While on a long car trip last week I started thinking about this question: how much is litigation revenue down in Mississippi since the peak of the litigation bubble?
Initial reaction: My initial gut reaction was 40%. This was a system 1 take on the question.
After thinking about it: After thinking about it for a while, I changed my mind. I decided that the actual figure is 80%, perhaps more. This was a system 2 take on the question.
The reasons that I changed to 80% include the impact of the tobacco litigation and mass litigation including fen phen, insurance sales practice litigation and asbestos.
Back around 2000, it seemed like there were good plaintiff lawyers who didn’t want to fool around with a personal injury case with a settlement value in the $200,000- $400,000 range. That was tier 2 litigation in Mississippi at the time. The real money was in mass tort–on both the plaintiff and defense side.
Here is a story from the mass tort days. Back in the 90′s when I was at Baker Donelson, I didn’t work on mass tort cases. After I started my own firm in 2002, I picked up the defense of a retailer in the silica litigation. I was stunned when I showed up for the first plaintiff deposition in the case.
In a hotel conference room, approximately thirty defense lawyers and one plaintiff lawyer sat waiting for the deposition to start. The deposition lasted all day. Most of the defense lawyers never asked a question. There was a stunning amount of money being billed. And scenes like that were replayed all over Mississippi all the time. Those days are gone now.
And thanks to tort reform and tort reformed juries, even litigation that still exists is worth much less than it used to be. Medical malpractice was a viable practice specialty on both sides in the 90′s. Not anymore.
Nursing home litigation survived into the 2000′s. But now a nursing home case is more trouble than it is worth and most plaintiff lawyers avoid them.
Heck, even car wreck cases are worth less than they used to be.
The legal industry has gotten a lot smaller. Survivors on the plaintiff side of the bar almost all generate substantially less income than a decade ago. Survivors on the defense side may not have taken as large a pay cut as plaintiff lawyers, but that’s little consolation to people who lost their nice paying job.
You see a lot of former defense firm support staff working now at hospitals in administrative support roles. As for the attorneys, many have left the state or taken jobs at a reduced salary.
So 80% is my estimate. And if I had to bet the over/under on it, I would take the over.