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NFIB Ramps Up Lobbying Effort Against Lawsuits

 

June 30, 2004 -- The National Federation of Independent Business is throwing its weight behind legislation aimed at curbing the number of lawsuits against businesses.

Karen Harned, executive director of the NFIB's Legal Foundation, testified before the House Judiciary Committee last week that small business owners are often seen as "easy targets" for "frivolous lawsuits" and urged Congress to protect them through legislation.

The NFIB supports the Lawsuit Abuse Reduction Act, which allows for sanctions against those filing frivolous lawsuits and would limit the ability of plaintiffs to "venue shop."

The United States Chamber of Commerce, a business lobbying group, estimated that the tort system costs small businesses $88 billion a year in a recent study.

"When [small businesses] fall prey to predators filing frivolous lawsuits," Harned testified, "they have to hire an attorney and then take time consuming and costly steps to defend themselves."

A recent survey by the NFIB found that nearly half of those polled were either "very concerned" or "somewhat concerned" about the prospect of being sued.


Matt Quinn

Matt Quinn contributes to the Wall Street Journal's corporate finance blog. He has also written extensively about banking and corporate finance for publications including Inc., American Banker, and Financial Week. He lives in Brooklyn, New York.