The lumber and building material dealer industry received good news last week: The House passed the Lawsuit Abuse Reduction Act (H.R. 758).
The measure would reduce wasteful litigation by making sanctions against frivolous claims mandatory rather than discretionary under Federal Rule 11 of Civil Procedure, and by eliminating a 21-day “safe harbor” window period for plaintiffs’ lawyers to withdraw a lawsuit without penalty.
This act would benefit lumber and building material dealers by reducing the onerous costs that they are forced to spend in litigation on frivolous lawsuits each year. In a press release for Business Wire, the president of the U.S. Chamber Institute for Legal Reform, Lisa A. Rickard, said:
“Ever since Congress watered down federal laws that are supposed to prevent frivolous lawsuits in 1993, such claims have led to increased insurance costs, job losses, and an almost total failure of attorney accountability. The result over time has been potentially hundreds of millions of dollars in unnecessary costs to small businesses and our nation’s economy."
The bill has been supported by the National Lumber and Building Material Dealers Association. It now goes to the Senate.