January 30, 2023

New Jersey used to be a regular on the annual list of Judicial Hellholes published by the nonprofit American Tort Reform Foundation. The Foundation defines these as “places where civil judges systematically apply laws and judicial process in an unfair and unbalanced manner, generally to the detriment of the accused.”

For example, a decade ago New Jersey was considered the place of choice to sue pharmaceutical companies, with one Superior Court judge in Atlantic County being particularly well known for regularly ruling against companies. A statement from the NJ Civil Justice Institute at the time said, “This made Atlantic County a magnet for mass tort lawsuits, with more lawsuits being filed against the pharmaceutical industry than anywhere else in America.”

A drugmaker accused this judge of bias, and the New Jersey Supreme Court denied a motion to remove the judge from hearing the lawsuit. But two months later, the judge was moved to the Superior Court’s Appellate Division, and then the bulk of Atlantic County’s mass damages claims were moved to Bergen and Middlesex counties — including more than 13,000 drug and medical device claims.

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The American Tort Reform Foundation said the lawsuits were being resolved and New Jersey remained a hotbed for lawsuits.

New Jersey eventually made it off the list of judicial hellholes, perhaps due to its adjustments or the deteriorating climate of trials in other states. In 2021, the state was even awarded a Point of Light by the Foundation after its Court of Appeals ordered new trials in two Talk lawsuits because the court misconstrued “established judicial gatekeeping procedures” for expert testimony established by the new one had applied Jersey Supreme Court.

Last month’s report for 2022-2023 put the state on a watch list as it risks rejoining “the most unjust local courts and state civil justice systems in the country.” The foundation said it will “keep an eye on New Jersey to see if the state leadership can resist the influence of the powerful plaintiffs’ bar association or if it will embrace an agenda of escalating liability and become a full-blown judicial hellhole.”

In a state where attorneys for plaintiffs already command the legislature, the incoming Senate president, Senator Nicholas Scutari, is a personal injury attorney, the foundation said. Gov. Phil Murphy is “a progressive loyalist who has shown no interest in the priorities of civil justice reform.” And the changing composition of the NJ Supreme Court “may result in a shift toward activism and an expanded liability.”

The US Chamber of Commerce’s Institute for Legal Reform last month named New Jersey the fourth-most expensive state in the country for legal costs and number 8 in the country for “nuclear judgments” — civil judgments worth over $10 million. Institute President Harold Kim said: “While some may feel that a giant judgment ‘holds down’ a company, the reality is that nuclear judgments create uncertainty and costs across our economy that we all bear, undermining the rule of law in the process. “

Anthony Anastasio, President of the New Jersey Civil Justice Institute, said: “New Jersey policymakers need to wake up and accept the reality: An unfair and unbalanced civil justice system, aimed against the business community, invites out-of-control litigation and increases the… Living expenses and doing business for everyone in the Garden State.”

The public may wish to consider whether it is in the interests of New Jersey residents for attorneys to set the rules that determine the size of attorneys’ revenue streams.

Given the far-reaching burdens that the state is placing on economic activity, residents and even political leaders should advocate civil law reform to improve the state’s business climate without having to cut the state’s valuable tax revenues.

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