Wes Hickman/Kevin Bishop
-- U.S. Senator Lindsey Graham (R-South Carolina) today introduced ‘Loser Pays’ legislation in the United States Senate. The bill is designed to encourage settlements and reduce frivolous lawsuits which clog our court system.
Graham’s legislation establishes a set of guidelines under which the loser of a lawsuit in federal court could be required to pay the winner’s attorneys’ fees. The bill applies only to cases in which the parties are from different states. In order to receive compensation for attorneys’ fees the winning side must have made a settlement offer that was rejected, and then file a petition with the judge requesting compensation. The judge will make the final determination.
“This is responsible and effective legal reform,” said Graham, a member of the Senate Judiciary Committee. “Under this bill people will think twice before filing frivolous lawsuits. It will also encourage litigants to settle their differences before they go to trial. People will play around with other people’s money, but when they have a personal financial stake in the lawsuit it will force them and their attorney to more fully consider the merits of their case.”
Graham noted gun control groups have filed suits in some states to impose large legal costs on gun manufacturers in pre-trial discovery. In some western states, environmental groups have filed lawsuits to unnecessarily delay development projects, hoping to bankrupt development companies from months of delay.
U.S. Senators Charles Grassley (R-Iowa) and John Cornyn (R-Texas) have already agreed to add their names as co-sponsors of the legislation. Graham also noted he would like to offer the provision as a Senate amendment in the coming months for a floor vote on the measure.
“I believe very strongly that citizens of this country have a right to seek damages if they are truly injured or harmed by another,” said Graham. “This bill does not discourage legitimate lawsuits, but it does make those who abuse the system think twice about their actions and the possibility they could face very expensive consequences.”