I met this week with two of the top litigators in America for social conservative cases in federal and state courts. Both are involved in civil suits filed to fight the Obamacare contraception mandate and to defend state traditional marriage amendments. I discussed two bills recently passed in the U.S. House, and supported by Congressional Republicans, with a “Loser Pays” provision that forces the losing party in litigation to pay legal fees, which is used in courts in Europe to discourage litigation. The social conservative litigators are completely opposed to Loser Pays, and I urged them to take their objections public and to inform Republicans in Congress. Indeed, they told me that many of the Obamacare contraception cases they’ve filed – Hobby Lobby et al – would never have been filed if we had a national Loser Pays rule in American courts.
So why are they opposed to Loser Pays?
Loser Pays rules ensure that only the wealthiest plaintiffs can afford to undertake a civil action and also punishes individuals with serious and meritorious claims for seeking access to justice. Loser Pays rules fail to recognize that a person or a business can have a legitimate claim regarding fact and law, and yet still ultimately lose the case, sometimes on procedural grounds. In reality, for most individuals and small businesses, the financial risk of having to pay the other side’s costs and legal fees is one too great to bear, no matter how meritorious the claim. Indeed, Loser Pays schemes create a chilling effect on plaintiffs with worthy, legitimate disputes, and hamper access to the courts.
Loser Pays rules overlook the fact that state and federal judges have full authority to issue sanctions, including awards of legal fees, if parties engage in wrongful conduct or waste judicial resources. Mandatory Loser Pays rules trample on this tradition of judicial discretion and would overturn states’ rights to define their own civil justice rules.
From a purely political standpoint, Loser Pays hurts plaintiffs within the Republican base. Loser Pays rules hurt social conservative litigators, such as the Alliance Defending Freedom, ACLJ and the Becket Fund, as well as entrepreneurs who sometimes depend on the civil justice system. The Chamber of Commerce, which proposes Loser Pays laws in states across the country, and the business community don’t represent those conservative groups and small businesses and won’t protect them.
Of course, Loser Pays also hurts liberal nonprofit litigation groups, but many of those groups are already fighting Loser Pays bills in Congress and statehouses across the country. They need conservative groups to start warning Republicans, before the trend goes too far.