Welcome

• US Chamber Institute for Legal Reform

• United States Legal System • United Kingdom Context • Mission of the ILR in the United Kingdom and the European Union

• Examined general liability insurance data

• The countries for which sufficient data exist constitute over 83 percent of Eurozone GDP, plus the US, Canada and the UK

• Research controlled for other factors that might lead to cost differences:

• Differences in the mix of business in a country

• Spending on government social programs

• The cost of private healthcare

• Features of the legal environment in each country are highly correlated with litigation costs, implying that changes to the liability system may have a substantial effect on costs

NERA International Study Methodology

NERA International Study – Key Results

2011 Liability Costs as a Percent of GDP

NERA International Study – Key Results

From 2008 to 2011, the UK saw a 47.7% increase in litigation costs

47%

US Consumer ResearchKey Data from National U.S. Survey: Collective Action Lawsuits April 7-10, 2013#13117

Methodology:

• National survey of 800 voters throughout the United States• Interviews conducted April 7-10, 2013, on both cell and landline phones• Margin of error of + 3.46% overall; margins of error for sub-groups will vary by

population size• Some comparisons made to national voter surveys conducted on behalf of

ILR from 2001 – 2012

Key Results

Consistent with what we measured last year, voters view the number of lawsuits as a serious problem.

Question: “Do you think the number of lawsuits is a very serious problem, a somewhat serious problem, a not-so-serious problem, or a not-at-all serious problem?”

2012 2013

84% 87%

14% 11%

Total Serious Problem Total Not Serious Problem

Number of Lawsuits Serious/Not Serious Problem

Key Results

Question: “2001: And, to the best of your knowledge, have you ever received something in the mail saying that you may qualify to be a member of a class in a class action lawsuit? | 2013: Have you ever received a notice in the mail or via e-mail that advises you that you are, or could become, a plaintiff in a class action lawsuit?”

2001 2013

57% 61%

42% 38%

Yes No

+15% +23%

Received Notice They Qualify for Class in Class Action Lawsuit

Three-in-five American voters say they have received notice they qualify for a class action lawsuit - slightly more than 12 years ago.

Key Results

Question: “And, thinking about any notices you have received in the last two or three years, did you receive from the settlement of those cases something of meaningful value, considering your effort to comply with the notices, or not?”

Very few of those who participated in a lawsuit recently report receiving something of meaningful value as a result.

14%Received Something of Value from Class Action Settlement:

More abuse of the legal system 69%

Less abuse of the legal system 2%

The level of abuse has stayed about the same

25%

Question: “Thinking back over the last ten years, would you say there is…”

Key Results

Voters say there has been increased abuse of the legal system in the last decade.

The lawyers who file the lawsuit 76%

The people on whose behalf the lawsuit is filed 14%

Key Results

Question: “And more specifically, who do you think most benefits from class action lawsuits…”

More than three-fourths of voters say lawyers benefit more than the people on whose behalf class action lawsuits are filed.

Involved in Civil Suit(21%)

Not Involved in Civil Suit(77%)

12% 15%

80% 76%

The People The Lawyers

Benefits from Class Action Lawsuits by Involved in Civil Suit

Key Results

Question: “And more specifically, who do you think most benefits from class action lawsuits…”

Four-in-five voters who have been involved in a civil lawsuit say that lawyers benefit the most.

In fact, the overwhelming majority say it is a problem that the people suing end up with little of the money. Lawyers end up keeping most of the money awarded in these cases, while the people suing end up with little of the money.

Question: “Still thinking only about class action lawsuits...the following are a few issues some people have said are problems while others have not. For each one, please tell me whether you think this is a...”

61%

89%

Significant Problem

Total Problem

Key Results

Definitely Acceptable 6%

Probably Not Acceptable

27%

Don’t Know10%

Probably Acceptable

13%

Definitely Not Acceptable

44%

Total Acceptable 19%Total Not Acceptable 71%

Key Results

Question: “Would you say this is an acceptable practice that should be allowed or not an acceptable practice that should be stopped”

By large margins, voters continue to say that third party financing of lawsuits is not acceptable.

UK Consumer ResearchKey Data from National U.K. Survey: Collective Action Lawsuits Ipsos-MORI May 3-5, 2013#13117

Methodology:

• 1,036 adults (18+) throughout the United Kingdom.• Questions added to the omnibus regularly conducted by Ipsos MORI. Quotas

were set on age, sex, and standard geographical regions. • The data is also weighted against the profile of the UK to provide a

representative sample.• Interviewing via telephone May 3-5, 2013.• Bipartisan team of Public Opinion Strategies and Penn Schoen Berland

constructed the questions with guidance on wording from Ipsos MORI.• The margin of error is + 3.1%.

Key Results

By a three-and-a-half-to-one margin, U.K. residents are more likely to advise U.K. decision-makers to avoid making changes similar to the U.S. system than to model it.

Question: “Decision makers in the U.K. are considering changing the U.K.’s civil legal system to be more like the U.S. system because they say it will help the U.K. consumer more than under the current system. As a consumer in the U.K., if you could offer some advice to your leaders as they consider making changes, would you tell them…”

That the American system has more problems than the U.K. system and they should NOT make changes to be more like the American system.

57%

That the American system has more advantages than the U.K. system and they SHOULD make changes to be more like the American system.

16%

Key Results

By a four-to-one margin, U.K. residents are more likely to advise E.U. decision-makers to avoid making changes similar to the U.S. system than to model it.

Question: “Recently, some European Union decision makers in Brussels have proposed changes that could result in national legal systems containing more elements of the United States system. If you could offer some advice to leaders in Brussels as they consider making changes, would you tell them…”

That the American system has more problems and they should NOT make changes to be more like the American system.

60%

That the American system has more advantages and they SHOULD make changes to be more like the American system.

14%

Key Results

By large margins, respondents continue to say that third party financing of lawsuits is not acceptable.

Question: “Would you say this is an acceptable practice that should be allowed or not an acceptable practice that should be stopped?”

Probably Not Acceptable

25%

Definitely Not Acceptable

31%

Don’t Know/Refused

9%

Both/Mixed5%

Definitely Acceptable

10%

Probably Acceptable20%Total Acceptable30%

Total Not Acceptable 56%

Key Results

A number of features of the U.S. civil litigation system make U.K. residents less inclined to model it.

Only about one-half of the money awarded in the U.S. system goes to actual victims—lawyers end up with the remainder.

A recent study comparing the cost of the U.S. lawsuit system as a percentage of their economy to other nations shows that the U.S. system is the world’s most expensive—50% more as a cost to the economy than the U.K. system, and more than twice as expensive as most other E.U. Nations.

Question: “Taking a step back…here are some things you might hear about the American civil lawsuit system. For each one, please indicate if this makes you more inclined to want to change the U.K.’s current system to include elements of the U.S. system, less inclined to want to change the current system, or does it not make much difference in your opinion.”

Lawsuits cost America’s small businesses billons of dollars each year: money that could go to creating new jobs, or providing workers with better health care or retirement benefits.

Courts are clogged with frivolous lawsuits, and that leaves people with serious injuries having to wait to receive their fair compensation.

U.S. class action lawsuits make it easier to bring court actions, and this is a good development for the U.K.

Lawsuits help ensure that companies are careful and that products are safe for consumers.

Less InclinedNo DifferenceMore Inclined

9%

7%

18%

23%

28%

39%

16%

18%

18%

21%

29%

33%

72%

71%

61%

52%

36%

23%

Further Information

For further information, please contact:

LondonRaj Aujla: rajmeena.aujla@fleishmaneurope.com T: +44 20 7395 7176 M: 07710301679Ben Baruch: ben.baruch@fleishmaneurope.com T: +44 20 7395 7076 M: +44 07912 578 213

Washington DCBryan Quigley: bquigley@USChamber.com T: +1 202 463 5569

US CHAMBER INSTITUTE FOR LEGAL REFORM

The U.S. Chamber of Commerce Institute for Legal Reform (ILR) represents the interests of over 3 million businesses of all sizes, many of which operate in the UK, and some of which are British-owned and operate in the US.

The ILR was founded by the U.S. Chamber of Commerce in 1998 to address America's rapid expansion of litigation, with the aim of making the legal system simpler, fairer and faster for everyone. It now seeks to share its experiences with UK policymakers, helping to protect the integrity of the British justice system against the worst aspects of U.S. litigation culture.