(The Center Square) − Louisiana’s judicial system is under scrutiny as record-setting legal verdicts, a plaintiff-friendly environment, and skyrocketing auto insurance costs continue to impact the state’s economy and residents.
Louisiana ranked as the 10th worst state for tort litigation in the American Tort Reform Foundation’s annual report.
According to the report, trial attorneys have poured $66.3 million into advertising in Louisiana from January 2023 to June 2024, emphasizing their stake in a legal environment that frequently produces massive settlements.
A study by Marathon Strategies cited by ATR found Louisiana courts issued $409 million in “nuclear verdicts” (awards exceeding $10 million) against businesses in 2023. The pharmaceutical, oil, and trucking industries were among the most frequent targets.
One particularly controversial case this year involved a St. Landry Parish jury awarding $220 million to an EMT injured in a collision between an ambulance and a pickup truck. The verdict included $155.5 million in non-economic damages, sparking debates over proportionality in the state’s civil justice system.
Meanwhile, the Louisiana Supreme Court is facing criticism for reversing its stance on a statute of limitations case following legislative pressure. Justice James Genovese, dissenting in the June 2024 ruling, warned that the decision granted lawmakers “unbridled authority” and violated defendants’ due process rights.
“The idea that a legislature can abolish vested rights on a whim is alarming,” said Genovese. “This reversal undermines decades of legal precedent.”
And while Gov. Jeff Landry touts his recent tax reforms as “a WIN for the businesses in Louisiana,” the state’s persistently plaintiff-friendly tort climate raises concerns about the reforms’ real-world impact.
Louisiana remains one of the most challenging environments for businesses grappling with high legal exposure, particularly in industries like energy, pharmaceuticals, and transportation.
Landry’s close ties to trial lawyers, who have contributed more than $700,000 to his campaigns — exceeding donations received by former Democratic Governor John Bel Edwards — add to the unease.
Earlier this year Landry vetoed legislation aimed at curbing inflated damages in medical lawsuits. The bill sought to limit damages based on inflated list prices for medical care that no one actually paid.
Despite the tax reforms, which are designed to make Louisiana more attractive for new investments, the state’s tort climate continues to act as a deterrent.
While the reforms might ease tax burdens, they offer little relief from the pervasive legal challenges.
Louisiana’s legal climate is also working to exacerbate Louisiana’s already highest-in-the-nation auto insurance rates.
Fraud schemes like the staged accidents exposed in “Operation Sideswipe”, and high claims payouts have sent insurance companies in Louisiana packing.
So far, over 60 individuals charged or sentenced in the “Operation Sideswipe” scheme so far, including attorneys who represented the plaintiffs despite knowing the accidents were staged.
Combined with high uninsured motorist rates and natural disasters, Louisiana’s insurance crisis shows little sign of easing.
Rep. Nicholas Muscarello Jr., R-Hammond, defended the state’s recent efforts.
“We’ve implemented more tort reform in the last decade than our neighbors,” Muscarello told The Center Square in October. “The question is, why hasn’t it resulted in lower rates? That’s what we’re trying to figure out.”
