Governor Kemp’s Proposed Tort Reform: seeking to alleviate the burden of frivolous and unethical litigation against Georgia businesses.

On January 30, 2025, Governor Brian Kemp unveiled a comprehensive tort reform legislation package that aims to ameliorate the economic impact of Georgia’s current tort litigation landscape and bring the state’s legal environment “more in line with the legal environments of our neighboring states that we compete with for jobs and investment.”  These reforms will face some opposition in the General Assembly, but both bills passed the Senate Judiciary Committee this week. This is a promising development for the future of this legislation, and WWHGD will be closely watching its progress.

State Bills 68 and 69, if enacted, would make significant changes to Georgia’s laws regarding premises liability, litigation financing, methods for calculating damages, recovery of attorney's fees and procedural fairness. On many of these issues, the current state of the law has repeatedly landed Georgia on the American Tort Reform Foundation’s annual list of “Judicial Hellholes," where the organization lists the jurisdictions it deems the worst offenders for unfair and unbalanced civil justice, typically in favor of plaintiffs. Georgia businesses have seen their costs for liability insurance steadily increase in response to an excess of frivolous litigation and nuclear verdicts in the state. This proposed legislation seeks to alleviate that financial burden on both businesses and the consumers who ultimately bear the brunt of rising costs.

Liability for “Negligent Security” (Premises Liability for the Wrongful Acts of Third Parties)

Perhaps the most comprehensive reforms contained in SB 68 are those regarding tort claims for “negligent security,” which is where a Plaintiff seeks to hold the owner or occupier of a premises liable for injuries occurring on the premises, resulting from the wrongful (and often criminal) conduct of a third party. The theory of negligent security as a cause of action has been recognized by judicial interpretation of the general statutory provisions imposing duties owed by owners and occupiers of land to various types of entrants onto that land (O.C.G.A §§ 51-3-1 et seq). The two most impactful reforms in this section of the bill seek to (1) narrow the standard by which a plaintiff can prove a claim, and (2) ensure negligent security verdicts appropriately allocate fault to the actual wrongdoer, rather than leaving businesses bearing all (or virtually all) of the cost of the verdict for crimes committed on their premises.

Plaintiff’s Burden to Prove Negligent Security

SB 68 would make it easier for negligent security defendants to win on summary judgment and avoid a trial. If enacted, the bill would codify a stricter standard for plaintiffs to prove a claim for negligent security than what has been applied by the courts. Currently, following the Georgia Supreme Court’s ruling in Georgia CVS Pharmacy, LLC v. Carmichael (June 29, 2023), plaintiffs can sustain a negligent security claim if the “totality of the circumstances relevant to the premises gave the proprietor sufficient reason to anticipate the criminal act.” This “totality of the circumstances” approach makes it difficult for proprietors to obtain summary judgment, and thus avoid the burden of costly litigation and excessive verdicts, because this broad standard will often create a triable issue of fact for a jury.

If enacted, SB 68 would require plaintiffs to prove that an owner or occupier of land either “had particularized warning of imminent wrongful conduct by a third person,” or “by clear and convincing evidence, reasonably should have known that a third person was reasonably likely to engage in such wrongful conduct upon the premises.” The bill goes on to specify that the “clear and convincing evidence” required by the latter of those two provisions must be based on the owner/occupier’s knowledge of “[p]rior occurrences of substantially similar wrongful conduct.”

Under this proposed standard, a plaintiff cannot rely on a mushy “totality of the circumstances” argument, and instead must show that the defendant had actual knowledge of substantially similar prior occurrences. The bill also raises the burden of proof on this question to that of "clear and convincing evidence," a higher bar than the typical "preponderance of the evidence" standard. The proposed reforms recognize that proprietors operating in good faith should not be subject to liability simply because they can’t foreclose the possibility of persons outside of their control engaging in wrongful conduct on their premises. The bill would also apply this same standard to negligent security claims against security contractors.

Apportionment of Fault

Another issue that makes negligent security cases such a thorn in the side of proprietors, is that juries can and often do apportion more fault for the plaintiff’s injuries to the negligent security defendant than they apportion to the actual wrongdoer. SB 68 proposes a commonsense scheme that ensures premises owners are not held more responsible for the wrongdoing of third persons than the wrongdoers themselves. The bill takes a two-pronged approach to tackling this issue, by (1) prohibiting certain arguments that would improperly influence the jury’s apportionment of fault, and (2) mandating that trial courts set aside a verdict when a jury fails to apportion a reasonable degree of fault to the actual wrongdoer.

First, the bill prohibits parties from presenting evidence or making arguments to the jury concerning the financial resources of any party or nonparty, the effect of an apportionment of fault upon the total damages award, or any criminal penalties that have been or could be imposed on the third persons whose wrongful conduct gave rise to the claim. This will not entirely curtail the issue; some jurors are savvy enough to understand, without argument from the parties, that a person who has engaged in a criminal act against the plaintiff may be incarcerated or otherwise unable to pay any judgment against them. The urge certain jurors have to make a sympathetic victim whole by leaving the party with the deepest pockets holding the bag is not so easily extinguished. But the drafters of SB 68 seem to have understood that, and provided a second, more toothsome prong to the statutory scheme.

The second prong acts as a backstop for when a jury’s sympathy for the plaintiff outweighs the commonsense notion that the person who harmed the plaintiff bears more fault than someone who simply failed to stop them. If a jury fails to “apportion a reasonable degree of fault” to the actual wrongdoer, “the trial court shall set aside the verdict” and order a new trial. The word “shall” creates a mandate to the court in the event of an unreasonably apportioned verdict. The provision goes on to specify that if a jury apportions a greater percentage of fault to negligent security defendants than the total percentage apportioned to third persons for their wrongful conduct, “[t]here shall be a rebuttable presumption that an apportionment of fault is unreasonable.” The language in this provision ensures that unreasonably apportioned verdicts will be set aside, and proprietors will no longer be at risk of footing the entire bill for someone else’s wrongdoing.

Protecting the Jury’s Decision from the Influence of Improper and Arbitrary “Anchoring” Tactics

SB 68 seeks to curb excessive verdicts and protect the jury’s decision in awarding non-economic damages by prohibiting attorneys from engaging in a tactic known as “anchoring.” This change would apply to all trials for personal injury or wrongful death.

In addition to quantifiable monetary losses such as medical expenses and lost wages, tort plaintiffs in Georgia can recover for pain and suffering, emotional distress, and other “non-economic” injuries. These damages are not quantifiable with any concrete measures of monetary value, so the amount awarded for these injuries is left to the enlightened conscience of the jury.

The problem arises when attorneys use “anchoring,” a psychological tactic by which an attorney plants an arbitrary dollar amount in the minds of the jury as a starting point for deliberations, often tying the proposed value to unrelated benchmarks (like the hourly rate of the defendant’s expert witness or the salary of a professional athlete). Attorneys often try to create an expectation in jurors’ minds as to the value of a case as early as voir dire, asking potential jurors questions such as, “would you be willing to award damages as high as twenty million dollars if the evidence supported it?” 

The current state of the law in Georgia expressly allows anchoring under O.C.G.A. § 9-10-184. The statute does require that any argument about the worth of pain and suffering conform to “the evidence or reasonable deductions from the evidence in the case.” This qualifying language has been given little effect, however. In January 2024, the Georgia Court of Appeals in White v McGouirk affirmed an expansive reading of the statute by holding that a plaintiff’s closing argument anchoring an arbitrary damage amount of $65 million to the salaries of professional athletes in a case that had nothing to do with athletics was not improper.

The proposed legislation would prohibit counsel from making any argument as to the monetary value of non-economic damages until closing arguments. The bill also adds more forceful qualifying language, requiring that any such arguments “shall be rationally related to the evidence of noneconomic damages and shall not make reference to objects or values having no rational connection to the facts proved by the evidence.”  In the event counsel makes such arguments prior to closing, or makes arguments that are not rationally related to the evidence, the trial court is mandated to take “remedial measures.” The court would have discretion, however, to determine whether the appropriate remedial measure is simply a curative instruction to the jury, or a mistrial if the plaintiff’s attorney is the offender. If such argument or comment is made in the presence of any prospective jurors, the court would be required to excuse those jurors.

Bifurcating Trials

A jury is responsible for deciding two main issues in a civil trial: (1) whether any defendant is liable for plaintiff’s injuries, and (2) if a defendant is found liable, what measure of damages is owed to the plaintiff. These are two distinct questions, but as the law currently stands in Georgia, the jury hears evidence and arguments on both issues in one proceeding before they deliberate. This makes it easy for attorneys to muddy the distinction, and for evidence concerning the extent of a plaintiff’s injuries to improperly influence the jury’s decision regarding the defendant’s conduct.

SB 68, if enacted, would add a new code section (O.C.G.A. § 51-12-15) allowing any party in an action for bodily injury or wrongful death to “elect, by written demand prior to the entry of the pretrial order,” to have the issues of liability and damages determined in two bifurcated proceedings. First, the jury would hear evidence and arguments solely regarding what happened and who is at fault. Then, if the jury has found defendant liable to the plaintiff in the first phase, the trial will recommence and the jury will hear evidence and arguments regarding the extent of the injuries and measure of damages.

Eliminating “Phantom” Medical Damages

Under current Georgia law, plaintiffs can present inflated figures to show their medical damages, based on a medical provider’s initial bill, or “list price,” for services provided. Defendants, however, are prohibited from presenting evidence that the negotiated rate paid by plaintiffs or their insurers to satisfy the debt was far less than what was initially billed. This often results in an award of “phantom damages,” allowing a plaintiff to recover amounts that were written off by the provider and never actually incurred.

The proposed legislation package includes a new general provision on tort damages, limiting a plaintiff’s recovery for medical expenses to (1) amounts paid by or on behalf of the plaintiff for medical treatment, (2) amounts necessary to satisfy incurred but unpaid medical bills, and (3) “such amounts as are actually necessary to satisfy future charges for medically necessary care, treatment, or services.” If a plaintiff’s medical expenses were covered by insurance for which they paid premiums, they can also recover the amount of their premiums paid in the time between the incident giving rise to the litigation and the earlier of (1) their final treatment for their injuries, or (2) the conclusion of the trial. The bill expressly states that this new code section does not limit the right of any party to present evidence challenging the medical necessity of any past or future treatment.

Plaintiffs are No Longer Guaranteed Two Bites at the Apple

Currently, plaintiffs are allowed to unilaterally dismiss a suit without prejudice all the way up until the first witness is sworn at trial. This means that after a defendant has incurred the time and expense of pleading, discovery, pre-trial motions, jury selection, and opening arguments, if at any point the case is not going the plaintiff’s way, they can unilaterally dismiss their case and re-file it. This gives plaintiffs a guaranteed second chance at favorable pre-trial rulings and jury selection, perhaps with a new judge or in a different jurisdiction, and with the procedural slate wiped clean.

SB 68 seeks to put an end to this unfair practice by only allowing plaintiffs a right of unilateral dismissal without prejudice until 60 days after the defense has filed an answer. After such time, a plaintiff seeking to dismiss their claim without prejudice must do so with the consent of all parties, or by order of the court.

Streamlining Dismissal of Frivolous Lawsuits

Unlike the Federal Rules, the current rules of civil procedure in Georgia do not allow defendants to file a motion to dismiss in lieu of an answer. When moving to dismiss a baseless lawsuit, a defendant must still prepare and file an answer in order to avoid a default judgment. Defendants can also end up having to engage in extensive discovery before the motion to dismiss is decided, because the stay of discovery triggered by the motion can only last up to 90 days, even if the court has not ruled on the motion within that time. This can result in considerable legal fees in excess of what is truly necessary to effectively address a frivolous claim.

The proposed legislation would bring Georgia law in line with the Federal Rules of Civil Procedure by allowing defendants to file a motion to dismiss in lieu of an answer. If the motion is denied, then the defendant will have 15 days after notice of the court’s decision to file an answer. Additionally, discovery would be stayed until the motion to dismiss is decided, and courts would be required to decide motions to dismiss within 90 days.

Eliminating Double Recovery of Attorney’s Fees

Multiple Georgia statutes allow courts to award attorney’s fees to a party’s counsel under certain circumstances. Each code provision permitting such recovery was intended to apply separately, but court’s have interpreted the attorney’s fee provision of Georgia’s contract code to apply in tort cases as well, sometimes allowing plaintiff’s counsel to recover their fees twice in the same suit.

The proposed addition of O.C.G.A. § 9-15-16 would prohibit double recovery of the same attorney’s fees, court costs, or expenses of litigation, unless a statute specifically authorizes the duplicate recovery. 

Permitting Defense to Present Evidence Regarding Plaintiff’s Seatbelt Usage

Perhaps the most commonsense reform contained in SB 68 is the amendment to O.C.G.A. § 40-8-76.1, which currently prohibits defendants in cases involving automobile accidents from presenting evidence regarding a plaintiff’s failure to wear a seatbelt. Changing the law to allow admission of this evidence, as this bill seeks to do, is a no-brainer. A plaintiff’s failure to use a legally mandated safety feature is directly relevant to multiple aspects of a tort claim arising from an automobile accident.

Regulating Third Party Litigation Funding

Lastly, State Bill 69 introduces regulation of entities providing litigation financing, which is funding provided, usually by non-lawyers, to facilitate the operation of the litigation or to pay for expenses during the litigation. The current opacity and lack of regulation in the litigation financing industry creates an ideal environment for those seeking to abuse Georgia’s judicial system and exploit parties to lawsuits.

This bill will provide transparency and protection for both plaintiffs and defendants. The principal components of the bill are:

1. Requiring entities that provide litigation financing to register with the Department of Banking and Finance.

2. Litigation financiers are prohibited from having input into litigation strategy or taking an excessive portion of the award to the plaintiff. They are required to make certain disclosures to the party for whom they are providing financing.

3. Litigation financiers are made liable for awards of attorney’s fees and costs in the litigation they finance.

4. The existence and terms of a litigation financing agreement are made subject to discovery

5. Certain foreign entities are prohibited from engaging in litigation financing.

For more information on Governor Kemp’s proposed tort reform and its potential impacts on Georgia businesses, please contact WWHGD’s Georgia-based counsel in Atlanta

This alert provides a general overview of recent legal developments. It is not intended and should not be relied upon as legal advice.