Delaware Supreme Court

Drumroll please….the state with the best "lawsuit climate" is Delaware. And the worst is Illinois.

That's according to a report released Tuesday by the U.S. Chamber of Commerce's Institute for Legal Reform.

It's the 12th time since 2002 the Institute for Legal Reform has sponsored the survey. The results are based on interviews by The Harris Poll of 1,307 in-house general counsel, senior litigators or attorneys, and other senior executives with recent litigation experience at companies with annual revenue of at least $100 million.  

The survey asked respondents to give states an A – F grade on areas including  enforcing meaningful venue requirements; overall treatment of tort and contract litigation; treatment of class action suits and mass consolidation suits; damages; trial judges' competence and quality of appellate review.

The results provide an interesting grouping of states that otherwise have little in common politically or economically. Consider the top five: Delaware, Maine, Connecticut, Wyoming and Alaska. And the bottom five: Florida, Mississippi, California, Louisiana and Illinois. 

The perceptions matter. The poll found that 89% of respondents said a state's lawsuit environment is likely to impact their company's decisions about where to locate or do business.

Delaware's top showing—up from 11th place in 2017—comes on the heels of a bizarre campaign ad attacking Joe Biden for his alleged support of the state's Court of Chancery, which the ad criticizes as "too male and too white, and it's anything but open."

As my colleague Max Mitchell reported a few weeks ago, Shirley Shawe, a shareholder of TransPerfect and the mother of CEO Philip R. Shawe, spent $500,000 on the ad, which also blasts Delaware Court of Chancery Chancellor Andre G. Bouchard by name.

The poll respondents, however, are Delaware fans. 

"Delaware's well-respected Chancery Court has been very effective in reining in frivolous lawsuits in the state's courts," the Institute for Legal Reform states. "A 2016 ruling by the court prohibited so-called disclosure only settlements in merger and acquisition lawsuits, in which all of the money went to lawyers and not plaintiffs. As a result of the Chancery Court's decision, these types of lawsuits have largely migrated out of Delaware to other jurisdictions, such as the federal courts."

At the other end of the spectrum, Illinois came in last in part because the state "has been a magnet for out-of-state plaintiffs, especially in asbestos litigation. Ninety-two percent of the plaintiffs filing asbestos lawsuits in Illinois reside out of state."

California also fared poorly. For a closer at look at what ails the Golden State, see this report by my colleague Amanda Bronstad: California Ranks 48th in Chamber's List of States' Lawsuit Climate.