TALLAHASSEE, Fla.--(BUSINESS WIRE)--The Senate Judiciary Committee voted today 4-2 in support of Senate Bill 914 by Senator Jeff Brandes. This marks the second successful stop in the Senate for meaningful legislation to rein in the exorbitant fees trial attorneys take home on lawsuits tied to property insurance.
"The bill codifies the federal standard of rare and exceptional circumstances for contingency risk multipliers to be used in the same way they are prohibited under the PIP statute back in 2012," said Sen. Brandes. "So that as it relates to attorney's fees ... a strong presumption is created that the lodestar fee is sufficient and reasonable. Subsequent presumption may be rebutted only in rare and exceptional circumstances."
SB 914 would limit the use of the contingency fee multiplier when awarding attorney’s fees to only situations of extreme and rare circumstances.
Currently, using the contingency fee multiplier, attorneys can collect up to 30 times more in fees than the value of the homeowner’s claim. Due to frivolous lawsuits and these excessive attorney’s fees, homeowner’s property insurance rates could climb 10-fold over the next 10 years. Those higher rates contribute to the already rising cost of homeownership in Florida.
SB 914 was previously heard in Senate Banking and Insurance Committee on Jan. 21, where it was voted favorably 5-3. Next, the bill will be heard by the Senate Rules Committee.
The House companion bill, HB 7071 by Rep. Mike Beltran, passed 13-5 last week at its first stop in the House Judiciary Committee.
“The current system is not a level playing field. When there’s a contingency risk multiplier on the table, the business accused is forced to pay three fees: their own attorney’s fees, the plaintiff’s attorney’s fees and the plaintiff’s attorney’s fees again because of the multiplier. This bill will fix something that’s gone too far,” said Rep. Beltran. "I would not be sponsoring this bill if I thought it created an unfair advantage to an insurance company. On the contrary, I believe this bill will create more reasonable settlements, which will provide rate relief for consumers."
HB 7071 will be heard next in the House Commerce Committee.
ABOUT FLORIDIANS FOR LAWSUIT REFORM
Floridians for Lawsuit Reform is a 501(c)4 organization that was formed by Floridians to pursue lawsuit reform. The goals of the nonprofit are to: 1) raise awareness for the abuse of the system; 2) demonstrate the impact of frivolous lawsuits and over-the-top attorney fees on homeowners property insurance rates; and 3) promote possible solutions that will benefit Florida families.