Mayor Jim Kenney touted the importance of fostering a pro-business climate in Philadelphia during his Feb. 11 remarks to the Chamber of Commerce for Greater Philadelphia. He stressed the need to flip the message: Philadelphia is open for business, he said.
While leadership from the top is always encouraging, it is difficult to see “open for business” as the current reality. As long as the Philadelphia court system is awarding $8 billion verdicts against companies, like a recent one demanding payout from Johnson & Johnson for a drug’s side effects, the main business you’ll see flocking to the city are entrepreneurial trial attorneys and litigation tourists looking to cash in on Philly’s reputation for high-dollar judgments.
The Philadelphia Court of Common Pleas is the epicenter of pharmaceutical litigation and was named the No. 1 “Judicial Hellhole” this year by the American Tort Reform Association. It’s no wonder, considering 86% of new pharmaceutical suits in the city are brought by out-of-state plaintiffs. The court’s “open door” policy to out-of-state plaintiffs attracts trial lawyers from all around the country.
That $8 billion verdict? It came out of the Court of Common Pleas’ Complex Litigation Center in a case involving the drug Risperdal. The judge allegedly high-fived the jurors and posed with them for photos taken by the plaintiff’s attorney after the verdict. The Legal Intelligencer reported that the award was the largest verdict since verdicts and settlements began being tracked in 1994. Risperdal litigation has grown to more than 7,000 cases — or approximately two-thirds of the court’s inventory. This specific case was brought by a Maryland resident. We were encouraged by Judge Kenneth Powell’s decision to slash the $8 billion verdict — to $6.8 million — last month.
Last year, Bayer AG and Johnson & Johnson agreed to settle more than 25,000 cases involving their jointly developed blood-thinning medication, Xarelto, for $775 million. Before the settlement, there were about 1,800 active cases in the Philadelphia Court of Common Pleas, with 84% coming from out-of-state. Only three of the cases were tried to completion, but the defendant was successful in all three. Ultimately, they opted to settle in an effort to avoid the distraction and significant cost of continued litigation.
Trial lawyers use legal advertising to drive up the number of claimants, increasing the pressure on defendants to settle regardless of the merits of the case. In the first half of 2019, trial lawyers in Philadelphia spent nearly $11 million to air 73,000 local television ads to solicit more clients. During the same amount of time, a person could watch a season’s worth of Phillies games, Eagles games, and the first quarter of the Flyers’ season — which maybe too much for even the most avid Philly sports fan.
Philadelphia earned its unenviable title as the No. 1 “Judicial Hellhole” by swinging its doors open for trial lawyers to sue for more money over more issues. Lawsuit abuse harms everyone by clogging our court system with meritless and frivolous cases, taking dollars away from research and development of new consumer products, while driving up insurance costs and driving away jobs.
Everyone has a stake in promoting reform. We urge Mayor Kenney to see this as a wake-up call to create conversations around the worrisome trends in his city’s court system and to stop the lawsuit abuse. Stop creating more ways for lawyers to sue job creators, stop wasting money in court, and stop contributing to job loss. Then you’ll see Philadelphia truly open for business.
Tiger Joyce is the president of the American Tort Reform Association. Curt Schroder is the executive director of the Pennsylvania Coalition for Civil Justice Reform and served for 17 years in the Pennsylvania House of Representatives.