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2007 Harris Survey

verall Rankings by State1.2.DelawareMinnesota26.27.New JerseyVermont3.Nebraska28.Nevada4.Iowa29.Maryland5.Maine30.Idaho6.New Hampshire31.Georgia7.Tennessee32.Pennsylvania8.Indiana33.Kentucky9.Utah34.Missouri10.Wisconsin35.Rhode Island11.South Dakota36.Florida12.Virginia37.South Carolina13.Kansas38.Oklahoma14.Connecticut39.New Mexico15.Arizona40.Montana16.North Carolina41.Arkansas17.Oregon42.Hawaii18.Massachusetts43.Alaska19.New York44.Texas20.North Dakota45.California21.Colorado46.Illinois22.Wyoming47.Alabama23.Michigan48.Louisiana24.Ohio49.Mississippi25.Washington50.West Virginia


OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1State Court Liability Systems Overall Rating . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4Impact of Litigation Environment on Important Decisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5Overall Rankings of State Liability Systems ‘02-’07 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6SPOTLIGHT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7Most Important Issues for State Policymakers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7Cities or Counties with Least Fair and Reasonable Litigation Environment . . . . . . . . . . . . . . . . . . . . . . . . . .8Worst Specific City or County Courts by State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9Top Issues Mentioned as Creating the Least Fair and Reasonable Litigation Environment . . . . . . . . . . . . . .10Having and Enforcing Meaningful Venue Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11Treatment of Tort and Contract Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11Treatment of Class Action Suits and Mass Consolidation Suits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11Punitive Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11Timeliness of Summary Judgment or Dismissal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12Discovery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12Scientific and Technical Evidence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12Non-economic Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12Judges’ Impartiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13Judge’s Competence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13Juries’ Predictability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13Juries’ Fairness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13KEY ELEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14Overall Treatment of Tort and Contract Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14Having and Enforcing Meaningful Venue Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15Treatment of Class Action Suits and Mass Consolidation Suits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16Punitive Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17Timeliness of Summary Judgment/Dismissal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18Discovery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19Scientific and Technical Evidence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20Non-economic Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21Judges’ Impartiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22Judges’ Competence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23Juries’ Predictability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24Juries’ Fairness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25M ETHODOLO G YK EY EL E M E NTSS P O TLIGHTO VERVIEWMETHODOLOGY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26Recommended Allowance for Sampling Error of Proportions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29Sampling Error of Difference Between Proportions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SRespondents were first screened for theirfamiliarity with states, and those who werevery or somewhat familiar with the litigationenvironment in a given state were thenasked to evaluate that state. It is important toremember that courts and localities within astate may vary a great deal in fairness andefficiency. However, respondents had tothe following areas: having and enforcingmeaningful venue requirements, overalltreatment of tort and contract litigation,treatment of class action suits and massconsolidation suits, punitive damages,timeliness of summary judgment ordismissal, discovery, scientific and technicalevidence, non-economic damages, judges’evaluate the state as a whole. To explore thedetailed nuances within each state wouldhave required extensive questioning for eachstate and was beyond the scope andpurpose of this study. However, otherstudies have demonstrated this variabilitywithin a state. For example, several studieshave documented very high litigation activityin certain county courts such as MadisonCounty, Illinois and Jefferson County, Texas,revealing that these counties have “magnetcourts” that are extremely hospitable toplaintiffs. Thus, it is possible that somestates received low grades due to thenegative reputation of one or two of theircounties or jurisdictions.Respondents were asked to give states agrade (“A”, “B”, “C”, “D” or “F”) in each ofimpartiality and competence, and juries’predictability and fairness. These gradeswere combined to create an overall rankingof state liability systems. 2According to the U.S. businesses surveyed,the states doing the best job of creating afair and reasonable litigation environmentare Delaware, Minnesota, Nebraska, Iowaand Maine. The bottom five states today areWest Virginia, Mississippi, Louisiana,Alabama and Illinois. [See Page 6]The study also asked respondents to namethe most important issue that statepolicymakers who care about economicdevelopment should focus on to improvethe litigation environment in their state.Reform of punitive damages was cited by12% of our respondents as the mostM ETHODOLO G YK EY EL E M E NTSS P O TLIGHTO VERVIEW2. The “Overall Ranking of State Liability Systems” table was calculated by creating an index using the scores given on eachof the key elements. All of the key element items were highly correlated with one another and with overall performance. Thedifferences in the relationship between each item and overall performance were trivial, so it was determined that each itemshould contribute equally to the index score. The index was created from the mean across the 12 items, which was rescaledfrom 0 to 100 prior to averaging them together.2


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G Simportant issue. Other top issues namedwere timeliness of decisions (9%), tortreform issues in general (8%), eliminateunnecessary lawsuits (7%), caps/limits onjury awards (6%) and caps/limits on noneconomicdamages (5%). [See Page 7]In order to understand if there are anycities or counties which might impact astate’s ranking, respondents were askedwhich five cities or counties have the leastfair and reasonable litigation environments.The worst jurisdiction was Los Angeles,California (mentioned by 13% of therespondents), followed by Chicago/CookCounty (11%), Illinois. [See Page 8]In order to understand why respondentsread/seen a case study (12%) andpersonal experience (11%). [See Page 10]In conclusion, one important point to note isthat these rankings and results are based onthe perceptions of these senior corporateattorneys. It is also important to realize thatthe perceptions may be based on certaincities or counties within the state. But, as wehave noted in the past, perception doesbecome linked with reality. If the states canchange the way litigators and othersperceive their liability systems, we may findconsiderable movement in their rankings inthe future. Once these perceptions change,the overall business environment may bedeemed more hospitable as well.feel negatively about particular jurisdictions,a follow-up question was asked to thosewho cited a jurisdiction. The top reasongiven as to why a city or county has theleast fair and reasonable litigationenvironment is a corrupt/unfair system,given by 76% of respondents, and is thenumber one reason by a large margin. Thenext tier is led by unfair jury/judges,mentioned by 27% of respondents,followed by biased judgment (24%), haveSpotlight 7Key Elements 143


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SState Court LiabilitySystems Overall Rating*50% 50%49% 49%50%40% 40%49%40%30% 30%30%20% 20%20%10%10%10%0%0%0% 2003 2004 2005 2006 20072003 2004 2005 2006 200750%50%40%50%40%30%40%20%30%30%10% 20%20%2003 2004 2005 2006 2007EXCELLENT PRETTY GOOD ONLY FAIR POOR NOT SURE/NO ANSWEREXCELLENT PRETTY GOOD ONLY FAIR POOR NOT SURE/NO ANSWEREXCELLENT PRETTY GOOD ONLY FAIR POOR NOT SURE/NO ANSWER0% 10%0% 10%0% 10%0% 10%0% 10%10%10%10%10%10%0%0%20032003 200350%50%40%50%50%40%30%40%40%20%30%20%30%20%30%20%30%30%30%30%30%10% 20%10% 20%10% 20%10% 20%20%20%20%20%0%0%200450%50%40%50%40%30%40%0%0%200550%50%40%50%40%50%50%30%40%30%40%40%0%0%20060%0%20077%6%3%2004 20042005 2005 2006 2006 2007 200735% 35%35%7% 7%6% 6%3%3%M ETHODOLO G YK EY EL E M E NTSS P O TLIGHTO VERVIEW*Results given are for a base of 1,599 General Counsel/Senior Litigators who were asked “Overall, how would you describethe fairness and reasonableness of state court systems in America: Excellent, Pretty Good, Only Fair, or Poor?”4


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SImpact of Litigation Environmenton Important Decisions such asWhere to Locate or Do Businees*3%24%24%40%24%3%24%57%40%16%33%57%16%33%VERY LIKELY SOMEWHAT LIKELY SOMEWHAT UNLIKELY VERY UNLIKELY NOT SURE/NO ANSWERVERY LIKELY SOMEWHAT LIKELY SOMEWHAT UNLIKELY VERY UNLIKELY NOT SURE/NO ANSWER*Results given are for a base of 1,599 General Counsel/Senior Litigators who were asked “How likely would you say it isthat the litigation environment in a state could affect an important business decision at your company, such as where tolocate or do business: Very likely, Somewhat likely, Somewhat unlikely, or Very unlikely?”5


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SOverall Rankings ofState LiabilitySystems ‘02-’072007 SCORE ‘06 ‘05 ‘04 ‘03 ‘021. Delaware 75.6 1 1 1 1 12. Minnesota 70.6 14 7 8 9 193. Nebraska 70 2 2 2 2 64. Iowa 68.9 4 5 4 3 55. Maine 68.9 9 11 12 16 186. New Hampshire 68.2 6 12 7 10 177. Tennessee 68.2 29 22 25 26 768. Indiana 68.2 11 6 11 5 129. Utah 67.7 17 14 6 7 810. Wisconsin 67.5 23 17 10 11 1511. South Dakota 67 7 8 17 4 912. Virginia 66.9 3 4 3 8 213. Kansas 66.7 15 16 9 15 414. Connecticut 66.3 5 18 18 17 1015. Arizona 66.3 13 19 14 18 1116. North Carolina 65.9 10 20 19 20 1617. Oregon 65.7 30 25 27 14 3618. Massachusetts 65.7 32 31 28 22 3619. New York 65.6 21 27 22 27 2720. North Dakota 65.4 12 3 16 6 2521. Colorado 65.1 8 13 13 12 722. Wyoming 64.7 16 9 15 25 2023. Michigan 64.2 22 24 23 29 2824. Ohio 63.9 19 26 32 24 2625. Washington 63.7 28 15 24 21 326. New Jersey 63.4 25 30 26 30 3227. Vermont 62.5 24 21 20 19 2128. Nevada 62 37 29 34 34 3029. Maryland 61.7 20 23 21 23 2230. Idaho 61.3 18 10 5 13 1431. Georgia 61.2 27 28 29 39 2332. Pennsylvania 60.8 31 34 30 31 3133. Kentucky 60.8 34 36 35 35 3834. Missouri 60 35 40 41 33 2935. Rhode Island 58.5 26 35 36 37 3536. Florida 58.2 38 42 38 40 3337. South Carolina 58.1 42 39 40 42 4238. Oklahoma 57.7 33 32 31 36 4139. New Mexico 57.5 40 38 37 41 3940. Montana 57.2 39 37 43 28 4341. Arkansas 56.5 41 43 42 45 4442. Hawaii 56.3 46 41 39 43 4043. Alaska 56 36 33 33 32 3744. Texas 54.3 43 44 45 46 4645. California 53.5 44 45 46 44 4546. Illinois 50.8 45 46 44 38 3447. Alabama 50.7 47 48 48 48 4848. Louisiana 47.3 49 47 47 47 4749. Mississippi 46.1 48 50 50 50 5050. West Virginia 38 50 49 49 49 49M ETHODOLO G YK EY EL E M E NTSS P O TLIGHTO VERVIEW6


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SMost Important Issuesfor State Policymakers*Reform of punitive damages 12%Timeliness of decisions 9%Tort reform issues in general 8%Eliminate unnecessary lawsuits 7%Caps/limits on jury awards 6%Caps/limits onnon-economic damages 5%Limitation of class action suits 4%Speeding up the trial process 4%Limits on discovery 4%Other fee issues 4%Business/corporate issues/regulation/fairness 4%Fairness and impartiality 3%Judicial competence 3%Level playing field/do not favor plaintiffs 3%Predictability 3%Selection of judges 3%Adequately funding thecourt system (i.e., salaries) 2%Appointment vs. election of judges 2%Attorney/court fees paid by the loser 2%Forum shopping/venue selection 2%Limiting attorney fees 2%Quality of judges 2%Workers’ compensation 2%Jury system reform 2%Case processing 2%Summary judgment issues 2%More judges/judicial/staffing resources 2%*The responses displayed in this table were volunteered by the respondents. Mentions by at least 2% given above. Resultsgiven are for a base of 1,599 General Counsel/Senior Litigators who were asked “What do you think is the single worstaspect of the litigation environment that state policy makers should focus on to improve the business climate in their state?”7


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SCities or Counties withLeast Fair and ReasonableLitigation Environment*Los Angeles, California 13%Chicago/Cook County, Illinois 11%Madison County, Illinois 9%Mississippi (other mentions) 8%New Orleans/Parish, Louisiana 6%Miami/Dade County, Florida 6%San Francisco, California 5%New York GreaterMetropolitan Region 4%New York (other mentions) 4%Philadelphia, Pennsylvania 4%Beaumont, Texas 3%S P O TLIGHTK EY EL E M E NTSM ETHODOLO G Y*The responses displayed in this table were volunteered by the respondents. Mentions by at least 3% given above. Resultsgiven are for a base of 1,599 who were asked “While considering the entire country, what do you think are the five worst cityor county courts? In other words, which city or county courts have the least fair and reasonable litigation environments for bothdefendants and plaintiffs?”8


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SWorst Specific City orCounty Courts by State*Illinois** 24%Chicago/Cook County 11%Madison County 9%Other jurisdictions mentioned 4%Texas** 21%Houston 3%Beaumont 3%Dallas-Ft. Worth 2%Other jurisdictions mentioned 13%California** 20%Los Angeles 13%San Francisco 5%Other jurisdictions mentioned 2%New York** 10%Greater Metropolitan area 4%Bronx County 2%Other jurisdictions mentioned 4%Louisiana** 10%New Orleans Parish 6%Other jurisdictions mentioned 4%Mississippi 10%Jackson 2%Other jurisdictions mentioned 8%Florida** 9%Miami-Dade County 6%Other jurisdictions mentioned 3%Alabama 6%Pennsylvania 4%Philadelphia 4%Missouri 3%St. Louis 2%Other jurisdictions mentioned 1%*The responses displayed in this table were volunteered by the respondents. Mentions by at least 3% for entire state givenabove. Due to rounding and multiple responses, these percentages may not add up to 100%. Results given are for a base of1,599 who were asked “While considering the entire country, what do you think are the five worst city or county courts? In otherwords, which city or county courts have the least fair and reasonable litigation environments for both defendants and plaintiffs?”** Includes all mentions.9


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G STop Issues Mentioned as Creatingthe Least Fair and ReasonableLitigation Environment*Corrupt/unfair system 76%Unfair jury/judges 27%Biased judgment 24%Have read/seen a case study 12%Personal experience 11%Incompetent jury/judges 6%Verdicts/general comments 6%Other corruption mentions 6%Judges are bribed 4%Inconvenience 4%High jury awards 3%Influenced by other parties 3%Too liberal 3%Election of judges 2%Expensive/high court costs 2%Good-old-boy system/depends on who you know 2%High jury verdicts 2%Overburdened with cases/too many cases 2%Poor quality of jury/judges 2%Too easy to file cases there 2%Unpredictable jury/judges 2%Allow forum shopping 1%Composition of jury pool 1%Difficult/Hostileenvironment/jury/judges 1%Personal opinion 1%Slow process 1%S P O TLIGHTK EY EL E M E NTSM ETHODOLO G Y*The responses displayed in this table were volunteered by the respondents. Mentions by at least 1% are given above.Results given are for a base who were asked “Why do you say [Insert Name of City or County] has the least fair and reasonablelitigation environment for both defendants and plaintiffs?”10


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SBESTWORSTHaving and EnforcingMeaningful Venue Requirements1. Indiana2. Nebraska3. Delaware4. Tennessee5. New Hampshire46. Alabama47. Mississippi48. Louisiana49. Illinois50. West VirginiaOverall Treatment of Tortand Contract Litigation1. Delaware2. Nebraska3. New Hampshire4. Wyoming5. Minnesota46. Alabama47. Illinois48. Mississippi49. Louisiana50. West VirginiaTreatment of Class Action Suitsand Mass Consolidation Suits1. Delaware2. Tennessee3. Iowa4. New York5. Indiana46. California47. Louisiana48. Illinois49. Mississippi50. West VirginiaPunitive Damages1. Delaware2. Minnesota3. Tennessee4. Maine5. Utah46. Illinois47. Alabama48. California49. Mississippi50. West Virginia11


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SBESTWORST1. Delaware46. IllinoisTimeliness of SummaryJudgment or Dismissal2. South Dakota3. Minnesota4. Wisconsin47. California48. Louisiana49. Mississippi5. North Dakota50. West Virginia1. Delaware46. California2. Minnesota47. LouisianaDiscovery3. Wisconsin48. IllinoisScientific and Technical Evidence4. Nebraska5. Iowa1. Delaware2. Minnesota3. New York4. Virginia5. Massachusetts1. Delaware49. Mississippi50. West Virginia46. Alabama47. Louisiana48. Montana49. Mississippi50. West Virginia46. AlabamaS P O TLIGHTK EY EL E M E NTSM ETHODOLO G Y2. Nebraska47. LouisianaNon-economic Damages3. New Hampshire48. Illinois4. Maine49. Mississippi5. Tennessee50. West Virginia12


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SBESTWORSTJudges’ Impartiality1. Delaware2. Maine3. Minnesota4. Nebraska5. New Hampshire46. Texas47. Illinois48. Mississippi49. Louisiana50. West VirginiaJudge’s Competence1. Delaware2. Maine3. Minnesota4. New Hampshire5. Kansas46. Illinois47. Alabama48. Mississippi49. Louisiana50. West VirginiaJuries’ Predictability1. Nebraska2. Utah3. Indiana4. Tennessee5. Kansas46. Louisiana47. Mississippi48. California49. Alabama50. West VirginiaJuries’ Fairness1. Nebraska2. Minnesota3. Wisconsin4. Iowa5. South Dakota46. Illinois47. Alabama48. Louisiana49. Mississippi50. West Virginia13


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SOverall Treatment of Tortand Contract Litigation1. Delaware2. Nebraska3. New Hampshire4. Wyoming5. Minnesota6. Maine7. Iowa8. Connecticut9. Wisconsin10. Indiana11. Tennessee12. North Carolina13. South Dakota14. Virginia26. Arizona27. New Jersey28. Kentucky29. Washington30. Michigan31. Pennsylvania32. Georgia33. Idaho34. South Carolina35. Oklahoma36. Rhode Island37. Florida38. Arkansas39. Missouri15. Colorado16. Massachusetts17. Kansas18. Utah19. Oregon20. North Dakota21. Maryland22. New York23. Nevada40. Montana41. New Mexico42. Hawaii43. Texas44. Alaska45. California46. Alabama47. Illinois48. MississippiK EY EL E M E NTSM ETHODOLO G Y24. Ohio49. Louisiana25. Vermont50. West Virginia14


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SHaving and EnforcingMeaningful Venue Requirements1. Indiana2. Nebraska3. Delaware4. Tennessee5. New Hampshire6. Oregon7. New York8. Minnesota9. Virginia10. South Dakota11. Iowa12. North Dakota13. Connecticut14. Maine15. Massachusetts16. Utah17. Colorado18. North Carolina19. Kansas20. Wisconsin21. Ohio22. Michigan23. Vermont24. Florida25. Arizona26. New Jersey27. Wyoming28. Washington29. Idaho30. Georgia31. Missouri32. Nevada33. South Carolina34. Pennsylvania35. Kentucky36. Montana37. Oklahoma38. Hawaii39. Rhode Island40. California41. Maryland42. New Mexico43. Alaska44. Arkansas45. Texas46. Alabama47. Mississippi48. Louisiana49. Illinois50. West Virginia15


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G STreatment of Class Action Suitsand Mass Consolidation Suits*1. Delaware2. Tennessee3. New York4. Iowa5. Indiana6. Connecticut7. Kansas8. Nebraska9. Wisconsin10. Minnesota11. Wyoming12. Nevada13. Vermont14. New Jersey26. Oregon27. New Hampshire28. North Dakota29. South Dakota30. North Carolina31. Georgia32. Pennsylvania33. Missouri34. Hawaii35. Rhode Island36. Maryland37. New Mexico38. Alaska39. Florida15. Utah16. Virginia17. Michigan18. Massachusetts19. Maine20. Arizona21. Colorado22. Idaho23. Ohio40. Montana41. South Carolina42. Texas43. Oklahoma44. Arkansas45. Alabama46. California47. Louisiana48. IllinoisK EY EL E M E NTSM ETHODOLO G Y24. Washington25. Kentucky49. Mississippi50. West Virginia*Virginia and Mississippi do not have class actions but both have mass consolidation suits (source: U.S. Chamber Institutefor Legal Reform).16


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SPunitive Damages*1. Delaware2. Minnesota3. Tennessee4. Maine5. Utah6. Iowa7. Indiana8. Michigan9. Wisconsin10. Wyoming11. Kansas12. Arizona13. North Carolina14. New York15. South Dakota16. Virginia17. Ohio18. Kentucky19. Connecticut20. Vermont21. Colorado22. Maryland23. Idaho24. Nevada25. North Dakota26. Oregon27. Pennsylvania28. Georgia29. Florida30. Rhode Island31. South Carolina32. New Mexico33. Missouri34. Arkansas35. Montana36. Oklahoma37. Hawaii38. Texas39. Alaska40. Illinois41. Alabama42. California43. Mississippi44. West Virginia*This year the scores for the six states that have no punitive damages (Louisiana, Massachusetts, Nebraska, New Hampshire, New Jersey,and Washington) were calculated in two different ways. One way (used in our main tables and in all previous years) is to base the score on allthe other criteria excluding punitive damages. The second involved assigning each of these six states the highest score achieved from otherstates on punitive damages (i.e., Delaware’s). While this improves their overall raw score, it does not make a difference in their overall ranking.17


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G STimeliness of SummaryJudgment/Dismissal1. Delaware2. South Dakota3. Minnesota4. Wisconsin5. North Dakota6. Arizona7. Nebraska8. Iowa9. Tennessee10. Indiana11. Oregon12. New Hampshire13. Maine14. Utah26. New Jersey27. Arkansas28. Rhode Island29. Kentucky30. Ohio31. New York32. Georgia33. Pennsylvania34. South Carolina35. Montana36. Florida37. Maryland38. Missouri39. Massachusetts15. Washington16. Connecticut17. Wyoming18. Idaho19. Virginia20. Kansas21. Michigan22. North Carolina23. Vermont40. Oklahoma41. New Mexico42. Texas43. Hawaii44. Alabama45. Alaska46. Illinois47. California48. LouisianaK EY EL E M E NTSM ETHODOLO G Y24. Nevada25. Colorado49. Mississippi50. West Virginia18


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SDiscovery1. Delaware2. Minnesota3. Wisconsin4. Nebraska5. Iowa6. Indiana7. Tennessee8. Maine9. Wyoming10. South Dakota11. Kansas12. Utah13. North Carolina14. Connecticut15. New Hampshire16. Michigan17. Arizona18. North Dakota19. New York20. Virginia21. Nevada22. Massachusetts23. New Jersey24. Colorado25. Ohio26. Oregon27. Oklahoma28. Vermont29. Washington30. Idaho31. Missouri32. Kentucky33. Montana34. Pennsylvania35. South Carolina36. Georgia37. Maryland38. Florida39. Rhode Island40. New Mexico41. Texas42. Arkansas43. Hawaii44. Alaska45. Alabama46. California47. Louisiana48. Illinois49. Mississippi50. West Virginia19


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SScientific and Technical Evidence1. Delaware2. Minnesota3. New York4. Massachusetts5. Virginia6. Tennessee7. Colorado8. Connecticut9. Oregon10. Nebraska11. Iowa12. Michigan13. New Jersey14. Washington26. Pennsylvania27. Texas28. Georgia29. Vermont30. California31. New Hampshire32. Nevada33. North Dakota34. Missouri35. Idaho36. Florida37. New Mexico38. Rhode Island39. Kentucky15. Utah16. Indiana17. Wyoming18. Maine19. South Dakota20. Ohio21. Kansas22. Wisconsin23. North Carolina40. South Carolina41. Alaska42. Illinois43. Oklahoma44. Hawaii45. Arkansas46. Alabama47. Louisiana48. MontanaK EY EL E M E NTSM ETHODOLO G Y24. Arizona25. Maryland49. Mississippi50. West Virginia20


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SNon-economic Damages1. Delaware2. Nebraska3. New Hampshire4. Maine5. Tennessee6. Iowa7. Minnesota8. Wisconsin9. Vermont10. Utah11. North Carolina12. New York13. Indiana14. Kansas15. Connecticut16. North Dakota17. South Dakota18. Arizona19. Nevada20. Oregon21. Virginia22. Massachusetts23. Ohio24. Wyoming25. Michigan26. Colorado27. New Jersey28. Kentucky29. Washington30. Georgia31. Rhode Island32. Montana33. Idaho34. Maryland35. Oklahoma36. Florida37. Missouri38. Pennsylvania39. Arkansas40. Hawaii41. South Carolina42. New Mexico43. Texas44. Alaska45. California46. Alabama47. Louisiana48. Illinois49. Mississippi50. West Virginia21


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SJudges’ Impartiality1. Delaware2. Maine3. Minnesota4. Nebraska5. New Hampshire6. Colorado7. Wisconsin8. Iowa9. Kansas10. Oregon11. Virginia12. South Dakota13. North Dakota14. New York26. Maryland27. Michigan28. Missouri29. Vermont30. Pennsylvania31. Georgia32. Kentucky33. Florida34. California35. Wyoming36. Nevada37. Rhode Island38. Montana39. South Carolina15. Arizona16. Tennessee17. Connecticut18. Indiana19. Massachusetts20. North Carolina21. Utah22. Ohio23. New Jersey40. New Mexico41. Alaska42. Oklahoma43. Hawaii44. Arkansas45. Alabama46. Texas47. Illinois48. MississippiK EY EL E M E NTSM ETHODOLO G Y24. Washington25. Idaho49. Louisiana50. West Virginia22


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SJudges’ Competence1. Delaware2. Maine3. Minnesota4. New Hampshire5. Kansas6. Virginia7. Oregon8. Iowa9. Tennessee10. Massachusetts11. Connecticut12. Wisconsin13. New York14. Indiana15. Nebraska16. Utah17. Washington18. South Dakota19. Arizona20. North Carolina21. North Dakota22. Georgia23. Michigan24. New Jersey25. Colorado26. Vermont27. Maryland28. Idaho29. Ohio30. Missouri31. California32. Pennsylvania33. Montana34. Nevada35. South Carolina36. Kentucky37. Florida38. Rhode Island39. Wyoming40. Alaska41. New Mexico42. Hawaii43. Arkansas44. Oklahoma45. Texas46. Illinois47. Alabama48. Mississippi49. Louisiana50. West Virginia23


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SJuries’ Predictability1. Nebraska2. Utah3. Indiana4. Tennessee5. Kansas6. Iowa7. South Dakota8. Delaware9. North Dakota10. Wisconsin11. Virginia12. New Hampshire13. Wyoming14. Ohio26. Connecticut27. Oregon28. New Jersey29. Michigan30. Nevada31. Maryland32. Rhode Island33. Vermont34. Montana35. Washington36. Missouri37. Oklahoma38. South Carolina39. Pennsylvania15. Minnesota16. New Mexico17. Arizona18. North Carolina19. Idaho20. Colorado21. Maine22. New York23. Massachusetts40. Florida41. Hawaii42. Alaska43. Arkansas44. Texas45. Illinois46. Louisiana47. Mississippi48. CaliforniaK EY EL E M E NTSM ETHODOLO G Y24. Kentucky25. Georgia49. Alabama50. West Virginia24


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SJuries’ Fairness1. Nebraska2. Minnesota3. Wisconsin4. Iowa5. South Dakota6. Indiana7. Delaware8. Maine9. New Hampshire10. Ohio11. North Carolina12. Utah13. Kansas14. Tennessee15. Colorado16. Arizona17. Virginia18. Oregon19. Massachusetts20. North Dakota21. New York22. Wyoming23. Connecticut24. Nevada25. Michigan26. Washington27. New Jersey28. Idaho29. Vermont30. Pennsylvania31. Kentucky32. Georgia33. Missouri34. Rhode Island35. Arkansas36. South Carolina37. Maryland38. Alaska39. Oklahoma40. Hawaii41. Florida42. New Mexico43. Montana44. California45. Texas46. Illinois47. Alabama48. Louisiana49. Mississippi50. West Virginia25


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SAll interviews for the 2007 State Liability Systems Ranking Study wereconducted by telephone among a nationally representative sample of inhousegeneral counsel, senior litigators and senior attorneys who areknowledgeable about litigation matters at companies with annual revenuesof at least $100 million. Interviews averaging 22 minutes in length wereconducted with a total of 1,599 respondents and took place betweenDecember 27, 2006 and March 2, 2007. The sample was segmented intotwo main groups. Of the 1,599 respondents, 5% were from insurancecompanies, with the remaining 95% of interviews being conducted amongpublic corporations from other industries.Sample DesignA representative sample of companies with Interactive would be contacting them andannual revenues of at least $100 million requested their participation.annually was drawn using a sample fromThe sample was segmented into two mainidExec, Dun & Bradstreet, and AMI. Alertgroups. Of the 1,599 respondents, 77 wereletters were sent to the general counsel atfrom insurance companies, with the remainingeach company. These letters provided1,522 interviews being conducted amonggeneral information about the study, notifiedpublic corporations from other industries. Thethem that an interviewer from HarrisM ETHODOLO G Y26


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G Sproportion of interviews with insurancecompanies represents 5% of the totalsample. Typically, in the universe ofcompanies with $100 million or more inrevenues, insurance companies represent6% of this population. Since propertycasualty insurance companies have extensiveexperience with state liability systems, for thepurposes of this study we worked to ensurethat our proportion of insurance companiesmatched the overall population.Respondents had an average of 22 yearsof relevant legal experience (includingtheir current position), had been with theircompany an average of 13.8 years, andhad been in their current position anaverage of 11.4 years.Telephone InterviewingProceduresThe 2007 State Liability Systems RankingStudy utilized Harris’ computer-assistedtelephone interviewing (CATI) system, wherebytrained interviewers call and immediately inputresponses into the computer. This systemgreatly enhances reporting reliability. It reducesclerical error by eliminating the need forkeypunching, since interviewers enterrespondent answers directly into a computerterminal during the interview itself. This dataentry program does not permit interviewers toinadvertently skip questions, since eachquestion must be answered before thecomputer moves on to the next question. Thedata entry program also ensures that all skippatterns are correctly followed. The on-linedata editing system refuses to accept punchesthat are out-of-range, it demands confirmationof responses that exceed expected ranges,and asks for explanations for inconsistenciesbetween certain key responses.In order to achieve high respondentparticipation, in addition to the alert letters,numerous telephone callbacks were madein order to reach the respondent andconduct the interview at a convenient timefor the respondent.Once a qualified respondent was identified,the respondent was first asked about theirfamiliarity with several states. First, 24 statesout of the list of 50 possible states werepresented to the respondent. Within these24 states, the 17 states presented were thefollowing: Alaska, Hawaii, Idaho, Iowa,Kansas, Maine, Montana, Nebraska, NewHampshire, North Dakota, Rhode Island,South Dakota, Utah, Vermont, West Virginia,Washington and Wyoming. These states27


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G Swere prioritized in order to get a sufficientnumber of evaluations, since in the past yearsof this study, data for these states werebased on fewer evaluations. The remaining 7states were randomly selected from theremaining states not mentioned above.Respondents were then given the opportunityto name any other state, aside from the statesalready presented, and specify if they are veryor somewhat familiar with that state.If the respondent was very or somewhatfamiliar with a given state, the respondentwas then given the opportunity to evaluatethat state’s liability system. The maximumnumber of states a respondent had theopportunity to evaluate was 10. On average,each respondent evaluated 3.24 states. Thisrepresents a change from 2006 whenrespondents were given an opportunity toevaluate a maximum of 15 states, evaluatingan average of 6 states. This change wasmade in order to reduce the burden onrespondents and increase the likelihood thatthey were really familiar with the states.Significance TestingReliability of Survey Percentages It is important tobear in mind that the results from anysample survey are subject to samplingvariation. The magnitude of this variation (orerror) is affected both by the number ofinterviews—the base size—and by the level ofthe percentages expressed in the results.Table A-1 shows the possible samplevariation that applies to percentage results forthis survey. The chances are 95 in 100 that asurvey result does not vary, plus or minus, bymore than the indicated number ofpercentage points from the result that wouldhave been obtained if interviews wereconducted with all persons in the universerepresented by the sample. For example, if theresponse for a sample size of 300 is 30%,then in 95 cases out of 100, the response inthe total population would have beenbetween 25% and 35% (+/-5%). Note thatsurvey results based on subgroups of smallsize can be subject to large sampling error.Significance of Differences Between ProportionsSampling tolerances are also involved inthe comparison of results from differentsurveys or from different parts of a samplefrom the same survey (subgroup analysis).Table A-2 shows the percentagedifference that must be obtained before adifference can be considered statisticallyM ETHODOLO G Y28


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G SRecommended Allowance forSampling Error of Proportions *Sample 10% 20% 30% 40%Size or 90% or 80% or 70% or 60% 50%1600 2 2 2 2 31500 2 2 2 3 31400 2 2 2 3 3900 2 3 3 3 3800 2 3 3 3 3700 2 3 3 4 4600 2 3 4 4 4500 3 4 4 4 4400 3 4 4 5 5Sampling Error of DifferenceBetween Proportions**Sample 10% 20% 30% 40%Size or 90% or 80% or 70% or 60% 50%900 3 4 4 5 5500 3 4 5 5 6300 4 5 6 7 7200 5 6 7 8 8100 6 8 10 10 1050 9 11 13 14 14500 4 4 6 6 6300 4 6 7 7 7200 6 7 8 8 8100 7 9 10 11 1150 9 12 13 14 15*All percentages are +/-**Approximate Sampling Tolerances (at 95% Confidence Level)29


2 0 0 7 S T A T E L I A B I L I T Y S Y S T E M S R A N K I N G Ssignificant. These figures, too, representthe 95% confidence level.To illustrate, suppose the two percentagesin question are 34% and 25%. Morespecifically, suppose that one group of 300has a response of 34% “yes” to a question,and an independent group has a responseof 25% to the same question, for anobserved difference of 9 percentage points.According to the table, this difference issubject to a potential sampling error of 6-7percentage points. Since the observeddifference is greater than the sampling error,the observed difference is significant.Sampling error of the type so far discussedis only one type of error. Survey research isalso susceptible to other types of error,such as refusals to be interviewed (nonresponseerror), question wording andquestion order, interviewer error, andweighting by demographic control data.Although it is difficult or impossible toquantify these types of error, the proceduresfollowed by Harris Interactive, Inc. keeperrors of these types to a minimum.Notes on Reading TablesThe base (“N”) on each question is the totalnumber of respondents answering thatquestion. An asterisk (*) on a table signifiesa value of less than one-half percent(0.5%). A dash represents a value of zero.Percentages may not always add up to100% because of computer rounding orthe acceptance of multiple answers fromrespondents answering that question. Notethat in some cases results may be basedon small sample sizes. Caution should beused in drawing any conclusion fromresults based on these small samples.For the “Ranking on Key Elements”tables, states were ranked by their meangrades on that particular element.The “Overall Ranking of State LiabilitySystems” table was calculated by creatingan index using the scores given on each ofthe key elements. All of the key elementitems were highly correlated with oneanother, and with overall performance. Thedifferences in the relationship between eachitem and overall performance were trivial, soit was determined that each item shouldcontribute equally to the index score. Theindex was created from the mean across the12 items, which was rescaled from 0 to 100prior to averaging them together.A full copy of the report, including grades foreach state on each of the key elements, isavailable at www.InstituteForLegalReform.comM ETHODOLO G Y30


1615 H Street, N.W. Washington D.C. 20062-2000 P: 202-463-5724 F: 202-463-5302 InstituteForLegalReform.com

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