Georgia Lawsuit Abuse Reforms Will Protect Local Businesses

Stephanie Walton
Senior Director, Digital and Editorial Communications

Rachelle Mortimer
Senior Director, Legislative Affairs, Institute for Legal Reform

Published

March 11, 2025

On January 30, Gov. Kemp unveiled a comprehensive tort reform package aimed at addressing the root causes of excessive litigation, reducing costs, and creating a more balanced legal environment. These reforms will have a far-reaching impact on Georgians, delivering financial relief, protecting property owners, and ensuring fairness in the courtroom.

Real Stories Highlight the Need for Reform

For businesses, the impact of this reform is deeply personal. Whether it’s a family-owned grocery store, a local trucking company, or a neighborhood childcare facility, the cost of Georgia’s litigation environment has been a heavy burden. In 2022 alone, Georgia’s tort costs reached nearly $20 billion, translating to an average of $5,050 per household. Small businesses, which bear nearly half of these costs, are particularly vulnerable. These are the businesses that form the backbone of Georgia’s economy, providing jobs, services, and a sense of community. Yet, they are often the first to feel the financial pinch of frivolous lawsuits and inflated damages.

During a Georgia Senate Committee on Judiciary hearing, we heard stories of the real impact of Georgia’s current legal environment. John Triplet, a proud Georgia native and owner of a chain of grocery stores, has seen firsthand how rising insurance premiums and frivolous lawsuits hinder his ability to expand into underserved areas. “We took the risk… mainly because we love small towns, we love communities, and we love investing our money where we live,” he shared. However, the legal risks in certain areas have made it impossible for him to open stores in food deserts, leaving communities without access to fresh food. “The future of the grocery industry is at stake if something doesn’t change because of tight margins,” he added. John’s story is one of many that show the urgent need for tort reform to create an environment where businesses can thrive and invest in Georgia’s communities.

Sarah Gillis, a lifelong Georgia resident, also shared her family’s harrowing experience with a baseless lawsuit. In April 2024, her neighbors accused her family of trespassing and property damage, demanding $111,000 without providing any evidence. “On [the day we were served] our family began losing time,” Sarah said. After nine months of stress and legal battles, the plaintiffs admitted they had no evidence to support their claims. “The tort reform could’ve saved my family 10 months of our life that we lost on this baseless case,” Sarah explained. Her story highlights how the proposed reforms, such as earlier dismissals of frivolous lawsuits, could prevent families from enduring unnecessary turmoil.

What Georgia Tort Reform Means for Business Owners

Gov. Kemp’s proposed tort reform legislation is designed to create a fairer legal system that protects businesses, consumers, and communities. Here’s what some of the key changes mean for business owners:

Fair Liability for Businesses (“Negligent Security Liability”):The legislation ensures that businesses are only held responsible for what they can directly control. Property owners will still be accountable for keeping their premises safe, but they won’t be unfairly punished for crimes or incidents that happen on their property but is outside their control. This is especially important for businesses in areas with higher crime rates, allowing them to operate without fear of being sued for circumstances beyond their reach.
Accurate Medical Damages (“Phantom Damages”): Plaintiffs will have to show the actual amount paid (or to be paid) for medical bills, rather than only inflated figures. This ensures that successful plaintiffs are fairly compensated while protecting businesses and consumers from inflated costs that drive up insurance premiums and prices.
Preventing Inflated Pain and Suffering Awards (“Anchoring”): The bill stops attorneys from using arbitrary comparisons—like the cost of fighter jets or a celebrity’s salary—to influence jury awards for pain and suffering. This empowers juries to make fair decisions based on the facts of the case, without being swayed by irrelevant arguments.
Clearer Trial Procedures (“Bifurcated Trials”): The legislation allows trials to be split into phases: first to determine liability, and then to assess damages. This ensures a fair process where both sides can present their arguments without confusion or bias.
Seatbelt Evidence in Auto Cases: Defendants will now be able to present evidence if a plaintiff wasn’t wearing a seatbelt during an auto accident. This can help mitigate damages in cases where the plaintiff’s injuries were worsened by not using this essential safety feature.
Ending Double Attorney Fee Recovery: The bill closes a loophole that allowed attorneys to recover their fees twice in the same case. Courts can still award attorney fees, but only once, ensuring fairness for all parties.
Transparency in Third-Party Litigation Funding: Protecting National Security: The bill bans foreign adversaries from funding lawsuits to exploit Georgia’s legal system for political or economic gain. Safeguarding Plaintiffs: It prevents predatory lenders from taking advantage of vulnerable litigants and ensures plaintiffs retain control over their cases. Increasing Transparency: All parties, including courts and opposing litigants, will have visibility into third-party funding arrangements, ensuring fairness and accountability.

This comprehensive reform package is a win for Georgia’s business community, offering essential protections against frivolous lawsuits, inflated costs, and unfair legal practices. By supporting these changes, business owners can focus on growing their operations and serving their communities without the constant threat of being sued. Gov. Kemp’s leadership in advancing this legislation reflects a commitment to fostering a stronger, more competitive Georgia where businesses can thrive.

The Bottom Line: All Policy is Local

The benefits of these reforms go beyond the courtroom. Reduced legal costs and a balanced legal system will make Georgia a more attractive place for investment and entrepreneurship. When local businesses succeed, communities flourish—jobs are created, services expand, and neighborhoods grow stronger. This is a clear example of how all policy is local–a message echoed at the 2025 State of American Business–as these reforms will directly impact the businesses and families that form the backbone of Georgia’s economy.

Watch the 2025 State of American Business

State of American Business 2025: All Business Is Local

Georgia lawmakers now have the opportunity to support these critical reforms and protect the local businesses that drive our state forward. By passing this legislation, Georgia can set a new standard for tort reform, ensuring a fair and efficient legal environment that benefits everyone. It’s time to act and secure a brighter future for Georgia’s businesses and communities.

The U.S. Chamber Institute for Legal Reform recently released research on Georgia's liability environment and the need for legal reform.