Small Business Liability Reform

Date: April 04, 2008

Civil litigation was once a last-resort remedy to settle limited disputes and quarrels, but recent years have brought a litigation explosion.

Liability Reform Would Return Common Sense to the Court System

The frequency and high cost of litigation in our country’s current civil-justice system is a matter of growing concern to small businesses. Liability reform would inject a measure of fairness into a legal system that currently preys on business, often without regard to legal merit. Liability reform also would help reduce the number of frivolous lawsuits and the exorbitant costs that can drive businesses to financial ruin.

Civil litigation was once a last-resort remedy to settle limited disputes and quarrels, but recent years have brought a litigation explosion. The number of civil lawsuits has tripled since the 1960s. Litigation has become a big business, and it is putting small companies out of business. When the typical cost of a lawsuit that goes to trial is at least $100,000, the economic pressures to settle are enormous. NFIB members say that being sued is one of the most threatening experiences for a small-business owner. It is even more frightening for the smallest of the small, which can be put out of business by one lawsuit.

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