CHARLESTON – A statewide legal reform group says excessive tort litigation cost West Virginia more than 3,800 jobs and about $35 million in state and local revenue.
West Virginia Citizens Against Lawsuit Abuse released the economic impact figures Feb. 11 as a follow-up to a statewide study last fall. The study was conducted by the Perryman Group.
WV CALA says the figures show “why continued legal reforms in West Virginia will benefit families, businesses and local government.”
A group for trial attorneys dismissed the study, calling it worthless.
“This so-called 'study' issued by WV CALA isn't worth the paper on which it's printed,” said Stephen New, president of the West Virginia Association for Justice. “Ray Perryman has gained a reputation for producing exactly what his clients want him to produce – not independent analyses. He's been discredited nationwide, from newspapers in his home state of Texas to the Wall Street Journal.”
According to CALA’s study, the Charleston Metropolitan Statistical Area lost more than 1,200 jobs and almost $90 million in state and local revenue because of excessive tort litigation. CALA said that resulted in a “tort tax” of $623.04 per person annually in the area.
In the Huntington-Ashland market, the study shows 360 jobs and $19 million in lost personal income were lost because of excessive litigation. That means the “tort tax” was $133.60 per person.
“These excessive acts of litigation are having a direct cost to our families and local and state government,” WV CALA said in a press release about the study. “$400 million is the direct cost in gross product to the citizens of the state of West Virginia annually due to these excessive acts of tort litigation.
“All industries in West Virginia are negatively affected but retail trade, business services and health services are typically experiencing the greatest losses.”
WV CALA says excessive litigation is hurting West Virginia families, businesses and local government.
“West Virginia Citizens Against Lawsuit Abuse will continue advocating for the citizens of West Virginia and create public awareness of specific acts of legislation that will benefit the state of West Virginia regarding legal reform,” the release stated.
New, with the WVAJ, said the tort tax claim mentioned by CALA and Perryman has been discredited for more than 10 years.
“The so-called costs are total insurance industry costs, including multi-million dollar insurance CEO salaries,” New said. “Even more outrageous, they say that we've lost jobs without any independent data to support the claim.
“Real economic research is hard – and the findings are replicable by other researchers. Perryman refuses to share either data or methodology used. His findings can't be verified by independent researchers.
“The truth is the billion-dollar corporate special interests behind CALA and Perryman don't care about West Virginia's economy, West Virginia jobs and West Virginia citizens. This is about increasing their corporate profits at the expense of our rights and our bank accounts – and they're lying to West Virginia lawmakers and misleading our citizens to do it. It's wrong.”