Delaware’s lawsuit climate has reclaimed the number one ranking in the U.S. Chamber Institute for Legal Reform‘s (ILR) national survey. Starting in 2002, the state ranked in first place every year until dropping to 11th place in 2017.
The drop in ranking took place after the General Assembly banned “loser pays” provisions in company bylaws that required shareholders who file and lose lawsuits to reimburse companies’ legal fees.
ILR said that the Chancery Court has since reigned in “frivolous lawsuits.” In 2016, the Chancery Court prohibited “disclosure only” settlements in merger and acquisition lawsuits.
“Hands down, Delaware has some of the most competent and experienced judges and stable legal system in the country,” said Harold Kim, chief operating officer of the U.S. Chamber Institute for Legal Reform. “As long as the state legislature doesn’t try to interfere with that, Delaware will continue to be a great state in which to do business.”
According to the survey, 89 percent—an all-time high—said a state’s lawsuit environment is likely to impact their company’s decisions about where to locate or do business.
The 2019 Lawsuit Climate Survey: Ranking the States is the 12th time The Harris Poll has conducted the survey since 2002 for the U.S. Chamber Institute for Legal Reform.
The final results are based on interviews with a national sample of 1,307 in-house general counsel, senior litigators or attorneys, and other senior executives who are knowledgeable about litigation matters at public and private companies with annual revenue of at least $100 million.