March 2019 – Florida Justice Reform Institute

Workers’ Comp Changes Might Get Scuttled

March 28, 2019/in Sunshine State News

Workers’ Comp Changes Might Get Scuttled

By CHRISTINE SEXTON NEWS SERVICE OF FLORIDA
March 28, 2019 – 9:30am

Cord Byrd

A push by Florida’s business community to tackle the state’s workers’ compensation insurance laws could be poised to fail again this year.

As legislators near the midway point of the 60-day session, the possibility is fading that groups representing major corporations, retailers and small businesses can win changes to the complicated system designed to provide health benefits to injured workers.

A House panel this week unanimously approved a proposal (HB 1399) that could result in a 5 percent reduction in the workers’ compensation insurance rates paid by employers.

Much of the savings would be derived by changing how insurance companies reimburse health providers. The bill, if it became law, would tie payments to rates established for Medicare, a proposal opposed by some health providers.

But business lobbyists say the legislation is missing one key feature they desperately crave: caps on the fees charged by attorneys representing injured workers.

Caps are part of a Senate workers’ compensation bill. But there wasn’t enough support this week in a Senate committee to pass the bill, according to people involved in negotiations.

The Florida Chamber of Commerce, Associated Industries of Florida and the National Federation of Independent Business, among others, want lawmakers to reinstate fee caps that were ruled unconstitutional by the Florida Supreme Court in 2016.

“This (House) bill does good things,” said Kimberly Fernandes, a lobbyist for the business-backed Florida Justice Reform Institute who said her group was “happy” to support the measure. But Fernandez said her group believes the Senate bill “does more.”

The House bill would allow insurance companies to depart from state-set rates and reduce rates by 5 percent.

FCCI Insurance Group lobbyist Tom Koval told the House Insurance & Banking Subcommittee that allowing companies to deviate from the approved rates could lead to predatory pricing and insurance company insolvencies.

The approval of the bill by the House panel came a day after the Senate Banking and Insurance Committee delayed action on a Senate workers’ compensation bill (SB 1636).

While the Senate bill would cap attorney fees at $150 an hour and limit overall payment to $1,500, there weren’t enough votes on the committee to pass the measure, committee member Tom Lee, R-Thonotosassa, said.

Workers’ compensation is meant to be a self-executing system that provides health benefits and lost wages to injured workers and protects employers from lawsuits.

While the system is generally set up to avoid lawsuits, disputes about injured workers’ benefits often lead to legal fights, which is when attorney fees come into play.

Workers’ compensation has long been a divisive issue in Tallahassee because of the breadth of its impact, touching disparate interests including injured workers, employers, health-care providers, insurance companies and workers’ attorneys.

Lee said the Senate committee didn’t have time to digest the complicated issue before taking up the bill.

“It puts you in a very awkward situation of having to move quickly on a bill that has massive consequences for the general population,” Lee said, noting it’s not just workers’ compensation but also other insurance issues that can befuddle legislators.

“To try to jump into these things on the fly is very dangerous,” Lee said.

Reinstating the workers’ compensation fee caps has been a priority for business groups since the Supreme Court struck them down. The groups argued that without caps, insurance premiums paid by employers would skyrocket, hurting the state’s economy.

Following the Supreme Court ruling, the state approved a 14.5 percent increase, which was largely attributable to eliminating the fee caps.

But since that initial increase, Florida Insurance Commissioner David Altmaier approved a nearly 10 percent reduction in rates for 2018 and an overall 13.8 percent decrease in workers’ compensation insurance rates for 2019.

Rep. Cord Byrd, a Neptune Beach Republican who is sponsoring the House workers’ compensation bill, told members of Insurance & Banking Subcommittee this week that the Legislature erroneously interfered in the free market when it agreed in 2003 to pass the fee caps that the court ultimately found unconstitutional.

“I think sometimes government has been more of a player instead of a referee,” said Byrd, an attorney who has practiced on both sides of workers’ compensation cases.

“As a practitioner, someone who has done both sides, philosophically I am opposed to caps,” he said. “I think we need to trust our judges.”

http://www.sunshinestatenews.com/story/workers-comp-changes-might-get-scuttled

Florida tort law makes it hard for truckers

March 28, 2019/in Jacksonville Business Journal

Florida tort law makes it tough for truckers

Florida Rock & Tank Lines President and CEO Rob Sandlin, and Patriot Transportation and

FRPH CEO Tom Baker. — JAMES CRICHLOW

By Will Robinson – Reporter, Jacksonville Business Journal

Mar 28, 2019, 2:51pm EDT

Trucking companies across Florida share a common pain point: double-digit growth in insurance costs. In a perfect storm of more expensive vehicles, declining insurer competition and “nuclear verdicts,” some in the industry believe this is the new norm.

Jacksonville-based Patriot Transportation (Nasdaq: PATI) is among those that have seen double-digit insurance costs growth in consecutive years. The company, which primarily carries fuel to gas stations across the Southeast, blames the rapidly rising costs on a Florida tort law that allows juries to award damages if a trucker is 1 percent negligent, versus states like Georgia that demand litigants prove a trucker is 50 percent negligent.

“That [50 percent] threshold is much more reasonable,” said Matt McNulty, CFO of Patriot. “It discourages frivolous suits.”

In Florida, losses from insurance claims and settlements have become so onerous that major insurers are leaving the Sunshine State altogether. Major insurance carriers Zurich Insurance Group AG and American International Group Inc. have both reduced their offerings in Florida and elsewhere.

The shrinking supply of insurers in Florida pushes costs up further.

“They couldn’t charge enough to make it make sense to be here,” said McNulty.

In light of Florida’s low negligence standard, Patriot has joined efforts to lobby for tort reform, CEO Rob Sandlin said. He noted that both the Florida Trucking Association and Florida Chamber of Commerce are lobbying to change the state’s tort laws, and other businesses, like property owners liable for slip-and-fall claims, are as well.

“There’s more and more interest in change from Florida businesses,” he said.

A 2018 Florida Justice Reform Institute report estimates Florida loses more than $11.8 billion and 126,000 jobs each year due to what it deems excessive litigation. The report further claims that Florida loses $615 million in annual state revenue and $516 million in annual local government revenues, according to data compiled by The Perryman Group.

Much of those estimated losses, however, belong to the retail industry. The transportation and utilities sector is responsible for about 8 percent of the losses, $1.8 billion, and about 4 percent of the jobs lost, 5,280.

Despite the tort law Patriot is pushing to change, Florida did not make the top 10 list of verdicts assembled by Carr Allison, a Southeastern law firm and national trial counsel for seven of the top 10 motor carriers, in 2016.

Jacksonville-based Landstar System Inc. (Nasdaq: LSTR) made the list twice, though for verdicts in Georgia and California. In fact, a Carr Allison presentation slide singles out Landstar as proof that verdicts are escalating, noting the two previous verdicts as well as a $15 million verdict in Florida and a $19.5 million verdict in Arizona.

Beyond tort reform

But to Amy Wagner, vice president of risk management at fleet management company Ryder System Inc. (NYSE: R), high verdicts and tort laws are only part of the reason insurance costs are rising. Wagner believes consecutive double-digit insurance cost growth is here to stay.

In the years leading up to 2008, insurance premiums were largely stagnant, Wagner explained. But since 2008, vehicles have become more expensive to repair or replace; more drivers are on the road; the proliferation of smart phones has been matched by the proliferation of distracted driving; and high employment has given truck drivers their choice of jobs, leading to higher turnover and with it, higher accident rates.

To combat this confluence of factors, Ryder has turned to technology. Camera systems installed on the company’s entire fleet of trucks in 2017 record and save the moments leading up to and immediately following traffic incidents. This allows the company to quickly either accept responsibility or dismiss fraudulent claims.

The company has also installed adaptive cruise control, which automatically applies breaks to prevent rear-end collisions, and technology to prevent roll-overs. LED lights on Ryder trucks increase visibility and reduce driver fatigue.

“We’re taking a comprehensive approach to mitigating risk,” said Wagner.

Not all of Ryder’s mitigation strategies are technological. It is also working to reduce driver turnover, since research suggests that drivers are more prone to accidents in their first 12 months on the job. But given a nationwide driver shortage, that is no easy task.

More than 60,000 truck driver jobs went unfilled in 2018, according to the American Trucking Associations, with that deficit expected to reach 175,000 by 2026. The average age of truck drivers is 55, according to the Bureau of Transportation Statistics, putting many drivers within retirement age.

To retain its drivers, Ryder pays well and recognizes excellence with driver of the month and driver of the year awards, Wagner said. It also has a “Captain of the Ship” policy that allows drivers who feel unsafe for any reason to call dispatch and get taken off of a route. So far, the efforts are paying dividends.

“We do have lower than average turnover,” said Wagner.

Patriot, too, introduced a number of ways to attract and retain drivers last year, the company disclosed in its shareholder meeting in January. Despite boosting pay, the company still saw 68 percent driver turnover in 2018.

https://www.bizjournals.com/jacksonville/news/feature/statewide-transportation/2019/03/florida-tort-law-makes-it-tough-for-truckers.html

Assignment of benefits lawsuits continues to rise for eighth straight year, report says

March 28, 2019/in Tallahassee Democrat

Assignment of benefits lawsuits continues to rise for eighth straight year, report says

Jeffrey Schweers, Tallahassee Democrat Published 3:33 p.m. ET March 27, 2019

For the eighth year in a row, assignment of benefits lawsuits accounted for more than half of all litigation against insurers statewide, a newly updated report by the Florida Justice Reform Institute claims.

Eighteen percent more AOB lawsuits were filed than in 2017. Over the last decade, that growth was 900 percent. Total lawsuits increased just over 400 percent for the same 10-year period.

Gov. Ron DeSantis gives his State of theState speech during
the opening day ofsession for the Florida Legislature
Tuesday, March 5, 2019.
(Photo: Tori Schneider/Tallahassee Democrat)

And while the proportion of personal injury protection cases only rose 5 percent, the share of AOB cases rose 70 percent, according to the report.

“This updated report details how out-of-control AOB lawsuits based on the one-way attorney fee continues to accelerate, driving up overall litigation and costs for policyholders,” William Large, president of the Florida Justice Reform Institute, said in a news release.

The report uses data from the Florida Department of Financial Services’ Service Of Process database, updated through 2018, to show the widespread growth of Assignment of Benefits lawsuits.

The state law was intended to benefit insurance policyholders by putting them on an equal playing field with insurers, but has instead created a growing windfall for trial lawyers and the repair companies that hire them, the institute said.

“I hope the Legislature passes legislation to reform the issue of AOB, which has really degenerated into a racket,” Gov. Ron DeSantis said during his State of the State address.

Gov. Ron DeSantis speaks to the press after giving his State
of the State address during the opening day of session for the
Florida Legislature. Tuesday, March 5, 2019.
(Photo: Tori Schneider/Tallahassee Democrat)

Two weeks ago, Insurance Commissioner David Altmaier said he would remain committed to supporting measures “that stem AOB abuse and protects consumers from the abusive tactics exhibited by bad actors who exploit Florida’s unique attorney fee structure.”

The report was released today, the day before the House Judiciary Committee was to take up its version of an insurance assignments bill similar to one that was filed the previous two years.

State law allows a policy homeowner to sign over their rights to a building contractor or auto repair shop so they can immediately pursue direct payment from the insurance company for the cost of the repairs.

Often, the amount of the claim is disputed and the case winds up in court. Under the one-way attorney fee requirement, insurance companies pay legal costs whether they win or lose, giving lawyers an incentive to file AOB suits, critics said.

The consequence of the spike in lawsuits and award amounts is that insurance rates for many of the state’s 6 million property insurance policyholders has gone up by a third, state insurance officials said.

The House committee bill would curb the abuse mainly by going after the one-way attorney fee statute by setting a formula for determining which party, if any, receives the award of attorney fees.

A similar bill sponsored by Sen. Doug Broxson, R-Pensacola, would only award attorney fees to policyholders if they win.

Five firms filed more than 20 percent of all property AOB lawsuits, according to the FJRI report, and nine firms filed nearly 85 percent of all auto glass AOB cases. Most AOB lawsuits appear to be concentrated in Miami-Dade and Broward counties, with the majority of auto glass lawsuits in Hillsborough and Orange counties.

“Unfortunately, rampant AOB lawsuits threaten our confidence in the state’s legal climate,” Large said. “The Legislature can help the people of Florida by standing up to the trial lawyers and passing meaningful AOB lawsuit reform.”

Contact Schweers at [email protected]. Follow him on Twitter @jeffschweers.

https://www.tallahassee.com/story/news/2019/03/27/aob-lawsuits-continue-plague-florida-new-study-shows/3289723002/

FJRI Update Details Continued Growth in AOBs … Thanks to a Handful of Busy Attorneys

March 27, 2019/in Sunshine State News

Report Details Continued Growth in AOBs … Thanks to a Handful of Busy Attorneys

By SUNSHINE STATE NEWS
March 27, 2019 – 2:00pm

State law intended to benefit insurance policyholders continues to generate an ever-increasing windfall for trial lawyers and the repair vendors who hire them, according to a newly updated report released today by the Florida Justice Reform Institute.

The report uses data from the Florida Department of Financial Services’ Service Of Process database, updated through 2018, to show the widespread growth of Assignment of Benefits (AOB) lawsuits.

“This updated report details how out-of-control AOB lawsuits based on the one-way attorney fee continues to accelerate, driving up overall litigation and costs for policyholders,” said William Large, president of the Florida Justice Reform Institute

But guess what?

The Florida Justice Reform Institute points its finger at a handful of lawyers filing most of the AOB lawsuits, but it fails to connect the dots on at least one embarrassing and another ironic fact: Two of the most prolific filers of AOB lawsuits — Malik Law Group and Hale, Hale and Jacobson (the firm of Florida Justice Association spokesman Lee Jacobson) are members of the Restoration Association of Florida, the very group that contends it is opposing AOB reform on behalf of consumers.

Here’s what the report says:

“… A fifth of all property AOB litigation is filed by 5 firms representing 6 attorneys. In PIP AOB lawsuits, an analogous pattern is seen. It is worth noting that PIP AOB attorneys seem to be the most prolific lawsuit filers — for example, a search in the DFS system for PIP attorneys demonstrates that one lawyer filed over 30,000 PIP AOB lawsuits in 2018.”

The report continues, “Confirming FJRI’s previous analysis of the shift from AOB starting in PIP and then moving to other coverages, there are several firms that do multiple types of AOB work. For example, the well-known Morgan & Morgan does AOB lawsuits for PIP, auto glass, and property, as does Hale, Hale & Jacobson (embarrassing) Other firms, such as Malik Law (ironic) and Emilio Stillo PA, work in at least two of these coverage areas, filing hundreds — sometimes thousands — of lawsuits annually.”

Find a copy of the new report HERE.

At the heart of the AOB problem is the one-way attorney fee statute designed to give policyholders equal footing in disputes with insurers. Some vendors use AOBs to seize control of this special policyholder right, and then file expensive lawsuits based on inflated claims. Sometimes these lawsuits even happen without the policyholder’s knowledge or consent.

This lawsuit-for-profit scheme has become an incentive for trial lawyers and their vendor clients — often water damage remediation firms or auto glass shops with aggressive marketing schemes.

Updated with new data through 2018, the report, authored by FJRI counsel Ashley Kalifeh of Capital City Consulting, contains some startling insights:

• For the eighth consecutive year, AOB lawsuits make up more than half of all lawsuits filed against insurers statewide.

• In 2018, 18 percent more AOB lawsuits were filed than in 2017.

• From 2008 to 2018, AOB lawsuits increased by over 900 percent, while total lawsuits in that same period increased just over 400 percent.

• Five firms filed more than 20 percent of all property AOB lawsuits. Even worse, nine firms filed nearly 85 percent of all auto glass AOB cases.

• In a troubling development, some lawyers are also setting up their own repair businesses, so they can profit from both the abuse and the lawsuits.

• AOB lawsuits are still concentrated in a few Florida counties, raising questions about statistical probability. In 2018, almost half of all property AOB lawsuits were filed in Miami-Dade and Broward counties, while the vast majority of all auto glass AOB lawsuits were filed in Hillsborough and Orange counties.

“While Florida is a growth state, AOB lawsuits are growing much faster than the population, going from little more than a few hundredths of a point as a fraction of Florida’s population to nearly a full three-quarters of a percent now,” said Kalifeh.

“Unfortunately, rampant AOB lawsuits threaten our confidence in the state’s legal climate,” said Large. “The Legislature can help the people of Florida by standing up to the trial lawyers and passing meaningful AOB lawsuit reform.”

The Florida Justice Reform Institute was created in 2005 to fight wasteful civil litigation through legislation, promote fair and equitable legal practices and provide information about the state of civil justice in Florida.

http://www.sunshinestatenews.com/story/fjri-update-details-continued-growth-aobs-thanks-handful-busy-attorneys

Insurers and Others Urge Supreme Court to Limit Assignment of Benefits

March 27, 2019/in Claims Journal

Insurers and Others Urge Supreme Court to Limit Assignment of Benefits

By Jim Sams | March 27, 2019

The main battle may be at the Florida state capitol as lawmakers consider reforming the state’s assignment of benefits law, but insurers, trial lawyers and contractors staked out their positions this week in a separate skirmish at the state Supreme Court that may close the door on some claims.

The Supreme Court since Saturday has received amicus briefs from the Florida Justice Reform Institute, Florida Bankers Association, Florida Defense Lawyers Association, American Property and Casualty Insurance Association and National Association of Mutual Insurance Companies, the Personal Insurance Federation, the Florida Roofing and Sheet Metal Contractors Association and the Coalition Against Insurance Fraud.

Each of them argues that the high court should affirm a decision by the Florida Fourth District Court of Appeal that would allow insurers to require signatures of all policyholders, including mortgage lenders, before accepting an assignment of benefits.

Insurers say that assignment of benefits agreements are often abused by shady contractors who sue insurers for inflated repair costs despite shoddy work and sometimes no work at all.

“It is inescapable that each individual consumer policyholder has every right to require their written consent to be obtained before their very right to control the proceeds is signed away,” the Coalition Against Insurance Fraud argues in its brief.

Matthew Smith, government affairs director for the Coalition, said his organization supports the right of policyholders to assign their claim benefits and has no position on reform legislation. But Smith allowing insurers to require the approval of all the insureds on a policy is a sensible step that will protect consumers by ensuring that all parties involved have a chance to vet a decision to hand over their claim rights. Otherwise, he said, insurance carriers “are stuck between a rock and hard place.”

“Their only option real option is they they have to go to court and ask a judge to intervene and say, ‘We don’t know who owns this claim any more.’”

The Roofing and Sheet Metal Contractors Association said in its brief that legitimate contractors don’t need benefits assigned to them in order to repair damaged buildings.

“The exponential growth in the abuse of AOBs in Florida’s construction industry has resulted in harmful secondary effects for legitimate, ethical roofing contractors, by undermining the reputation of the roofing industry, eroding customer confidence in their work performance, and taking business away from reputable roofers who are trying to make an honest living in the industry,” the association says in its brief.

On the other hand, the Florida Justice Association argues that the Supreme Court ruled in 1917 that any conditions placed on right to assign benefits is unconstitutional.

“Any additional conditions or restrictions on post-loss assignments grant no additional protections and are only a thinly-veiled attack on the practicability of the notion of post-loss claims being freely assigned,” the Justice Association said in its brief.

The Supreme Court’s ruling will likely resolve conflicting rulings by Florida appellate courts. While the Fourth Court of Appeal ruled that Ark Royal Insurance Co. can add an endorsement to its policies requiring all insureds to accept an assignment of benefits, in 2017 the Fifth Court of Appeal reached the opposite conclusion when ruling in Security First Insurance Co. v. Florida Office of Insurance Regulation.

The insurance office had rejected a similar endorsement that Security First wanted to add to its policies and an administrative hearing officer agreed that such restrictions are contrary to state law.

Even though his office didn’t give Security First what it wanted, Florida Insurance Commissioner David Altmaier supports a change to state law. He issued a press release last week when a reform measure, Senate Bill 122, cleared the Senate Judiciary Committee. The bill would amend a “one-way” provision of state law that allows plaintiffs to collect all of their attorney fees from insurers if they can show they obtained even $1 more in benefits after taking a claim to court. Similar bills have failed to pass the legislature in the past seven sessions, according to the Insurance Journal.

“An insurance affordability crisis has been identified and if left unchecked, rates will likely continue to rise, and companies will likely stop writing policies in zip codes where AOB abuse is most prevalent,” Altmaier said. “As a result, consumers will be left to navigate a crippled insurance market as they prepare for the next major hurricane to make landfall.”

https://www.claimsjournal.com/news/southeast/2019/03/27/290034.htm

AOB lawsuits outpacing population growth

March 27, 2019/in CQ Roll Call, Daily Commerical, Florida Politics, Roundtable Politics

AOB lawsuits outpacing population growth

Florida is growing fast. AOB lawsuits are growing faster.

By Drew Wilson on March 27, 2019

Florida is growing fast.

The state is already the third-largest in the union and recent research from the Florida Chamber of Commerce estimates 1,100 people move to the Sunshine State every day — that’s amounts to 5 million new residents by 2030.

But another statewide metric is accelerating faster: assignment of benefits lawsuits.

“While Florida is a growth state, AOB lawsuits are growing much faster than population, going from little more than a few hundredths of a point as a fraction of Florida’s population to nearly a full three-quarters of a percent now,” said Capital City Consulting lobbyist and FJRI counsel Ashley Kalifeh.

AOB is a process where policyholders sign over their insurance benefits for a quick repair after their property — be it a home, car windshield or something else — is damaged.

The contractor or attorney who receives those benefits often attempts to collect a payout from insurers in court. AOB reform advocates say those lawsuits lead to inflated payouts which in turn drive the cost of insurance premiums for all Floridians.

According to the Florida Justice Reform Institute, AOB lawsuits made up more than half of all lawsuits filed in Florida in 2018 — the eighth year in a row they’ve held the majority.

Additionally, the quantity seen 18 percent growth year-over-year.

A report produced by Kalifeh shows AOB suits increased by over 900 percent between 2008 and 2018. Total lawsuits increased by a little over 400 percent during the same stretch.

“Unfortunately, rampant AOB lawsuits threaten our confidence in the state’s legal climate,” said FJRI President William Large. “The legislature can help the people of Florida by standing up to the trial lawyers and passing meaningful AOB lawsuit reform.”

“This updated report details how out-of-control AOB lawsuits based on the one-way attorney fee continues to accelerate, driving up overall litigation and costs for policyholders.”

The report also found that about 85 percent of those suits were filed by nine law firms. Just one attorney — Gregory Gudin of Landau & Associates — filed more than 30,000 AOB lawsuits last year.

Most of those suits were filed in a handful of counties, too. Miami-Dade and Broward accounted for nearly half of property AOB suits, while Hillsborough County alone was home to more than 50 percent of auto glass AOB suits.

FJRI supports measures moving through the House and Senate that would make changes to AOB rules.

Among those reforms is an end to one-way attorney’s fees in AOB cases. Currently, the losing side of an AOB case has to cover the attorney’s fees for the prevailing party.

Opponents of the reforms say AOB suits would slow down if insurance companies green lit repairs faster and used higher quality contractors, especially in the case of water damage.

http://floridapolitics.com/archives/291981-aob-lawsuits-outpacing-population-growth

Bill Proposing $50,000 Jurisdictional Limit for County Courts Advances in Florida House

March 22, 2019/in Daily Business Review

Bill Proposing $50,000 Jurisdictional Limit for County Courts Advances in Florida House

If signed into law, HB 337 would take effect in July 2021. The bill is sponsored by Florida Rep. Tom Leek of Ormond Beach and contains a provision allowing defendants to challenge the amount of damages sought by plaintiffs in a lawsuit. Plaintiffs would have to provide evidence early in the litigation showing they are likely to recover the sum sought, or risk having their cases dismissed.
By Zach Schlein | March 22, 2019 at 12:34 PM

FL State Capitol

Florida State Capitol/Photo: Joseph Sohm/Shutterstock.com

A proposed Florida bill stands to dramatically alter the case composition of Florida courts.

Florida House bill 337 is intended to overhaul statewide provisions of Florida county and circuit courts. Following an amendment entered Tuesday by the bill’s sponsor, Republican Rep. Tom Leek of Ormond Beach, adjustments would increase the jurisdictional limit of county courts to $50,000.

HB 337 outlines a plan for the change to take place over a two-year period. The bill calls for raising the limit to $30,000 by July 1 before instituting the new standard of $50,000 by July 1, 2021.

The bill received a favorable vote by the Civil Justice Subcommittee on Wednesday afternoon, paving the way for it to be heard next in the Justice Appropriations Subcommittee and the Judiciary Committee. Its Senate counterpart, SB 328, calls for the jurisdictional limit of Florida circuit courts to be raised to $50,000 by Jan. 1, 2022.

The legislation also establishes a means for defendants to formally question the award sought by plaintiffs in civil cases. In its current form, the bill allows for defendants to “demand proof of the reasonableness of the alleged amount in controversy within 30 days,” according to an analysis shared by the Civil Justice Subcommittee. The defendant would not be required to provide evidence or arguments backing the veracity of their challenge. It would then fall upon the plaintiff to provide a preponderance of evidence that there is a “reasonable likelihood” they’ll recover at least the amount of damages alleged in the complaint. If they fail to do so, the case would then be transferred by the court to the appropriate jurisdiction.

An earlier iteration of the bill was stricter in its standards, requiring litigants to justify the sum sought with “clear and convincing evidence.” The penalty for failing to do so was similarly steep, as those who failed to make their case would have their litigation dismissed with prejudice in the jurisdiction in which it had been filed.

Additionally, a section of the bill allows for Florida Supreme Court justices residing outside of Leon County to have an office in the district they permanently reside in.

Read HB 337 here:

HB 337 is the latest iteration of an effort to reorient what cases will be heard in Florida’s county and circuit courts. In 2018 Rep. Leek sponsored HB 7061, which provided for an institution of a $50,000 jurisdictional limit that would be raised every five years. Leek did not respond to requests for comment on the bill by deadline.

William Large, president of the Florida Justice Reform Institute, criticized the prospective raise in the jurisdictional limit for circuit courts.

“A Florida Supreme Court work group recommended raising that jurisdictional limit to $25,000,” Large said in a statement. “As amended in the House Civil Justice Subcommittee today, HB 337 phases in a doubling of the Court’s recommended limit, to $50,000.”

Noting that costly cases heard by the District Court of Appeals would now be handled in circuit court, Large said “circuit courts may not be able to handle the results.”

“Circuit court judges don’t have the resources, like law clerks, to help them with this larger, more complicated workload,” he said. “We support the Florida Supreme Court’s recommendation of a $25,000 jurisdictional limit and then studying the impact.”

However, others see the prospective raise as a much-needed and long overdue shift to the system. Jeffrey Gilbert, a partner with Cozen O’Connor’s Miami office, called the raise a good idea and noted the jurisdictional limits haven’t been changed in more than 25 years.

“It definitely will alleviate a lot of the pressure on the circuit courts for cases where damages are alleged,” Gilbert said. He commented the change would arrive at an interesting time in Miami-Dade County with the construction of the new circuit courthouse.

“Most of the county courts at this point are located not only downtown, but also in satellite courthouses throughout the county,” he said. He noted the influx of cases into county court would necessitate the review of its buildings and personnel for capacity and qualification purposes.

Fowler White Burnett shareholder James Hurley said “there’s no reason” county court judges couldn’t hear cases once handled in circuit court.

“The county court judges I’ve been front of … there isn’t a whole lot of differences between them and circuit court judges in terms of experience,” he said. “The nature of litigation has changed. You have far more cases now that exceed the $15,000 threshold. … There needs to be a redistribution of how these cases are handled, otherwise it just takes too long to be resolved.”

Rep. Leek touted his 22 years’ worth of experience as a practicing lawyer when discussing the legislation with the Daily Business Review. the limit set in 1992 was already pretty

“The limit that was set in 1992 was pretty low,” Leek said. He added the changes would put Florida “more in line with what other states are doing” with their court systems.

“There are so many advantages to going through county court that it just made sense,” he said. “Cases move quicker, you’re able to get more attention on your cases, and it’s just time.”

https://www.law.com/dailybusinessreview/2019/03/22/bill-proposing-50000-jurisdictional-limit-for-county-courts-advances-in-florida-house/?slreturn=20190225101050

Six Florida bills, reconfigured Supreme Court boost tort reform prospects

March 15, 2019/in Florida Watchdog

Six Florida bills, reconfigured Supreme Court boost tort reform prospects
By John Haughey | Watchdog.org Mar 15, 2019

The Supreme Court of the State of Florida in Tallahassee, Fla.

Tort reform is a seemingly perpetual priority for Florida lawmakers, with many going into legislative sessions vowing to address the state’s much-maligned “lawsuit climate” but few adjourning from Tallahassee achieving anything substantive.

In January, however, newly-elected Gov. Ron DeSantis installed three new justices on the state Supreme Court, turning a 4-3 conservative minority into a 6-1 bloc on the bench.

The new configuration of the state’s highest court could mean tort reform or “bad faith” bills that previously may not have survived inevitable legal challenges now, with conservatives dominating the bench, have a greater chance of being upheld and implemented.

At least four House bills and two Senate bills proposing tort reforms, including two proposing caps on lawsuit awards and “bad faith” provisions requiring alternates to personal injury lawsuits are working their way through committees.

The 21-member House Commerce Committee is expected next week to review House Bill 17, which would place a $1 million cap damages for pain and suffering, and HB 301, which would give parties additional time to complete appraisal and resolve disputes without lawsuits.

Flaws in the state’s liability laws are widely cited.

According to the U.S. Chamber of Commerce Institute for Legal Reform’s “Lawsuit Climate Survey,” Florida has the fifth-worst liability system in the nation.

The American Tort Reform Foundation’s (ATRF) annual report ranks Florida the second-worst “judicial hellhole” in the U.S., alleging state courts “systematically apply laws and procedures unfairly towards defendants in civil cases.”

According to ATRF, Florida has the highest tort system costs among states as a percentage of state GDP, at 3.6 percent. In 2016, the total costs and compensation paid within the state’s tort system averaged $4,442 for each Florida household.

The ATRF states that “excessive tort costs in Florida are estimated to annually cost the state economy:

• $7.6 billion in direct costs

• $11.8 billion in annual output

• 126,139 jobs

• $614.8 million in state revenues

• $516 million in local government revenues

Over the past few decades, Florida lawmakers have unsuccessfully attempted to reduce the costs of the tort system by prohibiting courts from awarding unreasonable or inaccurate damages. Below is a roundup of 2019’s proposed tort reform bills:

• House Bill 17, sponsored by Rep. Tom Leek, R-Ormond Beach, was approved March 6 by the House Civil Justice Subcommittee in a 10-5 vote.

It goes before the House Commerce Committee next week and must be heard by the House Judiciary Committee before being presented for a floor vote.

A companion Senate bill, SB 1320, sponsored by Sen. Kelli Stargel, R-Lakeland, awaits hearings before the Senate Judiciary, Health Policy and Rules committees.

If passed, HB 17 would cap at $1 million the amount of damages for pain and suffering that can be awarded in personal-injury or wrongful-death lawsuits. It also states that judges couldn’t tell juries about the limit.

The bill would also change the way plaintiffs are reimbursed for medical costs and monetary awards would have to be based on actual costs, not billed costs.

The bill was approved by the House Civil Justice Subcommittee in a partisan vote but several Republicans who voted for it said they want a higher cap than $1 million.

The bill would eliminate “phantom” health-care costs the difference between what health-care providers bill for services and what they agree to accept for payment and “letters of protection” issued by law firms.

• House Bill 301, originally filed in January by Rep. David Santiago, R-Deltona, but now jointly sponsored by the House Civil Justice and Insurance & Banking subcommittees.

HB 301 was approved Feb. 13 by the House Insurance & Banking Subcommittee in a 9-4 vote and by the Civil Justice Subcommittee on March 11 in a 15-0 vote. It goes before the House Commerce Committee next week, the last stop before being presented for a floor vote.

A companion Senate bill, SB 1320, sponsored by Sen. Jeff Brandes, R-St. Petersburg, was approved unanimously on March 11 by the Senate Banking & Insurance Subcommittee and awaits hearings before the Senate Judiciary and Rules committees.

“HB 301 gives the parties some additional time to complete appraisal and resolve their dispute without more lawsuits,” Johanna W. Clark with the Florida Justice Reform Institute in a statement. “We have a problem with the bad faith law in Florida. Appraisal is great because either party can invoke this balanced process used solely to determine the amount owed under the insurance policy when a dispute arises.

“The problem now,” Clark concludes, “is that the clock to a bad faith lawsuit is ticking during the appraisal process.”

Tallahassee-based Florida Justice Reform Institute (FJRI) is among advocacy groups supporting the tort reform initiatives.

• House Bill 7077 was filed March 15 and is sponsored by the House Civil Justice Subcommittee. It was approved as PCB CJS 19-02 by the subcommitteeon March 11 in a 9-6 vote. It has not as yet been assigned to committees. No companion bill has been filed in the Senate.

HB 7077 gives defendants the right to review records and interview witnesses in the same manner as plaintiffs, re-enacts caps on noneconomic damages in medical malpractice claims, and limits medical damage awards “to the real dollar amounts medical providers actually accept to provide treatment.”

“In a medical malpractice case, often the most valuable providers of expert testimony are prior and subsequent treating physicians,” FJRI attorney Tom Dukes said. “Under our system of justice, both sides should have the same right to learn the facts of the case from those treating physicians, without one side having an advantage. This bill cures that problem.”

Dukes said HB 7077 reverses the Florida Supreme Court’s decisions in McCall and Kalitan by re-enacting caps on noneconomic damages in medical malpractice claims.

“Finally,” he added, “the greatest element of economic damages in a personal injury lawsuit is often the cost of medical treatment. Because unsubstantiated ‘billed charges’ can mislead a jury as they calculate a damage award, the bill properly limits recovery to what the medical provider actually accepted, or would accept in payment under the Medicare program.”

• House Bill 751, ‘The Duty of Good Faith Act,’ originally filed in February by Rep. Alex Andrade, R-Pensacola, now sponsored by the House Civil Justice Subcommittee, which approved it on March 13 in an 11-5 vote. No companion bill has been filed in the Senate.

HB 751, another bill relating to “bad faith,” awaits hearing before the Government Operations and Technology Appropriations Subcommittee; Judiciary Committee

“This bill goes a long way to addressing the bad faith crisis in Florida by equalizing how the law treats first and third party bad faith claims,” FJRI attorney Rick Parker said.

https://www.watchdog.org/florida/six-florida-bills-reconfigured-supreme-court-boost-tort-reform-prospects/article_a3b99342-4754-11e9-9f0a-93104846edc0.html

Florida House could shield equipment firms from liability

March 6, 2019/in Tampa Bay Business Journal

Florida House could shield equipment firms from liability

By News Service Florida staff
March 6, 2019

After a Florida Supreme Court ruling last year in a case involving a worker whose finger was severed, state House members Wednesday began moving forward with a bill that could help shield heavy-equipment owners from liability in such situations.

The bill (HB 355), approved by the House Civil Justice Subcommittee, focuses on companies that lease heavy equipment to other people or businesses and deals with a legal issue known as the “dangerous instrumentality doctrine.”

A divided Supreme Court in September ruled that Caterpillar Financial Services Corp. could be held liable in a case stemming from injuries suffered by worker Anthony Newton, who had been hired by C&J Bobcat and Hauling LLC to help clear a lot.

Newton and another man used a multi-terrain loader that had been leased from Caterpillar and was used to dump debris into a trailer for disposal, the Supreme Court decision said.

Newton was inside the trailer when the other man released a stump from the bucket’s loader, with the stump rolling onto Newton’s hand and severed a finger.

Newton filed a lawsuit in Pinellas County alleging that Caterpillar was liable because the loader was a dangerous instrumentality. A circuit judge and the 2nd District Court of Appeal turned down the argument, but the Supreme Court, in a 4-3 decision, overturned the appeals court.

The House bill, filed by Rep. Tom Leek, R-Ormond Beach, would make a series of changes, but a key would be to help protect equipment-leasing companies such as Caterpillar from liability.

Under the bill, such companies would not be liable if they lease equipment to other people or businesses who carry minimum levels of liability insurance.

The proposal is supported by groups such as the Florida Chamber of Commerce, Associated Industries of Florida and the business-backed Florida Justice Reform Institute. Christine Graves, an attorney representing the Florida Justice Reform Institute, said equipment-leasing companies currently can be held liable while not being involved in negligence by equipment operators.

https://www.bizjournals.com/tampabay/news/2019/03/06/florida-house-could-shield-equipment-firms-from.html

Fla. court reform group: Engle rulings denying tobacco companies chance to defend against big judgments

March 5, 2019/in Florida Record

Fla. court reform group: Engle rulings denying tobacco companies chance to defend against big judgments

By Carrie Bradon | Mar 5, 2019

The U.S. Supreme Court recently refused to hear appeals from three tobacco companies ordered to pay punitive damages in eight Florida cases decided under so-called Engle rulings, according to a Florida Watchdog report, even though the companies claimed they had not been given the chance to build their defense.

Engle rulings originated in 2006, when the Florida Supreme Court upheld a ruling from the Florida Third District Court of Appeal dismissing a $144.8 billion class action liability verdict in the case of Engle v.Liggett Group on the grounds that individual details were necessary to hear each case, and so a class action was not appropriate. The decision maintained individual plaintiffs would have to file their own lawsuits against tobacco companies in the future.

Since the Engle ruling, big tobacco companies have paid out millions in compensatory damages and there are as many as 8,000 lawsuits remaining outstanding from the Engle v. Liggett Groupruling.

William Large of the Florida Justice Reform Institute recently talked with the Florida Record about the difficult nature of this case and what it will take to move the individual lawsuits forward.

William Large of the Florida Justice Reform Institute Courtesy of FJRI

“Tobacco companies have argued since 2006 that the Engle decision isn’t fair,” Large said. “The reason is because the findings from one decision, Engle, were applicable to all future cases. Because of that, tobacco companies have argued that concepts of due process haven’t been followed.”

Large likened the Engle decision to a one-size-fits-all ruling for other types of incidents, such as a slip-and-fall.

“The problem with the Engle case is that the courts have applied the findings from one decision to all future cases, which would be like applying the findings of one slip-and fall to all future slip-and-falls,” Large said. “It just doesn’t take into account the individual details of each case.”

The eight cases that were in question on Feb. 25 sought over $120 million as awards for smokers and their relatives. The defendants – Altria Group, British American Tobacco and Liggett Group LLC – claimed the Engle ruling holdings effectively deprived them of the opportunity to build a defense.

https://flarecord.com/stories/511904587-fla-court-reform-group-engle-rulings-denying-tobacco-companies-chance-to-defend-against-big-judgments

Florida Justice Reform Institute

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