Race to the Bottom or a Better Court System – New York’s Turn

When I was in law school back in the dark ages of 1980-1983, no one taught a course in the litigation industry or courts competing for cases. Thirty years later, the industry and competition are evident.

New York is the latest entrant into the litigation industry race to be "good to business" litigation. That could mean many things, such as faster and more efficient systems with smart judges. Or, it could mean a tilted playing field. Prof Lynn LoPucki has eloquently and convincingly proven the "race to the bottom" caused many bankruptcy cases to end up in Delaware. Either way, court fees bring revenues and courthouse jobs, not to mention lawyers.

Set out below are excerpts from Joe Palazzolo’s WSJ new article on New York’s approach to doing better in the litigation industry competition:

“We must seek to create an even more hospitable environment for business,” said Chief Judge Jonathan Lippman Tuesday in his annual address on the state of the judiciary. The judge said he wants to “set a new vision for how we in the New York State court system might better serve the needs of the business community.”

The Commercial Division, New York’s business court, was carved out of the state Supreme Court 17 years ago, with an eye toward improving the quality and consistency of judicial decision-making in commercial litigation. Judge Lippman noted that other states had used New York’s business court as model, increasing the competition for cases.

“We must ask ourselves anew whether business leaders in New York and around the country know they can rely on our courts for the most efficient and expert resolution of business disputes,” he said.

Lippman announced the creation of a task force led by his predecessor Judith Kaye and Martin Lipton of Wachtell, Lipton, Rosen & Katz. In the next year, the task force will look at how to better control dockets, manage case flow and make more effective use of non-judicial personnel and alternative dispute resolution within the courts, the judge said.

***

Lippman said he would soon be sending a bill to the state legislature that would establish a new class of Court of Claims judges that the governor could appoint to sit on the Commercial Division.

“This would enable direct designation of seasoned commercial practitioners to supplement the court’s roster. New York has the best commercial lawyers in the world,” Lippman said. “They are a resource for our state, and it would be of great benefit if we could attract more of them to the New York Bench.”

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About Kirk

Since becoming a lawyer in 1983, Kirk’s over 30 years of practice have focused on advising a wide range of corporations, associations, and individuals (as both plaintiffs and defendants) on both tort and commercial law issues centered around “mass torts.”

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