NFIB to Senate Committee: 'Litigation Has Become a Big Business' That Hurts Small Businesses

Date: January 18, 2018

NFIB Kansas State Director Dan Murray went before the Senate Judiciary Committee today to speak in support of Senate Bill 199, legislation that would help the state’s small businesses by balancing the scales of justice.

“The frequency and high cost of litigation in our country’s current civil justice system is a matter of growing concern to small businesses,” Murray said. “Liability reforms inject a measure of fairness into a legal system that currently preys on business, often without regard to legal merit.”

In his written testimony, he said, “The proposals in SB199 provide just the kind of legal reforms that give small businesses the fairness and certainty they need.”

Murray singled out a provision allowing for lower appeal bond limits for small businesses as the kind of reform that is long overdue. Under the bill, i the appellant is a small business, the bond must not exceed $1 million or the amount of the judgment, whichever is less.

“Small businesses, in most cases, simply cannot afford the level of security required to appeal an adverse judgment in many of the frivolous litigation cases we see today,” Murray said. “The bill’s treatment of small businesses is reasonable and fair, and, the lower limits safeguard the due process rights for small business owners by facilitating meaningful access to our state’s appeals court.”

NFIB is Kansas’ leading small-business association. Read the full transcript of Murray’s testimony below:

Written Testimony in Support of SB199

Mr. Daniel Murray
Kansas State Director, National Federation of Independent Business 
Senate Judiciary Committee
Thursday, January 18, 2018

I am pleased to submit written testimony in support of SB199 on behalf of NFIB Kansas.  NFIB Kansas is the leading small business organization in Kansas representing small and independent businesses. A nonprofit, nonpartisan organization founded in 1943, NFIB Kansas represents the consensus views of its over 4,400 members in Kansas.

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 reforms inject a measure of fairness into a legal system that currently preys on business, often without regard to legal merit. Liability reform also helps 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. 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.

The proposals in SB199 provide just the kind of legal reforms that give small businesses the fairness and certainty they need. We certainly support the entire bill; but, specifically we are pleased with the provision allowing for lower appeal bond limits for small businesses.  The bill provides that, if the appellant is a small business, the bond must not exceed $1 million or the amount of the judgment, whichever is less. The bill defines small business as any independently owned and operated business or nonprofit organization with no more than 50 full-time employees and no more than $50.0 million in annual revenue. 

Small businesses, in most cases, simply cannot afford the level of security required to appeal an adverse judgment in many of the frivolous litigation cases we see today. The bill’s treatment of small businesses is reasonable and fair; and, the lower limits safeguard the due process rights for small business owners by facilitating meaningful access to our state’s appeals court.

Again, thank you for your consideration of our comments, and we urge you to vote SB199 favorably for passage.

Related Content: Small Business News | Kansas | Legal

Subscribe For Free News And Tips

Enter your email to get FREE small business insights. Learn more

Get to know NFIB

NFIB is a member-driven organization advocating on behalf of small and independent businesses nationwide.

Learn More

Or call us today
1-800-634-2669

© 2001 - 2022 National Federation of Independent Business. All Rights Reserved. Terms and Conditions | Privacy