8 Comments

Loser pays would be an improvement if cases were decided fairly. Combined with the present procedural and judge bias toward plaintiff’s lawyers this only exacerbates the problem.

While it’s true that loser pays will occasionally compound the problem, adding 200 pounds to a multi-ton weight load is not a big change.

Adding 200 pounds to ZERO (the current risk for the plaintiff) is a big difference!

The idea is to deter bad lawsuits, not improve any other part of the system.

Loser Pays would go a long way to “balance the scales” as it were in “Lemon Law” litigation against car manufacturers. If plaintiff is successful, the manufacturer, in addition to paying to repurchase the vehicle (and possibly for the effects of the consumer’s bad credit), also pays for the cost of Plaintiff Counsel. But even if the manufacturer “wins”, the manufacturer still bears the costs of its own counsel through trial, and possibly appeal. A cost far exceeding the value of the vehicle in question.

Perhaps, as a policy decision, many of the readers here would agree to pay a bit extra on each of their car purchases to subsidize the cost of plaintiff counsel in Lemon Law cases where the manufacturer refused to “do the right thing”. How many of us, however, would be willing to subsidize Plaintiff’s Counsel where the manufacturer OFFERS to do the right thing and repurchase the vehicle, but the customer, or their attorney, refuses to allow it while seeking increased attorney fees or some other windfall for the customer?

Check out:
Belfour v Schaumburg Auto, No 2-98-0948 in the Second District, 7 July 1999 as an example. One of the plaintiff attorneys in that case, I happen to know, still practices in the same manner. Its one of the rare “wins”, but defendants were only awarded fees and costs on appeal, not for the original litigation.

More recently, in California Courts:
Julio C Dominguez v American Suzuki Motor Corporation
(Superior Court No. 05CC10415) Fourth Appellate District, Division Three

Elsewhere:
Marquez v Mercedes-Buenz USA (Appeal No. 2007AP681) Wisconsin COurt of Appeals, District Two (2008 WI App 70, 751 N.W. 2d 859

I suspect there might be more such examples if the cost to Defendant of a trial (even a successful one) did not exceed the purchase price of the vehicle in question by a substantial margin, and that plaintiff might choose not to appeal after having lost once. Its an expensive gamble at a time when most car companies are losing money at record rates.

…not what I would prefer my moeny to be spent on when i buy a new vehicle.

(Again – in the interest of full disclosure, I work for a major car company, and deal with these issues on a daily basis)

The Osteens are stuck with large legal bills and Ms Brown probably isn’t paying a dime…

Deoxy, and others, your point is well taken.

While we are at it, why not pay the defendant who is forced to respond to the ultimately unsuccessful extortioni attempt for his uncompensated time and mental anquish as well. Why not pay him at the hourly rate or imputed hourly rate the plaintiff’s lawyer is charging, and let him calculate his hours of work and suffering with the same degree of of court supervision that plaintiff’s lawyers are currently subjected to.

Christopher Eckel,

I think you’re meaning that sarcastically, but I would actually take most of that as the new “sanctions” for malicious lawsuits. If you’re dragging me to court on false pretenses (to punish me with the process when you know you can’t possibly win), all of that stuff sounds like pretty reasonable penalties.

OK, everything but the “metal anguish” part… that’s pretty much always BS.

I have familiarity with both the UK and the US system. Many litigants already have attorneys on staff. Plaintiffs often do not. It seems to me that in the UK, the obligation to pay attorneys fees is often an obstacle to settlement. The problem is this: both sides believe that they are “right” and will prevail in the end. Both sides believe that the other will pay their attorneys fees. It is very easy to spend someone else’s money. There is no incentive to economize. When it comes time to settle, both sides are now looking at enormous fees. At that point many would simply roll the dice and hope that they would prevail since they are facing such high costs. This does not promote settlement at all.
Carlitguy: Plaintiffs in Lemon Law cases don’t have counsel. Car companies do. Plus, it would make more sense to resolve these cases through mandatory arbitration, like securities cases. This would reduce legal fees.