Lawsuit Climate Survey Says: Move Your Company HQ to Delaware

By Andrew Lu on September 18, 2012 | Last updated on March 21, 2019

A survey of in house counsel and other attorneys ranked all 50 states in terms of their "lawsuit climate." In the survey, a state's lawsuit climate basically means how the business world perceives the state's judicial and tort liability system.

It's not entirely clear what the point of the survey is nor what attorneys are supposed to get out of it.

However, there are some definite trends in the ten years that attorneys have been surveyed regarding a state's lawsuit climate. For example, Delaware has been on the top of the list since 2002. And West Virginia has been at, or near, the very bottom.

So should in house counsel now push to have their company headquarters relocated to Delaware as a result of this survey? Obviously, not. But there are some lessons in house counsel can take from the lawsuit climate survey conducted by the Institute for Legal Reform.

Perhaps the biggest takeaway from the survey is a management of expectations. If you are sued, or are suing, in a state like West Virginia (ranked #50 for lawsuit climate), Louisiana (49), or Mississippi (48), you should be prepared for delays, frustrations, and other headaches related to a tort action.

If you scoff at the idea of doing business (let alone being sued) in one of these states, the next two lowest ranked states were major hubs for business — California (47) and Illinois (46).

In the lawsuit climate survey, in house and other attorneys were asked to grade each state in the following areas: overall treatment of tort and contract litigation; having and enforcing meaningful venue requirements; treatment of class action suits and mass consolidation suits; damages; timeliness of summary judgment or dismissal; discovery; scientific and technical evidence; judges’ impartiality; judges’ competence; and juries’ fairness.

They were also asked to give the state an overall grade for creating a fair and reasonable litigation environment, writes the Institute for Legal Reform.

In house counsel should take the lawsuit climate survey for what it’s worth — a bit of useful information to consider. However, you should not be basing your litigation strategy on the survey nor base your relocate your company based on it alone.

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