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Addressing the Trucking Litigation Crisis: Challenges and Solutions

Writer's picture: Johan RahardjoJohan Rahardjo



The trucking industry is the backbone of the American economy, responsible for transporting over 72% of goods across the country. However, this critical sector is facing an unprecedented challenge: a surge in litigation and inflated verdicts that threaten its stability. The paper "Roadblock: The Trucking Litigation Problem and How to Fix It" by the Institute for Legal Reform delves into the growing legal pressures on trucking companies and proposes comprehensive solutions to mitigate these issues.


The Rise of Litigation in Trucking

Over the past decade, the trucking industry has experienced a dramatic increase in the size of verdicts against it. Between 2010 and 2018, the average size of verdicts over $1 million increased by a staggering 867%. This surge in litigation is not correlated with a rise in accidents; in fact, the rate of fatal crashes involving trucks has decreased. Despite this, the financial impact of these lawsuits is substantial, particularly for small trucking firms that struggle to bear the increased insurance costs and legal risks.


Factors Driving Litigation

Several factors contribute to the rise in trucking litigation:

  1. Inflated Medical Bills: Plaintiffs' lawyers often use inflated medical bills to justify higher damages. These inflated bills can significantly increase the amount of compensation awarded, even if the actual medical costs are much lower.

  2. Reptile Tactics: These courtroom strategies aim to appeal to jurors' primal fears, leading to larger verdicts. By framing the case in a way that suggests the defendant's actions endanger the community, lawyers can elicit emotional responses from jurors that result in higher awards.

  3. Expanding Defendant Pool: Lawyers increasingly target a wider circle of defendants to find deeper pockets. This strategy involves suing not just the trucking company, but also brokers, shippers, and other parties connected to the trucking operation.

  4. Ambiguous Standards of Care: The lack of clear standards for trucking operations makes it easier for plaintiffs to argue negligence. Without well-defined guidelines, trucking companies can be held liable for a wide range of alleged infractions.


Impact on the Industry

The financial burden of litigation is significant. Higher insurance premiums and legal costs translate to increased prices for consumers. Small trucking companies, which make up over 90% of the industry, are particularly vulnerable. The rising costs threaten their survival and, by extension, the stability of the supply chain. When small trucking firms go out of business, it reduces competition and can lead to higher shipping costs and delays in delivery times.


Proposed Solutions

To address these challenges, the paper suggests several reforms:

  1. Medical Billing Transparency: Legislation should limit medical damages to reasonable and customary amounts actually paid. This would prevent inflated medical bills from being used to justify excessive compensation.

  2. Reptile Reforms: Courts should limit the use of reptile tactics that unfairly influence juries. By focusing on the facts of the case rather than emotional appeals, verdicts can be more balanced and fair.

  3. Damages Reforms: Caps on non-economic damages can help prevent excessive verdicts. These caps would limit the amount of compensation that can be awarded for pain and suffering, emotional distress, and other non-economic damages.

  4. Clarifying Standards of Care: Establishing clear standards for trucking operations can reduce ambiguity and litigation risk. By defining what constitutes acceptable practices, trucking companies can better ensure compliance and reduce the likelihood of being found negligent.


Conclusion

The trucking industry is crucial to the American economy, but it is under siege from inflated litigation. By implementing the proposed reforms, we can ensure a fairer legal environment that balances the need for just compensation with the sustainability of the trucking sector. Addressing these legal challenges is essential to maintaining a robust and efficient supply chain, which is vital for the economy and consumers alike.


To read the full report, visit the U.S. Chamber of Commerce Institute for Legal Reform’s website here:


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