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Grassley introduces bill to combat lawsuit abuse

Senator Charles Grassley
Senator Charles Grassley

Washington, D.C. – Senate Judiciary Committee Ranking Member Chuck Grassley of Iowa and Congressman Lamar Smith of Texas, the former Chairman of the House Judiciary Committee, introduced legislation to reduce frivolous lawsuits that that he claims plague the United States legal system. The Lawsuit Abuse Reduction Act imposes mandatory sanctions for lawyers who file meritless suits in federal court. Federal rules mandating sanctions for frivolous suits were watered down in 1993, resulting in what some call widespread lawsuit abuse. The Lawsuit Abuse Reduction Act restores the mandatory sanctions which hold attorneys accountable for lawsuit abuse.

“Law-abiding Americans with a legitimate legal grievance are entitled to their day in court.  But unscrupulous attorneys who file frivolous lawsuits stand in the way of valid claims.  Frivolous lawsuits need to be weeded out of the system.  Putting the brakes on frivolous lawsuits that damage the economy and clog the legal system will go a long way towards balancing the scales of justice, upholding the rule of law, and improving the public good,” Grassley said.  “The serious threat of punishment for filing frivolous lawsuits that would be enacted with our bill will help to deter these baseless suits.”

“Lawsuit abuse is all too common in America today partly because the lawyers who bring these cases have everything to gain and nothing to lose. Plaintiffs’ lawyers can file frivolous suits, no matter how absurd the claims, without any penalty.  Meanwhile defendants are faced with the choice of years of litigation, high court costs and attorneys’ fees or a settlement,” Smith said.  “The Lawsuit Abuse Reduction Act restores accountability to our legal system by reinstating mandatory sanctions for attorneys who file meritless suits. Though LARA will not stop all lawsuit abuse, it encourages attorneys to think twice before filing a frivolous lawsuit.”

Every year, billions of dollars are wasted on frivolous lawsuits, forcing individuals and businesses to spend thousands of dollars on litigation. This ultimately costs jobs and damages the economy because money that could be spent hiring new employees or investing in new businesses is instead directed toward legal fees. The annual direct cost of American tort litigation exceeds $250 billion.
The Lawsuit Abuse Reduction Act restores accountability to the U.S. legal system by providing penalties for filing baseless, meritless and frivolous lawsuits. Specifically, the bill:

•    Reinstates sanctions for the violation of Rule 11. Rule 11 of the Federal Rules of Civil Procedure was originally intended to deter frivolous lawsuits by sanctioning the offending party.
•    Ensures that judges impose monetary sanctions against lawyers who file frivolous lawsuits, including the attorney’s fees and costs incurred by the victim of the frivolous lawsuit.
•    Reverses the 1993 amendments to Rule 11 that allow parties and their attorneys to avoid sanctions for making frivolous claims by withdrawing them within 21 days after a motion for sanctions has been served.

In the Senate, the Lawsuit Abuse Reduction Act is cosponsored by Senators Tom Coburn and Marco Rubio.

In the House of Representatives, the bill is cosponsored by House Judiciary Committee Chairman Bob Goodlatte, along with Representatives Trent Franks, Jason Chaffetz, Blake Farenthold and George Holding.

A copy of the bill can be found here.

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