Michigan Lawmakers’ Agenda Earns “Heat Watch” Designation

Today, the American Tort Reform Association placed Michigan’s legislature on “Heat Watch” for the second consecutive year in its latest Legislative HeatCheck report. The designation is due to two active bills that could open the door to increased litigation.

“Lawmakers are driving Michigan’s legal climate into a disadvantageous position,” said Tiger Joyce, president of ATRA. “These bills target individuals, small businesses and professionals — the very backbone of the state’s economy.”

Legislation

• Senate Bill 134 seeks to remove the regulatory compliance exemption under the Michigan Consumer Protection Act. If passed it would allow lawsuits under the MCPA against more than 80 different regulated entities and professions. These changes would create a more hostile legal environment for companies and small businesses by facilitating more lawsuits.
• House Bill 4327 proposes to establish a False Claims Act, significantly expanding potential liability for those doing business with or receiving funds from Michigan state and local governments. This bill includes qui tam provisions, authorizing private individuals to sue on behalf of the state and collect a financial award if there is recovery.

“H.B. 4327 would create opportunities for abuse and encourage financially motivated lawsuits that aren’t necessarily in the public’s best interest,” Joyce said. 

Impact on Families and Businesses

The consequences of expanding opportunities to sue carry real economic costs. Michigan residents already pay $1,103 per person annually in “tort tax” — that’s more than $4,412 for a family of four. Additionally, these costs also contribute to an estimated loss of more than 96,000 jobs and $566.5 million in state revenue annually.

From Heat Watch to Judicial Hellhole®

Michigan’s civil justice climate continues to raise national alarms. The Michigan Supreme Court is ranked the eighth-worst “Judicial Hellhole®” in the country. The 2023-2024 rankings included Lansing. 

“Unless lawmakers reverse course and seek to improve their state’s civil justice system, Michigan will continue being included on lists they don’t want to be on,” Joyce said. “Bills like this risk harming the state’s economy and reputation.”

ATRA’s Legislative HeatCheck report evaluates a select group of states’ progress — or lack thereof — in enacting meaningful tort reform measures during their most recent legislative sessions.

Michigan’s legislature is named to the “Heat Watch” list alongside both the California and Ohio state houses. The full Legislative HeatCheck report is available at heatcheck.atra.org.

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About the Legislative HeatCheck: The Legislative HeatCheck is an annual analysis, started in 2024 by the American Tort Reform Association, that assesses which states are making strides to improve their civil justice systems through tort reform and which states remain in dire need of legal reform. The report categorizes a select group of states into three groups:

• Tort Reform Trailblazers: States that have recently enacted key tort reform measures to rein in lawsuit abuse and improve their legal climates.
• Lawsuit Infernos: States whose legislatures are actively expanding liability and worsening their civil justice systems or failed to pass any meaningful legal reforms during their latest legislative sessions, leaving their civil justice systems mired in a litigious status quo.
• Heat Watch: States whose legislatures still are in session and are considering either positive or negative legislation. These states are placed on “Heat Watch” due to inaction on tort reform or the potential for liability-expanding legislation that could worsen their legal climates.

The Legislative HeatCheck provides an overview of tort reform battles waged in statehouses nationwide and serves as a guide for where reform efforts should be focused in the year ahead.