Governor Hochul’s stated goal is to transform New York into the most business- and worker-friendly state. However, her current approach seems to contradict this objective, as she is advocating for an increase in frivolous lawsuits that could potentially burden businesses.
Hochul’s budget proposals include a provision to modify state consumer-protection laws. This change would increase the minimum damage payout for class-action lawsuits from $50 per person to $1,000.
While this may seem like a significant increase, it could potentially benefit legal practitioners who specialize in driving these lawsuits. By having this powerful tool at their disposal, they could pressure companies into settling even the most frivolous cases.
Consumer class-action lawsuits are thriving in the Empire State due to the current minimum payout. Legal “entrepreneurs” are actively seeking cases, ranging from sandwiches not filling their containers entirely (as seen in the 2017 lawsuit against Pret a Manger) to complaints about Strawberry Pop-Tarts lacking a sufficient amount of actual strawberries.
According to The New York Civil Justice Institute, there were almost 100 lawsuits filed in New York in 2019-2020 specifically related to “vanilla” flavoring. Furthermore, there was a threefold increase in class-action cases regarding the marketing of products and services in the state between 2017 and 2020.
Lawyers typically seek out potential targets and then recruit individuals to sign on as plaintiffs. This is not about addressing major consumer grievances.
When a business is faced with a lawsuit, it must consider the expenses associated with fighting the case and the potential costs it may incur if it loses. By significantly increasing the minimum payout, Hochul’s decision would greatly increase the likelihood of companies opting to settle.
This also ensures that there will be even more such cases, providing businesses with even more reasons to leave New York or avoid coming here altogether.
Who needs enemies when you have a “business-friendly governor” like Kat? Is she really that eager for trial-lawyer donations?
Yes, it seems that way: To further benefit the tort bar, she would also require lawyers to receive “reasonable” attorneys’ fees, instead of the current provision which allows for the possibility of payment.
According to the American Tort Reform Foundation, New York is currently ranked as the fourth “judicial hellhole.” However, it seems that the governor is determined to elevate the state’s status to the number one spot.
The courts are being involved in cases where vanilla flavoring is not derived from real vanilla, as consumers in New York have become more aware of the ingredients used in various products. This situation highlights the need for adequate protection for consumers in the state.
Hochul’s proposed shift would only contribute to the already excessive legal “protection” racket.
