Survey: California, Illinois among worst states for business in terms of lawsuit climate

West Virginia may have been almost heaven to John Denver, but it’s hell for businesses when it comes to lawsuits.

That’s according to a survey of general counsels and senior attorneys at large corporations conducted for the U.S. Chamber Institute for Legal Reform. West Virginia was rated as having the worst litigation environment in the country. Delaware was rated as having the best liability system, based on factors such as overall treatment of tort and contract litigation, treatment of class action suits, and judges’ impartiality and competence.

Three of America’s largest states — California, Florida and Illinois — ranked in the bottom 10. The most populous state in the top 10 was North Carolina.

The ratings are important because a state’s lawsuit climate can affect corporate decisions on where to do business: 75 percent of the 1,203 senior attorneys surveyed said a state’s litigation environment is likely to influence business decisions at their companies. That’s up from 67 percent five years ago.

The good news is that the overall scores for states are improving, and half of the survey’s respondents view the fairness and reasonableness of state court liability systems as excellent or pretty good. This is the 10th edition of the survey, which was conducted by Harris Interactive.

The survey also asked senior attorneys about what local jurisdictions are the worst for contract and tort litigation. East Texas was rated the worst, followed by Chicago, Los Angeles, Madison County, Ill., and New Orleans. The rest of the bottom 10 local jurisdictions included San Francisco, Miami, Philadelphia, St. Louis, Detroit and Washington, D.C. The main reason cited for these jurisdictions’ poor rankings was biased or partial juries and/or judges.

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