passes, more “tort reform” will follow. Some Republicans, with deep drug company campaign pockets, would like to immunize the pharmaceutical industry for all drugs that have initial, FDA, approval. In other words, if a dangerous drug causes you cancer, heart disease or other life/health threatening condition, you would be powerless to pursue litigation against the manufacturer. You are left to battle physical and financial devastation without justice, without compensation from the wrongdoer. My state, Michigan, is currently the only state that has such a law; ask any Michigan bad drug victim what they think of it. A Republican governor, Republican legislature and a Republican state Supreme Court have virtually eliminated the cause of justice in Michigan. Is this what you want for America? Your vote and your voice are the only weapons you have to combat corporate abuse and corporate control of our civil justice system. Use them or lose them.

Mark Bello has thirty-three years experience as a trial lawyer and twelve years as an underwriter and situational analyst in the lawsuit funding industry. He is the owner and founder of Lawsuit Financial Corporation which helps provide legal finance cash flow solutions and consulting when necessities of life litigation funding is needed by plaintiffs involved in pending, personal injury litigation. Bello is a Justice Pac member of the American Association for Justice, Sustaining and Justice Pac member of the Michigan Association for Justice, Business Associate of the Florida, Tennessee, and Colorado Associations for Justice, a member of the American Bar Association as well as their ABA Advisory Committee, the State Bar of Michigan and the Injury Board.


  1. Gravatar for Cilla Mitchell
    Cilla Mitchell

    Looks like Rep. Lamar Smith is a Congressman in my district. This means I will be busy contacting his office about HR 996 among other things. (Why are politicians from Texas losing their minds? Do they all take stupid pills in the morning?)

    Am very appreciative of the information you share with your readers. In my opinion, the information you share are tools needed for surviving in our present society. If we do not take the tools you are considerate in sharing, shame on us.

    Rep Lamar Smith will be hearing from me.

    Cilla Mitchell

  2. Gravatar for Cilla Mitchell
    Cilla Mitchell

    HR 966. My bad.

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