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Tuesday, July 13, 2010

Around the web, 7.13.10

Small Businesses Pay 33% of Rising Tort Costs Out-of-Pocket

Insurance Journal

July 9, 2010

A new study from the U.S. Chamber of Commerce shows that small businesses shoulder a sizable burden of the nation's tort liability costs, having paid $105.4 billion in 2008— a third of it out of their own pockets.

According to the report, small businesses bore 81 percent of business tort liability costs but took in only 22 percent of revenue.

The study, Tort Liability Costs for Small Businesses, also found that small businesses ($10 million or less in annual revenue) paid, collectively, $35.6 billion of these costs out-of-pocket rather than through insurance.

The study was conducted for the Chamber's Institute for Legal Reform (ILR) by NERA Economic Consulting.

Parasitic Tort Lawyers

By John Stossel  | The Creator.com

July 7, 2010

Tort lawyers lie. They say their product liability suits are good for us. But their lawsuits rarely make our lives better. They make lawyers and a few of their clients better off — but for the majority of us, they make life much worse.

Automated Debt-Collection Lawsuits Engulf Courts

By Andrew Martin | The New York Times

 July 12, 2010

As millions of Americans have fallen behind on paying their bills, debt collection law firms have been clogging courtrooms with lawsuits seeking repayment.

Few have been as prolific as Cohen & Slamowitz, a Woodbury, N.Y., firm that has specialized in debt collection for nearly two decades. The firm has been filing roughly 80,000 lawsuits a year.

With just 14 lawyers on staff, that works out to more than 5,700 cases per lawyer.

How is that possible?

The answer to that question is at the heart of a growing debate over the increasing use of the nation’s legal system to collect on bad debts.

Like many other firms, Cohen & Slamowitz relies on computer software to help prepare its cases. While many of the cases represent legitimate claims, critics say the lawsuits are too often based on inaccurate or incomplete information about the debtor or the amount owed.

Already, some state legislators and judges have tried to crack down on collection lawsuits, and on Monday, the Federal Trade Commission weighed in, saying the system for resolving disputes over consumer debts was broken and in need of “significant reforms.”

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