Overview
Overall, Marathon’s analysis found that Louisiana’s total corporate nuclear verdicts – and the state’s inclusion in the top 10 states – were driven by two cases.
The first, $9 billion in Allen v. Takeda Pharmaceuticals North America, Inc. (2014), was ordered by a jury in US District Court for the Western District of Louisiana, which includes most of the state. The case was a product liability matter concerning allegations that Takeda Pharmaceutical Co. and Eli Lilly & Co. failed to warn users their Actos diabetes drug could raise the risk for bladder cancer. The verdict was later slashed to $36.8 million by US District Judge Rebecca Doherty, who argued the original award was “excessive” and violated the companies’ constitutional rights to due process.
The second-largest verdict in Louisiana, $257 million in the consumer protection matter State of Louisiana v. Janssen Pharmaceutical, Inc., was ordered by a state court jury in St. Landry Parish District Court in 2010.
Despite its small population, Louisiana ranked sixth on the ATR Foundation’s 2021 list of “Judicial Hellholes” due in-part to judicial misconduct, the governor’s veto of a bill that sought to limit lawsuit advertising practices, and lost jobs and revenue due to excessive civil court costs: as much as $3.87 billion in lost economic activity.
The US Chamber of Commerce’s September 2022 review of nuclear verdicts – which covered non-corporate cases – ranked Louisiana in the top 10 states due to the number of cases involving auto accidents. Louisiana was also one of only two states to receive an “F” grade by R Street Policy’s Insurance Regulation Report Card, due to its excessively high auto loss ratio.
Marathon’s findings reflect the same, with motor vehicle cases naming a corporate defendant making up 23% of state court verdicts, or $114 million. The cases included three matters naming a trucking company as a defendant.
The American Transportation Research Institute has also highlighted recent fraudulent lawsuit activity in the state. In December 2019, the US Attorney’s Office of the Eastern District of Louisiana indicted eight people for staging a fake crash involving a semi-truck and resulting in a trucking and insurance company paying out $4.7 million in fraudulent claims associated with the staged accident. In December 2020, four people involved in the incident pled guilty to conspiracy to commit mail fraud.
Legal Services Advertising
According to the ATR Foundation and Kantar, between 2017 and 2021, spending on local advertisements for legal services and/or soliciting legal claims in Louisiana totaled $231,416,902. Louisiana is also among the top-five states for aired TV legal services ads between 2017 and 2021. Overall, Louisiana accounts for a disproportionate amount the TV ads and spending by lawyers on the ads considering the state makes up less than 1.5% of the nation’s population – 4% of all spending and 5.6% of ads in one quarter.
