Trade group says reports reveal an ‘unfair and unbalanced’ court system in N.J.

A business trade association that pushes for changes to the state’s civil justice system says three new reports show New Jersey’s system is among the most expensive in the country — and it may get worse.

The situation in New Jersey is so alarming, the American Tort Reform Association says, the group put the Garden State on its annual “judicial hellholes” report. That report, along with new economic studies from the U.S. Chamber of Commerce Institute for Legal Reform, should concern New Jersey residents who are paying for the state’s “lawsuit-friendly policies,” said Anthony Anastasio, president of the New Jersey Civil Justice Institute.

“New Jersey policymakers need to wake up and accept reality: An unfair and imbalanced civil justice system that is tilted against the business community invites runaway litigation and increases the cost of living and doing business for everyone in the Garden State,” Anastasio said.

In the American Tort Reform Association report, the group cited the number of lawyers in New Jersey’s Legislature. With trial lawyers like Senate President Nicholas Scutari (D-Union) and Sen. Jon Bramnick (R-Union), plus dozens of other attorneys elected to serve in Trenton, the association called New Jersey a “Bar-controlled Legislature.”

Anastasio said former Senate President Steve Sweeney, an ironworker and labor official, offered a balance to the chamber that is no longer there. Scutari replaced Sweeney as the Senate’s president in January after Sweeney lost reelection.

The American Tort Reform Association report — which calls Scutari, a former personal injury attorney, “unabashedly pro-plaintiff” — notes he sponsored the Insurance Fair Conduct Act, a 2022 law that allows policyholders to bring civil litigation against their insurers for “unreasonable” delays or denials of payments under their policy. The association says the law could prompt more “meritless” claims against insurance carriers and lead to higher insurance costs for New Jerseyans.

Scutari did not respond to requests for comment.

Bill Matsikoudis, an attorney who has represented plaintiffs in personal injury cases, said he disagrees with the reports highlighted by the New Jersey Civil Justice Institute and believes New Jersey is a model for other states because courts here “actually help our businesses thrive.”

“This is the same tired, old rhetoric of big business that would like to shut the courthouse doors to New Jersey families and employees who are harmed by corporate greed, negligence, and hostile work environments,” he said.

Matsikoudis acknowledged that one of the state’s biggest challenges currently is the judicial shortage, which has led courts in some counties to postpone certain kinds of cases altogether. But Matsikoudis said this could benefit businesses and insurance companies “because they know they can sit around and wait before they have to get serious.”

The U.S. Chamber of Commerce Institute for Legal Reform’s studies call New Jersey the fourth-most expensive state in the country for lawsuit costs and say it ranks eighth in the nation for “nuclear verdicts,” its term for civil judgments that exceed $10 million. The group analyzed 1,376 of these verdicts between 2010 and 2019 and found nearly 75% are concentrated in 10 states. New Jersey had 35, the group says.

The Chamber study didn’t identify the $10 million-plus verdicts in New Jersey but says high verdicts in other states are largely due to cases stemming from auto and medical liability.

Harold Kim, president of the U.S. Chamber of Commerce Institute for Legal Reform and a legal officer for the organization, said in a statement that high-dollar verdicts have “spun out of control and should concern every policymaker, business, and consumer.”

“While some might feel that a huge verdict is ‘sticking it’ to a business, the reality is that nuclear verdicts add uncertainty and layers of cost throughout our economy that we all pay and undermine the rule of law in the process,” he said.