Georgia Tort Reform

In an effort to level the playing field in the courtroom, stabilize insurance costs, and increase transparency and fairness, Georgia passed new tort reform legislation in April 2025 (SB68 & SB69). The changes attempt to push back against a wide range of strategies used by the plaintiffs that had turned Georgia into a judicial hellhole.

1. Limits on Anchoring

Problem: Plaintiff attorneys “anchor” the value of their client’s non-economic damages (i.e. pain and suffering) to irrelevant comparisons such as the cost of a yacht, plane, or valuable art. After the Plaintiff suggests a number, jurors typically accept the number as a reference point causing juries to reach awards that are significantly higher than the amount they would have awarded if left to determine a just and reasonable award on their own.

Reform: The amount of non-economic damages must be rationally related to the evidence.

2. Phantom Damages

Problem: Plaintiffs could recover for all medical services billed (regardless of whether or not those bills were ultimately paid by the plaintiff or their health insurance). However, defendants were prohibited from introducing evidence of the amount paid and accepted for those medical services.

Reform: Limits medical damages to the reasonable value of medically necessary care and permits evidence of both the amount billed and the amount actually paid.

3. Seatbelt Rule

Problem: Defendants were barred from introducing evidence of plaintiffs’ failure to wear a seat belt, hindering the ability to argue comparative negligence and causation.

Reform: Permits evidence of plaintiffs’ failure to wear a seat belt.

4. Negligent Security

Problem: Property owners and occupiers were being held liable for injuries to visitors or customers, when a crime was committed against a visitor or customer on their premises.

Reform: A reasonable share of fault must be apportioned to the third-party criminal actor and vague foreseeability standards have been replaced with statutory factors.

1. Motion to Dismiss in Lieu of an Answer

Problem: If defendants wished to move to dismiss a suit after service of a complaint, they were required to file both an answer and motion. Discovery would proceed as the motion was pending.

Reform: Allows defendants to move to dismiss, in lieu of filing an answer, allowing the parties to avoid costly discovery in cases that will be dismissed.

2. Plaintiff’s Ability to Voluntarily Dismiss

Problem: Plaintiffs could voluntarily dismiss their case without prejudice up until the first witness was sworn in at trial thereby allowing plaintiffs to work up a case, engage in expensive discovery, and drop the case at trial with the ability to refile and get a second bite at the apple.

Reform: Limits the time for plaintiffs to voluntarily dismiss their case without prejudice to 60 days after the answer is filed.

3. Double Recovery of Attorney Fees

Problem: Plaintiffs could recover the same attorneys’ fees, court costs, or expenses of litigation under more than one statute for the same case, resulting in what was called “double recovery”.

Reform: Prohibits recovery of the same fees, costs, or expenses unless duplicative recovery is specifically authorized by statute.

4. Bifurcation of Trials

Problem: In an effort to garner sympathy and sway jurors, plaintiff attorneys would present evidence of plaintiff’s injuries before liability had been established.

Reform: Trials may be bifurcated – one trial for liability followed by a separate trial for damages, thereby  shielding the jury from arguments pertaining to damages before liability is adjudicated.

This is a rising problem, which Georgia has directly addressed.

1. Registration with the Department of Banking and Finance

Problem: TPLF was an opaque unregulated industry used by national and foreign funders to effect Georgia litigation.

Reform: Funders must register with the Georgia Department of Banking and Finance. Funders affiliated with any foreign government, person, or entity that is a federally designated foreign adversary are prohibited from registering. Failure to register constitutes a felony, punishable by one to five years in prison and/or a fine up to $10,000.

2. Discoverability of Funding Agreements

Problem: Defendants were unaware if TPLF was involved in their case, preventing defendants from knowing who was controlling the litigation and settlement decisions.

Reform: The existence and terms of funding agreements providing $25,000 or more are discoverable.

3. Control of the Litigation

Problem: Litigation funders were controlling the litigation, deciding when and whether cases would be settled.

Reform: Litigation funders are prohibited from controlling the litigation. They cannot make decisions as to legal representatives, expert witnesses,  litigation strategy, or settlements.

4. Frivolous Lawsuits

Problem: Litigation funding turned lawsuits into speculative investments with limited downside risk to funders.

Reform: Funders that provide $25,000 or more may be held jointly and severally liable for the costs or sanctions from frivolous litigation.

5. Consumer Protection

Problem: Litigation funding involves complex financial agreements that can place consumers at risk of being taken advantage of.

Reform: The TPLF agreement must be memorialized in a written contract that contains all material terms and conditions, including disclosures that explain: the right to cancel the agreement within five business days from execution or the date of receipt of financing; the funder may not receive an amount greater than the amount received by the plaintiff after attorney fees and costs are paid; the funder has no right to influence or make decisions in the settlement and/or handling of the matter;  the consumer may choose its attorney without fear of punishment by the funder; and  if the case is lost or the damages awarded to the plaintiff are not enough to pay the money owed to the funder, the consumer shall not owe anything in excess of its recovery.

This tort reform legislation should assist in limiting liability, reducing outsized verdicts, and removing Georgia from its place among American judicial hellholes. Only time will tell how effective the legislation will be.

To discuss further, contact Frank DeMento (fdemento@transre.com) or Howard Freeman (hfreeman@transre.com).