‘Judicial Hellholes’ Report Highlights Need for Reform in Michigan

December 5, 2023 Last Edit: June 5, 2025

Lansing’s Ranking Equals Billions in Lost Income, Tens of Thousands of Jobs

‘Judicial Hellholes’ Report Highlights Need for Reform in Michigan

NFIB State Director Amanda Fisher says the American Tort Reform Foundation’s latest Judicial Hellholes report highlights the need for legislative action to balance the scale of justice in Michigan. CLICK HERE to read the full report. The organization ranked Lansing No. 6 on its annual list of Judicial Hellholes, pointing to a variety of issues that leave small businesses open to frivolous lawsuits, including premises liability, workplace liability, and expansive medical liability. ATRF estimates that lawsuit abuse and excessive tort costs will drive up the costs of goods and services for everyone in Michigan. ATRA’s estimates are staggering and it’s not just small business owners who are at risk. According to the report’s findings: $817 tort tax on every Michigander every year Loss of more than 87,000 jobs $5.94 billion loss in personal income “This is not a list that you want to brag about cracking,” said Amanda Fisher, NFIB State Director in Michigan. “After decades of judicial stability, Michigan has fallen under activist judges who make decisions based on personal and partisan whims rather than following the rule of law.” “In the past year, actions by the legislature and the Michigan Supreme Court put small business owners at a much higher risk of being slapped with a lawsuit that puts them out of business. The “obvious and open” danger principle has long protected small business owners from lawsuits from customers who injure themselves from clear hazards – leaving owners one slip-and-fall away from losing their business. The shield protecting small business owners against lawsuits from dishonest folks out for a big payout is gone, leaving many mom-and-pop shops vulnerable. Michigan courts will likely see an influx of these slip-and-fall cases to be decided by juries, meaning mom-and-pop shops are especially vulnerable to time consuming and expensive litigation. Small, family-owned shops don’t have piles of cash laying around nor the time to sit in court and pay a team of lawyers to defend them. Most put what they earn right back into their business so they can expand and create more jobs here in Michigan. The cost of defending against just one meritless lawsuit could shut their doors for good. State legislators are expanding civil liability at every opportunity. Lawmakers are also considering legislation starting next year that could make things even worse. If passed, ATRA estimates that small business owners could face a substantial increase in their insurance rates while providing very little benefit to consumers. According to a study, the legislation would create 35 new avenues for legal action with a price tag between $2 to $4.7 billion dollars or up to 21% of the premiums paid by all Michigan residents and business owners. According to ATRA, the only people who benefit from the legislation are trail attorneys who will reap millions of dollars from fees and settlements while punishing small businesses and consumers. Other proposed legislation would put small businesses that comply with state and federal regulations open to private lawsuits and allow lawsuits for things that date back several decades. “Michigan has become a hostile place to start and operate a small business. This report should serve as a warning flag for lawmakers to stop before they make things even worse. The last few years, the legislative majority has increased spending by mindboggling amounts, grown government, increased corporate giveaways, and added needless and time-consuming regulations. Add to the list the elimination of workplace freedoms and the addition of expensive and destabilizing energy regulations and you get a state ripe for predatory lawyers. Let’s not make it even more attractive to file frivolous lawsuits that earn big buck settlements.”

Topics:

Taxes

State:

Michigan

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