A Message from the Director
Trial Lawyers, Inc.: Illinois is the Manhattan Institutes
fourth full-length report examining the workings of the litigation industry and
the second such report focusing exclusively on a single state, following Trial
Lawyers, Inc.: California, published in April 2005.
Illinois is a logical subject for our second state study: the fifth-most populous
state, Illinois is home to a plaintiffs bar whose aggressive tactics have
had a far-reaching nationaland even internationalimpact.
As we have documented throughout this publication series, todays
American trial bar has thrown off its traditional strictures of legal professionalism
and ethics and now wrings dollars from the U.S. economy using a business model
at least as advancedif not nearly as wholesome as those of the large
corporations off which it feeds. Trial Lawyers, Inc., as we call
this sue-for-profit behemoth, differs from traditional big businesses in two
important ways. First, Trial Lawyers, Inc.s revenues are extracted from
unwilling defendants, rather than paid by willing customers. Second, the tort
industry is in many respects immune from outside regulation: since the bar associations
police themselves, Trial Lawyers, Inc. plays by its own rules.
Since we launched our Trial Lawyers, Inc. series in September
2003, the litigation industrys growth has slowed
in key areas such as mass torts and class actionsowing to federal class
action reform and prosecutorial and judicial investigations into criminal wrongdoing
by the plaintiffs bar. Nevertheless, Trial Lawyers,
Inc.s overall profits have continued their long-term trend: over the last
three years for which data are available, litigation industry revenues have
grown by over 26 percent, or almost twice as fast as the U.S. economy
as a whole. Viewed as a corporation, Trial Lawyers,
Inc. has enjoyed annual domestic revenues that exceed those of every single
publicly held company headquartered in Illinois: it grosses over $49 billionmore
than the U.S. operations of Walgreens, Boeing, or Allstate, over twice as much
as Archer Daniels Midland, over three times as much as Motorola, and fully seven
times as much as McDonalds.
It would be difficult to overstate the importance of Illinois
courts to this massive litigation business. Relative to the size of its economy,
Illinois has more lawyers than any American state except New York
and Massachusetts. Tort costs for medical-malpractice
liability are a greater share of Illinois economy than of any states
save New Yorks. Illinois companies fare
little better than its doctors: its corporations self-insured liability
costs are third-highest in the nation. Little wonder,
then, that for each of the last three years, corporate attorneys and general
counsels have ranked Illinois litigation
climate 44th or worse among the 50 states.
Trial Lawyers, Inc. has prospered in Illinois by developing
lucrative lines of business that parallel its national case portfolio:
medical malpractice, whose liability costs have sent doctors scurrying out of
the state; class actions, which have made the judges of Madison County infamous;
and asbestos, the nations longest-runningand horribly corruptmass
tort. Illinois courts have made fortunes not only for the states own tort
kings but also for lawyers nationwide who have sought out the Prairie States
magic jurisdictions, those county courts where judges are elected
with verdict money funneled to their campaigns by the plaintiffs
bar. For although Illinois litigation business
is broad-based in terms of caseload, it is narrowly focused in geography: these
select courtsincluding Madison and St. Clair Counties, east of St. Louis,
and Chicagos Cook Countyattract cases from around the state and
nation hoping to cash in on the venues trademark jackpot justice.
To maintain these magic jurisdictions, the Illinois division
of Trial Lawyers, Inc. supports relentless government-relations efforts targeting
both the legislature in Springfield and courthouses throughout the state. The
stakes have gotten so high for the trial bar and its legal victims that in the
2004 election for a single state supreme court seat in southern Illinois, the
two candidates and their supporters together spent over $9 million, a mind-boggling
sum unprecedented in American judicial-election history.
Such heavy investment in the states high court makes sense when you consider
that in 1997, the litigationfriendly court overrode as unconstitutional the
tort-reform measures that the state legislature had just enacted.
the tide in Illinois may be starting to turn. In that $9 million judicial race,
Gordon Maag, the trial bars candidate, not only lost the supreme court
election but also lost his retention election to the court of appeals, becoming
the first judge to receive a no-confidence vote since retention-election rules
were adopted in 1984. The state supreme court seems
to be improving, as it recently reversed a class action decision that intruded
on other states laws and regulations and threw
out an egregious multibillion-dollar verdict issued under a misuse of the states
consumer-protection laws. And just last year, the state
legislature enacted comprehensive medical-malpractice liability reform, which
has already led to a 25 percent drop in Cook County medical-malpractice case
Whether the Illinois Supreme Court behaves responsibly and allows
these reforms to stand will go a long way toward determining whether the state
can lift itself out of the national basement in medicalmalpractice law, a necessary
step in improving access to health care and lowering its cost. Still, Illinois
overall legal climate badly trails that of neighboring states, and its economic
future depends on enhancing its attractiveness to job-creating businesses. We
hope that this latest iteration of our Trial Lawyers, Inc. series will
help illuminate how Illinois legal barons enrich themselves at their home
James R. Copland
Director, Center for Legal Policy
Manhattan Institute for Policy Research
1. The Manhattan Institute, Trial Lawyers, Inc.: California (Apr.
2005), available at http://www.triallawyersinc.com/ca/ca01.html.
2. The Manhattan Institute, Trial Lawyers, Inc. (Sept. 2003), available at
3. See Paul Davies, Plaintiffs Lawsuits Against Companies Sharply
Decline, Wall St. J., Aug. 26, 2006, at A1.
4. See Tillinghast -Towers Perrin, U.S. Tort Costs and Cross-Border Perspectives:
2005 Update 6 (2006), available at http://www.towersperrin.com/tillinghast.
5. Based on the most recent annual reports from the respective companies, available
(last visited Oct. 5, 2006).
6. See Lawrence J. McQuillan & Hovannes Abramyan, Pacific Research
Institute, U.S. Tort Liability Index: 2006 Report, underlying data available
at Tort Reform Index Data Table, http://www.pacificresearch.org/pub/sab/entrep/2006/tort_reform/Tort_Index_Data.xls,
at Column AB.
7. See id. at Column N.
8. See id. at Column X.
9. See ILR/Harris Poll, 2006 U.S. Chamber of Commerce State Liability
Systems Ranking Study 15, 97 (Mar. 17, 2006), available at http://www.instituteforlegalreform.com/harris/index.html.
10. Richard Scruggs, Asbestos for Lunch, panel discussion at the Prudential
Securities Financial Research and Regulatory Conference (May 9, 2002), in
Industry Commentary (Prudential Securities, Inc., New York), June 11,
2002, at 5.
11. See Paul Hampel, Big Money Race Sets Record for a U.S. Judicial
Contest, St. Louis Post-Dispatch, Nov. 1, 2004, at A01.
12. Best v. Taylor Machine Works, Inc., 689 N.E.2d 1057, 1104 (Ill. 1997).
13. See Steve Gonzalez, Gordon Maag Comes Up Short on Retention,
Madison County Rec., Nov. 3, 2004.
14. Avery v. State Farm Mutual Auto. Ins. Co., 805 N.E.2d 801 (Ill. 2005).
15. Price v. Phillip Morris, Inc., No. 96236, 2005 Ill. LEXIS 2071 (Ill. 2005).
16. See 2005 Ill. Laws 677; Mike Colias, Cook Med Mal Suits Down 25%,
Crains Chicago Bus., Sept. 18, 2006, available at
http://www.chicagobusiness.com (subscription required).