The challenge of lawsuit mills is a phenomenon uniquely tied to the American civil justice system. Whether it’s consumer products, intellectual property or the Americans with Disabilities Act (ADA), personal injury lawyers are twisting the law to create personal profit at the expense of working-class Americans and costing taxpayers millions of dollars every year.
For more than a year, ABC15 Arizona has been investigating the explosion of ADA “drive-by” lawsuits in the state, most of which have been filed by a handful of loosely connected plaintiffs. Drive-by lawsuits involve allegedly injured plaintiffs who never actually attempt to patronize a business, but simply drive business to business collecting addresses and notating minor and technical violations of the law.
With these pieces of data in hand, they then file hundreds of lawsuits utilizing the same or similar language, and in most cases, merely change the name and address on a boilerplate complaint. Business owners, in most cases small, family-owned enterprises, must choose between paying a shakedown settlement or spending several times that amount to fight it in court. Sadly, the shakedown usually works.
ABC15 Arizona’s investigation also unearthed an agreement used with plaintiffs by a company called Litigation Management and Financial Services, LLC (LMFS). The agreement called for a payment of $50 for every lawsuit a disabled plaintiff allowed to be filed on their behalf, with LMFS being “first entitled” to dollars paid out in a settlement.
So while LMFS reportedly dupes unsuspecting disabled persons into lawsuits for $50, they pocket thousands of dollars for each settled lawsuit. This crooked behavior results in millions of dollars being extracted from the pockets of small business owners, workers being laid off, and no better access for the disabled.
Adding insult to injury, LMFS claims to cover all court costs, but that’s only partially true. In one case, LMFS filed over 99 complaints about a single disabled plaintiff, while simultaneously utilizing that person’s eligibility for a waiver of the $400 filing fee. That’s right, while LMFS gets rich extracting cash from vulnerable business owners, taxpayer money is being used to partially finance their money-making lawsuit scheme. As their lawsuit mill scheme spreads throughout the Four Corners, taxpayers and small business owners in New Mexico, Colorado, Utah, and Arizona are at risk.
This type of systemic abuse is particularly repulsive, as these personal injury lawyers present themselves as advocates for those in need. However, their settlements focus on self-enrichment with little to no regard for improving accessibility for the disabled.